Tips to remove negative items from your credit report
Negative items in the credit report lower your credit score. A credit report also contains positive data like timely payments, fully paid loans, etc. Whereas negative items consist of information about late payment of loans and credit cards, bankruptcies, charge-offs, etc. A good credit score favors you with the creditors. From credit scores, banks and loan givers come to know about your payment habits and whether you have any debt. Hence, a person with a good credit score is likely to get some advantages like low-interest rates, rewards or discounts on travel payments, etc. While a person with a low credit score is unqualified for a loan or credit card.
Sometimes there can be false or inaccurate negative data on your credit report. Correct it or can cause damage to your credit score. This false data can happen due to various reasons. If you have a reason for failing your payments, you can add a statement explaining your circumstance related to that item.
Check for inaccuracies:
Mention of the negative items on your credit report can be because of some error. There are chances of mix up of accounts, credit bureau makes some mistake, mistake made by lender or creditor, mistaken identity, etc. So, instead of running to clear mistakes. First, check whether the mistake should be clear. If the negative item is because of the above-mentioned reasons, you can contact a credit bureau to rectify it. Every credit report has one or two errors. So, check all the negative items in your credit report. If the entry looks accurate, check its details for inaccuracy. Check the report properly and make note of all the inaccuracies. Even note how to correct the inaccuracies. This helps you while writing a credit dispute letter.
Submit a credit dispute letter:
As you are aware of the inaccuracies. Make sure you make the credit bureau aware of it. For this, you have to write a dispute letter. In this letter write a complete detail of the negative items and also provide them with documents if possible. In this letter request them to remove all the negative items from your credit report. In the credit dispute report, you can dispute about the collection, late payment, bankruptcies if not removed after 10 years, and foreclosures if not removed after 7 years. The Credit Bureau contains reports of all the citizens of the country, so mentions all the required information.
Write a Goodwill letter:
While disputing investigation, if no errors were found or credit bureau fixes the error. Your next step should be writing a goodwill letter to the creditor. Here, you will write a letter to the creditor or lender requesting them to remove the negative item from your credit history. Ask as an act of goodwill. They do it if you are trying to remove late payments from the history. You can also write this letter for paid collections or paid charge off. In this letter, you have to explain the reason for failing your payment. White about how you want the mortgage to end and struggles with negative items. To your surprise, they will do it for goodwill. Also, try to do this if you have failed payment or two. But, if you have a long history of failed payments then it will not work.
Negotiate a Pay for Delete:
Pay for Delete is an agreement between the creditor and borrower. It states that the borrower will pay the said amount in exchange for the creditor will erase the account from the credit record. It is a win-win situation for both creditors as well as borrowers. In this, if the borrowers decide to pay an unpaid debt, the collector gets direct profits. For a borrower, as the record erases unpaid debt it increases their credit score. The information of debt is seen in a record for seven years from first delinquency. So, it will impact the record even if you pay later. Therefore, it is better to make this agreement.
How to remove the negative items from your credit report?
Negative items accurate or not can affect your credit score. Removing it will help improve the score. Though it will not completely help as many factors can reduce the credit score. So, try avoiding debt, credit utilization ratio, and limit loans as possible. If you find inaccurate negative items follow the above steps to remove them. If you find it hard try contacting professionals. They will check your credit report for all information and find a negative item. Professionals will work faster as compared to you. They are experts in removing items from your credit report. It helps you in having a good credit score.