It seems like a dream come true: For a “low monthly fee,” have negative information wiped off your credit report and get a huge jump in your score. Many companies make their living helping people to “repair” their credit by disputing all negative information on a report. But is this too good to be true? Let’s look at 6 key points about credit repair, and how you can make the principles of disputing work for you.
What is a credit report dispute?
Disputing information on a credit report means you inform the credit bureau(s) – Experian, Equifax, and/or TransUnion – that there is something wrong on your report that needs to be adjusted or removed. They then have 30-45 days to contact the creditor in question and either confirm the data or have it corrected or removed.
How is using a credit repair company different than doing the dispute myself?
A credit repair company usually will try to dispute all negative information, whether or not it is technically incorrect. They do this in hopes that the creditor will forget to respond back to confirm the information and thus inflate the credit score, if temporarily.
Does the credit bureau advocate for me?
No. Whether it is you or a third party that places the dispute, the job of the credit bureau is simply to check in with the creditor and make sure of the basics – that the account belongs to you and the balance and payment history are correct. If the original creditor needs to adjust information (reprocess insurance, correct payment history, etc) then it may mean you need to contact them FIRST to resolve issues before you begin the dispute. A credit repair agency will not do this on your behalf.
Are disputes generally successful?
It mostly depends on whether the debt was accurate. Nothing can truly remove an accurate debt from your history until it “ages off” after 7 years. If it was not accurate or if there is insufficient information, then they will likely fix it or remove it. (Collections or other debts that used to have a balance but were paid should show as a $0 balance. That’s accurate. You used to owe it and it’s a part of your history, but now it’s affecting your score significantly less.)
Can I do this myself?
Absolutely! All three credit bureaus allow you to submit disputes as often as you need. You can do this through a mailed letter, a call, or an online submission.
Should it cost anything?
The disputes themselves are always free. Educational organizations including Apprisen may charge a fee for helping you understand the credit reports, how to read them, a personalized plan unique to your situation for how to improve your score, determining what might need to be disputed, and getting you started on that process. It is a one-time fee which helps you become capable of handling your finances and credit independently long-term. This is very different from a credit repair agency which charges sizeable monthly fees to send the disputes on your behalf.
Still have questions? We’re here to help. Whether it’s a simple clarification or a full credit report review, our Financial Service Specialists can help you make the most of your credit score with a Credit Health Education Session.