Who Put The Bad Stuff In Your Credit Report? It May Not Be Who You Think.

Believe it or not your credit is susceptible to any number of factors beyond your control. The point is nobody's perfect, and neither is the average person's credit report. Anybody recall the summer a few years ago when Florida was hammered by what seemed to be an endless succession of hurricanes? Do you suppose those natural disasters might have slowed down the mail service, and perhaps causing some payments to be late? You bet it did, and this simply an illustrates what I'm talking about.

There any number of legitimate, and illegitimate, reasons for negative entries to show up in your credit report. Do you think lenders and creditors are perfect? Not for a minute. With billions of bits of information flying around it is only logical for honest mistakes to happen. This being said it proving extremely difficult to obtain the lofty status of "perfect" credit.

There are very few people who have what is considered "perfect" credit, or a FICO score of 850. In my previous career I saw this score only once. Lack of perfection is much more commonplace, and as long as your credit report shows more smooth sailing than rocky shoals you should be eligible for plenty of loans at competitive rates.

By now you are probably saying "Well that's all well and good, but just how many bumps can my credit report tolerate before it moves into the danger zone? How long does the negative information remain? How do lenders interpret this?" Bad credit typically stays on your credit report for seven – ten years, depending on your state of residence. Lenders use a complex formula to determine your risk factor.

The long and short of it is if you have a lot of information on your credit report, with most of it being positive, the negative has less of an impact. For the younger generation this isn't the best of news, as they tend to fewer open accounts and months of credit history.

So what do you do if you do discover negative information on your credit report that you are certain is in error? By law you are allowed by the Fair Credit Reporting Act to dispute any listings in question on your credit report. To learn what you are going to need for information and documentation either go online or use the automated telephone system. Both are tedious and time consuming, but persist you'll learn exactly what you'll need to submit a written request. Once the bureau receives your request they have to take action.

By law the credit reporting bureaus have only 30-days to verify and respond to your written request. If they fail to meet this time requirement they must remove the listing in question, and notify you of the outcome.

A word of advice - your written request should not be couched in threatening terms. I suggest instead taking the same approach you would for writing an acquaintance. Don’t you enjoy receiving a letter from someone who cares whether you are having a good day or not? These types of letters, if written properly, are highly effective. Place yourself in the credit reporting bureau employee’s shoes. He, or she, has just opened several letters that all started out the same. Some are irate, some are con jobs and some are downright stupid because the poor soul who wrote it has no writing skills. Now here comes your letter across her desk with a “Thank You” – isn’t that a nice, and clever way, to change their mental state and get them interested in what you have to say? Here you are thanking them for something they have not even done yet. Think they might read on further?

Your credit report is truly one of the most important documents you are responsible for. Banks, lenders, and the reporting bureaus are not going to take it on themselves to verify the accuracy and validity of the information unless you take an active role and force the issue. Do nothing and your inaction could unnecessarily cost you thousands of your hard-earned dollars. Take action and enjoy the benefits and advantages of good credit.

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