By all appearances. my mother is probably the most envied person in America right now. She has held the same job for seven years and earns enough money to pay her bills, put back some money into savings, and pay cash for her purchases. She managed to pay off her car in two years as well. Prior to this job, she had filled for bankruptcy and was a poor credit risk. For the past four years, my mother has not taken out any lines of credit. When she applied to a home loan, she expected no surprises as all of her delinquent accounts had been included in her bankruptcy filing years ago.

She was floored when the mortgage company informed her that she had many negative items on her credit report. They recommended that she discontinue the home buying process and clean up her credit.

My mother learned the hard way that is it important to review your credit reports annually and challenge any errors that may have been reported. The Federal Fair Credit Reporting Act (FCRA) was enacted to promote the accuracy and privacy of information in the files of the nation’s consumer reporting companies. This legislation makes it possible for consumers to stand up to unfair and unethical reporting practices of credit card companies and collection agencies.

Despite the consumer’s right to fair treatment by the credit reporting companies, disputing credit reporting errors is a daunting task. It takes months, and sometimes years, to challenge and resolve errors on your credit reports. As there are three credit-reporting agencies, it takes three times the amount of time and effort to correct these mistakes.

The first step is obtaining a copy of your credit report from all three agencies: Equifax, Experian and Trans Union. Thanks to the Federal Fair Credit Reporting Act (FCRA), consumers are entitled to a free copy of your report every 12 months. The three consumer reporting agencies have been kind enough to set up one website, toll free number, and mailing address to order your reports from. This is the easiest part of the disputing process. The rest is a complete nightmare.

Under the Fair Credit Reporting Act (FCRA), the company reporting the information [the company providing the credit or collection agency] and the consumer reporting company are responsible for correcting inaccurate or incomplete information in your report. They will correct the information, but only after you file a compliant for each error you locate.

This is accomplished by writing a letter to the credit reporting company, telling them what information you feel is incorrect. You need to provide copies of the evidence that supports your ascertations, you name, address, and why you feel that the information should be removed.

The consumer reporting agency determines if your claim is frivolous. If it is, they are not obligated to investigate. This is why it is very important for you to have your facts correct and state a very convincing reason for disputing the claim. Your letter should be well written, in a professional manner. If your claim is accepted, then it is forwarded to the agency that reported the information in the first place and they investigate it on their end.

Here is where the process becomes even more difficult. Typically, negative items on your credit report are dated. The original creditor probably sold the debt to a collection agency, who may have sold it again after you did not pay up. All three parties may be listed on your credit report as you owing them money. A frequent tactic of collection companies is to be as difficult as possible with these types of requests.

The easiest way to clean up your credit is to hire a professional. Professional credit repair companies are well versed in credit reporting errors and dealing with unscrupulous collection agencies and credit card companies.

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