No matter how heavy it feels, bad credit doesnt last forever. Even if you made a total mess of your financial life at one point, after a certain amount of time, most of those financial mistakes will be expunged from your credit report. For unpaid or delinquent accounts, the time period is 7 years. For bankruptcies, its 10 years. To prevent mistakes, credit bureaus often err on the side of removing bad information a little early. For delinquencies, most of the (bureaus) are set up to automatically delete the data at six years nine months, or somewhere around there. However, negative debts dont always disappear on schedule. Misunderstandings or errors can result in a debt overstaying its welcome on your credit report. If old debt is still haunting your credit report, you dont have to live with it. Here are a few steps to get it off your credit report and out of your life. 1. One of the biggest factors in fighting old debt? Determining just how old it really is. If its not falling off, then the credit reporting companies have not received the right date. With a court action (like judgment or bankruptcy), determining the date is easy. You count it the day it was filed. Delinquency is more difficult. The regulatory language on it is very complicated. However, the date that you first became delinquent and after which never caught up is the date that should count. For example: You missed a payment last January. Then you make it up and also pay in February. Then you miss March and your bill eventually goes into default. Your delinquency date: March. In practice, divining a delinquency date can be squishy. Some creditors may let that string of nonpayments go for a couple of months before the account is tagged delinquent. 2. No matter how many times a debt is sold (and resold), the date that counts for the seven-year credit report clock is the date of delinquency with the original creditor. Think of it as your debts birth date. If a collection agency bought your 10-year-old retail card debt and has started putting it on your credit report with a different date, thats illegal. 3. Your three credit reports from consumer reporting agencies Equifax, Experian and TransUnion are not identical triplets. The old debt in question might be listed in some credit reports but not others. To find out, get a copy of all three of your reports. Federal law entitles you to request a free copy of each report once every 12 months. You can download or send for them free at AnnualCreditReport. Once you find out which bureaus are listing the debt, contact them. Your credit report will include contact information and dispute instructions. 4. If the debt really is too old be reported, its time to write the credit bureau(s). While email is allowed, this is one time youre better off with regular U.S. Postal mail. If you do (email), that can mean that no human being ever sees it is recommended people do not do it online. When you dispute an old debt, the bureau will ask the creditor reporting it to verify the debt. If it cant, the debt has to come off your report. What you want to do: Make a case so strong that the creditor will have to acknowledge that its correct or present tangible evidence to the contrary. So include copies of anything that supports your claim, such as copies of court filings that show the correct date for a judgment or bankruptcy, or a letter from your original creditor showing when the account became delinquent. If a collection agency is reporting an account as a different (and newer) debt, include any paperwork that shows the two accounts are really the same debt. Send this letter certified with a return receipt requested so that you can prove when it was sent and that it was received. 5. You also want to send a similar letter to the creditor whos currently reporting the debt. To do this, either reframe your credit bureau letter, with copies of your documentation, to the creditor or simply send a copy of the same letter with copies of any documents included. As with the credit bureau, send it certified with a return receipt requested. The creditor has 30 days to investigate your claims and respond. Pro tip: Too many times consumers get angry and their letters tend to reflect that. But thats damaging. Instead, keep all your conversations and letters to everyone involved calm, measured and businesslike. 6. If your initial letters dont do the trick, you may have to kick your approach up a notch. Take a few minutes to research online the company reporting the debt. Direct your next letter to the presidents attention at the companys headquarters address because you get a different kind of response from the office of the president than you do from customer service. Again, send it certified and keep a copy in your files. A good source of company information on collection companies: the searchable database of the Association of Credit and Collection Professionals. Try searching by the location rather than the name of the company. You can also follow up with a phone call after a few weeks. Cant get past an officious gatekeeper? Call after hours and leave your message directly in the executives voice mailbox. 7. If the collector is in any way, shape or form a bank, it has a federal regulator. They actually take individual complaints and contact the companies about the complaints they receive. However, it safe to say that it should not be your first recourse. Only use this one if you have contacted the company and received no resolution or response, as regulators want to see that youve tried to solve it yourself first. Opt for U.S. Postal mail. You want to be able to send in copies of your correspondence, and copies of your return receipts, and you cant do that online. One short cut: Print out the agencys complaint form, fill it out and send it in clipped to your documents. States sometimes offer help, too. Many times you will find that your state has a governmental agency that regulates debt collection in your state. If you complain to them, they actually contact the company on your behalf. Try your own state (as opposed to the creditors state). As a constituent, you have a little more leverage.
Posted on: Thu, 13 Feb 2014 12:55:18 +0000
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