Consolidating what you know

Now is the time to organize. Make a note of everything. It is a good idea to get a day-by-day journal, and under the date on which you took action in regard to your dispute, make a note of what it was you did. At the same time, take careful note of when you wrote to a credit bureau, and skipping ahead mark the day when you should be hearing from them (say, three weeks ahead).

Also, keep the correspondence regarding each of your lender under a different file. Do not lump them all together in one big file. Keep each credit bureau separate as well. And keep each document filed in chronological order. If you do have a telephone conversation with your lender, on a sheet of paper, immediately note down all the points discussed, what you agreed to do and what the lender agreed to do, along with the date and time of the call, the name of the person you spoke with, and his or her telephone number. If possible, try to get the name and telephone number of this person's superior as well.

When you receive your credit report, you will notice that each derogatory field is marked in a different way. Here is how the three credit bureaus show negative entries:

Equifax:

• Any entry rated higher than I1, M1 or R1.
• Any entry highlighted by the ">>>" symbol.
• Any entry shown as a repossession, foreclosure, any write-off, paid charge-off, settled, settled for less than full balance, bankruptcy.
• Any collection account, paid or unpaid.
• Any court account: judgment, lien, bankruptcy Chapters 7, 11, or 13, divorce, satisfied lien, or satisfied judgment.
• Any item showing 30, 60, 90, 120 day late payment.
• Any inquiry on your account.


TransUnion:
• Any entry rated higher than I1, M1 or R1.
• Any entry shown as a repossession, foreclosure, any write-off, paid charge-off, settled, settled for less than full balance, bankruptcy.
• Any collection account, paid or unpaid.
• Any court account: judgment, lien, bankruptcy Chapters 7, 11, or 13, divorce, satisfied lien, or satisfied judgment.
• Any item showing 30, 60, 90, 120 day late payment.
• Any inquiry on your account.


Experian:

• Any item marked with an asterisk (*).
• Any inquiry on your account.

As you already know, the Experian credit report is written in plain English and is very straightforward. And you have learned how to decipher Equifax and TransUnion reports as well.

The first thing to do when you receive your credit report is to make at least three photocopies of it. Never scribble or write anything on the original credit report. Keep it in a file, safe, because it is an original document which you will need later on.

Now read each of your three reports and mark or highlight (on the photocopy) each time you come across a negative entry. Once you've marked out all the derogatory entries on your report, you must now begin looking for inaccuracies and inconsistencies. Whenever you come across one, mark it off, or highlight it.

Remember, an inaccuracy is an entry that you know is not true, such as an item that does not belong to you, or a listing that shows the wrong balance. An inconsistency, on the other hand, is an inherent contradiction in the credit report itself. Below is a handy check-list that you can use:

Inaccuracies:

• Late pay history is wrong.
• Account type is wrong.
• Balance of your account is wrong.
• Status of your account is wrong.
• Date of account is wrong.
• Account number is wrong.
• Account does not belong to you.


Inconsistencies:
• Personal information is wrong.
• Past addresses are wrong.
• Account is shown to be older than possible.
• You never lived in the area of the court record.
• Duplicate accounts.
• Item shown in BK field, but no BK is listed.
• There are more late pays than months reviewed.

Once you've marked all the derogatory entries in your report, it is now time to begin charting a course of action. Before you begin this process, here are some do's and don'ts that you should carefully heed:

• Never lie in any of your disputes or credit applications. As you may be aware, lying on a credit application is a federal offense. As well, you really have no need to lie in order to dispute your credit report. In fact, you are disputing the report because you believe that it contains information that is unverifiable, inaccurate, or obsolete. If there is information that is technically accurate, your dispute letter should state: "I do not believe the following listing is correct".
• Make sure you tell the credit bureau what it is that you are disputing - the existence of the entry itself, or the information contained in the entry. This is an important difference. You need to tell the credit bureau whether you believe that the entry does not belong to you at all, or if you believe that the information in the entry should be changed. If you show any confusion at this stage, the credit bureau will promptly return your letter with a note that it is frivolous.
• Make sure you tell the credit bureau what you want them to do. You have two options: Ask them to delete the entire listing, or secondly erase the late pay notations in the listing. The information in bankruptcy, lien, collection, charge-off, repossession, foreclosure, or settled account cannot be challenged. All these must be disputed in order to be completely deleted.
• Make sure you provide a reason for your dispute, such as: You don't recognize the listing as reported, or that you would know if you were as late as reported. If you do not give an explanation with your dispute, the checker may simply ignore your dispute.
• Do not flood the credit bureau with disputes. Send only one dispute every 90 days. For each one, use inaccuracies and inconsistencies to show how wrong the information is on your credit report.
• Always send an original copy of your credit report with the dispute letter. At this stage, you may mark the report to bring inconsistencies and inaccuracies to the attention of the checker. Always include personal information about yourself in the letter itself, namely, your full name, current address, date of birth, and Social Security Number.

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Formulating your case