Letter to Repair Credit

Credit repair is accomplished in several different ways, including debt reduction and rebuilding of timely payments records. These efforts can take many months, but quick repair is possible for people with mistakes on their credit reports. The Federal Trade Commission cites letters as the best method for cleaning off bad report entries by filing disputes.

Purpose

Credit repair letters are used to dispute credit report mistakes. The Experian, TransUnion and Equifax credit unions compile financial information, but they do not audit its accuracy. The FTC explains that consumers are allowed to check their credit bureau records once per year through a government mandated website (see Resources). People who notice mistakes on any of their reports can write dispute letters to the appropriate bureaus to repair the bad information.

Reason

The three big credit bureaus encourage people to use their online forms for dispute filing. The FTC advises against this because credit repair letters have advantages over online submissions. Each bureau lists a postal address for disputes on its website. Letters can be formatted in an efficient way that lists each mistake and a detailed explanation of the problem. Consumers can enclose copies of their own records for proof, like bank or credit card statements and canceled checks. The postal office will send the letters through certified mail for an extra charge and provide proof of delivery. Credit bureaus have 30 days from the receipt date to handle disputes.

Contents

Experian, TransUnion and Equifax are not required to follow up on letters for disputes that appear to be frivolous or unfounded, the Divorcenet.com legal website warns. A credit repair letter lends credibility to claims if it is customized for each credit bureau. The three bureaus sometimes have different information in their records, so referring specifically to the contents of each credit report shows that the claims are well researched. Every bit of corroborating evidence enclosed with the letter strengthens the credit repair case, too. The letter should list the consumer's name, address, telephone number and Social Security number. It should clearly request that the listed items checked and removed.

Responses

The U.S. Fair Credit Reporting Act obligates the credit bureaus to reply to disputes once they are investigated, which must be done within 30 days, according to the FTC. The bureaus then send response letters explaining if the disputed items were verified or if they were removed from the reports. Erasure is required when a lender does not verify the questionable entry. Every removed entry helps the credit repair effort because the negative information no longer figures into credit scores or gets considered by creditors.