As a consumer, you need to be vigilant about protecting your credit and financial reputation. One of the best ways of doing this is to understand some of the basics of credit repair (e.g., monitoring, reporting, disputing errors). It would help if you also were careful that you don’t undermine your consumer rights when dealing with the major credit reporting agencies, with the main one being that the Fair Credit Reporting Act (FCRA) requires a credit reporting agency to investigate every dispute a consumer makes. There are several things you may need to know about making a dispute for credit repair purposes.
How to Start a Credit Dispute
Although you have the right to request that the Fair Credit Reporting Agency (FCRA) make an investigation into the company that initiated a charge (a.k.a., furnisher or data furnisher), you must first dispute it with the credit reporting agency. This is meant to protect you, but if they insist that their records are correct, you can’t sue them for failing to investigate the mistake unless you’ve taken this step first. Therefore this must always be the first step you take in any credit repair process.
Initiating a Lawsuit Against a Credit Reporting Agency
Once you’ve sent numerous complaints that have been ignored, you can use the credit reporting agency for failing to timely investigate a prima facie claim. You need to be diligent in keeping records and evidence of all the efforts you’ve made to resolve the dispute. Therefore, make sure that you keep all letters denying credit. Take notes of the date and time of any phone calls. The judge will then require the creditor to provide the recording of the call that was made at that specific date and time when there’s a credit repair lawsuit.
Traditional Reporting of Credit Disputes
When you attempt credit repair, you must keep all the evidence you can gather (e.g., notes, letters, emails, denials), as this is typically the primary factor in deciding a lawsuit. The process starts when you neatly type or handwrite a letter and then mail it via Certified Mail. Once you start, you should then clearly mark all evidence and keep it in chronological order. Never use email or a website to file a claim because you may not have evidence that you’ve done so later on.
Watch Out for the “Arbitration Trap”
It’s up to you to preserve your rights. Therefore you should always read the “fine print” because there you’ll find “arbitration clauses.” You’ll want to know this information if negotiations break down and you think a lawsuit is necessary because you may find that your next step has to be arbitration. Unfortunately, this isn’t consumer-friendly, so make sure you’re wary and vigilant about reading the fine print.
Beware of the “Re-Aging of Debt” When Attempting Credit Repair
Debt claims aren’t perpetual. The law states that a company’s right to sue for or collect on a debt is time-limited. Once the statute of limitations has run out, you have a bulletproof defense against any lawsuit. However, this only works if you don’t accidentally or inadvertently re-age the debt by doing something such as talking with a debt collector or agreeing to make a partial payment on an expired debt.
When you’re ready to start the credit repair process, you’ll want to call a credit reporting agency to file a report.