The one hundred word statement will not repair your credit rating
- By Stuart Hunter
- Published 11/9/2009
- Credit
- Unrated
The one hundred word statement will not repair your credit rating
Negative listings on credit reports make some of the largest hits to your credit score. A few delinquent payments can be the difference between getting a favorable interest rate on a loan and having to make a substantial down payment just to qualify for financing. Major blemishes like charge-offs, liens, and foreclosures have the potential to drop your credit score so much that you will have difficulty getting approved for credit at all.
So what is a person to do when there are damaging items on a credit report that shouldn't be there? Credit reporting mistakes do happen and damaging information gets incorrectly added to peoples' credit reports all the time. And what about negative listings that do describe actual events but there was a perfectly good reason for why they exist? Is it really fair to have to live with a poor credit rating for up to a decade or more when the negative items on your credit reports were completely outside your control?
The Fair Credit Reporting Act (FCRA) provides consumers with a few options when dealing with bad credit, and enforcing their right to a fair and accurate credit score. This includes the right to request free copies of your credit reports as well as the right to request verification of any items on your credit reports that you feel may be inaccurate, untimely, misleading, incomplete, ambiguous, unverifiable, biased or unclear.
Another antiquated option you have as a result of this act is the ability to add a one hundred word statement to your credit reports explaining to creditors the circumstances behind negative items on your credit reports. The idea is that when referencing your credit reports, lenders will be able to take into account the justification behind these negative listings when considering your loan application.
What makes this statement antiquated is that these days, lenders rarely consider the individual listings in your credit reports. In fact, they may never see your reports at all so your meticulously penned 100-one hundred word statements would never be read.
On top of that, lenders are primarily interested in your credit score, which does not take the 100 word statement into account. No matter how reasonable your justification is for having a negative listing on your credit reports, your credit score will remain unchanged.
The only way to keep negative items from affecting your credit score is to have them removed from your credit report. One option people have for attempting to do this is the credit bureau dispute described in the Fair Credit Reporting Act. Additional credit repair options are made available through a number of other consumer protection acts targeted towards creditors and collections agencies.
So what is a person to do when there are damaging items on a credit report that shouldn't be there? Credit reporting mistakes do happen and damaging information gets incorrectly added to peoples' credit reports all the time. And what about negative listings that do describe actual events but there was a perfectly good reason for why they exist? Is it really fair to have to live with a poor credit rating for up to a decade or more when the negative items on your credit reports were completely outside your control?
The Fair Credit Reporting Act (FCRA) provides consumers with a few options when dealing with bad credit, and enforcing their right to a fair and accurate credit score. This includes the right to request free copies of your credit reports as well as the right to request verification of any items on your credit reports that you feel may be inaccurate, untimely, misleading, incomplete, ambiguous, unverifiable, biased or unclear.
Another antiquated option you have as a result of this act is the ability to add a one hundred word statement to your credit reports explaining to creditors the circumstances behind negative items on your credit reports. The idea is that when referencing your credit reports, lenders will be able to take into account the justification behind these negative listings when considering your loan application.
What makes this statement antiquated is that these days, lenders rarely consider the individual listings in your credit reports. In fact, they may never see your reports at all so your meticulously penned 100-one hundred word statements would never be read.
On top of that, lenders are primarily interested in your credit score, which does not take the 100 word statement into account. No matter how reasonable your justification is for having a negative listing on your credit reports, your credit score will remain unchanged.
The only way to keep negative items from affecting your credit score is to have them removed from your credit report. One option people have for attempting to do this is the credit bureau dispute described in the Fair Credit Reporting Act. Additional credit repair options are made available through a number of other consumer protection acts targeted towards creditors and collections agencies.
Stuart Hunter
Providing credit repair services since 1991, Lexington Law has helped over 500,000 clients legally take on their credit. Last year alone, Lexington Law helped clients remove over 600,000 negative items from their credit reports.
View all articles by Stuart Hunter