A low credit score hampers your ability to get loans and mortgages. When you do take out loans, it often ratchets your interest rate higher than it should be. To avoid these issues, you need a better credit score, and improving it involves more than just paying off loans. If you want to boost your score, you need to know how to remove debts from your reports using these steps.
1. Audit your credit report.
Annually, you have access to one free credit report from each of these three credit reporting bureaus, and in some states, you have the right to receive free reports every time something negative is added to your file. Take advantage of these free opportunities or buy a credit report from each of the three reporting bureaus, Equifax, Experian and Transunion, and carefully audit these reports.
2. Demand proof of your debts.
Your credit reports list the creditor who granted each loan to you, and if the loan has gone to a collection agency, the report has details for the agency as well. Write letters to the relevant collection agency or creditor and demand proof of the debt.
Even if you know that you owe the money, the burden of proof is on the entity demanding the debt — this means the banks, credit card companies, utility companies, phone companies and anyone else who has reported a debt in your name to the credit reporting bureaus must prove it.
Once you send a verification demand to a collection agency, it must stop collection activities until the debt has been verified.
3. Send omission by silence letters to your creditors.
If you have repeatedly and clearly demanded verification of your debts, and the creditors have refused to respond, they are guilty of “omission by silence. This legal phrase essentially means that the creditors’ silence or refusal to verify your debts indicates that the debts do not exist.
4. Send cease-and-desist letters and issue FTC complaints.
Once you have let the agency or creditor know that the debt is not valid, you need to send them cease-and-desist letters. Your letter should detail why the collection activities must halt, and ideally, it should run through the verification attempts and review the claim of omission by silence. If any creditors or collection agencies fail to remove the record and stop collection activities, it’s time for you to contact the Fair Trade Commission (FTC).
The FTC is a consumer protection agency, and with enough complaints, the FTC can shut down a collection agency and freeze its assets. As a result, most collection agencies are not interested in having complaints sent to the FTC, and they will often do almost anything to avoid that.
Erasing debts from your credit reports is an efficient and lasting way to boost your credit score, but writing effective letters requires reasonable knowledge of the law. In particular, you should understand the basics behind the Fair Debt Collection Practices Act (FDCPA), the Fair Credit Reporting Act (FCRA), the Fair and Accurate Credit Transaction Act (FACTA), and the Health Insurance Portability and Accountability Act (HIPAA).
To help navigate the process and ensure its success, many consumers turn to a credit repair company — these entities help guide you through the steps listed above as well as taking other measures to improve your credit.
If you’re interested in building your credit score, contact Build My Scores credit services and get on the road to financial freedom!
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