Your credit report can often make or break your loan applications. The prospective lender will research your credit score from any of the three major credit rating agencies (Experian, Equifax, and TransUnion) to determine your suitability for their loans. You will then be classified as a low risk, medium risk or high risk borrower, which will constitute one of the criteria for loan approval, as well as the terms and conditions contained in it.

Rules and exceptions

It is very important to be aware of your credit score so that you can take the necessary steps to correct any inaccuracies reflected in your score. However, keep in mind that can only dispute inaccuracies and You must have evidence to support your claims.

Otherwise, all accurate negative information on your credit report will be reflected for up to seven years. The calculation of said seven years begins from the moment of non-payment within the term or the moment in which the delayed remittance was collected. Note that the calculation is No of your last payment made on the particular account.

As can be expected from the law, there are exceptions to the seven-year rule. Under the Fair Credit Reporting Act, these exceptions are:

• Chapter 11 bankruptcy filings can be reflected for 10 years from the date of entry or date of award
• Civil lawsuits and judgments, as well as arrest records, can be reported for 7 years or until the applicable statute of limitations expires, or whichever is longer.
• Paid tax liens can be reported for 7 years from the date of payment, not the date of judgment

Within these exceptions there are also other exemptions, as there are no time limitations for these items:

• All credit transactions involving, or that can reasonably be expected to involve, the principal amount of $150,000 and more
• Life insurance underwriting that involves, or can reasonably be expected to involve, the face amount of $150,000 and more
• Apply for and/or be employed in a job that provides, or can reasonably be expected to provide, an annual salary of $75,000

It pays to know the law when it comes to the content of your credit report. In this way, you can challenge any inaccuracies and any illegality in it.

Steps to dispute inaccuracies

When you want your credit report to be more accurate and up-to-date, you have two resources.

First, you can write to the credit reporting agency about the disputed items and their corresponding second copies of documentary evidence. Be sure to include your full name and address, as well as a request for correction and/or deletion.

Second, you can also write to the information providers about the items you want to dispute. They must then act on your letter by reporting it to the credit reporting agency. You must also request its correction or deletion, as the case may be.