Q. My wife and I have been working on our credit for a couple of years. I was unemployed in 2009 for about 6 months and our credit went to hell. We are now in a place where we feel our credit is good enough to buy a home, having done a series of credit report disputes to remove bad information. We were told by our loan officer that our credit score is good enough to qualify for an FHA loan. To our surprise, when we formally submitted our paperwork, the loan company’s underwriter said they can’t approve us because I have several items “in dispute” on my credit report. The items weren’t removed from my credit report, they are in “dispute limbo” as a result of my credit restoration efforts. How can I get these removed?
A. Writing to the credit bureaus and requesting an investigation of questionable items on your credit bureau is a very effective way to clean up your credit report. By law, if you dispute something on your credit report, the company reporting the item on your report needs to list the account as “disputed”. This notation is required to remain until the investigation is complete. What winds up happening is that some companies never update the notation when the investigation concludes and the account remains “in dispute” for an extended period of time. I’ve seen accounts report as “in dispute” for up to one year.
Most lenders require that all items DO NOT have the “in dispute” language before they’ll process an application to closing. This is because while an account is in dispute, it is not being factored into your FICO and Vantage credit scores and therefore your score is not being accurately calculated. Lenders, especially mortgage companies, are score driven.
I can see the light bulb go off in your mind right now – if disputing an item removes it from consideration from your credit score, can you just dispute everything and have your credit score rocket up? Sure, your score will go up, temporarily, but you will get denied credit because if those “in dispute” listings. So this temporary “fix” will do you no good.
The “in dispute” listings should naturally fall off your credit report. However, what if you don’t want to wait and want them off quickly?
- The best way to quickly resolve your “in dispute” issues are to call or write the credit bureaus and tell them you are no longer disputing any items on your credit report. I’ve had readers report good success with this method, the disputes are removed immediately.
- In cases where notifying the credit bureau does not work, you can write to the individual company reporting the account and ask them to remove the dispute notation.
- You can tell the company reporting the information that you no longer wish to dispute the account. By law, a company must report an account accurately.
Don’t let this information prevent you from disputing listings on your credit report. Cases where items stay in dispute for a long time is not the norm. Investigation requests are the only way to clear up bad listings on your credit report. In the long run, this is the most effective way to rebuild and repair your credit.