Imagine this..
You have worked very hard to improve your credit in order to purchase a home – either with a credit services company or on your own. You complete your home loan application, rather excitedly, and… Your application is denied!
What happened?
When you dispute negative items on your credit reports, the creditor will leave a comment on the account informing whomever is reviewing your credit report that you disputed their reporting on your credit file.
Lenders require that all dispute comments be removed from any non-medical account prior to being approved for a home loan.
Why?
One reason is that dispute remarks can cause issues with the lender’s automated underwriting systems. Another, more important reason, is that dispute comments on an account alters the way it is calculated into your credit scores. When approving you for a 15-30 year loan, lenders want to see your ‘real’ credit scores with both negative and positive accounts being considered.
Fortunately, a home loan denial is temporary. Lenders will require you to remove the dispute comment, possibly a letter of explanation, and will re-pull your credit before issuing a final approval or disapproval.
Keep in mind, – and this is very important – when you remove a dispute comment from an account with negative history, your credit scores may temporarily decrease. This is why you will want to remove your dispute remarks as early as possible before applying for a home loan.
Here’s how to do it!
How to get dispute remarks removed from your credit report
1) Get a copy of your credit report.
The first step is to get a copy of your credit report from all the three bureaus. You can request a free copy of your credit report from Annualcreditreport.com. Alternatively, you can get credit reports through third-party services as well.
The next step is to mark accounts that have a dispute remark or comment associated with it. You’ll need this list when contacting the bureaus.
2) Contact the relevant credit bureaus.
Now it’s time to call the credit bureaus.
In most cases, speaking with a live agent and reporting the matter is all you need to get the comment removed. Make sure to mention why it is critical to get the remarks removed as quickly as possible; namely tha you have a pending mortgage approval.
When it comes to finding the number to call, we recommend using the number provided on your Annualcreditreport.com credit report. You’ll also have a credit report ID number, which makes it easier and faster to get through to a representative when calling.
Here is a list of calling numbers we found for different credit bureaus.
- Experian: Call 855-414-6148; 714-830-7000
- Equifax: Call 800-846-5279
- Transunion: 800-916-8800.
3) Mail your request to the credit bureaus.
If you’re having trouble reaching the credit bureaus by phone, you can also write them; however, the process will be a bit longer.
Mailing address for Equifax
Equifax
P.O. Box 740256
Atlanta, GA 30374-0256
Mailing address for Experian
Experian
P.O. Box 9701
Allen, TX 75013
Mailing address for TransUnion
TransUnion
P.O. Box 2000
Chester, PA 19016
How long will it take to remove dispute remarks from your credit report?
Ideally, it should take between 24 to 72 hours to get any dispute remarks removed from your credit report. However, if you couldn’t reach them on the phone and sent the request by mail instead, the process could take about a month or so.
For some reason, if you’re unable to get the dispute remark removed, you can try contacting the original creditor/collection agency directly to request that they remove the comment asap. In case you’re wondering, YES, if you still owe them money, they will use this opportunity to attempt to collect on that debt. With this in mind, weigh your options and plan accordingly. They cannot try to negotiate payment in exchange for removal of your dispute remark.
You Can Refile Your Dispute in the Future
If you took an account out of dispute for the sole purpose of being approved for a home loan, you can re-dispute the account after you have closed on your new home. This will give you an opportunity to dispute the item for permanent removal from your credit reports.
Bottom line
As an individual, getting dispute remarks removed may appear a little overwhelming at first, but understand that it’s a fairly straight forward process that requires only reasonable efforts at your end. The trick is to do proper follow-up and don’t be hesitant while seeking explanations.
Need help improving your credit so that you can Claim the Keys to your New Home? We’d LOVE to Help! Complete our Prequalification Application here 🙂
