Should I dispute all my debts on my credit record, even the ones that I know are legit?

Question

Someone told me that I should do this first before debt consolidation, being that the company has to verify the debt. If they do not respond in time, then it gets wiped off my credit report. Sounds pretty sweet, but I don't have any companies or government agencies coming after me down the road. Is this legal, and if so, how well does it work? Thanks!

Answer 1

The only "idiots" are people like Emma who don't bother to research their answers first....makes them look terribly foolish when someone like me comes along with sources and proof.

FACT:  Over 50% of the credit reports contain errors.

FACT:  About 25% of credit reports contain errors serious enough to cause the denial of credit, or other similar severe actions.

FACT:  Based on these Congressional studies, Congress passed the Fair Credit Reporting Act, allowing consumers to request off of ANY item that is being listed on their credit report.  

When you request an investigation, you are not sending in an affidavit claiming the items are not true.   You are simply requesting validation as allowed by the law.

Therefore, it is ALWAYS recommended that you dispute every single negative item listed on your credit report.  

Answer 2

This is the precursor to fraud.  When you challenge everything on your credit report your credit is put on "hold" until further investigation.  Your creditors have 30 days, by law, to respond.  Once proven that you do owe that money the ding will be put back on your credit report.

Debt consolidation companies appear as bankruptcies on your credit report -- this tells creditors that because you used a debt consolidation company you were not able to manage your credit.  You'll have this black mark on your report for 7 years!

Trust me ... if there was an easy, permanent way to fix your credit without having to pay or suffer it would be common knowledge!

Answer 3

you have the right to dispute a rating on your credit, and credit that don't belong to you.  I worked with banks, and deal with credit reports, and yes, if you consolidate and try to get more credit down the road, it will show up as a warning sign to other companies, that you cannot pay your debts.  I have seen many people denied loans to purchase homes, even mobile homes.  

you can have good credit, but once they see that you had to consolidate, its a warning sign, and if anyone says it doesn't must not work in the business of sells.   Seen it more than once.

Answer 4

In response to the above answer, it is not illegal or fraudulent to request written validation of negative items on your credit report...even all of them. Consumers have this right under the Fair Credit Reporting Act. I've never heard of your credit being put on "hold" for requesting validation...this is news to me.

Here's how to request validation:

Per the Fair Credit Reporting Act you have the right to request written validation of negative entries on your credit files. Per this law they must validate the item(s) within 30 days or remove them from your credit file. Mail a letter via certified mail with return receipt to all three credit bureaus (Equifax, TransUnion & Experian). Include a photocopy of your driver's license and social security card...If you don't include these, they may write back requesting them, which would slow the process down by several weeks. For each negative item, write a separate letter and simply include the phrase:

Per the Fair Credit Reporting Act, I am requesting written validation of this item.

Do this one at a time for each negative entry....DO NOT request validation for all items at one time.

There is NO guarantee that this will work....It may give some decent results. The worst that can happen is that all negative items come back verified.

Answer 5

Debt consolidation is most certainly not the same as a bankruptcy. It is a valid attempt to pay off your debts without declaring bankruptcy. It isn't as simple to have debts erased as you have been told. When you consolidate through an agency, they negotiate your interest down and sometimes are able to reduce the principle of the debt, depending on the company involved.  

Answer 6

This is absolutely NOT fraud. Contesting items that you know are legitimate may be a big waste of time though. Most companies of any size have your account on their computer and they will simply and easily verify your account information.  

Answer 7

Of course it's not legal. It's fraud and you're an idiot.

Answer 8

Would be considered fraud plus you have to have proof there are errors, or it will come back to haunt you.