3 Ways To Remove A Closed Account From Your Credit Report
There are three ways to seek to erase a closed account from your credit report, especially if it contains erroneous information or unfavorable elements. You can either dispute false information with the credit agencies, submit a formal “goodwill letter” to seek removal, or just wait for the account to be closed once a certain amount of time has passed. Depending on your scenario, any of these ways may be beneficial.
1. Dispute inaccurate information.
If the information on a closed account on your credit report is erroneous, you can dispute it and have the item removed from your report.
You can challenge the information by following the steps below:
Send a letter to the three main credit bureaus, TransUnion, Experian, and Equifax, explaining what information you’re disputing, why you think it’s wrong, and why you want it erased.
Send a letter to the financial institution that provided the bureaus with the information.
After you’ve waited for answers, go through your revised report and score.
To assist you, we offer a handbook that explains the dispute procedure in full.
2. Write a “goodwill” letter.
A goodwill letter is a formal request to a creditor for the removal of a negative item.
Although creditors are not obligated to delete bad entries upon request, they may be inclined to do so if you have a lengthy relationship with them or if the negative item resulted from unusual circumstances.
Goodwill letters, on the other hand, are often used solely for late or missing payments, not for collections, repossessions, or other more serious negative issues.
You can also request that an account be deleted using a “pay for delete” letter in addition to goodwill letters. These letters may lead to a settlement with a collection agency in which the account is closed in exchange for a predetermined amount. However, the collection agency may choose not to delete the account, and the original account that was sent to collections may still appear on your credit report.
3. Allow time for the closed account to be erased.
Closed accounts do not stay on your report indefinitely, so you may just wait until the account is erased.
Accounts that have been closed might stay on a credit report for up to ten years.
When a closed account with unfavorable information is reducing your score, it will ultimately be removed from your report. Furthermore, positive information about closed accounts fades from your credit report over time, so it’s critical to maintain solid credit practices across a range of account types.