Bad credit report can be cleaned up


If you are denied credit, there are a number of things you can do to find out why.

First, ask the agency for a copy of your credit report. Federal law mandates you have the right to have it -- free -- if you've been denied credit. (You can always buy a copy for a nominal fee -- $15 from TRW -- if you're just curious about what it contains.)

If you believe there is something inaccurate about the report, circle it and send it back to the agency. Include any backup information, such as a canceled check or receipt, that you feel substantiates your claim.

The reporting agency will then contact the retailer to determine if the negative information is in error.

The reporting agency should get back to you within 30 to 60 days with its finding.

If it says the retailer maintains the negative information is accurate and therefore should stay on your report, you should do two things:

* If you disagree, you may write a response of no more than 100 words, which is included in your credit report. At that point, anyone who requests your credit history will get the report, adverse information and all, plus your response.

* You should also contact the retailer involved. Take any backup material, like canceled checks or receipts, to the retailer to bolster your case.

If you convince the retailer that the negative information is the result of its error, it will send the amended information to the

credit reporting agency and your file will be updated.

If you find an error in the report, demand in writing that it be fixed. If the agency refuses, contact the Federal Trade Commission (202) 326-3650, 9 a.m. to 5 p.m. weekdays.

Experts agree, however, that you should avoid hiring a company that says it can repair your credit history.

"Those can be very expensive," says Susan Murdy, a national spokeswoman for TRW. "They can charge up to $600 or more, and they can't do anything for you that you couldn't do for yourself."

However, consumers should not wait until they've been turned down for a job or had a loan application rejected before checking their credit records.

A clean credit history is one of your most valuable assets. It pays to know what information -- or misinformation -- is being distributed under your name.

It's important to get a copy of your credit reports a few months before they're needed in a car or house purchase, said Esther Shapiro, director of the Detroit Department of Consumer Affairs.

To get a complete picture of your records you may have to order several reports -- one from each agency. That's because some companies have information that others don't have.

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