how to clean up your credit score

If you are a regular reader of my blog, you certainly already know how much information that the Credit Information Bureau has collected about you has a huge impact on your creditworthiness and financial credibility when you want to apply for a hard money loan. Did you miss it? In that case, take a look at the entry about how credit restoration works and how to build creditworthiness. 

Although I have a very good credit history myself, I have recently started to wonder if there is any legal option to clean your credit? It is about removing information that indicates bad credit history and thus significantly improving your situation when applying for a loan. I have looked at this issue quite thoroughly, and the results of my analysis can be found in today’s post. I invite you.

Credit Restoration is a wrong shortcut

The phrase “credit cleaning” appears regularly in the offers of various companies (I will come back to it in a moment), but in fact, it is completely detached from reality. There is no lawful option to remove unfavorable information about your credit history bypassing the applicable regulations, which you will read about later in this article.

It must be remembered that the Credit Information Bureau does not affect the content of the story, it is only its administrator and publishes what is provided by independent entities, i.e. banks, credit unions, and loan companies.

A brief repetition on what it takes to fix your credit

As you probably know, information about you goes to the credit bureaus when you submit a loan application – for example regarding the payment for the purchase in installments. The next information is about whether you are honestly fulfilling your obligations.

Data on reliably repaid loans are not visible to any financial institutions checking your history with the credit bureaus – unless you have previously agreed to it, However, if you should have a leg, then, under the law, information about an unpaid liability is stored on your credit score for up to 5 years (however, the delay had to be over 60 days, and at least 30 days from the payment request).

Can data be deleted from my credit report

You can, and it’s completely legal. However, only 3 solutions are allowed:

  • Revocation of consent to the processing of data on a repaid loan – you could suddenly turn back and you simply do not want banks or credit unions to have access to such information about you (although it is beneficial).
  • You want to remove information about an unpaid loan – you can submit such an application only after 5 years from the date of repayment of the entire liability.
  • You want to correct incorrect information about yourself – such as a distorted name or wrong date of birth.
  • Remember that you must apply to change your data with the institution that provided your data to the Credit Information Bureau. Without receiving the application signed by this institution.

How Do Credit Repair Services Work?

Perhaps you have come across beautiful-sounding advertisements such as: “Cheap removal of bad credit history!” Sounds unreal? You have a nose. These types of services are simply spoofing desperate people who cannot get a bank loan due to negative history. What exactly is this “credit cleaning”?

Companies offering such a service will not skip the legal stipulation that information on defaulted loans must be kept for 5 years. What do they do then? First of all, they try to use a certain legal loophole.

As I mentioned – Lenders will store information about late payment of the loan installment only when the delay is at least 60 days, and 30 days have passed since the bank sent the notification to the customer. Banks sometimes do not comply with the latter condition and try to use the so-called “credit repair services”. On behalf of the client, they question the legitimacy of making an entry due to the breach of the procedure.

Also, companies offer a credit restoration service on behalf of the client for debt restructuring, i.e. consolidating loans so that they are easier to pay off. Such a company may also apply with a request to remove incorrect data or withdraw consent to the processing of information about a timely repaid loan.

The most important thing, however, is that you can do all these procedures yourself and do not pay anyone for it (often quite a lot). 

Regularly check your credit history!

Of course, all these considerations do not make any sense if for some reason you do not know your credit history. This can be checked very easily. Anyone can download a report on their history. All you need to do is visit the website of the Credit Information Bureau, create an account, and go through a simple verification procedure. I encourage you to do so, because such knowledge may prove to be invaluable.