It's a fact that most credit files have incorrect information contained in them. This can be caused by many different factors. Regardless of the reason, incorrectly reported negative items on a credit report have the potential for lowering an individual's credit rating and hampering their ability to obtain new credit. There is a dispute process that you can follow that will remove the item from your file and restore your good credit rating.

Identifying Inaccurate Information

Obtain copies of your credit report. It is important to get a report from each of the three major credit reporting agencies: Equifax, Experian and TransUnion. Each of these agencies can be reporting differently based on the information they receive. While it is not mandatory, it is best to get a copy from each of these three agencies individually instead of receiving a consolidated report from one, as the information is likely to be more accurate. Scan for inaccurate collections accounts. These items can include accounts that are not yours, collections accounts that were paid. Any item that is not reported accurately can be disputed.

Disputing Inaccuracy

File an online dispute with each agency that is reporting the collections account. Begin your dispute with an online dispute. Each of the credit agencies' websites has a link to their online dispute process. Complete the information requested in its entirety and then wait. Online disputes will usually take anywhere from two weeks to 30 days to complete. You will be notified by mail and email. Contact the collection agency. Work with the collection agency to remove the account. Make sure to get any arrangements and promises made by the agency in writing so that you can submit the information to the credit bureaus in the event the agency does not follow through. Write a letter. If your dispute is not resolved and the collections account removed with the initial online dispute, follow up with a written communication to the agencies. Send the letter certified mail so that you have proof of delivery. This process can take up to 30 days to complete.

Last Resort

Submit an explanation. If the account is still not resolved and removed, submit a 100-word statement explaining the dispute and submit to the credit bureaus reporting the account.

Source:

Consumer Credit Counseling Service: Clean Up Your Credit Report