A foreclosure can only be on your credit report for a maximum of seven years. There are inaccurate statements that say a foreclosure must be on your report for a minimum of seven years.

This information is wrong; the truth is credit reporting is entirely voluntary on behalf of the lenders. A lender can remove a negative mark from your credit at any point in time and do not have to report the negative mark in the first place.

I would first recommend that you dispute the listing directly with the credit bureaus. This is done by mailing a dispute letter to each credit bureau.

In this letter you are challenging the accuracy or validity of the foreclosure. You must include the reason the mark is wrong for example; item is out of date, amount is wrong, not my account and etc.

The credit bureau will receive your letter and probably deem it invalid. This means they will respond with a letter to you requesting more information. This is nothing more than a stall tactic and is used because it only cost bureaus money to conduct an investigation.

Therefore you will have to send your dispute letter again, with some persistence you can get a dispute submitted that is valid. Then the bureaus will hold an investigation into the listing.

If they are unable to verify the foreclosure then it must be removed from your credit report. Since the housing crisis many lending institutions have gone under or are unwilling to spend money verifying debt. With some luck your listing will be unverifiable.

If you are having trouble submitting a valid dispute or the foreclosure is verified then I recommend a credit repair service. They often have credit lawyers on their staffs that have an expert understanding of credit laws. These lawyers can use advanced dispute tactics or if necessary even take your case to court.

We expect some new case precedents with the increasing number of individuals going through foreclosure. Thus it may be in your interest to hire a service, especially if the foreclosure is not your only negative mark.

You do however have one more option. You can negotiate a settlement agreement with the lender. In exchange for your payment get the lender to agree to remove the foreclosure from your credit report.

In sum, items of bad credit do not have to stay on your credit report. You can remove negative items and clean your credit report.

Disputing negative credit items with the credit bureaus Equifax, Experian, and Transunion can often be a challenge. Many times the bureaus respond to a dispute with a letter indicating they verified the disputed item. Accordingly, you are stuck with the information being reported about you.

Credit bureaus always respond to disputes with a letter where they inform you that you have the right to attach a 100-word statement to your report. Often, people believe this is a good opportunity to explain away their negative information or argue their case.

It is surely tempting to tell your side of the story by way of the “consumer statement.” It appears as your opportunity to explain why you have negative items on your credit report. There probably is a good reason why you were late on that payment. Perhaps you were sick or got laid off from your job.

Do not fall into the trap of adding a consumer statement to your credit. It is almost never a good thing.

Do not mistake the 100-word statement for good faith on the part of the credit bureaus. As you will see, such a statement is usually used against your best interests.

Let’s assume that you were to attach a statement like this: “I was only late on my credit cards because I was laid off from work. Once I found another job I caught up on all my bills and have never been late since.”

It may seem unreasonable to punish somebody for losing her job. Especially if she caught up on all her bills.

However, the credit bureaus and creditors read such a consumer statement entirely different. They don’t see a good person who went through some brief and unexpected hard times.

Her inability to make payments is seen as a sign of weakness and/or irresponsibility. They believe that she should have emergency money to pay bills during times of emergency.

The 100-word statement also has additional hidden dangers. For instance, adding such a statement confirms your guilt. It is direct proof that you were late on those payments. Moreover, you put yourself on perilous footing should you decide to hire a credit correction law firm in the future. The credit bureaus will ignore any future disputes on your behalf because you have already admitted guilt.

As you can see, attaching a 100-word written statement to your credit report could possibly be the worst step you can take. In fact, it is only an option because it was part of the original Fair Credit Reporting Act enacted in the 1970’s. Thirty years ago bankers actually manually reviewed credit applications and read those statements personally.

In today’s digital world most applications are reviewed electronically. Thus, such a statement only serves as another way for the credit bureaus to ignore your credit report dispute.

Briefly, the 100-word statement is dangerous to your credit file. It serves no good purpose for the consumer whatsoever.

Credit correction is not accomplished overnight and so the order in which you dispute items is very important (especially if you are on a deadline to raise your credit score).

If your credit is a mess, chances are you have a variety of bad credit listings such as charge offs and collections. Some items are more damaging than others.

Ordered below is the list of negative items as they correspond to their severity.

The credit bureaus are allowed to list most negative credit for seven years. However, public records including tax liens and judgments are allowed to remain for up to ten years. That is why these items are the most severe.

Any credit cards or other debts that were discharged in bankruptcy are listed as “included in bankruptcy. These listings are just as severe as the bankruptcy listing itself.

Collection items are very severely damaging. Try to negotiate with the agency for a complete deletion. You do not want to have a paid collection, or settled collection on your credit file.

Foreclosure/Repossession are likewise very severe. These listings are severely damaging to your score and can keep you from getting the next mortgage or car loan.

Charge Offs, especially recent charge offs are indications of a very severe credit risk. A charge off can often lead to multiple negative credit listings. The original creditor will list the “charge off” as well as the subsequent collection agencies that purchase the debt.

A recent late payment is especially bad for those people with previously good credit. It can instantly lower a credit score that you have spent years to establish. The scoring formula believes that a late payment may be a sign of impending financial meltdown.

Moderately severe items include a 30,60,90, or 120 day late payment. These items can either be disputed with the credit bureaus or negotiated with the creditor.

The credit scoring formula is biased more towards recent late payments. Older late payments should be given a low priority in your dispute process.

A wrong address or employer listing has no effect on your score. Plus, the credit bureaus will probably update this eventually.

In order to quickly clean up your credit report, you must challenge the most severe items first. It does no good to focus your time and effort on insignificant items like your employer or address.