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How can I get debt discharged in my bankruptcy taken off my credit report? A bankruptcy does not remove credit information. A credit report may continue to show payment history before the bankruptcy was filed. It should, however, also show that the debt has been discharged. While the listing for most creditors will be changed upon the discharge, on occasion this does not happen and you will need to take steps to correct the listing.


To correct the information on the credit report, you will need to:

 

1. Obtain a current copy of your credit report. You can easily obtain a copy of your credit report for a small charge, or even free under some circumstances.

 

a. Annual free credit report.  Federal law requires that each credit reporting agency provide you with a free credit report once a year.  Check with our Free Credit Report page for more information.

 

b. Free report when credit has been denied. If you have been denied credit within the last 60 days, you may receive disclosure of the credit file at no charge. To obtain the report, you will need to contact the credit agency that made the report.

 

c. Purchasing your credit report. You can purchase a copy of your report for a small charge. Credit Data Southwest, Inc. accepts requests for reports by phone at (602) 252-6951, by mail or fax, or in person from their offices in Phoenix and Tucson offices (addresses are given at their phone number). You may also obtain credit reports by phone and on line from Experian [800-682-7654] (formerly TRW) www.experian.com, Equifax [800-685-1111] www.equifax.com and Trans Union [718-459-1800] www.transunion.com. Some web sites allow corrections to be requested on line. Since there are three major credit reporting agencies, you may need to correct three reports. You may find it more convenient (although slightly more expensive) to order a combined report from Credit Data Southwest.

 

2. Make a list of errors on the report. In addition to correcting a listing not showing the discharge, you may want to remove as much other adverse information from the report as possible. Make a list of all information which should be removed. This includes not only errors, but old adverse information.

 

The Fair Credit Reporting Act (15 U.S.C. 1681 et seq) places limits on how long negative information can stay in your credit report. The length of time depends on the nature of the activity and credit being applied for:

 

Lawsuits, paid tax liens, accounts sent for collection, criminal records and any other adverse information can stay on a credit report for up to seven years from the date of the last activity on the account. If you received a discharge in bankruptcy, the last action on the debt which you listed in your schedules should be the date of bankruptcy discharge.

 

Bankruptcies can stay on a credit report for no more than ten years from the date of the last activity. Although the date of the last activity for most bankruptcies is the date you receive your discharge (or the date it was dismissed if you never receive a discharge), credit bureaus usually start counting the ten-year period from the filing date.  We are also advised that the more common practice is to remove Chapter 13 bankruptcy information after seven years.

 

If you apply for $50,000 or more of credit or insurance, or if you apply for a job with an annual income of at least $20,000, adverse information may be reported indefinitely. However, the more common practice is to permanently delete all negative information after the applicable seven or ten year period.

 

Also look for:

 

Incorrect or incomplete name, address, phone number, Social Security number or employment information.

 

Chapter 13 bankruptcy not identified by the chapter number.

 

Credit inquiries (requests by companies for a copy of your report) older than two years

 

Accounts that are not yours.

 

Lawsuits you were not involved in.

 

Incorrect account histories such as reports of late payments which were actually paid on time.

 

Closed accounts incorrectly listed as open (it may look as if you have too much open credit).

 

Accounts you have closed that do not have a "closed by consumer" notation.

 

3. Make a written request to correct the report. Complete the "request for reinvestigation" form which was enclosed with your credit report, or if there was no form with the credit report, send a letter. List each incorrect item and explain exactly what is wrong. Be sure to keep a copy of your request for reinvestigation. Once the credit bureau receives your letter, it must reinvestigate the matter and respond to your request within a "reasonable time," usually interpreted as 30 days. If you do not hear from the bureau within 30 days, send a follow-up letter. If you let them know that you are trying to obtain a mortgage or car loan, they can do a "rush" verification.

 

If you are right, or if the creditor who provided the information can no longer verify it, the credit bureau must remove the information from your report. The credit bureaus will often remove an item on request without an investigation if rechecking the item is trouble than it is worth.

 

If the credit bureau insists that the information is correct, you may want to contact a credit bureau representative at the phone number listed on the credit report. If they advise that the creditor claims the information it has reported is correct, you will need to contact the creditor and ask that they correct the report they have made to the credit bureau. Write to the creditor's customer service department, vice president of marketing, and president or CEO. If the information was reported by a collection agency, also send the collection agency a copy of your letter. Be sure to keep a copy of your letter.

 

If you feel a credit bureau is wrongfully including information in your report, or you want to explain a particular entry, you have the right to put a 100-word statement in your report. The credit bureau must give a copy of your statement or a summary of it, to anyone who requests your report.

 

If a credit bureau employee violates the law, you can complain to the Federal Trade Commission, 6th & Pennsylvania Avenues, NW, Washington, DC 20580. Complaints should be in writing and should include the name of the credit bureau, its address and phone number, the name of the employee you dealt with, the nature of the problem, the dates of your contact with the credit bureau and copies of documents that pertain to the problem. It may be helpful to send a copy of this letter to the credit bureau.

 

If you were seriously harmed by the credit bureau's improper action (for example, it continued to give out false information after you requested corrections), you may sue. The Fair Credit Reporting Act lets you sue a credit bureau for negligent or willful noncompliance with the law within two years after the bureau's harmful behavior first occurred. You can sue for actual damages, such as court costs, attorney's fees, and lost wages. In the case of truly outrageous behavior, you can recover punitive damages (damages meant to punish for malicious or willful conduct), but punitive damages for violating federal law may be limited to $1,000. It is not an easy case to win, and you will need good evidence including complete documentation of repeated abusive.

 

The fees for Chapter 7 and 13 do not include any action to correct credit report information. Additional fees will be incurred in dealing with creditor compliance issues and will require a retainer to be paid in advance of services being rendered.