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If you are hoping to make a major purchase or secure a loan for something big like a house, then you know how important it is that you clean up your credit. These days, even if you are trying to get a small line of credit or land a new job, it is important that you have a clean credit report. Some prospective employers may request permission to run your credit, and if you refuse, know that you won’t get the job.

It is easier than ever to get your credit taken care of, although it does require perseverance and diligence. For one thing, you can get your credit reports for free once a year from the three major reporting agencies: Experian, Equifax, and TransUnion. You can get them all in one spot at annualcreditreport.com, by filling out their online form and giving some unique identification information. You can also get your reports by telephone or with a letter.

Once you get your reports, look them over for errors including items that have not been removed after seven years, and items that were charged to you but were never authorized by you. Make sure any credit card companies have not overcharged ...
... you for annual fees or unexpected finance charges, and make sure that all the payments you have made over the years have been correctly applied and reported. If you find any errors, you will need to write a letter to the reporting agency, using a sample letter like those supplied by CreditElves.com. This letter will detail the mistake, list your account number and Social Security number, and have you supply any supporting documentation that will prove that the charge is erroneous and needs to be corrected.

Once the credit reporting agency gets your letter, they have thirty days to make a decision and let you know the results in writing. If they agree with you, they have to notify the other reporting agencies and the original creditor that the item is incorrect and needs to be noted on your credit report. Follow up afterwards to make sure the items have indeed been changed or removed; if not, follow up with another letter.

If the credit reporting agency finds against you, you might try working directly with the creditor with whom you have the dispute. Try contacting them and stating your case, and ask how you can either make alternative payment arrangements or see if they will drop some finance charges or percentages. If they will not, then ask if they will be amenable to dropping the total amount to something that is more within your means. If they refuse to work with you at all, then you might have to settle for sending them whatever you can every month and just ride out the seven years’ toll on your credit report. It’s not the ideal option, but it might be the best you can do.

It is not the easiest thing in the world to clean up your credit, but in the long run it is definitely worth the time and effort.