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How to Repair Damaged Business Credit

Credit Suite - Friday, October 24, 2014



Many business owners think they have items reporting on their business credit reports that really aren’t reporting. But over 90% of trade vendors don’t report to the business credit reporting agencies. So chances are good that the negative information you think is on your report might not even be there. 

Obtain Business Credit Reports is to know whats on your business credit you should obtain business credit reports from the main business credit reporting agencies.

Business Credit reports are offered by:

·         Experian

·         Dun & Bradstreet

·         Equifax

You will first want to get a copy of your business credit reports to see what is being reported.

You might have already heard of the FCRA. The Fair Credit Reporting Act outlines consumer’s rights to dispute inaccurate information on their credit reports. But it’s essential to know that this law does NOT apply to business credit repair.

There are currently no laws which outline business owner’s rights regarding credit disputing. The FCRA also requires credit issuers to notify you of what bureaus they pulled your credit data from to determine your denial for financing. In the business credit world this is not the case, you rarely ever know the source pulled your business credit or which reporting agencies they pulled it with.

If you see accounts or details you don’t recognize or you feel are inaccurate, request a debt validation for that account using a debt validation letter. A debt validation is where you solicit the creditor for verification of the account details they are reporting. They will typically send you back details of your account that they are reporting.  The FCRA and the fair debt collections practices act apply to consumer debts, not business debts. So you can send a debt validation letter, but the creditor is not required by law to respond to your dispute.

When sending a debt validation request, your request must be sent to the creditor in writing. Also insure you dispute the debt with the credit reporting agencies if the creditor doesn’t respond to your request. If no response is received within 30 days of mailing the letter directly to the creditor, then you should then dispute the account with the business credit reporting agencies.

To dispute a debt with the business credit reporting agencies, first contact customer service with any of the three reporting agencies for billing disputes, challenging payments and outdated public filings that appear on your reportWhen you dispute an item the business reporting agencies will have vendors re-verify payments and remove charges if the vendor cannot verify the information.

The business credit reporting agencies can also help to clear up issues that have been settled or dismissed, yet still appear in your report.  You may be asked to send in documentation to verify a settlement or dismissal. The business credit reporting agency will then recheck the status of the public filing if you do not have documentation.

iUpdate… from Dun and Bradstreet provides US based Small Businesses and Non-publicly traded companies convenient access to D&B's information on their business. Registered users can view, print, and submit updates to their D&B Business Information Report. 

Many business owners don’t know that credit monitoring services for Dun and Bradstreet reports are actually provided by a private company known as D&B Credibility.

Equifax Business also has an online system for credit disputing that they provide through their online credit monitoring platform in their member center under “Disputes”.  Keep in mind, the business credit reporting agencies may not be allowed to release the name of the person making the negative reference on your report.

REMEMBER, you don’t have the same rights as you do with consumer credit reporting as there is no Fair Credit Reporting Act. However, you can contact customer service to discuss the item on your report as well as your options.

If your debt validation and investigation don’t net you the deletion of the derogatory item, next you need to contact the creditor. Find out from them what you must do to have the item removed from the business credit report. Usually, they will remove the account if you pay the outstanding debt. 

The main reason for a derogatory item to be on the report is usually because the creditor feels there is an outstanding balance that you owe them. So they will typically remove the account if you pay the outstanding debt.  If you reach an agreement for deletion, get the agreement in writing. And insure they provide you a time frame of when they will correct the damage on your report.

Business credit scoring is based on how you pay your bills. If you pay the majority of reported accounts on time or early, you will have a good score. Most business owners have little to no credit reporting. So even one negative account can have a BIG impact on their business credit score.

It is essential that you continuously build your business credit profile just as you do with your consumer credit. One of the best ways to battle negative information on your report is to offset it with LOTS of positive information. So continuously build your business credit profile just as you do with your consumer credit.

Click Here to watch a video with all of the necessary details.

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