The 100 Word Statement
Many of our credit repair customers ask about their legal right to insert a 100 word statement into their credit report. Being in the credit repair business we understand the frustration that you may feel about the presence of unwarranted derogatory information on your report, but we advise against the insertion of statements.
Your FCRA Rights
The Fair Credit Reporting Act requires the credit bureaus to accept and publish a statement from consumers in the case that an item has been disputed and verified by a creditor. To wit:
Section 611 (b): “Statement of dispute. If the reinvestigation does not resolve the dispute, the consumer may file a brief statement setting forth the nature of the dispute. The consumer reporting agency may limit such statements to not more than one hundred words…”
Tips for Writing Your Statement
Use dates, names, and other supporting evidence to explain clearly what happened and why it led to your credit being dinged. Sullivan gives this an example statement: “Company X claims they never received payment. I mailed the check on X date and have a copy of the canceled check from my bank. My 3 calls between X date and X date to service representative X have gone unreturned.”
If a tragedy in your life has led to missed payments for bills, explain simply the nature of the event with the facts and circumstances. You may not want to give potential future landlords a sob story that could negatively influence their decision.
3.Don’t make excuses.
No need to get into a long-winded explanation about how your ex-boss was a jerk and that’s why you lost your job, or that your brother-in-law never paid you back the money he owed you.
Your 100-word explanation will stay on your credit report unless you ask for it to be removed. Everyone who accesses the report will be able to read it, including future employers. Poor spelling or bad grammar won’t derail your credit, but it might not help your case either.
Do creditors read the 100-word statement?
The Fair Credit Reporting Act gives consumers the right to add a brief statement to their credit reports explaining disputed items. Our experience has shown, however, that these statements are at best unhelpful, and at worst, damaging.
Many misinformed credit experts suggest using this statement to explain your side of the story when a negative item on your credit reports is lowering your credit score. Unfortunately, because human eyes rarely read through the details of your credit reports, this explanation most likely will have zero effect on a creditor’s opinion of your creditworthiness.
Even worse, when you add a statement on your credit reports such as “these payments were only late because there was a problem with the company’s automatic withdrawal system”, it can be interpreted as an admission of guilt. If you try to dispute the item in the future, the credit bureaus will not need to bother contacting the credit grantor to determine the accuracy of the negative item because your credit statement already admits you were late in making the payment.
Because of their ability to hinder your credit repair efforts, we suggest making 100-word statements the first things you delete from your credit file.