Step 1: Decide whether the collection is accurate or wrong

Start with one question: is the information on the report true? The CFPB says you generally cannot have negative information removed from your report if it is accurate. It also says most negative information stays on a report for seven years.

A dispute is for something that is wrong. The CFPB's list of common errors includes an account that belongs to someone else, an incorrect balance, wrong payment, opening or delinquency dates, an account incorrectly reported as late or delinquent, and the same debt listed more than once, possibly under different names.

For a collection, that turns into five questions:

  • Ownership: Is this debt yours at all?
  • Balance: Does the amount match your records?
  • Status: Is it shown as unpaid when your records show a payment?
  • Duplicates: Is the same collection listed more than once, for example by two collectors or under two slightly different names? One entry from the original creditor and one from a collector for the same debt is not by itself a duplicate.
  • Dates: Is the date the delinquency began correct?

If your honest answer to all five is "the report is right," a dispute letter is the wrong tool. You can still ask a collector for information about the debt, covered in Step 4.

Step 2: Gather your records before you write anything

Get your reports first. The CFPB says you can review a free report online from each of the three nationwide bureaus once a week at AnnualCreditReport.com, and that checking your own report has no effect on your score.

Use this checklist for each collection entry:

  • The report page with the entry marked, and the report date
  • The collector's name and the original creditor's name, as the report shows them
  • The reported balance and the date the account was opened or assigned
  • The date the delinquency began, as the report shows it
  • Any letters from the collector, with the date you received each one
  • Statements, receipts or bank records from the original account
  • Proof of any payment, or an identity theft report if the account is not yours
  • A dated log of every call, letter and reply

Write down the field that looks wrong and the record that shows what is true. "The report shows $410 and my last statement shows $0" is something you can support. "This is wrong" is not.

Step 3: Know the two different disputes

People often mix these up. They are two separate processes.

A credit reporting dispute asks a credit bureau, and the company that supplied the information, to check what appears on your report. It is about the report.

A debt collector dispute asks the collector for verification of the debt. It is governed by debt collection rules, not by the credit reporting rules, and it is about the debt.

You can use one, the other, or both. Each has its own steps and its own deadlines, covered next.

Step 4: Dispute the error with the bureau and the company that reported it

The CFPB says to dispute with the credit reporting company, and then with the company that provided the information. A written dispute should include your contact details, each error you want investigated with the account number, a clear explanation of why you are disputing it, and copies, not originals, of supporting documents. Send one to each bureau that shows the error.

Under the FCRA, a bureau must conduct a reasonable reinvestigation, generally within 30 days of receiving your dispute. That can extend by up to 15 days if you send relevant new information in the first 30. If you dispute after getting a report through the free annual disclosure, the period is 45 days. Within five business days the bureau must notify the company that reported the item.

If the investigation finds the item inaccurate, incomplete or unverifiable, the bureau must delete or modify it. If not, the entry can stay. A bureau may also stop investigating a dispute it reasonably decides is frivolous or irrelevant, including when you did not give enough information.

The CFPB says furnishers generally must investigate and respond within 30 days. It suggests certified mail so you have proof of receipt. Keep a copy of everything you send.

Step 5: Ask the collector to validate the debt

The CFPB says a debt collector must give you validation information in its first contact or within five days. That includes the creditor's name, the amount you owe and how to dispute. Under Regulation F, the notice must also itemize the current amount, reflecting interest, fees, payments and credits.

You have 30 days after you receive that information to dispute all or part of the debt. The CFPB says that once you dispute, the collector cannot call or contact you to collect until it responds with verification of the debt. Regulation F says the collector must cease collection of the disputed debt until it provides verification. Send your dispute in writing, by certified mail with a return receipt, and keep a copy.

If more than 30 days have passed, the CFPB says it is still a good idea to ask for what you need. The CFPB also offers a sample letter to a debt collector for when you do not recognize a debt.

A fictional example

Maya Example sees "Sample Recovery Co., collection, $410" on her report. She has no record of owing it. She checks her files and finds a utility bill with the same amount that she paid in March, and she has the receipt.

She does two things. She writes to each bureau, names the entry and encloses a copy of the receipt. She also writes to Sample Recovery Co. within 30 days of its notice, disputes the debt and asks it to name the original creditor. She sends both by certified mail and keeps copies.

Maya cannot know the answers in advance. A bureau may change the entry, or the collector may verify the debt and the entry may stay. Either way she has a dated record and knows what her next options are.

What this guide does not cover

  • Accurate collections. The FCRA generally limits how long a collection can be reported to seven years, and the period begins 180 days after the delinquency that came before the collection activity. A collection that is accurate and inside that period is not something a dispute is built to change.
  • Time limits on lawsuits. A statute of limitations is a time limit on using legal action to collect a debt. It is a different clock from credit reporting, and it varies by state. The CFPB says collectors cannot sue or threaten to sue once it has passed, but may still try to collect by letter or phone. It also says that in some states a partial payment or acknowledging the debt can restart the clock, so check your state's rule or ask a lawyer before you pay or sign anything.
  • Whether to pay. That is a separate financial decision and this guide does not advise on it.

Where DisputeGoat fits

You do not need DisputeGoat, or any paid service, to dispute an error on your credit report.

DisputeGoat is a self-service workspace for organizing a report review and preparing editable letters about the items you choose. It is included with a Goat Monitoring membership, $39.95 per month, billed by Goat Monitoring. You print, sign and mail every letter yourself and pay your own postage. DisputeGoat never contacts a creditor or bureau on your behalf. It is not a credit repair organization, a law firm or a financial advisor. No outcome or score change is guaranteed.