Do you need to remove foreclosure from credit report history? Getting a foreclosure removed from your credit reports requires time and patience. You can challenge it, but you’ll need the proper documents to prove that it shouldn’t belong on your credit report.
You may be able to delete a foreclosure from your credit reports if:
- The foreclosure is older than seven years
- The lender isn’t in business any longer
- You possess a voluntary dismissal
- There is a shortage of available documents
What Can I Do to Get an Inaccurate Foreclosure Removed from Credit Report?
Follow the steps below to guarantee you have the best odds of eliminating an inaccurate foreclosure from your credit reports.
Step 1: Discover Errors on Your Credit Reports
First, you’ll need to collect your most credit reports from Experian, TransUnion, and Equifax. You’re authorized to receive a free copy of each credit report every year from AnnualCreditReport.com. You must check all three reports considering your scores and information will be somewhat different for each.
Make certain to look for:
- The foreclosure balance
- All dates associated with the foreclosed account
- Complete account number
- Name of the bank
If you find any mistakes, reach out to the credit bureaus directly to initiate a credit dispute. You should identify what accounts you are disputing, explain why you’re disputing the information, provide proof, and demand that it be deleted or corrected. The Federal Trade Commission provides a sample letter you can use to get started.
The credit reporting agencies are obligated to investigate your dispute within 30 days. They have an additional five days after their investigation is complete to communicate their findings to you. The Fair Credit Reporting Act (FCRA) gives them the leeway to increase this time in some circumstances slightly.
Step 2: Write a Letter to Inform the Lender
In addition to informing the bureaus, you should also contact your lender and tell them about the inaccuracies. Include all of the same details as you did in your initial letters to the credit bureau. Lenders, too, are obligated to investigate your disputes.
Step 3: Consider Hiring Professional Assistance
If you’re unable or don’t want to devote the amount of time and effort it may take to complete the process, a credit repair service like CreditStryke could be your most reliable resource for removing a foreclosure from your credit report.
It’s essential to have someone on your side who frequently works on credit repair circumstances like yours and is familiar with the complex details involved in the process. For instance, credit repair companies are more inclined to know what kinds of documents are required to prevail with a dispute.
How a Foreclosure Affect Your Credit Scores
A foreclosure means you were at least several months late on your payments before the foreclosure, which leads lenders to believe you may not pay them back. A foreclosure can lower your credit score by up to 165 points. Thankfully, the negative impact of a foreclosure on your credit reports becomes less severe on your credit report as time passes.
How Long Will a Foreclosure Stay on Your Credit Report?
Foreclosures typically remain on your credit reports for at least seven years. Foreclosures can impact your eligibility when looking for a place to live.
Do Short Sales Affect My Credit Score?
According to Experian, short sales, which are basically settled debts, are almost as damaging to your credit score as a foreclosure.
A short sale is your last recourse before your home ultimately goes into foreclosure. You do need approval from your lender to sell your home for less than what is owed, which the lender may or may not allow.
The appearance of the short sale on your credit reports will depend on how the bank reports the short sale. If the mortgage gets reported as paid, you may not see a change in your credit score at all.
How Long Will a Short Sale Stay on Your Credit Reports?
Short sales are similar to foreclosures and typically stay on your credit reports for up to seven years. However, it won’t appear on your as a “short sale.” Instead, your mortgage might be reported as “settled.”
Can I Buy Another House With Foreclosure on My Credit Report?
Yes, it is possible to purchase a house even with a foreclosure being reported on your credit report, though it is challenging. Most likely, you won’t be able to buy a house immediately after a foreclosure. You will be required to wait a few years before you qualify for another mortgage.
It may be beneficial to partner with a mortgage broker who can help you secure other options, like government-supported loans.
A foreclosure can also make purchasing a home more expensive. Lenders will view you as a higher risk and likely charge you much higher interest rates and associated fees. However, it is possible to get a mortgage with bad credit as long as you’re willing to pay higher fees and down payment.
Removing Foreclosures With a Credit Repair Company
There are several benefits to employing a credit repair service to help you remove a foreclosure from your credit reports. You can save time and a ton of money, and you will most likely have a greater chance of removing the foreclosure.