How to remove black marks and defaults on your credit report

Check your credit report for mistakes and learn how to identify and correct negative entries.

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Maybe you’ve been refused credit and found out your credit score is way lower than you expected. Or you’ve missed a few payments and are wondering if you can erase them from your credit report.

Whatever your circumstances, having a low credit score can be expensive, especially if you’re considering borrowing money or buying a car or a house, so you should do all you can to improve it. Unfortunately, there are no easy fixes, but checking your credit history, correcting mistakes and committing to healthy financial behaviour (plus reading this guide!) are the first steps in the right direction.

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How to remove blemishes and credit report errors

A negative item on your credit report can only be removed if the information listed is inaccurate or if it’s outstayed the rightful duration. When legitimate black marks are on your credit report, the only thing you can do is give them time and wait for them to be removed – most negative marks stay on your report for six years.

To improve your chances of clearing inaccurate marks from your credit report, follow these three steps:

Step 1. Get a copy of your credit report

To kick things off, request a copy of your credit report from any or all of the credit reporting agencies: Equifax, Experian and TransUnion (formerly Callcredit). Once you’ve received a copy (or copies) of your credit report, start looking through your history to identify any black marks or defaults.

Keep in mind that the details on your credit report may vary between each agency, so cross-checking between reports to confirm complete accuracy is recommended.

Step 2. Identify the black marks and defaults

The term “black mark” refers to any information on your credit report that may throw up a red flag for potential lenders. Some black marks can have a worse impact than others, for example, defaults can have more of a detrimental effect to your credit score.

When you receive your report, these are the negative items to look for:

  • Being at your credit limit. Regularly borrowing as much as you can (for example, up to your credit card limit) could mean you’re in financial difficulties and send a negative signal to potential lenders.
  • Missed payments. Your credit report retains negative payment history for up to six years. This means any missed payments on your mortgage, loan or credit card will likely show up on your credit report, lowering your credit score and hurting your chances of obtaining new credit.
  • Defaults. A default is when a lender closes your account (for example a credit card) because you’ve missed too many payments (usually in the course of three to six months). It’ll stay on your credit report for up to six years.
  • Individual voluntary agreements (IVA). If your debt gets too high for you to be able to pay it back, you could be able to enter an IVA, which is basically an agreement with your creditors: they’ll write off part of your debt if you commit, for example, to pay back a certain amount every month. An IVA severely impacts your credit score (again, normally for six years) and your ability to get credit, as lenders will often see you as a high-risk borrower.
  • County Court Judgments (CCJ). If you fail to repay money you owe, you may be issued a court order. Once you receive one, it’ll stay on your credit report for 6 years unless you pay it back in full within 30 days after you’ve received it.
  • Bankruptcy. If you can’t come to an agreement with your creditors, you may have to file for bankruptcy. Again, this will show on your credit report for six years and heavily impact your chances of borrowing money.
  • Credit inquiries. Credit inquiries (including personal loans, mortgages and credit cards) usually remain on your credit report for 12 months, regardless of whether they’re approved. They’ll have a much lighter impact on your credit score than any of the above black marks, but they still send a negative signal to potential lenders because if you make too many applications, it may look like you’re desperate for credit. That’s why it’s important to space out your applications and only apply for credit you have a high chance of being approved for.

Step 3. See if you can remove the black marks and defaults

Removing the black marks and defaults is a long process and in most cases there is nothing you can do except wait for the six years to pass.

However, there may occasionally be mistakes in your credit report that could be damaging your score. After you’ve requested your report and identified the negative items, here’s what you should do:

  • Check for incorrect listings. Lenders can sometimes make incorrect listings by mistake. For example, they may report the same debt twice, list it on the wrong person’s account or incorrectly list a debt as a default.
  • Report any errors. If you come across any errors on your credit report, you can initiate an investigation by filing a dispute with the credit reporting agency or agencies that have this mistake on file. The credit reference agency will verify your claim, contact the lender and if you’re right, amend your report.
  • Add a notice of correction to your credit report. If you report an error in your credit report but your claim isn’t accepted, the credit agencies will still allow you to argue your side with a 200-word-long notice of correction you can attach to the report. It won’t help your credit score, but lenders will be able to see it.

If, instead, the report is correct, fixing your credit score will probably be much harder work. It’ll involve waiting for the worst black marks to “expire” and maintaining a healthy financial behaviour that can have a positive impact on your credit score throughout. Consider:

  • Negotiating with your credit provider. If existing credit accounts are part of the problem, get in touch with your credit provider and try to negotiate a repayment plan that’s manageable for you. This will help reduce missed payments and prevent debts from becoming defaults on your credit report.
  • Getting external help. Debt problems can be really difficult to manage by yourself. Consider, for example, going to Citizens Advice for help. It will be able to point you towards the right direction.

What about credit repair agencies?

Credit repair agencies will go through your credit reports for you, analyse them, look for any potential mistakes and help you have them corrected if they find any. In some cases, they’ll also advise on what to do to improve your credit score, even if there are no visible errors. However:

  • They’re costly to hire. Weigh up the costs of credit repair against the possible value of the service. For example, the long-term benefit of a mortgage with favourable terms outweighs the short-term costs of hiring a credit repair specialist. But the benefit depends on the service being successful.
  • No guarantees. The agency will investigate your listings but cannot offer any certainty of removing them.
  • Some charities will give you debt advice for free. If you have a debt problem, your credit score is more the consequence than the cause of it and a credit repair agency may not be the best way of seeking help. A specialised charity or in some cases a debt management company will be a better option.

Consider your credit report carefully and what may be realistically achieved through a credit repair agency before you take on the expense of this service.

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