Credit Repair Summit

FACTUAL TECHNICAL DISPUTE

METHODOLOGY
By Joshua Carmona

TABLE OF CONTENTS
Part 1 Credit Repair and the Consumer
I. Background and Introduction to Credit Repair 1
II. The Fair Credit Reporting Act (FCRA) 3
III. Credit Repair Organization Act (CROA) 4
IV. Re-Active Credit Repair Legacy Model 5
A. The Method 5
B. The Implications 5
V. Pro-Active Credit Repair Model 7
A. The Method 7
B. The Implications 7
VI. Credit Reporting Agencies and the Processing of Disputes 8
VII. Consumer Understanding and Misunderstandings 9
VIII. The Custodians of the Credit Report 10
IX. Credit Report Violations 11
X. Consider the Statistics 16
XI. Meet the Need 17
Part 2 Meeting the Need
XII. Classic Dispute Technique 20
XIII. Strategies and Tactics Make You Feel Secure 22
XIV. ScoreWay Credit Repair Organization Dispute Process 25
XV. ScoreWay 27
A. The Deliverable 27
B. The Spun Template 28
C. The Template Types 28
D. The Processor Trade Line Analysis 28
XVI. The Anatomy of A Dispute Letter 29
XVII. Scores Policy 34

Part 1
Credit Repair and the Consumer
BACKGROUND AND INTRODUCTION TO CREDIT REPAIR
Why choose the Credit Repair Business? There are a multitude of lucrative
industries out there, what is it that makes the Credit Repair Business so attractive?
Statistics tell the story. The Wall Street Journal explains that over 43 million
Americans have a FICO score of 599 or less. That is 25.5 percent of the adults in
America. In 2006, the United States Public Interest Research Group reported that 79
percent of credit reports contain errors. Of those, 25 percent have errors that can
cause a denial of credit. In 2009, the National Consumer law Center in a study
called Automated Injustice released information claiming that the lowest estimate
indicated that 25 percent of consumers' credit reports contain errors. This statistic
indicates that six million Americans possess serious errors on their credit reports.
In another report, Zogby Interactive found that 37 percent of consumer credit
reports contained errors and 50 percent of those errors could be easily corrected.
Correctly stated, they could have been done with a simple click of a button on an
online dispute platform or they could have been done correctly from the start.
Sadly, that is not how the system works.
The National Credit Reporting Association found that 29 percent of credit reports
among the big three credit reporting agencies (Experian, Equifax and Trans Union)
had as much as 50 percent difference (or more) between the highest and the lowest
score. It is an incredible statistic and it means that right now with all these
statistics, there are numerous errors present on consumer credit files. When
correlated with a FICO score, the effects of these errors are compounded with the 50
percent variance between consumer high and low scores. Now once you consider
the range that creates for consumers - 50 points could be the difference in
qualifying for a home and obtaining the loan to purchase it, being offered a federal
job or not and so much more.
The Federal Trade Commission, in December 2012, determined that 26 percent of
consumers reported a material error on one or more of the big three credit reporting
agencies. If you calculate the figures - there are approximately 200 million credit
reports managed by the credit reporting agencies and that extrapolates to 20
percent which is 40 million Americans. These forty million Americans, on average,
have errors on their credit reports that could potentially cost them a 50 point
variance between them and others within the same group. If you recalculate, and
assume that one half of that number is correct, it's still 20 million Americans. Those
20 million Americans are potential clients for your credit repair business. It is an
incredible opportunity to generate a vast amount of revenue while you help others
improve their lives.

In 2013, a judgment was issued against Equifax for the sum of $18.6 million. From
2009 to 2011, Oregon resident, Julie Miller tried multiple times to get her Equifax
Credit report corrected. Miller first became aware of the errors in 2009 when she
was denied credit by a local bank. She requested her credit report and upon
receiving the copy she discovered incorrect identifying information, including social
security number and birthday as well as degrading collection accounts. She
contacted Equifax repeatedly to dispute the errors. Each time she was told by
Equifax that she needed to provide further information. She did. In 2010, she was
denied credit again based on her Equifax Credit report. She continued to file
disputes and was told her file had been combined with that of another creditor.
Equifax told her she would have to dispute the accounts with the creditors. Her
reputation was damaged, her privacy was breached and shared and she lost
potential opportunities.
After eight failed attempts to correct her information, she filed a lawsuit against
Equifax in October 2011. The suit was settled in her favor and she won an $18.6
million settlement after Equifax failed to correct her credit report. It is the first
settlement of its size. These errors were small and could have been easily corrected.
She did not have major errors, but multiple small errors. It is not a number that
correlates to the damage she incurred, but is rather a statement to all the credit
reporting agencies that too many American consumers are experiencing errors on
their credit reports and being adversely affected because of the errors. It affects not
only what they can do but also prohibits them from getting what they need when
they need it. It represents a failure in what the credit reporting system was built to
do.
THE FAIR CREDIT REPORTING ACT (FCRA)
The Fair Credit Reporting Act (FCRA) was enacted in 1970. The Fair Credit Reporting
Act is the legislation regulates the collection, dissemination and use of consumer
information, including consumer credit information. It not only protects consumers'
rights, but also provides the responsibilities of any and all companies who utilize
consumer information. This includes credit reporting companies and credit bureaus
as well as any agency that collects, stores, compiles, disseminates, or utilizes credit
reports including

Employee background reports

Tenant screening reports
Insurance reports
Bad check and overdraft reports
Court records
Consumer credit Personal information and any other reports related to
consumer information.

The Fair Credit Reporting Act includes these guidelines and states that the
information contained in consumer reports must be 100 percent verifiable,
accurate, and free from error. Credit repair business or any company who uses this

information must be able to ask and answer these questions, "Is it correct? Can it be
verified? Can it be substantiated?"
That being said, the regulators who created the Fair Credit Reporting Act is already
defined and signed by the two participating parties. Rather, the FCRA regulators
wanted to ensure that the information gathered during the transaction is
maintained accurately so that if a customer has an issue, he or she has a simple
way to challenge the information, without jumping through innumerable hoops to
get correct information on the report. Prior to 1970, there was no legislation in place
to give a consumer those protections making this one of the most important pieces
of consumer legislation in history.
The Fair Credit Reporting Act requires 100 percent verifiable information on behalf of
American consumers. Consumers aren't required to explain - "These dont belong to
me" or "It's not mine" or 'It's been paid as agreed" because the information must
verified as accurate or the consumer reporting agency is required to remove it from
the report. If an item is removed, it's erroneous.
The Fair Credid Reporting Act also defines the dispute process for consumers,
creditors, and the credit reporting agencies. It essentially defines the process a
consumer should follow to dispute the information directly with the credit reporting
agencies. Through the amendment and factors 312 - 623, the FCRA further defines
how consumers can directly engage their creditors as well.
CREDIT REPAIR ORGANIZATIONS ACT (CROA)
After 1970, the enactment of the Fair Credit Reporting Act proclaimed that
consumer information had to Unfortunately, the problem was that some were
handling the process correctly and others were not. The result was that many
consumers were taken advantage of by less than truthful promises of results that
were impossible to constantly attain. Customers and their funds were being
compromised. In 1996, the Federal Government stepped in to protect consumers by
enacting the Credit Repair Organizations Act (CROAJ. This Act was essentially an
extension of Title 4 of the Consumer Credit Protection Act and its intent was to
protect prospective buyers of credit repair services from unfair and deceptive
practices.
The Credit Repair Organizations Act also prohibited fraudulent advertising from
credit repair organizations and disallowed the collection of fees in advance of the
execution of the services. For consumers, a written agreement for credit repair
services must be executed. These contracts must contain at least two items - a
notice of cancellation and a statement immediately above or below the signature of
the agreement. Also included is a section 405 disclosure, which is the federal
disclosure of rights. The 405 disclosure states that the consumer can perform the
information dispute himself without the use of a credit repair organization. A clear
description of pricing and services to be rendered is required with each new
contract.

RE-ACTIVE CREDIT REPAIR LEGACY MODEL

The Method
The Re-active Credit Repair Legacy Model is a 45 day dispute cycle. In this model,
the credit repair organization (CRO) prepares disputes and issues them to the Credit
Reporting Agencies (CRAs).
The credit reporting agency accepts the dispute and issues an Automated
Consumer Dispute Verification code (ACDV) based on their interpretation based on
their interpretation from the disputes. The creditor named in the dispute receives
the ACDV through E-Oscar, the system platform used by data providers and credit
reporting agencies to communicate with one another. The creditor investigates the
dispute and returns a response via E-Oscar to the Credit Reporting Agency. The CRA
then updates the consumers file and sends the consumer the results of the
investigation. The consumer receives the results and sends them to the credit repair
organization. The credit repair organization receives the results, updates the results
and disputes again if necessary. If needed, the dispute will be repeated and the
cycle begins again.
From the credit repair organization's perspective, the CRO is always reacting to a
situation that has occurred based on an event the CRO initiated. If the credit repair
organization sends out a dispute on behalf of the consumer, they must wait for the
consumer to return the results creating a disconnect, thus the name Re-active
Credit Repair. Its known as the creating a disconnect, thus the name
Re-active Credit Repair. Its known as the legacy system. It is a process that has
been in place for many years though it does not produce optimal results for the
consumer.
The Implications
However, the credit reporting agencies do not respond at least not all the time.
When this occurs the consumer nor the CRO can view the results for the efforts
occurring 30 days prior. This creates a problem with your clients, the consumers
who hold you responsible for the results they cannot yet see. It, of course, does not
mean you didn't perform the service, but simply that you don't have access to the
results.
In some cases the CRAs will not send investigation results back to the consumer.
Thirty to 40 percent of the time, no results are returned. This is not necessarily an
indicator that the investigation isn't executed, but that they did not send the results.
Other times they dont investigate, they return frivolous responses or they request
proof of ID, social security number and address.
In other instances, the consumer receives a result but does not send the results to
the credit repair organization. In this case, the customer receives his or her results
from the credit reporting agency in the Re-active Credit Repair scenario and fails to
return them to the CRO. This creates a problem because they wont be able to see
the results the following month - because they held onto the reports. Well, unless
the CRO is able to view their credit monitoring account (if they have one), no results
can be provided making this a reactive posture.

As mentioned, the CRAs send frivolous requests and apply stall tactics. They
continually requests proof of identification, proof of social security number, proof of
address, and other duplicitous requests. In most cases it is best for CROs to send
along with every dispute these items - proof of ID, proof of social security number,
and proof of address. Unfortunately the CRAs are either not looking at these
documents or pretending they didnt arrive with the disputes because they just send
back more frivolous responses - inquiring for new dispute these items - proof of ID,
proof of social security number, and proof of address.
Since the dispute cycle takes 45 days; there are additional implications particularly
if you are in the top two credit repair demographics - California and Texas. In
California, there is a mandatory six month maximum contract period which means
you cannot continue to do business with a customer past the six month time frame
under the initial contract which limits your number of disputes that can be made on
behalf of your customer. If you dispute more than every 30 days, you'll begin
receiving frivolous responses more frequently because of the time frame involved
because the CRAs require 30 days to perform their investigation.
If you only dispute once every 45 days or four times in a six month period you will
have a diminished capacity to achieve results for that customer - about 30 to 40
percent because of the limited disputes possible. This in turn increases the cost of
doing business in California. If you are on a monthly model and cannot present the
results promised for your customers, your customer retention will drop. If you're on
a pay-per-delete model, you will not be able to generate enough pay-per-delete
revenue in that condensed amount of time.
In addition, the consumer will want to take the easiest route which is scanning in
documents and sending them to you as images - a jpg, a png, a tiff, or pdf format.
You will have to convert the documents to the proper format so you can use them.
You may also receive an inappropriate document or proof of document creating
further problems. This data sent by the client cannot be copied and pasted from on
a scanned image which means every single entry you are updating will need to be
read and manually input. If the documentation is a tiff document or a jpg, you wont
even be able to copy and paste account numbers. All of this increases your chances
of errors, making mistakes in data entry or handwritten recording systems.
Can one improve efficiency then with regards to Re-active Credit Repair? Yes,
absolutely by simply using Pro-Active Credit Repair.

PRO-ACTIVE CREDIT REPAIR

The Method
Because Pro-Active Credit repair is the best method available to Credit Repair
Organizations, there are fewer steps in the process, making it simpler and reducing
the probability of mistakes, thereby increasing positive results. Pro-Active Credit

repair begins the same as Re-Active Credit Repair with the writing of disputes for the
client and their submission. The credit reporting agencies then assign the ACDV and
send the dispute onto the creditor with the ACDV through the E-Oscar. The creditor
investigates and returns a response to the CRA. The CRA updates the consumer's
file. The difference comes now, when the CRO logs into the client's credit monitoring
service to see the results on the 30th day. The CRA updates the results for the
clients and resubmits disputes as necessary. The results are written and printed
once again along with any new disputes required.
The Implications
The difference in Pro-Active Credit repair is that as a CRO, you are not in a reactive
posture but in a proactive posture because the client has a credit monitoring service
to which you have access. This makes the process straightforward as you can log
into your customers accounts every 30 days and update disputes automatically. You
do not have to wait for your customers to provide needed information and your
customers do not have to provide it, since you have access automatically to
corrections the credit reporting agencies are making as you need them. With Proactive Credit Repair, the process is streamlined giving you the access and control
you need to do the best job possible.
In the earlier example with the customer from California, a mandatory six month
engagement state, you will be able to deliver disputes in all six months with the 30
day cycle of Pro-Active Credit Repair. This means you can deliver greater efficiency
to your client, removing disputed items as necessary. Your probability of success
increases with the 30 day cycle and the direct credit report access via the credit
monitoring service.
This is paramount to your success, because it enables your customers to see the
results quickly and easily. There are no client upsets due to unexpected delays. Your
customers have high expectations for your ability to perform as promised and with
Pro-Active Credit repair, you can deliver. The probability of delete repairs increases
by 30 to 40 percent and your cost of doing business is decreased. You will achieve
the results promised to your clients and retain more customers with this monthly
model particularly if you are on a pay-per-delete model. With Pro-Active Credit
Repair, you will be able to increase your dispute receivables within the first six
months and the only additional cost that your customer incurs is a subscription to a
credit monitoring service throughout the process.
CREDIT REPORTING AGENCIES AND THE PROCESSING OF DISPUTES
It is imperative as a Credit Repair Organization that you and your team understand
how credit reporting agencies process disputes. A dispute letter is prepared and
delivered to the credit reporting agency. Once it arrives, the dispute letter is opened
by a machine that removes the letter from the envelope and places it on a
conveyor, which then feeds the dispute into a scanner alongside its envelope. The

scanner captures an image of the dispute letter and the envelope producing an
image. It then attempts to perform optical character recognition or OCR.
OPTICAL CHARACTER RECOGNITION
OCR converts printed or handwritten material to text files that can be edited via
software and stored in much less space than the original document (in this case the
letter and envelope). The scanner breaks down the type into a bitmap and then
translates the bitmap into computer text. While the process generally works well for
fonts, it lacks in the recognition of handwriting and handwriting fonts. The OCR may
succeed at reading and converting the letter or it may not. If the dispute letter is
found to be a form Letter or a template, a letter downloaded from the internet or
other software, it will be deemed a "match" by the system and subsequently the
letter as frivolous.
If the text is unique, the disputes listed are captured by the OCR and categorized
internally, storing the date for current and future use. After the capture of the
disputed information is completed and stored in the internal system, the system will
initiate an investigation via E-Oscar. Essentially the system has automatically
extruded the data, interpreted the data and produced an ACDV. At this point it
issues an investigation directly to the creditor electronically. The entire process is
completely automated. The computer reads and interprets the letter and OCR is
successful with no human interaction.
If handwritten disputes or some other unconventional methods are used, one would
assume those disputes would be handled by a human being, but the reality is the
credit reporting agencies have no intention of that occurring. The credit reporting
agencies intention is to process all of their disputes electronically. They have
invested substantially in these OCR technologies in order to create an automated
process.
The Issues of OCR
This is the point where the problems begin - at the data furnisher level. It is the
place that errors begin. People - just adding information, doing inquires or inputting
information during loan processing or information requests and pulling credit
reports. Information is entered incorrectly, at the point of inception and the
problems begin. The errors are then proliferated by retrieval of an imperfect data
entry. Later attempts to correct the data are performed in an automated system
creating the second problem.
CONSUMER UNDERSTANDING AND MISUNDERSTANDINGS
False Expectations

Consumers do not understand the process. They are full of false expectations which
become obvious when they arrive in your office and present their questions:
Question One How long will this take?
Question Two Is credit repair legal?
Question Three How much does credit repair cost?
These are inevitably the first three questions of every potential client. Your job is to
explain the process with understanding and gain his or her trust.
Potential customers misunderstand what the dispute process attempts to
accomplish the how and why. They believe the process is ridding negative items
from the credit report and disputing negative items to make the credit report
perfect. That is what most people think when they hear the term credit repair and
credit repair organization. In reality, credit repair organizations are the custodians of
the credit report. You can only promise customers that you will do your best and
that you will satisfy that promise every time.
THE CUSTODIANS OF THE CREDIT REPORT
In the credit repair business, the goal is to provide customer satisfaction. Satisfied
customers are happy to compensate for a job well done and refer new clients to
your company. Then the process begins a new. Unfortunately customers and even
some employees in credit repair organizations believe the credit repair business
consists of deleting or repairing negative items on consumer credit reports, but only
the credit reporting agencies can do that. CROs do not delete or repair, but insure
that each consumer's credit file is 100 percent verifiable and free of error.
It is important that credit repair professionals inform the public, and in particular
customers of this information. The ideal time is during the initial consultation.
Everyone needs to understand the broad strokes of the law as well as why this
service is available and what is permissible and who is eligible to perform these
services legally. This is especially important if you are in a licensed and bonded
state. Consumers should understand that data furnishers are responsible to verify
and validate information as well as perform investigations on the veracity of items
on the credit report when the consumer interacts with them (based on 623 and 312,
FCRA amendment 2010).
If consumers are not informed, they develop a false sense of security coupled with
misunderstandings of the credit repair process and they will attempt to hold you
liable to what they believe to be correct. When you properly educate your
customers they will understand that your credit repair organization is a custodian of
their credit report. You are examining consumer credit reports and your goal is to
make sure the report is correct. You verify that their utilization ratios are
appropriate, and if not you will advise them accordingly.

CREDIT REPORT VIOLATIONS

There are any number of credit report violations that might appear on a consumer
credit report arising from the:
Credit Bureau
Original Creditor
Collection Agency
FCRA
FDCPA.
Within these violations are errors such as:
Willfully or recklessly reporting false information
Erroneous date of last delinquency
Inaccurate status of last activity
Incorrect balance
Imprecise status
Inaccurate remarks
Mistaken late pays
And other common errors.
Reinsertion
Reinsertion is often mentioned on this list, though they are rare occurrences. A
reinsertion requires a five business day advisory from the CRA sent to the consumer
that the item will be re-inserted. While reinsertion is very rare, it is common that
debts are being resold and consumers and credit repair organizations assuming it to
be a reinsertion. It happens frequently with collection agencies including NCO Group
and FINA. FINA has 99 corporations reselling collection debt from one corporation to
the next. On a consumer credit report, it appears to be the same collection agency
but it is not. The name and/or the account number changes or sometimes both. It
often appears that the debt is removed and then reinserted, but it is actually debts
being sold from one collection agency corporation to another
Failure to Respond
Failure to respond within 30 days is another common error. If you have a current
consumer credit report from annual creditreport.com, the response allotted is 45
days. There is even a 50 day extension which can be allotted if additional
information has been provided by the consumer during the dispute process. Keep
this in mind, if the credit reporting agency doesnt request it, dont voluntarily send
it.
Reporting a Bankruptcy Too Long
The time limit for reporting a bankruptcy is 10 years, and a common error is credit
reporting agencies to report a bankruptcy for longer than 10 years.

Reporting a Paid Tax Lien Too Long

Just like bankruptcies, paid tax liens can only remain on a credit report for seven
years from the date of payment. There are exceptions. For example in California,
both paid and unpaid tax liens can remain on a report for 10 years and in New York
the statute of limitations is less than seven years. Each state has different
guidelines and those guidelines are subject to change making it important to know
updated statutes in each state.
For a federal tax lien, the IRS implemented new guidelines in 2011 known as the
Fresh Start Program that helps you help your customers file for a removal. An
agreement can be made quickly and settled in a single day. It can be made in the
form of an offer to pay either a complete offer or compromise, like a settlement. It
can also be made in the form of a payment plan, and once the IRS accepts the
payment plan, the consumer only needs to make three payments through a
dedicated, direct debit income account (DDIA). Once they make three payments,
they can file for an IRS Fresh Start Tax Lien Removal, through Form 12277 for
removal of the lien from the credit report. As a credit repair professional you can
obtain more information at IRS.gov or Scoreway University. This is a valuable
additional service for which to bill your customers.
Failure to Update Report
Failing to update a report is also very common. It often involves an account status
that was included in a bankruptcy where the status and the balance are not
discharged or have a zero balance.
Failure to Provide Requested Information
Credit reporting agencies should provide, if requested at the verification, a method
of verification (MOV), including real name, address, phone numbers, and additional
data furnishers information within 15 days of your initial request.
Reporting a Collection or Charge off Too Long
Reporting a collection or a charge off longer than seven years from the date of the
last delinquency activity is another common error. This occurs when collection
agencies purchase a debt, creating a new account with a new open date. The date
included should be the last date of delinquency of the original creditor. Instead the
collection agency puts in the date they entered into E-Oscar as the new date of last
delinquency.
What does this mean for your customer? For example, consider a credit card that is
six years from the last date of delinquency, when it was reported by the original
creditor. Now, the collection agency purchases the debt, and allots yesterdays date
as the new date of last delinquency. This obviously now affords them seven years

from that day to collect the account. They have re-aged the account, and your
customer can literally have an account affecting his or her credit for six plus seven,
almost 13 years. It is a big credit repair violation and one that occurs frequently.
Failure to Notate a Dispute
Failing to notate an item on your customers credit report that is under dispute after
a creditor or a debt collector has reported it is another common violation. It is
known in the trade as an E8 error.
Ignoring an Investigation Request
Ignoring an investigation request occurs quite frequently. You send dispute letters
on behalf of your customer and nothing happens. Your method of verification, your
debt validation, your good will letter, and your financial hardship letter have all
failed to be acted upon. What happened? Well, nothing happened. Remember,
machines are managing the requests and it is possible that your request was
destroyed in the feeder, the conveyor, or for some reason failed to be read. It may
happen accidentally or through no fault of your own but it is still a violation by the
credit reporting agency.
Willfully and Recklessly Reporting False Information
Willfully and recklessly reporting false information to the credit bureaus after being
notified of a reporting error and failing to investigate or correct the error is the most
common. It is also a violation that credit reporting agencies often blame on
automation and technology.
Reporting Charge-Off Accounts without Reference to the Date of Last
Activity
Reporting charge-off accounts without reference to the date of last activity is
essentially attempting to re-age accounts.
Failure by a Collection Agency to Report Accurately an Account Disputed
By Consumer
Failure to report an account disputed by consumer as disputed to the credit bureaus
is important because if the credit bureaus don't report an account as being disputed
it is a violation. Once you've sent a debt validation letter or a verification letter to a
collection agency it should not be reported as disputed to the credit reporting
agencies according to the Fair Debt Collection Practices Act. Once you send a
dispute, a validation request, to a collection agency then for a period of 30 they are
not supposed to talk to any third parties, including the credit reporting agencies
regarding the account.

Failing To Delete a Hard Inquiry That Had No Permissible Purpose

Failing to delete a hard inquiry that had no permissible purpose is widespread.
Permissible purpose is the permission or waiver that consumers sign whenever an
item is purchased on credit, a home, a car, or a personal loan, or a credit card. The
consumer signs, giving that company or that bank the ability and the permission
(the permissible purpose) to access a credit report for the purpose of approving a
purchasing or obtaining a loan.

Transferring or Selling an Account to another Company without Reporting

the Transfer and Zero Balance
Transferring or selling an account to another company without reporting the transfer
and zero balance occurs frequently. One agency sells to another, now the credit
report shows two accounts with balances instead of one and both accounts probably
reflect incorrect information. A number of big banks sell accounts. In 2013, a
transaction between Bank of America and Chase caused a mass of errors on
customer credit reports for months before it was corrected.
Reporting Charge-Off Accounts without Reference to the Date of Last
Activity
Reporting charge-off accounts without reference to the date of last activity is
essentially attempting to re-age accounts.
Failing to Validate the Debt in Question while Continuing Further Activity
Failing to validate the debt in question while continuing further collection activity is
a common FDCPA violation. Failing to validate any debt in question while continuing
further collection activity once a debt validation letter is sent to a collection agency
is a violation requiring the collection agency to cease and desist. They cannot
continue any type of collection activity or provide information to 3rd parties for a
period of 30 days. If they continue, they are in violation of the Fair Debt Collection
Practices Act.
Reporting a Late Payment When Collection Accounts Are Closed
Reporting a late payment when collection accounts are closed is an FCRA Violation
because a closed account cannot be late.
Verifying an Account with a Credit Bureau Before the Request of Validation
Has Been Completed
Verifying any account with a credit bureau before the request of validation has been
completed is a common violation. If a letter is sent to the collection agency or the
dispute directly to the credit reporting agency, the credit reporting agency will try to
verify those accounts with the collection agency.
Legally they're not supposed to answer, but the violation of the Fair Debt Collection
Practices violation comes when they do.
CONSIDER THE STATISTICS

Understanding all these violations that appear on consumer credit reports clearly
demonstrates that the American Consumer needs the services that Credit Repair
Companies provide. Though the Federal Trade Commission (FTC) and the big three
credit bureaus (Equifax, Experian Understanding all these violations that appear on
consumer credit reports clearly demonstrates that the American Consumer needs
the services that Credit Repair Companies provide. Though the Federal Trade
Commission (FTC) and the big three credit bureaus (Equifax, Experian and Trans
Union) deny that need, but statistics reinforce the need for Credit Repair
Companies.
Consider these statistics:
The Federal Trade Commission examined 3000 consumer credit reports and
found that 21 percent had a confirmed material error. Further investigation
revealed that 5 percent of the original 3000 reviewed had errors significant
enough to change their credit risk profiles.
More than 200 million Americans use credit reports which means 40 million
Americans have errors that could significantly affect the report (extrapolating
the estimates from the 20 percent of the FTC 3000 credit reports). Even if you
choose to use the five percent figure, you find that is 10 million people with
errors on their reports.
Twenty-four percent of consumers have disputed a balance on their credit
reports.
Example: Mr. Bell, Jewelry Store Owner, who pays his mortgage on time every single
month. He discovers the mortgage company has recorded a mortgage payment he
made on time late (by mistake). He brought the error to their attention, and notified
all the credit bureaus of the error. The mortgage account was still reported as late,
so he proceeds to write letters of explanation to the credit bureaus, enclosing a
copy of his check and other supporting documentation. The credit bureaus refuse to
acknowledge his case and he cannot qualify to refinance his house at the current
low rate. Mr. Bell is an example of numerous consumers filing disputes and failing to
get the credit reporting agencies to correct his credit reports.

60 Minutes aired a segment in 2012 about the credit reporting industry that
depicted disturbing levels of inaccurate information on credit reports as well
as an industry dispute system for consumers that is best described as
Kafkaesque (nightmarishly complex, bizarre, or illogical quality). This news
report related stories of persistent consumers, armed illogical quality). This
news report related stories of persistent consumers, armed with all the right
documentation and even lawyers hired to assist them, who spent years of
their lives attempting to resolve obvious errors in their credit reports with
little success. In real terms 60 Minutes reported from 2 to 10 million
Americans with errors in their credit reports that could impact whether they
could obtain credit, or how much they would have to pay for it.

The issue is that in the current credit reporting system, no consumer can garner the
needed leverage against data furnishers and credit reporting agencies. They have
created an automated system that turns people into numbers. Credit reporting
agencies make money from their customers, the furnishers of information credit
card companies and other lenders and they are in the business of satisfying their

customers, not consumers. The consumers are the ones whose information is being
skewed and twisted and bought and sold for a multitude of purposes not necessarily
designed to serve their needs. The current system is designed to meet the needs of
those offering credit.
MEET THE NEED
Credit repair professionals are needed to guide consumers through the process of
credit repair. There are millions of people across the nation that need the help of
credit repair professionals like you. It is imperative that you get into position to help
more of those people - in your hometown, across the street or right next door. They
might be your beautician, guy at the grocery store, your mechanic or your pizza
delivery man. Everybody you come into contact with on a daily basis is a potential
prospect with a need for your services. Your marketplace is vast, your goal is to
reach and help as many people as possible and at the same time growing your
business successfully. You can penetrate your marketplace.
One of the most important things you can do to penetrate your market and set
yourself and your business up for success is to manage your time. In business, and
in personal life, you only have time. It's the only real asset you have and you must
manager it. By managing your time, you manage your energy and thus your
effectiveness.
One of the easiest ways to manage your time is to set aside the time to do what you
intend to do. It is a not a matter of saying "I'll do it today" but literally "Today at
11:00 I'll sit down and make these calls, handle this research, or help this client." Of
course, to be able to do that, you have to consider all that you have already
planned to do and set aside the time. There is no multitasking, plan one thing at a
time and do it well, you'll get much more accomplished in a day. Simply stated you
can't accomplish multiple tasks at once and perform this all well. You must focus
your time.
Everyone wants to focus and manage their time. It is the only way to get the things
accomplished effectively. Time blocking is the key to time management.
Step 1 Begin by listing every task that you have committed to do - for yourself,
your business, and for others.
Step 2 Understand your priorities. You have to decide on your most important
priority and follow with numbers two, three, four and so on
Step 3 Make sure you are spending adequate time and energy on those priorities.
When you are focused on your priorities you need to be present all in
Step 4 Eliminate your distractions. There will always be interruptions, so you have
to manage the ones that you can control.
Step 5 Focus on the task at hand. In order to manage your time and energy, you
must focus on whats pressing, whats most important, whats directly in front of
you. If not, youll find you're unfocused and you're jumping from one thing to the
next. This will keep you from completing any task; youll burn out and drive your
team to distraction.

You need to map your time, visualize it, sit down and write it down. Prioritize your
list and determine your goals. You can easily manage your time with time blocking.
It will help you discipline yourself and your day. Time blocking is literally using your
calendar to manage your day. If you don't control your day, your day will control you
and youll be making adjustments throughout your day and accomplish little.
In the credit repair industry, your business takes an inflow of customers which
means customers will be calling, stopping by your office and emailing. You need to
manage those times by telling your customers your schedule. Let them know when
you take calls, return calls, schedule appointments, and check emails. If your
appointment times are from 9 to 11 in the morning and 5 to 7 on select evenings,
let your customers know. Once you do you have set blocked your time and set that
expectation for your customers - both new and old. Your customers know what to
expect, and honestly that is what most people expect today.
Each Friday, you can plan and schedule the upcoming week, building in recurring
events. Build in those reoccurring events like phone calls and then begin to drive
those phone calls into that time slot. Build in the time you will hold staff meetings,
when youll leave work to go home, when you will arrive in the morning. By doing
so, you will begin to focus your energy toward the priorities on your calendar. With
time blocking you will also build your own discipline and the ability to resist the
temptation of distraction from your priorities and succeed.
By managing your time, energy and effectiveness, you can penetrate the market
and help your potential customers. Knowing that at least 10 million American
Consumers have errors on their credit reports, the marketplace is ripe with new
customers for your Credit Repair Business. You can teach consumers the truth about
credit repair and grow your business as the credit repair custodians of their
consumer credit reports. The possibilities are endless.

Part 2
Meeting the Need
CLASSIC DISPUTE TECHNIQUES
Score Technical Dispute Methodology arises from the need to avoid classic dispute
techniques which result in frivolous tags from the Credit Reporting Agencies. The
vast majority of the tactics from Violation Bingo to the Squeeky Wheel to the
Nervous Nellie and everything in between are known and used by credit repair
organizations and are template driven. They are specific templates that go out on a
particular round and the templates are continually reused. The content of a
complete letter has to be changed periodically after you do volume disputes. These
tactics are used by smaller credit repair businesses who manage fewer than five
customers in any given month. If you use them with any sort of repetition, letters
will be repeated and they will be flagged as frivolous when you start disputing.

In a retail credit repair company, this process must be automated. The result was
the Score Factual Technical Dispute Methodology. It differentiated Score from the
other credit repair organizations.
First, though Score still uses these templates, but the body of the template (the
dispute reason) changes on every single round. Score also spins the disputes. For
example, on a Basic MOV Request, there is a specific structure, you begin by
sending a dispute and follow-up on the following round with a response requested
the method used to investigate the dispute at the credit reporting agency or with
the creditor. In a Good Will Request, a one letter request, you have to be specific in
your request.
In the Collection Three Step Method or the DV Trifecta is a debt validation letter to
the creditor and prevents the creditor from contacting a third party about that debt.
Once youve confirmed the creditors receipt of the request, you then send a round
of disputes to the credit reporting agency and wait for the first round of results to
determine if the credit reporting agency sent a request for investigation to that
particular creditor. The third round consists of sending the creditor a letter stating
that they responded to the credit reporting agency prior to the validation of the
debt. You can then send a fourth round demanding that they remove the debt based
on a legal position (a loophole). This is an advance tactic that requires time to
understand and learn the timing for tying four rounds together.

What do these Tactics Have in Common?

1. Each of these tactics are template letters and are all very different approach.
This, of course, requires you to take the time to retrain processing staff. The
benefit is that the templates are changing because something different
happens on each new round processed.
2. Most of these methods are based on factual disputes, but not all of them.
3. Most tactics are template driven not Dispute Reason Driven.
4. These tactics assume that the consumer will gain leverage, particularly
MOVs, DVs, the DV Trifecta, etc.
5. Each of these methods point out a fault.
6. Each of these tactics tries to bypass the OCR. The templates are changing on
every round depending on the tactic chosen.
7. All of these methods are trying to embrace the process and the law. There is
no attempt to lie to the creditor or the credit reporting agency, but you must
be careful to use tactics that truly apply to the situation. A definitive positon
is required to send the message accurately. The reason is not driving the
dispute every time.
What Causes these Strategies to Fail?
1. You assume that the dispute is being read.
2. You assume that the dispute is being tracked. (No one is sitting at the Credit
Reporting Agency tracking the disputes through each round and tying them
together.) You are grouping them together as a process in a business; you will
use multiple tactics, complicating the process.
3. You assume that Credit Reporting Agencies and Data Furnishers are
leveraged by your disputes. You assume that they are intimidated enough to
interrupt their process to answer your dispute.
4. You assume that the Credit Reporting Agencies follow the rules. The numbers
do not lie; statistics show that the dispute process is flawed. Over 70 percent
of credit reports have errors, and 20 percent of those errors are denial of
credit type errors. They are not following the rules. They are automating new
processes on top of current inconsistencies, making the problem worse.
5. You assume that the Data Furnishers are following the rules. They are not
following the rules; the data is handled incorrectly from the beginning of the
process.
6. There is no one strategy that works. You will find that whenever a new tactic
is implemented, you have a spurt of new results. The problem was it did not
last. The Credit Reporting Agencies were smarter and possessed better
technology. They responded with frivolous, proof of address, proof of
identification and proof of social security number to delay the process. Once
the OCR was implemented, new tactics became old very fast because of the
number of disputes being processed. No one strategy works, success requires
a process.
7. Only processes that combine strategies provide consistency.

What do we Know?

The Credit Reporting System is flawed.

The Federal Trade Commission, The U.S. Public Interest Research Group, and
the National Consumer Law Center all agree that over 20 percent of credit
reports contain errors (The average lies above 20 percent, but rather than
quote numerous statistics , the 20 percent average is utilized here.)
The problem begins with motivation. The consumers' motivation to
investigate, understand and correct their credit history is to obtain a loan for
a home or a car. There is no motivation or monetary incentive for the Credit
Reporting Agencies or the Creditors to correct the flawed system.
The Credit Reporting Agencies are not paid by the consumers, but rather paid
by the data furnishers, the banks that buy the credit reports or the banks that
buy the studies of subsets of customers whose credit scores have improved
over the last 60 days so they can market to that list with pre-approved credit.
Consumers are not their primary source of revenue. They are using consumer
information as they like and exploiting it to their benefit. They are often not
violating the law, but when they do it is simply too much to resolve.
The technology used by the Credit Reporting Agencies is not fulfilling the
duties it was assigned to do. When the Fair Credit Reporting Act was enacted,
it was enacted to protect consumers from unfair and deceptive trade
practices and to give the consumer the ability to dispute inconsistent,
erroneous or unverifiable information on their credit report. The technology is
not helping consumers to do this at a greater rate.

STRATEGIES AND TACTICS ONLY MAKE YOU FEEL SECURE

They make us feel like this system has some type of organization to it and the latest
tactic is the new 'magic pill' to correct the issues. It is like weight loss. There is
simply no temporary fix. It is a process and it will take time. Tactics are only a
temporary fix. They may even make the customer feel good; attempting to explain
something that defies explanation and that is the current system. Neither the
customers nor the credit repair organizations are responsible for the current credit
reporting system; the credit reporting agencies and the data furnishers are
responsible. They are the suppliers of the information, the managers of the
information, handlers of the dispute process with consumers and credit repair
organizations alike.
The only thing that does work effectively is a process that exploits the system by
embracing it through:
Strategy
Consistency
Frequency
Change

This is the process by which the Factual Technical Dispute Methodology was
formulated. It allows credit repair businesses to implement the methodology without
plodding through every single tactic on your own. The tactics provide strategy and
consistency and when combined with the dispute reasons and frequency, you arrive
at change.
Keep in mind that customers have 15 to 20 line items that need attention including
technical data to public records and inquiries. This is the backbone of the
methodology. Templates change, the number of letters in the strategy changes, and
the dispute reasons change so if customers have 15 to 20 items and you change the
dispute reasons on every round you completely change the strategy behind it.
The ScoreWay dispute methodology invokes change and facilitates results. It
understands and embraces the fact that change facilitates results. It recognizes
dispute reasons as the key drivers. The reasons change on every single round of
dispute for any particular trade line. The template will be sent to the credit repair
agency, but because of 623 and the facta 312 amendment of 2010, items can be
specifically challenged and not merely verify debts with the creditor. You can also
verify the veracity of these items directly with the creditor as well as the credit
reporting agency. Depending on the type of report and the type of account there are
from 2 to 24 unique and different reasons that can be used to dispute an item in
permutations of two or more.
For example, look at a Bank of America revolving account that is open. The last
reported date is not shown because it has been over a year since their last report.
The balance is incorrect as is the high credit which can affect your credit utilization
ratio. There are numerous inconsistencies. Your response should be to create a
dispute reason that says, I believe that the last reported date and the balance of
this account could be incorrect. Could you please verify and correct if incorrect or
completely remove it from my credit report? You have now challenged two pieces of
account data on a line item.
Since on average customers have between 15 and 20 line items, on a template with
header, body and footer, inside the body you will have 15 to 20 items with different
reasons that are being disputed. This will change each template and make it unique.
Every round is different and you do not need dedicate yourself to a particular
strategy that commits you to one path. need to dedicate yourself to a particular
strategy that commits you to one path.
Essentially you have not begun with a dispute saying, This is not my account or
This account was paid as agreed. If you utilize those as first disputes then you
have boxed yourself in and have nowhere to go in the next round unless you lie or
are extremely creative. If, on the other hand, you are engaging and truly examining
the you are engaging and truly examining the report as the custodian of the report,
you are looking for inconsistencies and the options available to you are
mathematically phenomenal.
For example, if you have 10 items in a collection account and you dispute two at a
time, the permutations of two at a time would take you down a dispute path that
will not include a repeated dispute for at least 12 months due to the combinations.

With 10 options, you can dispute option one with option two, option one with three,
option one with four, option one with seven, and so on up to ten. Then you go to
option two with option three, option two with option four and so on eliminating
repeated reasons. You are never disputing for the same reason. You are verifying,
challenging information that is missing or incorrect, because that is what the law
allows you to do.
This of course is the beauty and functionality of the ScoreWay dispute methodology.
When you combine templates from every single tactic mentioned earlier, the
permutations increase. The templates and the strategies cause change by providing
the strategy to follow to success.
Even something as simple as adding handwritten envelopes helps to encourage
change. In the OCR examples and how it works, handwritten envelopes actually
decrease the chances of frivolous responses and increases results. Your goal is to
have your disputes actually read by the credit reporting agencys system. If you
cant bypass the OCR, getting read by the system is a milestone. If you can bypass
the OCR and get your disputes read, you will gain responses and achieve change.
It is the Pro-Active Credit Repair approach and coupled with customer credit
monitoring, you can view reports every 30 to 35 days and see changes before your
customers receive their responses. The changes are happening, even if the Credit
Repair Agencies have failed to send all the proper responses to the consumer. They
may have sent a frivolous response back to gain time, but they did perform the
investigation yet did not inform you of the results. You will likely receive responses
during the next round of disputes, though without credit monitoring it wont be
realized until that time. The combined effort of credit monitoring and Pro-Active
Credit Repair utilizing tactics and strategies brings positive change and successful
results.
Great software permits you to accurately engage each one of the letters being
produced. This process encompasses everything it is a process that requires
software that can accommodate each name, account number, multiple dispute
reasons, and so on for every item. The software must be able to handle the
correction process, the custodial processes that allows for correction of customer
reports.
SCOREWAY CREDIT REPAIR ORGANIZATION DISPUTE PROCESS
The ScoreWay Credit Repair Organization Dispute Process includes:
The review of the Credit Monitoring Report with the consumer
Identification of inconsistencies on the credit report approved by the
consumer
Prepares Factual Technical Disputes Reasons for each Trade line account to be
disputed
Selection of a first round Letter template, for each Credit Reporting
Agency/Director and Creditor, and add all items to be challenged on one
Letter (sending individual letters delays the process while combining disputes
accelerates the rate of success)

1. Include technical data, accounts, public records, inquiries

2. Select the template strategy to pursue

Send the disputes to Credit Reporting Agencies and directly to Creditors (note
Facta 312)
Inspect the Credit Monitoring no less than 30 days from the date of the
dispute. Pro-Active Credit Repair does not wait for responses, but monitors
changes via credit monitoring. It is the best way to help your customers help
themselves. In this step as you view the credit monitoring reports, you look
for deleted items, repaired items, added items and changed items. In using
this process, the credit reporting agencies will start responding, doing their
jobs correctly, and you are actively on top of the process and see the changes
sought and reported correctly, and ultimately the system improves. The
Factual Technical Dispute Process gets your requests read more than your
previous tactics. You actually get items corrected and verified. You get your
customers items moved from negative statuses to positive statuses. You
have effectually updated your dispute plan and process. If your software or
your outsourcing firm does not provide you with the options needed to
perform these function and update on a monthly basis, this will create a
burden on you and your company. In order to run an effective and successful
factual technical dispute methodology, processors have to be trained to read
and understand a myriad of different reports and who know what to do when
changes occur (or dont occur as expected). It is not a scenario based report,
but an expertise based report in regard to the credit reporting and the credit
score as it relates to the report.
Select a second or greater round letter template, for each Credit Reporting
Agency and Creditor, and add all items to be challenged on one letter. During
this round of disputes you will again look at technical data, accounts, public
records, inquiries and select the template strategy you need to pursue.
Send the Disputes to Credit Reporting Agencies and Directly to Creditors
keeping Facta 312 in mind.
Repeat the process for the customer until:
1. The process is completed. This does not mean you have 100 percent
results. It is actually the time when the consumer gets the needed credit
for the purchase (house, loan, car, etc.) that brought them to you in the
first place. The goal is to help your customer get to a point that they can
move move forward, live a better life and use their credit again. That is
completion and success for the consumer.
2. The Customer decides not to continue.
3. The Credit Repair Organization decides not to continue. Not only should
your customer be able to discontinue your service, but you need to be
able to discontinue service when there are no more results to be obtained.
If you fail to understand this threshold, you will begin to overspend by
continuing to dispute when there is no more revenue to be gained.
(Remember you are not a non-profit or a government agency. You are
running a for-profit business with the intention of learn, grow and profit
from the credit repair business.

4. You reach the State CROA time limit on length of service. Many states
have a six month rule for credit repair organization service contracts.
SCOREWAY
THE DELIVERABLE
Keep in mind, what you are producing is a deliverable. You do not delete or repair
anything on a customers credit report. You provide quality dispute letters for your
customers. Only the Credit Reporting Agencies and the Creditors can control the
result. Your credit repair business only controls the dispute letters. At the end of the
dispute process for any customer, the mechanism of what needs to be challenged
to the Credit Reporting Agency and to the Creditor, which is what is produced for
the consumer. In ScoreWay Dispute Methodology, it is composed of a spun letter
template, a hand written envelope, a customized dispute reason for each account
that changes monthly and is never used more than once.
THE SPUN TEMPLATE
Score utilizes over 200 different templates that are unique to every Credit Repair
Organization portal. Once the templates are used more than 100 times, the content
is spun (the message is the same but the wording and delivery is altered). This
addresses and avoids the OCR technologies quests for repetitive templates. It
maximizes the effectiveness of the template so that the template does not profile
the dispute. The processor should change fonts, types, and the general context
(look and feel) of the letter on every round before it is printed for delivery. You do
not want to use the same template on every round.
THE TEMPLATE TYPES
These template
greatest effect.
ScoreWay
ScoreWay
ScoreWay
ScoreWay

types are all the letters used over the years, spun regularly for
Advanced Tactics Collection Templates
Advanced Tactics Creditor (OC) Templates
Credit Bureau Templates
Credit Bureau Advanced Tactics Templates

In order to utilize the templates to your advantage and avoid repetition of templates
or repetition in dispute rounds, you must classify the templates into four types for
effective utilization. The bulk of the templates will fall into one of these four
categories or even overlap in the categories.
Verify
Demand
Validate
Escalate

For example, if your processor uses a Verify template in round one disputes with as
in the example a customer with 15 line items each with an independent dispute
reason. In round two, the processor may utilize a Validate template or an Escalate
template or Demand template format. Of course, he could also begin with the
Validate template and then follow in the second round with an Escalate, Demand or
Verify template. In each round, every single dispute reason is being changed and
two to four or more account data types for any trade line and altering that as well.
That is a unique deliverable.
Processor Trade Line Analysis
As the processor works, what is being considered? The processor must be taught
the right questions to ask themselves during the trade line analysis. It is broken
down to the trade line as the unit driver of profitability. There is a cost involved in
processing more trade lines. As the processor examines the trade line individually,
the processor needs to ask the following questions:
What is obviously missing based on the account type? For example, on
a collection account, you may see 10 items that can be disputed and at the
account data subsets (which change) to uncover what is missing. If nothing is
missing, then comes the next question.
What is obviously incorrect based on the account type? For example,
on the same collection account, with the original creditor is missing or
incorrect, or the account is previously disputed and does have the original
creditor in the second or third round and the reporting date is unchanged,
then something is obviously incorrect. But if there is nothing of note
incorrectly recorded, processors proceed to the next question.
What two or more account data entries can be verified? Why? That is
the law. Dont lie, verify. The Fair Credit Reporting Act says that the
information must be verifiable. You wont know until you ask. The Credit
Reporting Agencies and the larger collection agencies with their sophisticated
technology prompted the move to two or more per request.

THE ANATOMY OF A DISPUTE LETTER

The letter begins with the header which may include:
The consumer first and last name
The consumer address
Credit Bureau name
Date of letter
The consumer Social Security number
The date of birth
The salutation
Next come the body of the letter which contains:
Specific Letter Content based on the template. It can include account
numbers, names and descriptions. It includes the letter classification (Verify,
Validate, Demand or Escalate). Your processors will need to be trained as
experts on the credit report as well as all the templates and classifications
used in your business.

The Dispute reason correctly structured as a factual dispute reason (DR).

These dispute reasons must be in the form of a non-assertive statement with
the account data in question and a suggested resolution.

The letter closed with the footer which contains:

The consumer first and last name
The consumer address
Credit Bureau name
Date of letter
The consumer Social Security number
The date of birth
A non-spaced signature
CC references
It can have the information as in the header, allowing you to formulate various
templates.
Sample Dispute Reasons
Here are some samples of well-written dispute reasons:
"I believe the status and last reported date could be wrong. Verify and correct this
or completely remove it from my credit history."
Non-Assertive "I believe the...could be wrong."
Challenge Account Data "...status and last reported date..."Take care to report
this challenge correctly avoiding statements like "This is not my account" or
"this is paid as agreed" or "this is in duplicate" in order to avoid incorrect

disputing methods, intervention by the FTC, fines and harm to your business.
The factual technical dispute process implemented in your business will
provide the information and methodology that you need to prevent illegal
activity (even in ignorance).
Suggested Resolution "Verify and correct this or completely remove it from
my credit history."

Important Dispute Instructions

Dispute reasons should always be factual. Often consumers are unsure of the facts
and sometimes say an account does not belong to them. It is important that your
customer know coming in that because you are utilizing the factual technical
dispute technology you never claim an account does not belong to a customer.
Explain the reason behind the method no one is reading these accounts and if you
claim the no ownership, where do you go should the Credit Reporting Agency or
Creditor do nothing to correct it. If a customer continues to persist regarding
account ownership, ask for proof. Non-assertive statements are more effective at
getting items cleaned up on a credit report. Remember, no one is reading, tracking,
or analyzing disputes through the process. Every month becomes a new strategy
from the Credit Reporting Agencys perspective. You should always challenge a
minimum of two pieces of account data per line item. In most cases, this will
indicate a more difficult creditor or more difficult type of account.
All processors should create, spin, and submit new lists of dispute reasons every
month. Every new processor should be trained in the process for six to eight weeks
to ensure understanding and ability to complete processing of disputes well. Each
processor should then follow these processing guidelines using the processor's tool the dispute reasons.
It is similar to the tools that a service department in a car dealership has - it is how
they get the job done. Can you imagine a service department in a car dealership
where the mechanics are without tools? No, no one would ever get their job done.
Neither should you imagine a processor in the credit repair business without his or
her tools - the dispute reasons. They need to be capable of creating, spinning and
adding to them on a monthly basis. It should be an administrative review task,
particularly if you have a larger operation. You want to be certain that your
processors are doing their job well, and this is done by reviewing their work.
Dispute Dos and Don'ts
1. Don't dispute any items as:
" not mine"
" doesn't belong to me"
2. Don't Lie! Be technical and factual. (Utilizing the Factual Technical Dispute
Method - There is no reason to lie.)

3. Don't do the credit bureau's job for them. Don't give them any more
information than necessary. Simply use the process. Don't use 100 words
when less will do the job using the Factual Technical Dispute Process.
4. Don't waste time with baseless empty threats (Im going to sue you in
federal court")
5. Don't become angry and act unprofessionally. Using profanity or other
unprofessional behaviors will not help you to get the job done successfully for
your clients.
6. Don't quote law or court opinions or go on long discourses about morals and
ethics. The bureaus/collectors/ creditors don't need legal education.
7. Keep the dispute simple but always follow the process.
8. Make sure that your disputes make sense.
9. Use unique letter templates (spun templates) whenever possible. A unique
dispute letter will always have a better chance of success than one that has
been used over and over again because the likelihood of a computer
determining frivolity is decreased.
10.Don't use online disputes or any bureau controlled dispute formats.
Online disputes
Phone/fax disputes
(Credit reporting agencies are the Google of the financial industry. They
essentially manage customers content financial histories, spending habits,
bill paying tendencies. This information is used in many ways including
determining if someone is a good fit for a position in government or the
private sector. This information is important and must be taken seriously and
handled with care.)
11.Dont send a blanket cease and desist letter to a collection agency. Cease and
Desist letters prevent collection agencies from communicating with your
client, meaning you may leave the collection agency with no alternative but a
lawsuit. Stopping harassing phone calls is acceptable, but leave the collection
agency with the option for written communication. It is important that in the
case of outstanding balances your client understands the importance of
settling the account to avoid a lawsuit. The truth is a more savvy strategy
than lying to the customer. It builds trusting relationships and helps you grow
your business.
12.Dont send bank statements to a collection agency to prove a client has made
a payment. It is too much information and they do not need it.
13.Letters do not have to be perfectly typed and free of grammatical and
spelling errors. They should be written as the consumer would write -not as a
lawyer would write. Don't use legal terms until absolutely necessary.
"You don't need to be perfect, you need to be consistent." - J. Peters
There are many things you can dispute - account number, high credit, credit limit,
term, frequency of payments, status, balance, past due balance, date of last
payment, payment amount, date of first delinquency, date of last activity, charge
off, date closed, type of account, responsibility section, additional information,
dispute status and more. These are the items that can be challenged if it is not
obviously incorrect or obviously missing. Your processors should utilize these items
to determine what two disputes will be prepared.

Account Data Types

The account data types include technical, account, inquiries, public records and
bankruptcies 7 and 13, judgment, collection agencies and tax liens.
Technical data includes name, alias, date of birth, current address, previous
address, employer, and previous employer. The name is indirectly related to the
credit score, but should be verified. It is a way of disarming the credit bureau by
utilizing their rules. Name and current address should be correct from inception. If
incorrect, it could stall the dispute process and the credit score improvement if it is
recorded incorrectly.
Account Data includes creditor name, account number, open date, last reported
date, date of last activity, credit limit, current balance, amount past due, month
reviewed/rated, late payments over 30 days, 60 days or 90 days, comments
including status, ECOA requirements, and type of loan. The date of last activity
(DOLA) is the last date a payment was made or the charge-off date. Care must be
taken to not confuse date of last activity and date of last delinquency. They are not
interchangeable. Keep in mind that if dates are off, then balances are likely off as
well. It is also a good idea to have them update the past due amount. If the bureau
fails to do so, they will have to delete the account.
Inquiries are request for a consumers credit file and include name of inquirer and
date of inquiry. It used to be simple to remove an inquiry, but no more. The process
was abused, and today it is difficult to have inquiries removed.
This of course, translates to the fact that the removal of inquiries may cost you
more than you will make.
Public records and bankruptcies include both Chapter 7 and Chapter 13
inquires. The following items can be disputed with regard to this account type: date
filed, reference number, court, and plaintiff. In public records, you can dispute public
record type, date filed, amount, case number, and defendant.
Creating Your Dispute Reasons List
This additional helpful advice for your processors offers a process driven method
that is easy to follow and is proven successful. Beginning with the Account Data
Type, the processor will create the dispute reasons and classify them by days of the
week. For example, if they have 400 dispute reasons for the month, they will
change them on a monthly basis using different dispute reasons on different days of
the week. The important point here is that they classify their dispute reasons in
some manner so that 100 disputes will be used in week one, 100 different reasons
in week two and so on. This way they cover a myriad of accounts and dont repeat
dispute reasons. Scores software is set to flag this type of repetition to help you
manage the process and maximize the potential.
New processors should create 10 dispute reason for every type every day. In doing
this for six to seven weeks, they will have a large subset of dispute reasons. They

can then begin spinning those reasons into more reasons and organizing them by
days of the week and type. It makes their job easier and they can pre-load their tool
set to maximum functionality.
It is important that each processor use two pieces of account data for every dispute
reason. These disputes must be properly structured using non-assertive statements,
account data and resolution statement.
Processors must classify dispute reasons by the first piece of account data
challenged. For example if they are utilizing the last reported date and the balance,
they must classify as last reported date and balance under revision. Each dispute
must be reviewed monthly and followed up by adding dispute reasons and spin
them.

SCORES POLICY
As an example, at Score technical data is disputed beginning with full name and
current address. If this is incorrect, all other processes will be delayed.
With regards to account data, all derogatory information including collections,
repossessions, short sales and charge-offs are disputed. Also disputed are 30 day
late payments that are 24 months old or less and those that are 25 months or more
if three or more exist. Accounts at 60 day late payments are disputed if they are 24
months or younger and those that are 25 months or older if three or more exist. The
reasoning here is that according to FICO, any late payment only affects the score for
the first 24 months of the late payment. From the 25 month and if the customer
remains in the same scorecard range, the score could actually rise after the 25
month. Keep in mind that not all loans are approved by system, some are still
approved by loan officers particularly with home loans; by here pay here auto deals,
etc. If you dispute an account over 24 months and it is deleted, it could actually hurt
the customers score. Multiples of three or more are disputed because at that point
it shows a negative pattern for the consumer and a loan office will penalize this
behavior. Accounts with 90 day late payments are always disputed.
Accounts in dispute status are disputed even if the account status is positive. These
need to be removed first, if a client is seeking a home loan because accounts in
dispute can prevent a home loan from being approved. Often a phone call here form
the consumer with an explanation of the fact that it is preventing them from getting
a home loan will be corrected within days.
Inquiries, because they are so difficult to have removed, are only disputed if they
are less than three months old. Inquiries only affect score for the first twelve
months. If the credit report provided is a mortgage tri-merge from the previous
month, never dispute an inquiry. In the case of public records, all are disputed.
The Score Worst Creditor List
1. Bank of America
2. Wells Fargo
3. Citi Financial
4. Sears
5. SAMS
6. Walmart
7. AES Phea
8. Department of Education
9. Capital One
10.Midland
11.AFNI
12.NCO
13.GEMB
14.Verizon
15.Pinnacle
16.Enhanced Recovery

17.First Premier
18.TXU Energy
19.RJM Acquisition
The importance of this list is the fact that at Score, these creditors are disputed
differently than all others. These creditor have several things in common. They are
all huge companies, very automated, and only delete or repair less than 20 percent
of the time. Inquiries with these creditors delete less than 10 percent of the time.
This process for engaging the worst creditors is as follows:

Use four or more multiple account data types at all times when disputing
On every round spin dispute reason usage

Sample Dispute Letters

<Insert Sample A>
Here you can see that the dispute reason is clearly stated. It is followed by a tactic
form and includes information regarding the Fair Credit Reporting Act. This is a
direct to creditor dispute. It is not verifying or validating debt. The account is begin
engaged with regards to veracity.
<Insert Sample B>
This is a credit reporting agency verification letter. Here every dispute has a
different reason as account data sets are being disputed. This template also
addresses the Fair Credit Reporting Act. It is a part of the Angry-Educated Consumer
tactics templates.
<Insert Sample C>
This is an intent to sue letter, a demand letter disputed to the creditor and the
credit reporting information.
Opt Out
One final, but important step in the credit repair process, is to opt out your
customer, do not do a credit freeze. This step can be performed before or after
disputing the consumers accounts. At optoutprescreen.com, you will simple enter
the information required, save the information and save a PDF copy that can be
attached. You will then attach the opt out attachment to the attachment area in the
Dispute Suite. If the credit reporting organizations portal does not have the option
to attach documents, you should save it to the notes section.
You are now equipped with the tools needed to perform the tasks needed to help
your credit repair customers help themselves. By following these steps, managing
your time, classifying and organizing your data, strategies and dispute reasons you
can successfully confront credit repair agencies, creditors and collection agencies

on behalf of your customers bringing needed positive change. With at least 10

million American Consumers who have errors on their credit reports, the possibilities
for helping your customers and growing your successful credit repair organization
are endless.