Re: PFD Q&A, Examples, and PFD Success Stories[ Edited ]
05-16-2013 07:55 AM - edited 05-16-2013 07:57 AM
I unintentionally had a creditor report an installment loan as disputed recently. I hired a credit repair service and asked them not to dispute a certain negative item. The item was a student loan in which I had a 180 delinquency. It had since been brought current and I specifically asked Lexington Law to not send a duspute letter because it was a title iv student loan that i did not want to dispute and i also felt it was more positive than negative because of the fact that i was current more months than delinquent. They didnt keep their promises .they said they wouldn't however they still did. About 30 days later I received an alert from myfico scorewatch that my equifax score jumped up 20 points because of this item being disputed. I then checked with experian and saw that my score had jumped 37 points with them. I am a little confused because it says in this post that something that shows disputed on a credit report wil have a negative impact. But it didn't in my case so what is the deal?
If you have SW, then you are looking at an EQ FICO score. If you checked with Experian, then you aren't looking at an EX FICO score because Experian blocked all consumer access to your own EX FICO (though that will change very soon). With that said, ignore the Experian score since it's a FAKO and FAKO scoring factors in stuff that FICO does not and vice-versa.
Backtracking...your EQ FICO increased because a dispute comment was placed on it. Under FICO scoring, FICO will ignore certain aspects of a TL which include your balance, the CL (not applicable here), and the payment history. So, for as long as the dispute comment remains FICO will be artifically propped up because it is ignoring your lates on your SL. Once the dispute comment goes away, then your score will return to where it was, assuming there were no other changes to your EQ CR. I've made it a point that a dispute can harm for many reasons. I won't get into all of those here, but you cited one: a dispute gives a false sense of security because your FICO will drop if the acct is verified by the lender. Also, it is very common for a lender to add lates when they didn't report them before. It's quite common for a lender to underreport, in your favor, "OKs" when there should have been a late. That update can cause your FICO to drop even further than where it was before. Also if the current status is a negative, FICO will often view the baddies as a newer negative because the reported date will update (and sometimes DOLA too), and that will cause an additional FICO drop once the dispute comment goes away. Certainly all of this depends on what, if anything, changes. Who know, maybe it'll change in your favor.