Definitions

These are self-help explanations, not legal advice. Results are not guaranteed. You review, sign, and mail every letter yourself.

Dispute Rounds

Round 1

The first letter. It asks the bureau, creditor, or collector to investigate the item you selected. Only Round 1 letters are offered for this step.

Round 2

A follow-up after the first letter was mailed. Use it when there was no response, or when the item was verified as accurate and you want another look. Only Round 2 letters are offered.

Round 3

The last letter in this cycle. It uses stronger follow-up language. There is no Round 4. If nothing changes after Round 3, the dispute is complete.

Responses

Deleted, Corrected, or Balance Updated

The report changed in your favor. The dispute closes. You can still download the letters you already created.

No Response

Nothing came back after you mailed the letter. Choosing this opens the next round, until Round 3.

Verified As Accurate

The bureau or creditor says the item is accurate. You can accept that, or start the next round if you are not already on Round 3.

Stop Disputing

You are done with this item. It closes, and a later round is not opened.

Reappeared

An item that was verified shows up again. Restart begins a new Round 1 cycle. It does not continue the old round numbers.

Final Round Complete

Round 3 did not resolve the item. There is no further letter in this cycle.

Settlement and Accord

Settlement offer

A one-off letter to a creditor or collector about paying the debt. It is not Round 1, Round 2, or Round 3 of a credit dispute.

Accord and satisfaction

A one-off request for a written agreement that a payment settles the debt. Mailing it once does not start another round.

Pending, Settled, or Declined

Record what the creditor or collector decided. None of these results creates a second letter.

Payoff Plans

Snowball

Extra money goes to the smallest balance first. When that debt is paid, its payment moves to the next smallest balance.

Avalanche

Extra money goes to the highest interest rate first. This usually costs less interest than paying the smallest balance first.

Hybrid

Balances at or under $1,000 are paid snowball-style first. Larger balances then follow avalanche, highest interest rate first.

What the estimate includes

The timeline is an estimate from the balances, rates, and budget you enter. It is not a lending decision. Money set aside for a later balloon payment is savings, not a reduction of the debt.

Credit Report Terms

Date of last activity

The last time something happened on an account, such as a payment or a new charge. Companies do not all use this date the same way. It is not the date that sets how long a negative item can be reported.

Date of first delinquency

The date you first fell behind on an account and never caught up. For most collections and charged-off accounts, the 7-year reporting period starts 180 days after this date. Paying the debt or selling it to a collector does not change it.

Reporting period vs statute of limitations

The reporting period is how long a negative item can stay on your credit report, usually 7 years. The statute of limitations is how long a creditor or collector can sue you over a debt. State law sets it, and it differs by state and type of debt. The two clocks are separate.

Method of verification

After a bureau reinvestigates your dispute, you can ask how it checked the information, including the name and address of any business it contacted. The bureau must send this description within 15 days of your request.

Pay-for-delete

An agreement where a creditor or collector asks the bureaus to delete an account after you pay. Companies do not have to agree, and many will not. If one does, get the terms in writing before you pay.

Metro 2 status codes

Metro 2 is the file format most lenders and collectors use to send account data to the bureaus. Its status codes describe an account, such as current, 30 days late, charged off, or in collection. It is an industry standard, not a law.

Section 609 file disclosure

Section 609 of the Fair Credit Reporting Act gives you the right to see the information in your credit file, where it came from, and who asked for your report. It is a right to see your file. Disputes fall under Section 611.

Identity theft block (605B)

If information on your report came from identity theft, you can ask each bureau to block it. Send an identity theft report, proof of who you are, and a list of the items. The bureau generally must block them within 4 business days. You can create the report at IdentityTheft.gov.