If you have a negative listing on your credit report, the three Credit Bureaus (Equifax, Transunion, Experian) will allow you to submit a written explanation of your side of the story that will be provided to prospective creditors when accessing your credit file. For example, let's say you went 60-days late on a mortgage payment 8 months ago because your spouse lost their job and you were unable to meet your monthly obligations until they found a new job 2 months later. The Credit Bureaus will permit you to explain this in your credit file. The assumption is that a creditor will possibly overlook a poor FICO score due to the explanation you provided. Isn't that great?
This is a complete waste of time! Most creditors rely on automated risk models that are unable to take into account these written explanations and as a result put all the weight on the actual FICO score -- not your explanation of why your score should be higher. Furthermore, providing a written explanation does nothing but verify with the Bureaus and creditors that you were in fact late on your mortgage payment (in the example above). Don't bother providing a written explanation to be included with your credit file. If you have already, request that it be deleted.
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