The Blog

Disputed Accounts on your Credit

If you have any accounts that are currently in dispute on your credit, the lender will require those disputed to be removed.  

Removing disputed accounts on your credit can cause your credit score to drop.  Here are the rules when it comes to disputed account per Fannie Mae & Freddie Mac:

Fannie Mae Disputed Accounts:

  • Disputed accounts on credit report. Confirm disputed account was present on the credit report at time the AUS was run. If DU did not issue the disputed message, lender is not required to further investigate. If however DU identified the dispute, the borrower must provide documentation for credit agency consideration to have dispute removed. If borrower cannot resolve and dispute remains, loan is subject to manual underwrite. Include payment in DTI.

Freddie Mac Disputed Accounts:

  • Must be investigated and corrected, and may possibly require a downgrade to manual underwrite.

Ginnie Mae Disputed Accounts:

  • FHA requires loans for borrowers with derogatory disputed accounts of $1,000 or more (excluding medical) to be manually underwritten. FHA Total scorecard cannot recognize derogatory disputed accounts because they are not generally scored in the borrowers credit report.

uSDA Disputed Accounts:

  • All loans that have disputed accounts with a GUS Accept must be manually downgraded to a Refer unless: 1)Trade line has -0- balance, 2)Trade line is marked paid in full or resolved or 3)Balance is less than $500 and over 24 months old.

Disputed account must be taken off from all 3 credit Bureaus.  The credit bureaus do not account for any accounts that are dispute in the credit score.  Once the disputes are removed the credit score will more then likely drop.

If you currently have accounts that are in dispute please let us know right away.  We can remove these right away prior to making offers.  It normally takes about 3-4 days to remove dispute verbiage on the credit bureau.