Many people think that adding an explanation next to a negative mark on their credit report will help their credit score. This is just not true. While federal law does give you the right to add such a statement to your credit file, the statement itself has no effect on your credit score. The credit score formula looks at how items on your credit report are coded and your 100-word statement has no code at all. As a result it is not included in the calculation of your credit score.

Don't let disputes with utility companies or a local business get you into credit trouble. Once a late payment or charge off is reported to the credit bureaus, there is not much you can do.

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