How to remove old pd. collection?

Please bear with me I'm new and desperate...I've been reading the threads for the past couple of days and I have a headache trying to understand all the "lingo" and figure out where to start.
Here's my situation:

I would like to get pre-approved for my first home.
I ordered online credit reports from all 3 CRA.
Equifax FICO = 635 TransUnion FICO = 637 Experian FICO = 631

- One paid collection 06/2001 US Bank Checking Account. Reported to First Revenue (CA) 03/2001.
- Employer didn't make payroll and checking account went negative and we didn't get paid at all, then we were laid off.
- Shows up on all 3 CR.
* What can I do to try to get this collection removed from my reports?

- Credit limit to charge/revolving accounts too high.
- 1 Wells Fargo VISA with $3500 limit and $3025 balance.
- 1 Rhodes Furniture Account via Tidewater Credit $2500 limit and $1650 balance.
* Should I pay these down to 5% - 7% of the limit to increase my FICO over the next couple of months, leaving the VISA open or should I just pay them both off completely next month?

- I have several old accounts with a lot of lates. Nothing since 2001.
- Providian Visa that I paid off 2000 [4-30day, 1-60, 1-90] shows "Account Closed by Credit Grantor"
Equifax shows 2 Providian TL with diff. acct numbers, same "Date Open" and diff. "Date of Last Activity".
One shows as an "Open" account, other shows as "Account Closed by Credit Grantor"
- Discover paid off 2000 [2-30, 3-60] Shows "Open"
- Chase Mastercard
- 2 TL with same acct. numbers, diff. "Date of Last Activity"
- One paid off in 2000 shows "Account Closed by Credit Grantor", [1-30, 1-60] Closed Account
- Other has no lates, Open Account
* Any advice on how to get the duplicate TL, errors and lates removed?

TransUnion shows 2 TL for same auto loan.
- Paid off 4-1998. I have copies of the paperwork from bank showing "Paid in Full".
- Champion Federal S&L had initial loan, then First of America Bank merged with Champion 7-1995.
then, First of America (FOA BK) Bank merged with National City (NATL CITY) Bank in 11-1998.
- Transunion shows FOA and NATL CITY TL.
- NATL BK TL is "closed", but shows "Unrated or Bankrupty" status, no lates.
- FOA BK is "Closed", shows "Unrated or Bankrupty", [4-30, 4-60] all lates happened in 1997.
- Prior to finding this fine website, I JUST faxed a letter to NATL CITY stating problem and asking to correct CRA.
I just submitted an online dispute to Transunion 01/15/2004 for the auto loan. I asked for the FOA BK TL to be removed.
* Any advice on how to get the duplicate TL, errors and lates removed?
* Did I do anything horribly wrong by faxing and submitting online dispute? Should I follow-up with Certified letters?