Credit bureaus are in the business of collecting and reporting data about your credit history. They have every interest in keeping records as accurate as possible. These credit bureaus are not in the business of helping you dispute errors in your credit reports. That’s why it’s so important to know how to dispute credit report errors and how a dispute can be resolved.
If you find an error in the credit report, it is important to know how to dispute it. There are steps you can take to ensure that the error is fixed.
1. Identify credit report errors
It’s important to keep an eye out for any credit report errors, to make sure all the information it contains is accurate and up-to-date.
There are a few common mistakes you might spot on your credit report. These include::
- Errors such as incorrect address, phone number or name.
- Incorrect account information – This can happen if you have similar names to another consumer or if an account was wrongly assigned to you due to identity theft.
- When you have closed your account but it is still marked as open.
- If you are listed as the account owner on a credit report, but are only authorized to use the account.
- If you’ve paid your collection account but it still shows as unpaid.
- Inaccurate credit limits.
- If your account is labeled as overdue or overdue, it may include outdated information. This can happen if you are more than 7 years past due or if your last payment date is incorrect.
- Debts that are listed more than once.
- Multiple accounts listed with different creditors
- Incorrect balances.
Can a credit report error affect you?
It is important to monitor your credit report closely. An error on your credit report can negatively impact you in several ways.
Your credit report contains information about your bill payment history and any bankruptcies you may have filed. If there is an error on your report, it could affect your ability to find a job, buy insurance, or open a utility account.
If a utility company reviews your credit history and sees a report that isn’t great, they may offer you less favorable terms as a customer. This is called risk-based pricing, and companies are required to let you know if they do, but it can still affect you. Your credit report can also determine if you can get a loan and what the terms of that loan will be, such as the interest rate.
2. Contact the company
The next step is to contact the company that provided the inaccurate information. This can be a bank or a utility company. Check their records to confirm the error. In some cases, you may be able to resolve the issue directly with the company. If not, contact the credit bureau for assistance.
3. Challenge mistakes
If you find any inaccurate or incomplete information on your credit file, you have the right to dispute it with the credit bureau and the company that provided the information. These organizations are required by law to investigate your complaint and correct any errors in your report.
The U.S. Federal Trade Commission (FTC) recommends taking the following actions:
- If you believe inaccurate information is being reported about you by a credit bureau, it’s important to take action. You can write a dispute letter to the credit bureau outlining the information you believe is incorrect.
- You will need to provide copies of supporting documents, but do not use the originals.
- If you are sending a credit report, highlight or circle the errors on the copy you are attaching.
- If you want to make sure your letter is delivered, send it by registered mail with “acknowledgment of receipt requested”. This will give you a record at the post office that the letter was delivered, in case there are any issues.
- Make sure you have a copy of everything you send.
You should send the letter to the credit bureau and to the company that provided the incorrect information.
4. Schedule time to investigate
The process for disputing items on your credit file generally takes 30 days. The relevant information will be sent to the information provider and the provider must investigate the dispute and report to the credit bureau.
If a credit bureau or business decides your claim is frivolous, they may choose not to investigate, they must notify you of their decision
5. Follow-up after the survey
Once the investigation is complete, here’s what you can expect:
- The written result of your report
- A copy of your credit report, just in case it has changed
If you are not satisfied with the results of an inquiry into a disputed credit item, you can ask credit reporting agencies to include a statement in your file describing your version of events. This will be included in future reports.
If you have a problem with your credit report, you can file a complaint with the Consumer Financial Protection Bureau. The CFPB is required to forward the complaint to the company with which you have a problem. The CFPB will generally provide you with an answer within 15 days. The credit bureaus have five business days after completing their investigation to notify you of the results.
Credit report errors can be frustrating and take time to fix, but it’s important to be persistent and professional. Taking the time to dispute errors on your credit report can improve your credit health and help you save money on loans and long-term credit.
There is no single standard for disputing information in a credit report. You have the right to challenge the accuracy of any information contained in your credit report, but you should always be prepared to substantiate your claim. Try to gather all supporting documents before contacting the creditor or debt collector.