A third of Americans find credit report errors. How to Fix Errors

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Before taking out a mortgage or car loan, check your credit report.

There may be a mistake that could cost you dearly.

It’s not as rare as you might think. More than a third, or 34%, of Americans have found at least one mistake on their credit report, according to a new Consumer Reports survey. Consumer Reports asked volunteers to get a copy of their credit report and check for errors and 5,858 did so between February 1 and April 1.

Twenty-nine percent found personal information errors and 11% found account information errors.

Errors in personal information may not hurt your credit score, but could make it harder or impossible to access your credit report, said Consumer Reports policy analyst Syed Ejaz. Errors in account information, on the other hand, can hurt your credit score.

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This three-digit number has a direct impact on your ability to get loans, such as a mortgage, and the interest rate you’ll pay.

“Unfortunately people sometimes find out too late, when they’re in the process of getting a loan for a new house or a new car,” Ejaz said.

“That’s why it’s really important to check your credit report and assess its accuracy.”

The Consumer Data Industry Association, which represents major credit reporting companies Equifax, Experian and TransUnion, has released a long statement in response to Consumer Reports findings. He called the story “completely false and misleading” and said the industry had a 98% accuracy rate.

“Accuracy is the foundation of the credit reporting industry and getting good credit reports to consumers is our most important job,” the statement said.

Consumer Reports isn’t the only organization reporting errors. A 2012 study by the Federal Trade Commission found that 25% of Americans had an error on their credit reports.

The best thing to do is to stay on top of your credit reports through AnnualCreditReport.com. While generally available free from each reporting company once a year, Equifax, Experian, and TransUnion offer free weekly credit reports through April 20, 2022.

Correction of an error

Courtney Keating | Getty Images

If the error relates to your personal information and prevents you from accessing your online or telephone credit reports, write a letter directly to reporting companies, advised Ian Lyngklip, an attorney at Lyngklip & Associates Consumer Law Center in the Detroit metro area.

Be sure to include proper identification, such as your driver’s license, as well as proof of your address, such as a bank or utility statement. You can black out any financial information, he said.

For other errors, you will have to dispute them with each credit reporting company so that they are corrected. Clearly explain in writing what needs to be corrected and why — and provide the account number. (Here is the FTC letter model.)

Be sure to include your full name and address, along with the credit reporting company’s dispute form, if applicable, and a copy of the credit report with the disputed item circled or highlighted. It is also important to provide copies of documents supporting your application, such as credit card or bank statements, and to keep records of what you send.

In reality, it’s really, really, really hard to fix your credit report.

Ira Rheingold

executive director of the National Association of Consumer Advocates

Also inform the company and send them the same information. (Here is the FTC letter model.)

The FTC recommends sending all documents by certified mail so that there is a paper trail. Credit reporting companies have approximately 30 days to investigate your request. They will also forward your evidence to the company that reported the information, and they must investigate and report.

The credit reporting company must provide you with the results in writing and a free copy of your credit file if the dispute results in a change. If your dispute is not resolved, you can request that a status of the dispute be included in your file and in future reports.

If you lose the case, you can file again, but be sure to include additional information, recommends Consumer Reports. A simple new submission could automatically dismiss the challenge.

You can complain to the Consumer Financial Protection Bureau website if your second attempt doesn’t work, Consumer Reports advised you. If the problem is serious, consider hiring an attorney who specializes in the area. You can find one via the National Association of Consumer Advocates website.

Ultimately, disputing your credit report is not an easy process.

“In reality, it’s really, really, really hard to fix your credit report,” said Ira Rheingold, executive director of the National Association of Consumer Advocates.

This is because the credit reporting system was not designed for the benefit of consumers. It was built for the companies that use it, he explained.

“There is nothing in our credit reporting system that makes it easy for consumers, friendly for consumers, or useful for consumers,” Rheingold said.

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