If Your Credit Report is Full of Mistakes, Here’s What You Do

Your credit report should be a source of fact, actual truth. After all, this is supposed to represent your actual borrowing behaviors with creditors. When you apply for a credit card, mortgage, car loan, or even some non-financial applications such as for jobs, rentals, and insurance, lenders pull your credit report to judge your credit worthiness.

So, mistakes on your creddit report have long-reaching consequences. Yet, many Americans are surprised to learn errors on your credit report are quite common, much more common than the consumer reporting bureaus would have you believe. A 2024 Consumer Reports survey of more than 4,000 people found that 44% of people who checked their credit report found at least one mistake. Of those people, 27% said the mistakes were around account information errors, including accounts they did not recognize, on-time payments being reported as late or missed payments, and debts listed in collection that did not belong to them, alias, old and inaccurate personal information that was simply irrelevant.

Luckily, there’s a straightforward process in place for disputing credit report errors. Let’s walk you through the process.

Why Do Mistakes On Your Credit Report Matter

First, it’s essential to understand why mistakes on your credit report matter:

  • If your identifying information (address, name, birthdate) is incorrect, it can make it hard to get approved for new loans or credit because the information you put on the applicatioin doesn’t match what’s on your report.
  • If there is an error around account information, such as having debts listed that aren’t yours or payments listed as late even though you’ve paid on time, it can negatively affect your credit score. Each of these errors can significantly lower your credit score and impact your approval for new loans or credit. Or, if you are approced, your lower credit score means you’ll get a much higher interest rate. Paying a higher interest rate can cost you hundreds if not thousands of dollars on your overall loan!
  • Sometimes, you need to submit your credit information when applying for a job or a new rental agreement. In these situation, the errors might come across as concerning and cost you that job or lease opportunity.
  • Many unexplained errors on your credit report can also indicate someone is trying to steal your identity.

How to Dispute Errors

The Fair Credit Reorting Act (FCRA), regulates the consumer credit reporting agencies, and their interactions with consumers, as well as the data they store, and how they are able to dissiminate it. If you as a consumer find any mistakes on your personal credit report, you have consumer protected rights to file a dispute with the reporting agency. Now there are three major Consumer Credit Report Agencies or Bureaus, I hesitate to use the term bureaus because its somewhat misleading. Anyway these companies do not actually do the report themselves, they are fed data from other companies or subdivisions of the major company, at which time the main three companies compile the data for resale to their customers. The main three are Experian, Equifax, and transUnion, each of these companies have a simi monopoly on credit reporting in their region. Experian handles most of the population living on the Western United states, equifax handles middle America and TransUnion take the East Coast or Eastern states.

But How Do You File a Dispute

You can file your dispute via mail, phone call, or online. For the most optimal methods it is advised to utilize the first two in most circumstances. You will want to fill out the dispute form, or type or handwrite a letter with the information you are disputing on it along with any reason for the dispute

You’ll want to fill out the dispute form and also attach a personal letter. Your letter should include what you think is wrong on your credit report, a copy with the mistakes highlighted, the action you would like the credit bureau to take, and any supporting documents that prove your case. Make sure to only send copies of supporting documents, not originals, so if anything gets lost, you still have proof.

The credit bureau must respond to your dispute.

  • If your request is deemed “irrelevant,” they’ll notify you of this decision and close out the dispute. They’ll also provide you with their reasoning (such as not enough evidence) so you can follow up if needed. 

Suppose the credit bureau reaches out to the business, and they cannot prove the information to be accurate. In that case, it’s the business’s responsibility to notify all three credit bureaus so all your credit reports can be updated.  The credit bureau is obligated to give you the dispute results in writing. If your dispute led to any changes in your credit report, you will receive a free copy of your updated report. This copy doesn’t count towards your one free annual report.  You can ask the credit bureau to send the corrected credit report to any lender that accessed your credit report in the last six months. 

. As a consumer, you’re entitled to a free copy of your credit report from each credit bureau once every 12 months. Make it a habit to order this report and review it. 

Credit monitoring companies are an option if you don’t have enough time to dedicate to this task. These companies offer many helpful services, including monitoring your credit and alerting you of significant changes in your credit score, reviewing your credit report for mistakes, filing disputes on your behalf, and offering credit improvement advice. Of course, this all comes for a fee. 

So, it’s up to you to decide if you’re up for this responsibility or if you’d rather outsource it to someone else. The most important thing is that it gets done by someone!

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