Disputing Credit Report Errors

When it comes to your credit record, this impact can include denial of loans, jobs, insurance and housing — as well as the imposition of crippling expenses. This is why it’s key to review your credit report on an annual basis at minimum — ideally quarterly. Doing so gives you an opportunity to spot issues before they swell to unmanageable proportions. 

With that in mind, here’s how to go about disputing credit report errors.   

You Have to Review It to Dispute It

The Fair Credit Reporting Act mandates you are to be supplied with one copy of each of your three credit reports on an annual basis. AnnualCreditReport.comwas set up to provide this service. Log on, answer a few security questions and you’ll have the data in minutes. 

While each of the three reports is slightly different, they are close enough in content to allow individual annual reviews of each one and be OK. Thus, asking for them one at a time every three months gives you the ability to look at your history over four times a year instead of once. 

Common Errors 

While instances of credit fraud do occur, most errors happen because data was entered wrong, payments were applied to the wrong debt, or accounts are reported multiple times. 

Mischaracterized closed accounts can make it look like a lender shut you down. A former spouse’s debts can be reported as yours. Older bad debts that have expired may have failed to drop off. Accounts settled by credit card debt relief can sometimes be misreported as well. Further, debts you don’t recognize might well be the product of fraudulent activity. 

Either way all of the above is repairable — some of them more easily than others — but all are repairable just the same. 

What to Do About it

The credit bureau reporting the faulty data, as well as the business providing the information to the agency, must both be contacted. The good news is disputes can now be conducted online, which makes the process faster and simpler, given you must notify each of the three agencies reporting the bad information. 

Be ready to provide all pertinent material when you get in touch with them. You’ll need to articulate the problem with each item, the facts surrounding the conflict and request the correction — or deletion — of the flawed report. You’ll also need to provide supporting documentation to prove your claim. 

Should you decide to conduct this with a letter, send it by certified mail and include copies of all of your documents — not the originals. Request a return receipt so you can prove the letter was received. Keep a copy of your request letter as well. FICO offers a boilerplate dispute letter at MyFico.com. 

The agency will have 30 days to get back to you with the results of their investigation.

Not Satisfied with the Result?

There will be times when your best efforts will fall flat. While objectivity should be the rule of the day, you’re going to be dealing with people whose decisions can — though they really shouldn’t  — be subjective. 

Ask to have your dispute noted on your record if you get denied and are convinced the file is wrong. At least then you can explain the bad information to potential lenders if you’re denied a loan on the basis of it. 

Disputing credit report errors is a pretty straightforward process, but there may be times when you’ll need some backup from the legal community. Hire a lawyer to help resolve the situation if you feel that information is causing you irreparable harm and the reporting bureau is doing nothing to correct the situation.