Your financial identity relies heavily on your credit report. If you find credit report errors, it’s essential to take steps to correct them as soon as possible.
You can dispute credit report errors by providing supporting documentation to the three leading credit reporting agencies: TransUnion, Equifax, and Experion.
Credit reporting errors can negatively impact your credit score because your credit score is based on the information contained in your credit report.
If you have errors sitting in your credit report, it can make getting additional credit more challenging. It can also impact your ability to buy a home or restrict your ability to get a great interest rate on your mortgage or refinancing loan.
If you notice credit report errors, here’s how to file a dispute and help protect your credit score.
Credit Reporting Agencies
There are three key credit reporting agencies, TransUnion, Equifax, and Experion, and countless smaller agencies that potential lenders can reach out to for information and analysis of your financial habits.
All credit reporting agencies fall under the federal government’s Fair Credit Reporting Act (FCRA) and are monitored by the Federal Trade Commission. Credit reporting agencies do not make decisions about whether a lender should approve a loan or credit card application, nor do they have any input into what type of interest rate you can qualify for. Instead, they provide the collected information about your credit history to lenders to make their own decisions.
Credit reporting agencies collect and maintain your consumer credit information from any lenders you have. This can include banks, credit unions, and financial institutions, credit cards, loans — including student and car loans — and more.
Credit reporting agencies determine a potential borrower’s creditworthiness, in other words, how likely you are to repay your entire loan on time. Lenders can review your credit information or use your credit score when considering your loan or credit application.
Credit Report Errors: Where Do I Start?
Carefully reviewing your personal credit report for any errors or omissions is the first step to disputing and resolving credit report errors. You can get one free credit report per year from each of the three main credit reporting agencies —TransUnion, Equifax, and Experion.
How Do I File My Dispute To Correct Credit Report Errors I Found?
Once you’ve identified credit reporting errors, it’s time to take action.
Under the rules of the FCRA, the lender who has reported the information and the credit reporting agency itself must correct any errors or other incomplete information in your credit file.
To do this, you have to contact the credit reporting agency in writing, letting them know what the error or omission is. You can use this sample letter from the FTC as a guide to help get you started.
What Information Do I Need To Include?
Include the following information with your letter of dispute:
Personal
- Your name, address, and phone number. If you’ve moved during the past two years, include those previous addresses.
- Passport, driver’s license, or other government-issued ID.
- Your Social Security Number (SSN).
- Current employer information if you are employed. If you’ve changed employers in the past two years, include previous employers.
Credit
- The lender’s name and address that your dispute is with, e.g., bank, credit union, credit card company.
- Your account information with the lender in question, including a file or account number, if you know it.
Other information to include
- Why do you dispute the information on your credit report(e.g., the loan was repaid, etc.)?
- Supporting documentation, such as receipts or account statements
Send your letter of dispute to the credit reporting agency.
- TransUnion, P.O. Box 2000, Chester, PA 19016; Phone: 1-800-916-8800
- Equifax, P.O. Box 740256, Atlanta, GA 30374-0256; Phone: 1-866-349-5191
- Experian, P.O. Box 4500, Allen, TX 75013; Phone: 1-888-397-3742
Credit reporting agencies must investigate all written requests received, usually within 30 days, unless your dispute is considered frivolous. They must also provide the lender with a copy of the information and the lender is obligated to investigate the issue as well.
How Long Does The Investigation Into Credit Report Errors Take?
Once the credit bureau has received your information, they will begin their investigation. Simple errors such as name or date of birth can often be resolved immediately or within a few days.
If the issue is more complex, the credit reporting agency may take longer to come to a conclusion. Once their investigation is finished, they will provide you with a free copy of your credit report along with the results of their investigation.
At this point, you can also ask the credit reporting agency to reach out to anyone who reviewed your file within the last six months and notify them of the corrected error. This could be especially beneficial if you were turned down for a loan or mortgage because of a credit reporting error.
What Happens If They Don’t Remove The Credit Report Errors?
But what happens if the credit reporting agency’s investigation fails to correct the credit reporting error? You have the right to request that the credit reporting agencies add a note to your file outlining the specifics of the dispute. Any potential lenders who ask to see your credit report will also receive this note to your file.
Disputing credit reporting errors takes time, but your efforts can positively impact your credit report with a bit of patience and persistence. Disputing credit report errors can not only help you improve your credit score, but it can also help you save money and get better interest rates on loans such as home mortgage loans or debt consolidation loans.
After You have Disputed Your Credit Report Errors
If a new home is in your future or if you’re considering refinancing your current home and you’ve noticed credit report errors, disputing those errors with the credit reporting agency can help you secure a loan or refinance.
The loan and mortgage specialists at River City Mortgage are ready to help. Building on their extensive experience and comprehensive financial knowledge, they can help you find the best options for improving your financial health. To learn more about how disputing credit report errors can help you take advantage of record-low interest rates, contact us today.
Photo by John Schnobrich on Unsplash
