generic How to fix errors on your credit report
Checking your credit report can feel like the adult version of checking your report card. If it’s been a while, you could stumble across a few unexpected surprises.
The way to keep your credit report clean and your credit score in a good place is to get in the habit of checking your report at least once per year. And if you’re making a major purchase in the near future, experts say that checking it a few months beforehand won’t hurt. Going through all of the information in your report with a fine-tooth comb and checking for errors may sound tedious, but it can help you avoid major financial hurdles down the line.
How common are credit report errors?
They may be more common than you think. According to a study conducted by the Federal Trade Commission (FTC), one in five people have an error on at least one of their credit reports. And there are several reasons it could happen. “A creditor who supplies account information may have misreported the data, or a consumer may be a victim of fraud,” says Rod Griffin, senior director of public education and advocacy for Experian.
By requesting a copy of your report from all three major credit reporting agencies at least once per year will ensure that you catch any mistakes that could potentially cost you a lot of money down the line. While your credit score won’t appear on your credit report, the information contained within your credit report will factor into your overall score. Even a seemingly insignificant error on your report can be enough to lower your score and your odds of being approved for any type of financing in the future.
What kinds of errors could show up on your credit report?
There are several types of errors that could pop up on your report. A few common errors you might find on your credit report include:
Errors in your personal identifiable information (PII)
This could include a misspelled or incorrect name, phone number, or address
Accounts belonging to another person with the same or similar name to you
Incorrect accounts as a result of your identity being stolen
Errors related to an account status
Closed accounts reported as open
You’re reported as the owner of the account, when you’re just an authorized user
Accounts that are incorrectly reported as late or delinquent
Incorrect date of last payment, date opened, or date of first delinquency
Same debt listed more than once
Balance errors
Accounts with an incorrect current balance
Accounts with an incorrect credit limit listed
Data management errors
Reinsertion of incorrect information after it was corrected
Accounts that appear multiple times with different creditors listed
What do you do if you find an error on your credit report?
The first step is to go straight to the source. “It’s important to remember that you do not have to pay to repair your credit. Instead, if you believe there is inaccurate information reflected on your credit report, you can dispute the information for free through the appropriate credit bureau,” says Griffin.
Here’s how to do that, step by step:
1. Request copies of your credit report from each of the bureaus
You’ll want to request a copy of your credit report from each of the major credit reporting agencies to verify that the information is actually incorrect and not potentially a forgotten account or debt payment. You can request a free credit report from each of the three major credit bureaus every 12 months through Annualcreditreport.com, although currently all three major credit reporting agencies are offering free weekly online credit reports through December 2023 because of the COVID-19 pandemic. Equifax is also offering everyone in the U.S. six free credit reports per year through 2023 through its website.
2. Gather your supporting documents
Depending on the nature of the error, you’ll want to gather any documents that you’ll need as evidence when filing your dispute. If it’s an error in your personal identifying information, you’ll want to have a few forms of ID handy. If the error is related to your account balances or an account that has been closed but is reported as still open, you’ll want to dig up those statements and letters that clearly list your balances or confirm that an account has been closed.
3. Contact the credit bureau that is listing the incorrect information
All three credit bureaus (Equifax, Experian, and TransUnion) allow you to file a dispute online, over the phone, or by mail. This is your primary source for filing a dispute, although you can also contact the company or issuer who reported the incorrect information to the credit bureau (i.e. the “furnisher”) and dispute the error with it as well while you wait for your dispute to be processed with the credit bureau.
4. Wait for a response to your dispute
Once you’ve submitted your dispute, credit reporting agencies typically have 45 days to investigate your claim and collect additional information from the furnisher. After they have notified the furnisher and the furnisher has either confirmed or denied the information within the dispute, the bureau then has five business days after completing their investigation to notify you of the outcome of your dispute. If the bureau decides that your dispute is valid, the information will be removed from your credit report. And if you applied for a loan or new line of credit for example and were denied because of this error, you can also request that a corrected version of your report be sent to anyone who may have requested it in the last six months.
If the agencies decide that there is no error on your report, they will stop investigating. In these cases, you may need to provide them additional evidence to support your dispute.
The takeaway
The information in your credit report can be the deciding factor in some of the biggest financial decisions you’ll make. It tells lenders how you’ve managed credit in the past, and how likely you are to repay any money you borrow in the future. Keeping a close eye on your report and promptly reporting errors to the credit bureaus will ensure that when you’re preparing to cross a major financial milestone off your bucket list, you won’t have to put your plans on hold.
This story was originally featured on Fortune.com
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