Because your credit report contains information that is reported about you, mistakes are made. However, if someone looks at your credit report, he or she assumes that what it contains is accurate, whether it is a potential employer, or an insurance underwriter trying to figure out what premium you should be charged. And, of course, errors in your credit report can result in you being turned down for a loan, or paying a higher interest rate.
It is a good idea to check for errors on your credit report and, if you find them, properly dispute them. It’s up to you to be vigilant and make sure that the information reported about you is accurate.
There are three major credit bureaus: Experian, TransUnion, and Equifax. You should make the effort to check the information on each of these reports. Some information may not be reported to each credit bureau. Additionally, there might be a mistake on one report that does not appear on the other two reports. You should go through each of your reports and look for errors.
You can obtain a copy of your credit report in a number of ways. Once a year, you can look at your report from each of the bureaus. Visit www.annualcreditreport.com for more information on how you can get one free report every 12 months from each of the three major bureaus. You must go to this official web site if you want to get your free credit report. You will need to provide your name and Social Security number, as well as answer questions about your identity for security purposes, before you can see your credit report.
If you are turned down for credit, or for a job, you are entitled to a free copy of your credit report from the company who supplied the information that was used to decline your application. You must request your free copy in writing, though, and do it within 60 days of your rejection.
If you have already seen your free credit report, and you haven’t been turned down for credit or a job, you can purchase a copy of each credit report from the bureaus. Visit each bureau’s web site to purchase a copy of your report:
It is also possible to get what is known as a 3-in-1 report from any one of the bureaus, or from www.myFICO.com. A 3-in-1 report is a credit report that contains the information from all three major credit bureaus. This adds an element of convenience, since you can pay one price, at one web site, and look at all three of your credit reports. Note that the 3-in-1 option is not available from annualcreditreport.com, nor can you get it if you are receiving a free report because of a rejection.
Once you have a copy of your credit report, it’s time to look for problems that need to be corrected. Some common mistakes to look for on your credit report include:
Because credit bureaus are required to be as accurate as possible, it is possible for you to dispute errors on your credit report to have them corrected. Unless you are dealing with a fraudulent account, you should follow the normal dispute process.
By law, credit bureaus are required to investigate disputes you submit about the information in your report – unless it is an obviously frivolous dispute. Credit bureaus are required to investigate the matter within 30 days, and make corrections in a timely manner. It is up to the credit bureau to contact whoever reported the information, and then make sure your report is accurate. However, you can speed up the process by contacting the reporting organization as well as the credit bureau.
Here are the steps you should take when disputing an error on your credit report:
You also have the right to write a statement that will be noted on your credit report. You can explain your side of the story, and you can also include a copy of your dispute letter in the statement so that those checking your credit report will see that you believe some of the information being reported is inaccurate.
Realize that just because you dispute something, it doesn’t mean it will be changed on your credit repot. Indeed, if you know the information is accurate, you shouldn’t dispute it. Accurate information can only be removed by the passage of time. The best way to counteract accurate negative information is to engage in better habits so that you can overwhelm the negative item with multiple positive items. After a while, if you consistently make payments on time, the one late payment you had will no longer count for as much. If you can show positive financial behavior in your credit report for three years after a foreclosure, your credit will begin to recover, and those looking at your report will see that you are making progress.
You want your credit report to accurately reflect you. Dispute items that are inaccurate, but only improved habits will help you overcome accurate negative items in your report.