Any misinformation in your credit report can put you in financial distress. It will affect your chances of getting a job, buying power, loan application for a house, and buying insurance. Credit reporting agencies provide this information to certain businesses that help them decide whether you are eligible for a service or not.
You should keep in mind that the stronger your credit history, the higher your chances of paying less when borrowing money. You should ensure the information in your credit report is complete and accurate.
Some of the most common errors in a credit report include payments labeled open when they are closed. It’s also possible that the creditor accidentally added information of someone who has an almost similar Social Security Number or name to your report .
The bad news is that if the error is correct, it will stay on your report for seven years. The good news is that you can dispute the error if it’s the other way around.
Step 1: Get a Copy Of Your Credit Report
The first thing you need to do is get a copy of your credit report from a credit bureau. The top three credit bureaus offering free copies include TransUnion, Experian, and Equifax. Go through the record and highlight the ones you think are an error.
Step 2: Write A Letter And Explain The Errors
You will find a sample dispute letter on The Federal Trade Commission (FTC) website. Edit the letter with your name, explain why the information is incorrect, and mail the letter to all three credit bureaus.
Step 3: Dispute the Error With the Credit Bureau
Write an email informing the credit bureau that you have mailed them a letter that outlines the errors in your credit report. Cover all the bases to make sure that you get a fast response.
Step 4: Dispute The Error With The Company That Reported It
If the company that reported the error made a mistake, no amount of mail or emails would fix your credit report. So, send the same letter to the company, asking them to recheck the information.
Step 5: Review The Results
The credit bureau will take 30 days to review your case. After making a decision, they must inform you of the result within five days. If you are sure about an error in your credit report but the credit bureau says otherwise, you can re-file the dispute. Make sure to include proof this time.
If the negative errors are correct, you will have to improve your credit score the old way: Pay bills on time, pay off debts, create a budget, etc. For just $20, you can get credit monitoring services that will alert you in the case of identity theft and any big negative error. Disputing an error in your credit report is easy, but the process is quite long. You must ensure that the credit bureau and the creditor have all the information to set things right.