Your credit report can affect so many important things in your life, including what kind of deal you'll get on an auto loan or mortgage. A damaging mistake might even keep you from getting certain jobs.
Common Credit Report Mistakes
There's a surprisingly good chance that there are mistakes on your credit report that could be costing you money. It has been reported that there is as much as a 25% chance that there is some kind of big mistake on your report. The most common mistakes include:
- Outdated personal information
- Incorrect account details
- The appearance of fraudulent accounts
Unfortunately, it is absolutely possible for someone to steal your personal information and open up credit cards in your name. And when the bills for these cards go unpaid, the associated derogatory marks end up on yourreport, and it's yourcredit score that suffers. But that doesn't mean you're defenceless when it comes to your credit.
Requesting a Copy of Your Report
The process of correcting credit report mistakes cannot begin until you know what's on your credit report. Fortunately, once every 12 months, you are entitled to one free copy of your credit report by visiting AnnualCreditReport.com which covers each of the three bureaus: Equifax, Experian and TransUnion. It is important that you review your file from each of these bureaus because, in some cases, an error may not be showing on all three reports.
If you do spot a mistake that could be damaging to your credit score, don't panic. You've already taken the first step towards correcting your credit history.
Disputing Mistakes on Your Credit Report
To start the process for disputing a detail on your credit report, you need to do the following:
- Gather documentation to support your claim
- Circle the error(s) on your report(s)
- Make copies of your report(s) and supporting documentation
- Send this evidence to the bureau(s) along with your dispute letter
- Read the FTC guidelines for properly formulating dispute letter.
- Send everything as certified mail, marking “return receipt requested” on the accompanying form so that you'll have a record of the credit bureau(s) receiving it.
Waiting for a Decision
The credit bureaus are required by law to investigate your dispute, and they will generally do so within 30 days of receiving notification of the claim. Be patient, but if you haven't heard anything from the bureau in 60 days, follow up by contacting them.
If your dispute is successful, the bureau will report the inaccuracy and subsequent correction to the other credit bureaus. You will also receive an additional free copy of your credit report showing every change that was made.
If your dispute claim is denied, and you still feel that you are in the right, you can always seek legal representation in order to pursue your case.
The Bottom Line
Monitoring your documented credit history and reporting any potential mistakes may seem like a painstaking process, but the pay off that will come in getting the credit score that you deserve will be worth the entire amount of effort involved. And as we already know, your credit score can make all the difference when it comes time to qualify for an auto loan.
So, if it's been a while since you've seen your credit report, request your free copy today. What you don't know could definitely be hurting you!