Your credit report and credit score are vital parts of your financial health. Using credit responsibly means you can get loans at the best possible rates. But what if there is a negative mark on your credit report that’s just plain wrong?
Money expert Clark Howard says that it’s up to you to make sure your credit report is accurate. The credit bureaus sometimes make mistakes — as do companies that report your activity to the bureaus.
In this article, we’ll show you how to ensure there are no errors on your credit report and guide you through the steps you need to take to correct any inaccurate information.
5 Steps to Dispute an Error on Your Credit Report
Errors on credit reports are a top source of consumer complaints to the Consumer Financial Protection Bureau (CFPB) every year, according to its Consumer Complaint Database. To protect yourself from being the victim of one of those errors, here’s what you need to do.
1. Check Your Credit Report at Least Once a Year
You can’t find errors on your credit report if you don’t review it regularly. One way to make that a little easier is to monitor your credit score. If you see a sudden drop, it’s time to investigate. First, get copies of your actual reports from all three major credit bureaus: Team Clark’s Guide to Getting Free Credit Reports From All Three Bureaus.
Look for mentions of any accounts that you haven’t opened and any negative remarks on accounts you do have but that should be in good standing. If you spot anything that looks suspicious or out of place, you’ll want to move on to the next step.
2. If You Find an Error, Contact the Business That Reported It
If you spot something questionable or find an outright error on your report, contact the reporting entity involved. This could be a credit card company, the lender for your house or car note or even a landlord. It may just be a simple misunderstanding, in which case it should be relatively easy to clear up.
But no matter what caused the error or how insignificant it might be, you should send an official dispute letter to the company that reported the information to the credit bureau(s). Include a copy of the credit report itself, making sure you highlight the error. Also send any documentation you have in your favor. According to the Federal Trade Commission, the letter should look something like this:
[Your City, State, Zip Code]
[City, State, Zip Code]
Dear Sir or Madam:
I am writing to dispute the following information in my file. I have highlighted the items I dispute on the attached copy of the report I received.
This item [identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.] is [inaccurate or incomplete] because [describe what is inaccurate or incomplete and why]. I am requesting that the item be removed [or request another specific change] to correct the information.
Enclosed are copies of [use this sentence if applicable and describe any enclosed documentation, such as payment records and court documents] supporting my position. Please reinvestigate this [these] matter[s] and [delete or correct] the disputed item[s] as soon as possible.
Enclosures: [List what you are enclosing]
To ensure that the letter makes it to its destination, you should send it by certified mail, return receipt requested.
3. Dispute the Error With the Credit Bureaus
At the same time you contact the entity responsible for the error, you should start the process of getting the error removed. You can submit a dispute with all three major credit bureaus online or by mail. Make sure to check the instructions from each bureau and include all of the proper documentation with your dispute.
Here’s what you’ll need to dispute the error with the credit bureaus:
|Credit Bureau||Address for Disputes||Online Dispute Information
P.O. Box 4500
Allen, TX 75013
|Equifax||Equifax Information Services, LLC
P.O. Box 740256
Atlanta, GA 30374-0256
|TransUnion||TransUnion Consumer Solutions
P.O. Box 2000
Chester, PA 19016-2000
4. Keep Copies of Everything
This step is extremely important.
In order to get your dispute resolved, you may be asked at some point to provide proof of the actions you’ve taken. Keep copies of everything you send to both the reporting entity and the credit bureaus.
If you end up communicating with anyone by phone, get the name and employee number of that person. If there are emails involved in your dispute, keep them in a folder where you’ll be able to access them easily.
5. Stay on Top of the Process
Finally, it’s important to understand that getting an error removed from your credit report isn’t an overnight thing. It’s a process that can take weeks or even months. Give it time to play out, but make sure no one is dropping the ball. If you don’t hear anything from anyone for a while, follow up with a phone call or email to see where things stand.
Once Everything is Resolved, Follow Up
When you do get the error removed from your report, your job isn’t finished. There are still a couple of things you need to do:
- Send revised versions of your reports to anyone who pulled your report during the time it included incorrect information. This is especially important if the error on your report caused you to be declined for a loan or resulted in being quoted a higher interest rate than you might have gotten with a better credit score.
- Continue to check your reports. You want to ensure the error doesn’t pop up again and that new errors don’t appear. Remember to check your credit reports from all three bureaus at least once a year.
If You Don’t Get Resolution, Escalate
If you can’t get the error on your credit report removed to your satisfaction by following the steps above and you’re sure that it’s there through no fault of your own, you may need to escalate your situation to the CFPB and possibly even your state’s Attorney General.
Having an error on your credit report is no fun and can be damaging to your financial well-being. But with a little diligence and taking the right steps, you can most likely have the error removed.
Don’t forget to check your credit reports at least yearly for mistakes and if you really want to protect yourself, make sure your credit is frozen with all three bureaus.
If you do need to dispute an error, we’ve created this handy reference with all of the steps.
If you’re feeling stuck and need to talk to someone who can help, contact Clark’s Consumer Action Center — a FREE service to help you with your money problems!