March 24, 2015

What to Do if You Find a Mistake on Your Credit Report

Have you been keeping an eye on your credit reports? Regularly checking a credit report is something we’re all told to do, but many people either forget to check their credit reports or actively avoid them for fear of what they might find. However, if you do take the time to inspect your credit report, you might find that your credit score is being dragged down by a mistake. What then?

We specialize in helping used car shoppers with bad credit histories, and we’re no strangers to seeing negative items on credit reports. That said, it’s not rare for those negative items to be mistakes. If you think there’s a mistake on your credit report that’s negatively affecting your credit score, read on to learn how to handle the situation.

Getting a Copy of Your Credit Report

Oklahoma Credit History Report

The first step in checking your credit report for mistakes is to get a copy of your report from a credit bureau. In the United States there are three major credit bureaus that provide reports and scores for individuals: Experian, Equifax, and Transunion. Each of these credit bureaus can supply you with a free credit report at your request – but you have to know how to get it.

There are plenty of ways to go about getting your free credit report, but the simplest is to go to AnnualCreditReport.com and follow the steps to request your credit report. You’re entitled to one free copy of your credit report each year from each agency, but after that free report you’ll have to pay a fee to get another one.

Many experts recommend only requesting one credit report at a time and checking it thoroughly before requesting another. If you only pull one report and there are no mistakes, you can wait a few months to get the next one. This strategy allows you to easily and cheaply monitor your credit throughout the year. However, if you do find a mistake on your report you should request the other ones to ensure the mistake isn’t on all three.

Common Credit Report Mistakes

No matter what your credit score is, keeping an eye on your credit reports is a good practice. Some experts estimate that as many as 25% of credit reports have mistakes on them, and these mistakes could easily be costing you money or preventing you from qualifying for loans or financing.

Some of the most common credit report mistakes include:

  • Outdated or incorrect personal information such as names, addresses, or other identifying information.
  • Incorrect account details such as the name of your bank or credit union, the type of account, and the length of time it’s been open.
  • Fraudulent accounts or charges that could point toward identity theft.

Of these mistakes, the last one is the most concerning. It’s not only possible but relatively common for identity theft to take place. Thieves regularly open bank or credit card accounts in other people’s names, and those accounts will drag your credit down if they aren’t discovered and dealt with promptly. However, there are ways you can handle mistakes on your credit report.

Challenging a Mistake on Your Credit Report

While finding a mistake on your credit report might be simple, getting the mistake removed can be a challenge. Credit bureaus want to make sure they aren’t removing legitimate credit problems, so the verification process can be tough.

If you spot a mistake on your credit report, you’ll need to call the bureau that generated the report (Equifax, Transunion, or Experian) and see what they require to get the inaccurate information removed. However, to actually file a dispute you’ll need to compose a written letter and send it to the credit bureau. Most of the time your dispute will include the following:

  • A written explanation of what information on your credit report is incorrect;
  • A copy of the credit report that shows the charges or accounts you want to dispute;
  • Copies of any documents (such as bank or card statements, identifying information, or other supporting information) that can prove or help prove the report is incorrect.

Send your letter and supporting information by certified mail (not regular mail!) and make sure to request a return receipt. You should also keep your own copies of all the information you send to the credit bureau so you can make sure their information matches what you sent.

Once the credit bureau receives your dispute, they’ll have 30 days to respond to your dispute by investigating your claims and by forwarding your dispute to the institution that created the inaccuracy. Once that institution receives your dispute, they too will have to investigate it, correct it, and forward the correction to each of the three bureaus. Once the investigation is finished, the credit bureau will send you the results in writing and another copy of your credit report that reflects the changes.

This can be a tedious process, but it’s well worth the effort. Clearing up mistakes on your credit report can save you thousands of dollars per year in interest charges and loan fees, and it can also make it easier for you to get new lines of credit such as loans, credit cards, or financing for a car or a house.

If you want more helpful tips on managing your credit and finances, visit us today at The KEY in Oklahoma City. Our OKC used car dealership specializes in helping people with bad or no credit get auto financing, and we also offer free financial and life counseling to our customers. Visit our Oklahoma City used car lot today, or get more advice on our Facebook or Google+ pages.