Your credit report holds a lot of sensitive information. It spells out where you live, if you’ve ever been sued, and whether you pay bills on time. Companies sell those reports to businesses that want to check your credit such as:
- Lenders
- Landlords
- Employers
- Insurance companies
While credit reporting companies try to get everything right, mistakes happen. More often than you might expect. And when you’re trying to get a loan, a credit card, or an apartment, even one mistake can result in rejection.
Worse, sometimes those “mistakes” aren’t accidental. They may be brought on by identity theft – when someone else uses your personal information to get credit in your name. When they don’t pay the bill, the black marks go on your credit report. And that can haunt you for years.
How to Fix the Mistakes
The first step toward correcting mistakes – intentional or accidental – is to order a copy of your credit report. Once a year, you’re entitled to a free copy from each of the three national credit reporting companies:
- TransUnion
- Equifax
- Experian
All it takes is a quick trip to annualcreditreport.com to order your free report. Make sure you use only this website, backed by the FTC (Federal Trade Commission).
If you see any errors on your credit report, even if they seem small, take immediate steps to correct them.
Contact every credit reporting company showing that error in writing. Include a detailed description of the inaccurate information and copies (never originals!) of any documents to support your position. Also include a copy of that page of your credit report with the error clearly circled. Explain why you’re disputing their information, and ask them to correct or remove the error.
You can send a letter by certified mail, with a return receipt requested so that you have proof that the credit reporting company got your letter. Keep copies of everything: your letter, your backup documents, and your mailing receipt.
What Happens After You Report the Credit Report Error
Once they receive your letter, the credit reporting company has to investigate within 30 days. They also have to send the information you provided to them to the company that gave them the incorrect information. That company is also required to investigate your claim and report their findings to the credit reporting company. If they find out you were right, they have to tell all three national credit companies and all three will correct their files.
After all the investigating is complete, the credit reporting company will send you the results in writing. They’ll also provide an updated free credit report if your dispute resulted in an change.
Plus, if you request it, the credit reporting company must send notice of the correction to everyone who pulled your credit during the previous six months.
If your dispute doesn’t get resolved, you can ask the credit reporting company to include a “statement of dispute” in your file for future credit reports. At least that way someone who pulls your credit will know that you believe there’s inaccurate information listed.
Making Sense of Your Credit Report and Personal Finance In General
The current U.S. education system does a lousy job of preparing us for the realities of financial life. Unless you’re a certified public accountant (CPA) like me, or you have a degree in economics, you’re probably baffled by most of the terminology used in personal finance. You may look at a contract, terms for your credit card, or a stock market report and wonder, “What does all of this mean?”
That’s exactly why I wrote Personal Finance In Plain English.
This easy-to-use glossary gives you straightforward explanations of 350 personal finance terms from banking and taxes to cryptocurrency and retirement planning, and everything in between. You’ll learn what the term means, how the concept works, and how it is used.
You can read the whole book to get a firm grounding in personal finance or flip through to the appropriate term to understand whatever is in front of you at the time. Personally, I recommend doing both.
Once you have this handy companion, you’ll understand what finance companies are asking of you and what your rights may be when you have to deal with problems, like getting your credit report corrected.
Click on the button below to learn more and get your copy now.