A 4-Step Guide to Disputing a Credit Report Error

Your credit score is the ultimate determinant of your applications for a credit card, a job, a mortgage deal, and others. One way you can take care of your credit score is by routinely checking your credit reports. This will help you keep track of your credit activity and allow you to adjust accordingly if you’re overspending or not paying your bills on time. Checking your credit report also allows you to spot errors.

The Federal Trade Commission (FTC) found that one out of five consumers has at least one discrepancy in their credit report that can negatively impact their score. If you’re one of these people, you should immediately dispute the error in your credit report. But how?

Review your credit report

You can get one free credit report per year from AnnualCreditReport.com. You can also get a report free of charge if you’re unemployed and are job hunting, if you’ve been a victim of identity theft, or if you receive welfare or government assistance.

You have the option to order a report from one of the major credit bureaus: Equifax, Experian, and TransUnion if you’re not qualified for a free copy. The report costs $10 to $20, depending on the bureau.

Know which errors you can object

Credit bureaus can investigate any errors you object, but they’ll only remove the ones that the law requires them to. You can dispute details that are incomplete, inaccurate, unverifiable, or out of date. Negative items, such as late payments, overdraft, or debts, should only stay on your report for seven years. You can dispute the entry if it’s been on your record for more than that period. But bankruptcy can remain on your report for 10 years.

Keep tabs on common errors: incorrect names, paid delinquencies marked as unpaid, accounts that aren’t yours, payments reported as late that you paid on time, inaccurate loan amount or account balance, and inaccurate account status.

Decide how you want to make your dispute

credit report

You can file your dispute through email, over the phone, or by mail. You need to provide a copy of your credit report within the past month and the corresponding report number to dispute via phone call or online.

For the online process, submit a credit report dispute through the website of any of the three bureaus. This method is fast and convenient, but it doesn’t provide you with the concrete documentation you need since the bureaus respond online as well. Lastly, mail your supporting documents or proof to complete the online process.

Filing a dispute through mail takes more time, but it provides a paper trail necessary for following up the investigation. Write a dispute letter observing FTC’s sample and explain the information you want the bureau to remove and why they should do so. Include a copy of the proof of error if you have it. Then, send the letter and request a return receipt, so you have proof of when you made the dispute and when the bureau received it.

Objecting an error via phone call may be the most difficult since there’s no concrete evidence of the conversation. So take note of all the information the bureau will give you along with the name of whom you spoke with and when you made the call.

Allow time for investigation

Sometimes, the bureau responds by immediately removing the information you’ve disputed without notifying you. But if the creditor proves the item you’ve objected, the bureau will reinsert it in your record. If this happens, the credit bureau will send you a letter explaining that the lender has proven the disputed entry so it’s back on your report.

After the investigation, the bureau will send you a free credit report reflecting the changes. You can also request the credit bureau to forward the latest report to the creditor who provided the information in the first place, so he or she can update your records.

The process may be lengthy, but disputing an error on your credit report is something you should take the time and effort to do. In the end, your credit score will greatly benefit from a corrected discrepancy.

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