Are you a part of the 35% of Americans who have never checked their credit report?
If you are, you might want to request your yearly free personal credit report.
That’s because one in five consumers have an error on their credit report—and you could be paying higher interest rates on your credit products (credit cards, auto loans, mortgages, business loans, etc.) if you don’t deal with any mistakes on your report.
How do you file a credit report dispute? Here’s exactly how to do it.
How to File a Credit Report Dispute in 5 Steps
We’ll dive into the details of each step in a minute, but here’s your quick and dirty guide to filing a credit report dispute:
- Check your credit report. Get a copy of your credit report (from annualcreditreport.com) and scan through the items on the report.
- Make sure it’s really a mistake. If you find what looks like a mistake, check to make sure that it’s really a mistake on the information provider’s or credit reporting bureaus’ end.
- Gather documentation to support your claim. Put together any documents (proof of payments, correspondence related to the charge or error, etc.) that could help support your case.
- Tell the credit reporting bureau the information you believe is incorrect (online or via the mail). All three credit reporting bureaus let you file a credit report dispute online, but you can also do so via a letter in the mail.
- Tell the creditor or other information provider that you’re disputing information they gave to the credit reporting bureau. If the error stemmed from a misstep in how a creditor or information provider reported your behavior to the credit bureau, you should write a similar letter explaining the error and credit report dispute.
Those 5 steps are exactly what you need to do to dispute an error on your credit report.
But let’s give the issue of disputing a credit report a little more color—here’s what you need to know about each step in the process.
Step #1: Checking Your Credit Report
Checking your credit report is an obvious but crucial first step in the credit report disputing process.
If you don’t know what your credit report looks like, you’ll never know if your creditors and the bureaus are reporting accurate information about you.
How can you get a copy of your credit report?
Well, you’re entitled to a free credit report each year.
Annualcreditreport.com can give you a free copy of your credit report from all three of the consumer credit reporting bureaus—Equifax, Experian, and TransUnion.
You should take advantage of a free credit report each year, and in some scenarios, monitor your credit more closely.
Monitoring your credit is important for keeping a tab on your overall financial health, but specifically, it can help you:
- Stay on top of your eligibility for credit products. Most importantly, the information your credit report contains information that determines whether or not you can qualify for different credit accounts. You want to stay in tune with your credit report so you’ll know when you can qualify for better credit accounts, higher credit limits, lower interest rates, etc.
- Help guard against identify theft. An alarming amount of U.S. consumers suffer from identity fraud. In fact, every 2 seconds there’s another case of identity theft in the U.S. It’s important to monitor your credit report so you can be on the alert for what’s called new account fraud. Scammers could be opening credit accounts in your name for the purpose of committing fraud with the accounts. This kind of identity theft is particularly damaging to your credit score and your financial health, so it’s important to keep an eye out for this activity on your credit report.
- Monitor for errors. Of course, this is the biggie when it comes to credit report disputes. Keeping regular tabs on your credit report helps you know when the information is correct and when something is off. If something is off, you’ll know when you need to file a credit report dispute.
Step #2: Determining If Your Credit Report Really Has an Error
So you know why you should check your credit report and continually monitor it.
But how can you tell when something’s wrong?
If you’re not an expert on credit reporting data and how to read your credit report, then this might not come naturally to you.
If that’s the case, here’s what you need to know about credit report errors and how to spot one.
What’s an Error on Your Credit Report?
What technically is an error on your credit report?
Well, an error can be any type of information that shows up on your credit report but really shouldn’t be there. This could be because the information is incorrectly reported, the information just simply isn’t yours, or the report is listing information that’s illegal to report.
What Are the Most Common Errors on a Credit Report?
Any information that seems fishy, or you have no recollection doing on your credit accounts, is worth looking into with a skeptical eye.
If you can’t confidently say, “Yeah, that was me,” after reviewing your credit report, then you should look into the issue further.
While a variety of errors could pop up on your credit report, here are some of the most common ones to keep a special eye out for:
- A late payment that’s more than 7 years old.
- A credit account opened under a name that’s similar to yours (e.g., Jonathan Smith versus John Smith).
- Having a credit card or loan account that’s incorrectly listed as yours.
- Someone made a clerical mistake in reading or entering the name, address information, social security number, or employer information from a hand-written credit application.
- An account that was closed by you but is listed as closed by the account provider.
- Payments on credit account were incorrectly reported to other credit accounts.
- Payments that were reported as late but were actually on time.
- Inaccurate credit limit, loan amount, or account balance reported.
- A paid-off collections account still shows as unpaid on the credit report.
- A paid tax lien that is more than seven years past the payment date.
- An account that was discharged in bankruptcy still shows up as active with a balance.
If any of these instances of incorrect information appears on your credit report, you have reason to step back and question it.
Also, it’s important to remember that not all three credit bureaus report the same information.
So it’s not unusual to notice that, say, your Equifax credit report has slightly different information than your Experian credit report.
If any of your credit reports is missing information or has dissimilar information, that doesn’t necessarily mean you have an error and should gear up for a credit report dispute.
That could likely be due to the fact that some creditors report to only one or two credit bureaus, so the bureaus are getting slightly different information. Or the credit bureaus might not have all of the most recent updates on your credit accounts reflected in your last report. If that’s the case, check 3 to 6 months down the line to see if the updates have processed.
Step #3: Filing a Credit Report Dispute
After scanning your credit report closely, say you have reason to believe that something is indeed wrong on your credit report.
Did you know that it’s actually illegal for the credit reporting bureaus to report incorrect information?
You have legal recourse to file a credit report dispute and have anything proved to be incorrect removed from your report.
Just how can you go about disputing a error on your credit report?
Here’s what the credit report dispute process looks like.
Verify That the Information Is Indeed an Error
Before you go through the work of filing a credit report dispute, you want to make sure that you actually have an error on your account.
Check the list of common credit report errors above to see if you have one. If you see a piece of information that’s not on the list above but still have reason to believe that something’s up, check your account statements, new account openings, and general credit activity in the past.
You could go through the process of scanning for credit report errors yourself, or if you’re more comfortable having a professional do it, you can hire a credit repair agency to do it for you.
Either way, in the case that you find yourself in a tricky situation with a credit report dispute, you’ll be happy that you’ve kept important information about your account in an organized, easy-to-access place.
Gather Documentation That Helps Your Case
Depending on the type of error you find on your credit report, you might have pieces of information that prove the information is incorrect.
This could be any correspondence you have with a credit provider, an account statement, proof of account payment, and so on.
Putting these documents together to submit on your credit report dispute will all help your case.
Decide How You’ll File Your Credit Report Dispute
If it’s just a simple issue about an incorrectly reported late payment, then you could go straight to the creditor to get the issue resolved.
If it’s a more complicated matter, though, you might need to file a more serious credit report dispute.
There are three general ways to do that.
1. File an online credit report dispute with a bureau: First, you can now file credit report disputes online with any of the three credit reporting bureaus.
For filing a credit report dispute with any of the three bureaus, check out the pages below:
In a guided process, each bureau will walk you through what you need to fill out to file a credit report dispute online. Also, if you choose to file online, you might find that the process is a little faster due to the fact that online account information is readily available.
2. File a credit report dispute with a bureau via the mail: You can also do it the old-fashioned way and write a credit report dispute letter to the offending credit bureau.
In this process, you should tell the credit reporting company, in writing, what information you think was reported incorrectly. (The Federal Trade Commission has a sample letter that you can follow to write your own credit report dispute.)
In general, the letter should clearly identify the items you believe to be incorrect, and why they’re incorrect.
If you have any supporting documentation to help your case, you should enclose copies of the documents (not originals) in the letter. For clarity, you might also want to include a copy of the report that has the incorrect information in the letter, highlighting the errors.
Decide to go with snail mail?
Here are the respective addresses to send your credit report dispute to:
Download the dispute form and mail the form with your letter to:
Equifax Information Services LLC
P.O. Box 740256
Atlanta, GA 30348
Mail your credit report dispute letter to:
P.O. Box 4500
Allen, TX 75013
Download the dispute form and mail the form with your letter to:
Consumer Dispute Center
P.O. Box 2000
Chester, PA 19016
3. File a dispute with the information provider: If the error resulted from a misstep on the information provider’s side (i.e., your creditor who discloses your behavior to the credit reporting bureaus), then you might choose to go directly to the information provider to deal with the issue.
Similarly, you’ll want to send this company a letter explaining that they provided incorrect information to the given credit reporting bureau. (The Federal Trade Commission has a sample dispute letter for this, too.)
Approaching a credit report dispute this way might make sense if the error is related to a specific credit account—like payment history or other account details.
However, there are fewer ways to file a dispute with an information provider, and sometimes, they aren’t legally obliged to investigate your dispute. (For instance, if your credit report dispute is related to personal account information—like names, addresses, social security numbers, or employer information—they don’t need to pursue the matter.)
All in, file a credit report dispute with both the credit reporting bureau in question and the information provider to be thorough.
What Happens Once You File a Credit Report Dispute?
Once you send your credit report dispute in, what happens next?
Well, the credit bureau and information provider (or data furnisher) are required to investigate your dispute in 30 to 45 days.
They’ll forward all the documents to the data furnisher and report the results back to you—unless they determine that the claim is unfounded. When a credit reporting bureau or information provider determines that your claim is frivolous, they can decide to not investigate as long as they send you a notice of that decision within five days of making it.
If you haven’t heard anything back from either entities after a month has gone by, check the status of your dispute online, or call to see what’s holding up the process.
If you still aren’t getting a good answer—and feel that either entity is wrongfully ignoring the dispute—you can raise the issue with the Consumer Financial Protection Bureau or file a complaint with the Better Business Bureau.
However, if all goes well, the credit report bureau will provide you with the results of the investigation once it’s complete. If there was a change made to your credit profile after the investigation, you’ll get a new copy of your credit report. You can also request that the credit reporting bureau notify all of your creditors that have accessed your credit rating in the past six months from the date of the credit report dispute.
Why It’s Important to Stay In-the-Know With Your Credit Report
Disputing an error on your credit report seems like a daunting process—especially for a busy entrepreneur who already has so much on their plate.
However, you now have all the tools you need to dispute a credit report easily and effectively.
Remember, your credit health is something that you don’t want to take lightly.
If an error is weighing that all-important three-digit number down, you’ll want to make steps to correct it with the credit reporting bureaus.
A credit report dispute could make or break your qualification for low interest rates, or for a credit product entirely.
In fact, when people disputed the errors in their credit report, they found that their credit scores actually increased after the claim—helping them secure lower interest rates on their credit products.
The bottom line?
Don’t let an error in your credit report bring you down! Request a free copy of your credit report, and get out your magnifying glass. Consumers with a sharp eye for errors save money on their credit products in the long run.