Many years ago, I worked for a defense contractor and was put in for a security clearance. As part of the background check, the investigator ran my credit reports and noticed a discrepancy. There was an additional address on my credit report that I didn’t put in my paperwork!
You can’t imagine how nervous I was when the investigator asked me if I omitted any information on my clearance paperwork. They’re trained to find out if people are lying, not if there’s an honest error on a credit report.
It turns out there was an extra address on my report and the process of fixing it was a huge pain. Years after the fact, I had to give two pieces of evidence showing I didn’t live at that address (I used a cell phone bill and a utility bill) and sign a notarized letter stating I never lived at the address.
Here’s the thing — errors on a credit report are not rare.
An FTC study found that 25% of consumers had errors on one of their credit reports! It’s important for you to review your credit reports on a regular basis and dispute any errors you see — here’s how.
Review Your Credit Report
Go to AnnualCreditReport.com to get your credit report from Experian, Equifax, and TransUnion. It takes just a few minutes to get your reports and you’re entitled to a copy every single year.
Carefully review it for any error whatsoever. No error is too small or inconsequential, especially if it means you could be paying more for a loan. Some of the more common credit report errors are those involving:
- Your personal information, such as my extra address and information associated with my very common full name,
- Specific account information, such as a credit card’s credit limit or payment history,
- and outdated information, such as accounts that are still listed past the statue.
How to Dispute Errors
If you are reviewing your credit report online, you may be tempted to use the online dispute system. If you cannot put all the necessary information into the brief form, do not use it! The dispute forms are convenient and in many cases, sufficient. But if you don’t have enough space to make your case completely, you need to use another method. If that’s the case, use certified mail and this template from the FTC.
You don’t want to offer too little information, lose a dispute, and then look to sue the credit bureau to for failing to fully investigate. They’ll simply respond with “You didn’t provide enough information.”
You’ll want to do this as soon as possible because a bureau has between 30 and 45 days to investigate your dispute, which can be harrowing if you have a mortgage closing soon. So dispute as soon as you find something wrong.
Notify The Information Provider
Tell the entity, that reported the error to your credit report, in writing about their error and that you dispute the error on your credit report. The FTC offers this template you can use to to create your letter. If you include any supporting documentation, make sure to send copies and not the originals.
Finally, if you find one error on one bureau’s report, follow up with the others to ensure it is corrected there. Notifying the information provider is a great way to get errors fixed across multiple reports but is not guaranteed. You always want to make sure you file a separate dispute for every single error.
Jim Wang writes about personal finance at Wallet Hacks, where he shares unconventional strategies and tactics for getting ahead financially and in life. Join his super awesome free newsletter to get his Money Power Toolbox and never miss out on a single article!