Your credit report significantly impacts your ability to get loans, credit cards, or even a job. Let’s walk through the process of disputing mistakes on your credit report.
Step 1: Obtain Your Credit Reports
First things first, you need to get copies of your credit reports. In the U.S., you are entitled to one free credit report per year from each of the three major credit bureaus, namely, Equifax, Experian, and TransUnion. You can request these through the website AnnualCreditReport.com.
Step 2: Review Your Credit Reports
After you’ve obtained your credit reports, carefully review them for errors. Look for mistakes like incorrect personal information, accounts you don’t recognize, incorrect credit limits, wrong payment histories, and even signs of identity theft. For instance, if your report lists a credit card that you’ve never opened, this could be a sign that someone else has taken out a card in your name.
Step 3: Identify the Errors and Gather Evidence
Once you’ve found errors, document them thoroughly. Keep detailed notes and gather any supporting evidence. For example, if there’s a late payment reported on an account where you’ve always paid on time, find bank statements or other records that show you made the payment on time.
Step 4: Contact the Credit Reporting Agency and Dispute the Error
Now that you’ve gathered your evidence, it’s time to dispute the error. Write a formal dispute letter that details the mistake and include copies (not originals) of any evidence supporting your claim. Your letter should include:
- Your full name and address
- A clear identification of each error
- An explanation why you dispute the information
- A request for deletion or correction
For example:
Dear [Credit Bureau’s Name],
I am writing to dispute the following information in my file. The items I dispute are also encircled on the attached copy of the report I received.
This item [identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.] is [inaccurate or incomplete] because [describe what is inaccurate or incomplete and why]. I am requesting that the item be removed [or request another specific change] to correct the information.
Enclosed are copies of [use this sentence if applicable and describe any enclosed documentation, such as payment records and court documents] supporting my position. Please reinvestigate this [these] matter[s] and [delete or correct] the disputed item[s] as soon as possible.
Sincerely, [Your Name]
Mail this letter via certified mail with a return receipt requested, so you can document that the credit bureau received your dispute.
Step 5: Contact the Creditor
In addition to the credit bureau, also write a letter to the creditor or other entity that provided the inaccurate information (such as a bank or collection agency). The process is the same as the letter to the credit bureau.
Step 6: Wait for Investigation
After receiving your dispute, the credit bureau typically has 30 days to investigate. They’ll forward your claim to the organization that provided the incorrect information. If that organization finds the claim valid, they must notify all three credit bureaus to correct your credit report.
Step 7: Review the Outcome
After the investigation, the credit bureau will provide you with the results and a free copy of your credit report if the dispute leads to a change. Make sure the error has been fixed. If the dispute isn’t resolved in your favor, you can ask to include a statement in your credit report showing that you dispute the accuracy of the information.
This process might seem a bit daunting, but don’t worry! It’s crucial to ensure your credit report accurately reflects your financial history. A few letters and a little bit of patience can go a long way towards improving your credit.
1. How long does a credit dispute take? After receiving your dispute, the credit bureau generally has 30 days to conduct an investigation. However, if you’ve received your report from AnnualCreditReport.com, they have 45 days to investigate.
2. What happens after the investigation? Once the investigation is complete, the credit bureau must provide you with the results in writing and a free copy of your credit report if the dispute results in a change.
3. What if the dispute is not resolved in my favor? If the dispute is not resolved in your favor, you can request a statement of the dispute be included in your future credit reports. Additionally, you can file a complaint with the Consumer Financial Protection Bureau (CFPB).
4. Can I dispute online or should I always send a letter? While it’s possible to dispute mistakes on your credit report online, sending a letter by certified mail is often the most thorough method. This way, you have physical proof of what was sent and when it was received.
5. How often should I check my credit report? It’s recommended to check your credit report at least once a year. However, if you’re planning a significant purchase that requires a loan (like a house or a car), you may want to check your report a few months in advance to correct any errors and improve your credit score.
6. What kinds of mistakes should I look for on my credit report? Check for a range of errors, including personal information, incorrect account details (like an account you did not open), incorrect account status (like a closed account listed as open), data management errors (like reinsertion of incorrect data), and balance errors.
7. What if the same error appears on reports from all three credit bureaus? If the same error appears on all three credit bureau reports, you’ll need to dispute it with each bureau individually. Each bureau operates independently and won’t share your dispute details.
8. What can I do if I find signs of identity theft on my credit report? If you find accounts you didn’t open, debts you can’t explain, or other signs of identity theft, report it immediately. Contact the companies where the fraud occurred, place a fraud alert or freeze on your credit reports, and report identity theft to the Federal Trade Commission (FTC).