That is not right! - What to do About Incorrect Items on a Credit Report

According to the Fair Credit Reporting Act of 2005 , you may obtain one credit report from all three Credit Bureaus every 12 months at www.annualcreditreport.com. You may also receive a credit report if the following applies to your situation:

·         Denied credit because of the information on credit report. Request a copy from the credit bureau within 60 day of being notified.

·         Unemployed and plan to apply for job within 60 days following the request for the report.

·         Receive public assistance.

·         Believe credit file contains errors due to fraud.

·         Victim of fraud. Contact all three agencies and request a “fraud alert” to be added to report.

If there is something incorrect reported on a credit report, submit a letter stating the problem to all three credit bureaus. A sample letter  can be found at www.myfico.com. The letter should be sent by certified mail, return receipt requested, to document the credit bureau received the dispute. Do not send original documents of receipts and keep a copy of everything sent to the credit bureaus

The credit bureaus will contact the creditor who submitted the item within 5 business days of receiving the complaint. The creditor has 30 day to respond to the inquiry or the disputed item will be removed. If the credit bureau agrees the information is inaccurate or incomplete, the credit report must be updated with the correction or remove the item. The credit bureau will notify the creditor the reported item has been modified or deleted. The credit bureau must send notice within five business days if the disputed item is reinserted because the creditor provided documentation to prove the accuracy of the report.

If the disputed item shows up again it is time for more letters. Send a letter to the original creditor disputing the item. Resend the letters to the credit bureaus as well. All correspondence must be sent by certified mail, return receipt requested.

Removing an incorrect item on a credit report can be time consuming and frustrating, but it is important to be persistent. Credit reports determine the interest rates for new credit, can affect insurance premiums rates and may be evaluated when applying for a job.

Once a problem is resolved, you may request the credit bureau notify all the past inquiries of the corrected report for the last two years. Past employers may receive the updated report for the last 6 months at your requests. Review the credit report again in three to six months.

The three credit bureaus address are:

Equifax
equifax.com
PO Box 105069
Atlanta, GA 30349
(800) 525-6285

Experian
experian.com

TransUnion
transunion.com
PO Box 6790
Fullerton, CA 92634
(800) 680-7289

For more information:

Fair Trade Commission: Facts for Consumers

Freeze on Credit 

What is on your report?

What is on your report?

A Credit Report is a snapshot of your credit reputation. Credit reports are commonly used by banks and companies to determine the interest rates when issuing credit to customers. As the customer, a high credit score will result in a lower interest rate which makes a loan less expensive.

According to federal law, everyone is entitled to one report from all three credit bureaus, Equifax, TransUnion and Experian, each year. The only free reports are available at www.annualcreditreport.com  or call 877-322-8228. The website asks a series of questions, and then allows access to the report. The biggest problems with credit reports are incorrect or outdated information. Because each agency has its own reporting practices, it is important to take a look at all three credit reports.

The most common formula to calculate a credit score is created by the Fair Isaac Corporation, FICO. The FICO score is a formula which uses payment history, the amount owed on credit accounts, length of credit history, new credit and type of credit. The formula is ubiquitous and cannot be calculated by a consumer. The FICO score ranges from 300-850, with approximately 40% of scores are 750 or better.  A Credit Score is use by businesses to determine interest rates for loans, insurance premiums and may even be used when applying for job. The higher the score the less of a credit risk.

The free credit report does not include the credit score. A Credit Score can be purchased by several online sources. The three reporting agencies’ reports may have different information and actually calculate the score slightly differently.

Most of the time is more important to know how to raise a credit score rather than the score. If full payments are made on time, the score will improve overtime.

Tips to raise a credit score:

Pay bills on time.

Make up missed payments and keep all payments current.

Maintain low balances on credit cards and other revolving debt.

Pay off debt instead of transferring it to new account.

Do not open new credit accounts.

Beware of “Credit Repair Agencies” or promises to “fix” credit! These companies charge a customer to dispute or correct information. This can be done by the customer. Some advertisement claim to provide a free credit report but are actually “introductory” offers that convert to expensive subscription services. Expect to see ads for companies try to sell things that are not needed such as credit scores, "Credit Monitoring Service" or a “3-in-1 Report”.  

Credit scores are important in our society. Use the steps described here to improve your credit score!

Free Credit Report: www.myannualcreditreport.com

Understanding Credit Reports www.myfico.com