Credit reports contain information about the payment activity of each consumer. Items are added to credit reports each time a credit-based application is submitted to a lender. When information on a credit report is reported incorrectly, consumers may be denied services. Consumers are advised to check their reports on a regular basis. The Fair Credit Reporting Act (FCRA) gives consumers the right to dispute and remove inaccurate information from a credit report.
Request a Credit Report
Consumers, by Federal law, have the right to one free credit report annually from each credit bureau. Begin the credit report dispute process by securing a copy of your credit report. There are three major credit reporting bureaus that must be checked for inaccuracies: Experian, Equifax and TransUnion. Reports may be ordered and viewed online in most instances. The dispute process may begin while viewing the report online.
Begin the Dispute Process
Review the credit report section by section. If there are severe inaccuracies in your report, each item must be disputed separately. If the report is viewed online, companies such as Experian allow consumers to start the dispute process by clicking on a button. The software will prompt the users to provide a specific type of information. An email address may be provided for notification when the investigation is complete.
A notice will be filed with the company or source of the dispute. Within 30 days, the source must verify your account data. If the company fails to reply, the item is immediately removed from the credit report. If the information is verified as accurate, then it cannot be removed from the credit report. Experian will notify the consumer by email when the dispute investigation is ready to be viewed. The results may be viewed online with Experian.
Consumers who are disputing inaccuracies in writing should alert both the credit bureau and the source of the inaccuracy. Any evidence to support the claim, including cancelled checks or statements should also be mailed to support the dispute. The consumer’s name, address and nature of dispute should all be documented in the letter. A copy of the credit report should also be included with the information highlighted. Experts recommend that the dispute be sent via certified mail. A return receipt should also be used. This will serve as evidence that the dispute was submitted to the agency.
When the process is initiated by mail, the credit bureau also has 30 days from the date of receipt to investigate the claim and respond to the consumer in writing. The credit bureau will respond with the results and a free credit report reflecting the change, if the dispute ended in the consumer’s favor. Consumers may also request that the credit bureau submit a notice to all companies that accessed the consumer’s credit report in the past six months. The notification will discuss the amendment to the credit report.
Hiring an Attorney
Many consumers hire an attorney that specializes in these types of disputes. This action is taken because attorneys are more authoritative and more likely to receive favorable results from the credit bureau than consumers. This practice is not required. However, people who are not skilled in making a convincing argument may consider taking this route. Additionally, attorneys know the system and may be able to submit documentation in such a way to almost guarantee that the item will be removed from your credit report. Inquire with attorneys if you have special circumstances or disputes that may require legal intervention.
An attorney may also be required if the company supplying the information states that the item on the credit report is accurate, when in fact, the item is not accurate. These attorneys are fairly affordable considering a negative credit score could keep you from buying a house, purchasing a car at a low interest rate, renting an apartment, getting a job or any other major purchasing event.
Writing the Credit Bureau
If after using the traditional methods of disputing an item does not result in the inaccurate item removed from your credit report, consumers may write the credit bureau to post the consumer’s explanation on the credit report. This will inform potential lenders, renters or job prospects of the nature of the consumer’s particular situation. Many have found that this process effective especially in cases where consumers are asking for low risk credit or basic necessities.
How Bad Credit Can Affect Your Life
Bad credit resulting from inaccuracies may preclude you from obtaining the essentials in life such as a house, car, furniture, apartment or even a job. Potential employers will also use your credit as a means of judging your level of responsibility for a job. To many people, this practice seems unfair. The practice may also be viewed as an invasion of privacy and not a good measurement of success. However, many companies will not hire an employee with a low credit score. An inaccuracy on your credit could hold a person back from obtaining viable employment. To avoid unpleasant surprises, always check your credit report periodically and dispute any inaccuracies.
