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Disputing Credit Report Errors

It’s difficult to overstate the weight our credit scores carry with regard to our ability to function in modern society. A single number, generated by a credit reporting agency that is attempting to summarize an individual’s creditworthiness, has a major impact upon our ability to obtain housing, buy a car, get a loan, or purchase many other necessary goods. Credit scores are often the sole bit of information by which our potential to be financially responsible is assessed by disinterested parties, such as mortgage and auto lenders.

That one little number is incredibly important and, worst of all, it can be wrong.

Credit reporting is far from a perfect system. Misunderstandings, human error, and outright fraud can negatively impact your score without any adverse action on your part. One very obvious example of this is when your identity is stolen and the culprit takes actions on your behalf that negatively affect your credit. Unfortunately, credit reports are often processed mechanically, such that potential lenders have little or no interest in what mistakes may exist on your credit report.

So, what can you do when you find an error on your credit report? The good news is, there are steps you can take to fix the issue.

Firstly, you will need to contact every credit reporting agency whose report reflects the error. You actually have three major credit scores that come from distinct credit reporting agencies (“CRA”s): TransUnion, Equifax, and Experian; there is also the oldest and oft-cited FICO score, which is computed by the Fair Isaac Corporation. Do not assume, however, that there is an error because your scores are different with each CRA. The information collected by each company, as well as the scale by which they score your creditworthiness, differs between the CRAs, so your scores will likely differ even without errors.

You sometimes need to dig deeper, into the more detailed information on your credit report, to spot and report errors. Explain in detail the nature of the error, why you believe the information is incorrect, any evidence you have to show that an error was made, and send the letter to each CRA. You will also need to send this letter to whatever institution reported the faulty information to the CRAs, such as your bank or some other lender.

Keep copies of ALL correspondence you send and receive regarding the credit report error.

Under the Fair Credit Reporting Act, both the CRA and the institution that provided the faulty information are responsible for correcting the error. If the mistake is not corrected to your liking and you still believe you report is inaccurate, you may wish to contact a consumer litigation attorney like those at Bell Law, or file a complaint with the Consumer Financial Protection Bureau (CFPB).

Because your credit report is so important to your ability to function financially in our society, shouldn’t it always be accurate? Try to check your report as often as possible, and at minimum once a year, since every person is legally entitled to one free check of their credit report each year from each CRA. If you are denied a loan or some other financing based on your credit score, you are also entitled to view the report that the institution used to make their decision, so be sure to check and see if errors on your report impacted their decision.

If you believe you have been the victim of unfair credit reporting issues, please contact Bell Law today and let us fight to help you take control of your financial well-being.

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