What’s In Your Credit Report?
There’s a lot riding on your credit report. Your loan interest rates, insurance rates, employment status, and housing status are all to some degree related to the contents your credit history. With so much dependent on your credit, it’s important that you regularly check your credit history to make sure that it does not contain harmful errors.
Creditors and the credit reporting agencies occasionally make mistakes. One estimate suggests that as many as 80% of all credit reports contain some sort of error. Although most errors are minor, some inaccuracies can be devastating to your credit score. It’s critical that you check your credit report to make sure that it does not contain harmful mistakes. Your credit report can also alert you to identity theft, as identity thieves often open new credit accounts using your name. Those unauthorized accounts will likely appear on your credit report.
The term “credit report” is often used generically. However, there is no one, universal credit report. Each of the three credit reporting agencies maintains a profile of your credit history separately, and they may or may not contain the same information. It’s important that you check all three credit reports for accuracy.
Obtaining your credit report is quite easy. It only takes a few minutes to retrieve your credit score online. You can order your credit report for a nominal fee from any of the three credit reporting agencies – Equifax, Experian, and TransUnion. Many companies offer a 3-in-1 credit report that combines the information from all three reporting agencies. The combo report may be cheaper than purchasing the three reports individually.
The recently enacted Fair and Accurate Credit Transactions Act (FACT Act) mandates that everyone in the United States and U.S. territories will be eligible to receive a free credit report once per year from www.AnnualCreditReport.com by September 1, 2005. People in some regions of the country already qualify for free credit reports.
Once you retrieve your credit history, read it carefully. Thoroughly examine the report for errors. Make sure your name, address, employment history, and payment history are listed correctly. Pay special attention to any late payments. If you find an error on your credit report, you should notify the credit bureau that provided the report in writing immediately. You may challenge any information on your credit report free of charge. The credit reporting agency will launch an investigation on your behalf.
The credit reporting agencies are required by law to remove inaccurate information from your credit report. (Contrary to the claims of credit repair firms, there is no legal way to remove harmful, but accurate, information from your credit report.) When you challenge an item on your credit report, the credit bureau will ask the creditor that placed the item on your report to verify its accuracy. If the creditor cannot verify that the entry is correct, it will be removed from your credit report. If the creditor claims that the information is correct, however, you must satisfactorily demonstrate that the information is indeed wrong in order to have it removed from your report.
In your dispute letter to the credit bureau, you should identify clearly the item(s) on your credit report that you believe to be inaccurate. For example, if your credit report erroneously shows a late payment to one of your credit cards, your letter must identify the exact credit card account and the payment month indicated as late. Include with your letter evidence supporting your challenge, such as a cancelled check to the credit card company and/or a copy of a credit card statement that shows that the payment was on time.
The credit bureaus may be contacted at the following addresses:
Equifax
Equifax Credit Information Services, Inc.
P.O. Box 740241
Atlanta, GA. 30374
(800) 685-1111 (to order a credit report)
(888) 766-0008 (to place a fraud alert on your file in case of ID theft)Experian
National Consumer Assistance Center
P.O. Box 949
Allen, TX 75013
(888) EXPERIAN (to order credit reports or place a fraud alert)Trans Union Corporation
Transunion LLC
Consumer Disclosure Center
P.O. Box 1000
Chester, PA 19022
(800) 888-4213 (to order a credit report only)
The Fair Credit Reporting Act requires that the credit bureaus respond to your challenge within 30 days. Always send your correspondence by registered or certified mail. Do not use regular mail or communicate with the credit bureau over the phone, as there is no record of your challenge. Keep copies of everything you send and receive for your own records. (Sometimes, items you successfully challenge can magically reappear on your credit report. It’s helpful to have thorough documentation in case you need to re-remove an item.)
Hopefully you won’t find any incorrect information on your credit report. However, if you do find errors, following this advice should assist you in fixing your report. If the bureaus will not remove an incorrect item that you challenge, there is still hope. You may resubmit your dispute at any time for reinvestigation. It’s best to wait at least 60 days after your challenge is denied before sending another letter disputing the same listing. No matter what, try to be polite but firm in your letters. Humans, not computers, handle the disputes. Nobody likes to be harassed, not even credit bureau employees. Finally, check your credit report at least every six months.
