A recent study released by the FTC found that 1 out of 4 people  had errors on at least 1 of their credit reports from the Big 3 agencies and that 5% of them had errors so serious that it could affect a mortgage or car loan and other types of financial products.  This is alarming news, especially when you consider the amount of power a credit report has on someone’s ability to get credit, open a bank account, apply for a loan or purchase a home.  Since anything negative will remain on your credit report for a minimum of 7 years it is vital that, if you find an error, you deal with it quickly and robustly.  With this in mind we put together a short lesson in how to do just that.  Enjoy!

Of course the 1st thing that you’ll need is to get your credit report from all 3 of the Big 3 agencies.  They are Experian, Equifax and TransUnion and every year you are entitled to a free report from all 3 of them.  Indeed even though you will need to pay for more than 1 copy in a year it is a good idea to check bi-annually.  If someone steals your identity in January it would be better to catch them in June than next January.

Next you need to go over your reports with a fine toothed comb and, when you find errors, dispute them as quickly as you can.  This usually involves writing a letter with the error, your name and other info that they will need to certify that you are who you say you are. 

IMPORTANT- ANYTHING that you sent to any of the credit agencies should be sent CERTIFIED MAIL with the USPS or something similar with any other company that you use. This will create a timeline and will give you the proof you need (if necessary) that you sent the dispute letter.

Next is simply to have a little patience.  The law states that any credit bureau needs to respond to your dispute within 30 days (hence the need for the certified letter).  Give it a few weeks but mark your calendar so that you know when 30 days has expired and you should start an inquiry.

Contacting any lenders that might be involved in the error is a great idea and may expedite the process in some cases.  In fact a phone call to them may initiate a subsequent phone call to the credit agency where the error was found and help get it taken care of much faster.

If you find that you’re getting nowhere with the credit agencies then your next step would be to contact the Consumer Financial Protection Bureau  (CFPB).  They’re a federal agency that has power over the credit agencies and they accept complaints from consumers who are having trouble getting their error situation resolved.  Once they are involved the credit agencies will then have 15 days to respond with a plan for correcting the error.