How to Fix These 3 Credit Report Errors
Although Equifax, TransUnion and Experian do their best to maintain accurate information on your credit reports, mistakes do happen. According to Experian, it maintains around 220 million consumer credit files — the sheer volume leaves plenty of room for error. Credit reporting errors can also occur when the companies you do business with provide incorrect information to the credit bureaus. And identity thieves are well-known sources of erroneous information that can wind up on your credit reports.
It’s ultimately up to you to keep tabs on your credit and make sure the information contained in your credit reports is accurate. Common credit errors to watch out for include incorrect personal information, incorrect or incomplete information about your accounts, unauthorized credit inquiries and accounts that don’t belong to you at all.
You should monitor and review your three credit reports frequently to make sure credit errors aren’t damaging your scores. (LendingTree offers this free credit monitoring service, which can help.) After all, your credit can impact how much you pay for housing, your ability to qualify for financing and even whether you’re able to land a job. It’s simply too important to ignore.
3 credit report errors you need to fix
Not every credit reporting error is a catastrophe. Some errors might not have any effect on your credit scores at all. However, certain types of credit errors can be quite serious, resulting in lower credit scores and complicating your life in several unpleasant ways.
Below are three potentially significant credit report errors that you shouldn’t ignore. You’ll also find some tips on how to fix these credit reporting mistakes if they ever happen to you.
1. Incorrect personal information
When you check your credit report for accuracy, it’s important to review the personal information section of your reports. You should make sure that the following data is accurate:
- Your name (including spelling)
- Social Security number
- Date of birth
- Your addresses (current and former)
Mistakes in the personal information section of your credit reports won’t damage your credit scores themselves. However, they might indicate you have a bigger problem.
Errors that involve your personal identifying information are sometimes a clue that you’ve become a victim of identity theft and someone has applied for fraudulent accounts in your name. Another potential explanation for incorrect personal information on your report is the possibility that a credit bureau has mixed your credit file with someone else’s file.
How to fix the problem
The Fair Credit Reporting Act (FCRA) gives you the right to dispute incorrect or incomplete information on your credit reports. You can submit disputes via mail, online or over the phone with each of the three credit reporting agencies.
The Consumer Financial Protection Bureau recommends you dispute credit errors by contacting the credit reporting agency and explaining in writing what you think is wrong. It may be a good idea to send copies of documents which support your claim (like proof of your name, current address or Social Security number).
2. Negative information that has been on your report too long
Most derogatory accounts aren’t allowed to haunt your credit forever. The FCRA limits how long negative information is allowed to remain on your credit reports.
Generally, negative information can stay on your credit reports for up to seven years. (Bankruptcies are the exception to the rule and can stay on your reports for up to 10 years depending on the type of bankruptcy.)
Here’s the catch: There’s a way to manipulate the system and keep negative information on a credit report longer than legally allowed. The process is known as re-aging.
Re-aging occurs whenever a data furnisher, like a collection agency, changes the date of first delinquency on your credit report. This action can unfairly cause additional damage to your credit scores. Re-aging may also result in an older account remaining on your credit report longer than it should under the law.
How to fix the problem
The credit bureaus typically won’t know a date on your credit report has been manipulated unless you inform them through a dispute. It may also be a good idea to contact the organization that provided the incorrect information to the bureau(s) in the first place.
Per the FCRA, both the credit bureau and the company that provided information to the credit bureau (aka the data furnisher) are responsible for correcting mistakes on your credit report.
3. Accounts you don’t recognize
When accounts you don’t recognize show up on your credit reports, you might be experiencing one of two problems.
- You may be a victim of identity theft.
- Your credit file may be mixed with the file of another consumer (often a family member who shares a similar name).
If unrecognized accounts on your credit reports are negative, they could damage your credit scores even though they don’t belong to you. Even positive accounts which aren’t yours could cause problems. For example, they might make it difficult to qualify for new financing if your reports show you owe more money than you really do.
How to fix the problem
Remember, the credit bureaus don’t know that an account on your credit reports isn’t yours unless you tell them. If you believe your credit file may have been mixed with someone else’s, be sure to point that out in your dispute. That information may help the credit bureau(s) to correct the mistake faster.
Additionally, if you believe you are a victim of identity theft, you can also send in a police report or file a report with IdentityTheft.gov to support your claim. Federal law requires the credit bureaus to block any accounts associated with identity theft within four business days.
Not every problem with your credit report spells ruin for your financial future. But considering how little effort it takes to check and correct those errors, there’s no reason to put it off. You will probably thank yourself for it later. However, if your credit is heavily damaged, you may want to consider working with a credit repair company. It may help you work on your credit.