Categorized | Financial

Are You Being Victimized By An Error In Your Credit Report?

There was an article in our local paper today that echoed what I had seen reported on CBS’ 60 minutes. It’s that 40 million of us have errors in our credit reports and 20 million Americans have errors so serious they could be impacting their credit scores.

A small number of points can make a big difference

Credit scores go from 300 to 850. There are several “ranges” within these 550 points that can influence how lenders grant or don’t grant credit. For example, 620-679 is considered to be an average or okay score while 580-619 would be a low score. Suppose that your score was 625 (average) but an error in your report dropped it just 6 points. You would now be seen as having a low score and could be turned down for new credit – even though you had done nothing to deserve it.

Now, more than ever

Given this news, you really need to get your credit report and review it thoroughly for errors. If you find a problem that’s significant enough it could be affecting your credit score, you need to dispute the item with the relevant credit bureau.

It’s supposed to

If you file a dispute, the credit bureau is supposed to contact the company that supplied the information you believe is in error. That company then has 30 days to get back to the bureau with proof that the information it had supplied was accurate. If doesn’t, the credit bureau is supposed to remove the item from your report. Notice how I used the words “supposed to” twice. There’s a reason for this.

It may or may not

The reason for  using the words “supposed to” is because the credit bureau may or may not ever do anything about the item you’ve disputed. I have read reports that disputing an error will work but 60 Minutes claims it won’t – if you mail your letter to the bureau’s PO box as it will never be seen by anyone that has the authority to fix it.

Find a real address

This means that if you find an error you want to dispute, don’t mail your letter to a PO box. Call the relevant credit bureau, try to talk with a human being and get a name and address where you can send your letter.

If you’re having a problem with debt

Did you know it’s impossible to get negative items removed from your credit report if they’re true? If you’re struggling with debt, it’s important to get debt counseling  to head off problems before they can turn up on your credit report.