Credit Report Errors
Introduction
Your credit report—a type of consumer report—contains
information about where you work and live and how you pay your bills. It
also may show whether you’ve been sued or arrested or have filed for
bankruptcy. Companies called consumer reporting agencies (CRAs) or
credit bureaus compile and sell your credit report to businesses.
Because businesses use this information to evaluate your applications
for credit, insurance, employment, and other purposes allowed by the
Fair Credit Reporting Act (FCRA), it’s important that the information
in your report is complete and accurate.
Some financial advisors suggest that you periodically review your credit
report for inaccuracies or omissions. This could be especially important
if you’re considering making a major purchase, such as buying a home.
Checking in advance on the accuracy of information in your credit file
could speed the credit-granting process.
Getting
Your Credit Report
If you’ve been denied credit, insurance, or employment because of
information supplied by a CRA, the FCRA says the company you applied to
must give you the CRA’s name, address, and telephone number. If you
contact the agency for a copy of your report within 60 days of receiving
a denial notice, the report is free. In addition, you’re entitled to
one free copy of your report a year if you can prove that (1) you’re
unemployed and plan to look for a job within 60 days, (2) you’re on
welfare, or (3) your report is inaccurate because of fraud. Otherwise, a
CRA may charge you up to $8 for a copy of your report.
If you simply want a copy of your report, call the CRAs listed in the
Yellow Pages under "credit" or "credit rating and
reporting." Call each credit bureau listed since more than one
agency may have a file on you, some with different information. The
three major national credit bureaus are:
Equifax
P.O. Box 740241
Atlanta, GA 30374-0241
(800) 685-1111
Experian (formerly TRW)
P.O. Box 949
Allen, TX 75013
(800) 682-7654
Trans Union
760 West Sproul Road
P.O. Box 390
Springfield, PA 19064-0390
(800) 916-8800
Correcting
Errors
Under the FCRA, both the CRA and the organization that provided the
information to the CRA, such as a bank or credit card company, have
responsibilities for correcting inaccurate or incomplete information in
your report. To protect all your rights under the law, contact both the
CRA and the information provider.
First, tell the CRA in writing what information you believe is
inaccurate. Include copies (NOT originals) of documents that support
your position. In addition to providing your complete name and address,
your letter should clearly identify each item in your report you
dispute, state the facts and explain why you dispute the information,
and request deletion or correction. You may want to enclose a copy of
your report with the items in question circled. Your letter may look
something like the one on page 7. Send your letter by certified mail,
return receipt requested, so you can document what the CRA received.
Keep copies of your dispute letter and enclosures.
CRAs must reinvestigate the items in question—usually within 30
days—unless they consider your dispute frivolous. They also must
forward all relevant data you provide about the dispute to the
information provider. After the information provider receives notice of
a dispute from the CRA, it must investigate, review all relevant
information provided by the CRA, and report the results to the CRA. If
the information provider finds the disputed information to be
inaccurate, it must notify all nationwide CRAs so they can correct this
information in your file.
Disputed information that cannot be verified must be deleted from your
file. If your report contains erroneous information, the CRA must
correct it. If an item is incomplete, the CRA must complete it. For
example, if your file showed that you were late making payments, but
failed to show that you were no longer delinquent, the CRA must show
that you’re current. If your file shows an account that belongs only
to another person, the CRA must delete it.
When the reinvestigation is complete, the CRA must give you the written
results and a free copy of your report if the dispute results in a
change. If an item is changed or removed, the CRA cannot put the
disputed information back in your file unless the information provider
verifies its accuracy and completeness, and the CRA gives you a written
notice that includes the name, address, and phone number of the
provider.
Also, if you request, the CRA must send notices of corrections to anyone
who received your report in the past six months. Job applicants can have
a corrected copy of their report sent to anyone who received a copy
during the past two years for employment purposes. If a reinvestigation
does not resolve your dispute, ask the CRA to include your statement of
the dispute in your file and in future reports.
Second, in addition to writing to the CRA, tell the creditor or other
information provider in writing that you dispute an item. Again, include
copies (NOT originals) of documents that support your position. Many
providers specify an address for disputes. If the provider then reports
the item to any CRA, it must include a notice of your dispute. In
addition, if you are correct—that is, if the disputed information is
not accurate—the information provider may not use it again.
Accurate
Negative Information
When negative information in your report is accurate, only the passage
of time can assure its removal. Accurate negative information can
generally stay on your report for 7 years. There are certain exceptions:
Bankruptcy information may be reported for 10 years.
Credit information reported in response to an application for a job with
a salary of more than $75,000 has no time limit.
Credit information reported because of an application for more than
$150,000 worth of credit or life insurance has no time limit.
Information about a lawsuit or an unpaid judgment against you can be
reported for seven years or until the statute of limitations runs out,
whichever is longer.
Adding
Accounts to Your File
Your credit file may not reflect all your credit accounts. Although most
national department store and all-purpose bank credit card accounts will
be included in your file, not all creditors supply information to CRAs:
Some travel, entertainment, gasoline card companies, local retailers,
and credit unions are among those creditors that don’t.
If you’ve been told you were denied credit because of an
"insufficient credit file" or "no credit file" and
you have accounts with creditors that don’t appear in your credit
file, ask the CRA to add this information to future reports. Although
they are not required to do so, many CRAs will add verifiable accounts
for a fee. You should, however, understand that if these creditors do
not report to the CRA on a regular basis, these added items will not be
updated in your file.