How to tackle errors in Credit Reports?

A credit report is not just a piece of paper. But it is an important document in the lending-borrowing process. It is a summary of information about all your existing and past credit accounts. Credit accounts include everything from credit cards to mortgages, student loan repayments, and any other loan that is reported to these credit bureaus.

Your report also contains your personal information like PAN, Passport ID, Voter ID, Date of Birth, Contact Details, and Current and Previous Addresses. Included in your credit report is a historical record of how and when you pay your bills, how much debt you have undertaken, and how long you have been managing credit accounts.

Hence, any errors in your credit report, especially, in your account section are creating trouble in getting you a loan or credit card in the future. We are giving some points to understand which credit report errors are worth disputing, which are not worth disputing, and how to correct them.

 Which Credit Report Errors are not worth disputing?

Remember that only those errors should be disputed and have a valid reason behind them. If you want negative but accurate information removed from your credit report, you will need to negotiate with your creditors for the same.

Minor errors like a misspelled former employer or an outdated phone number — don’t affect anyone’s assessment of creditworthiness and aren’t worth disputing.

The Negative Flag might surprise you, but that does not mean it is an error. If it is accurate, instead of disputing, try to resolve it directly with the creditors. For example, if you accidentally missed a payment, contact the creditor, arrange to pay up, and ask if it will rescind the delinquency, so it no longer appears on your reports.

Which Credit Report Errors should you dispute?

Some are major errors that affect your credit score. When you come across these kinds of errors, it is better to raise a dispute for them as early as possible.

The most concerning errors are those that could hurt your scores or the ones that suggest identity theft. Those include:

  • Wrong account status (such as a payment mistakenly reported late when you paid on time).
  • Negative information that’s too old to be reported; most derogatory marks on your credit must be removed after seven years.
  • An ex-spouse incorrectly listed on a loan or credit card
  •  Wrong account numbers or accounts that aren’t yours.
  • Inaccurate credit limits or loan balances.
  • Accounts you don’t recognize.
  • Addresses where you’ve never lived.

We hope this is enough for you to understand what you should do and what you should not do. But you would have a question after finding errors, which should be disputed, and how should they be disputed. We are also giving you steps to follow for correcting errors.

 How to correct the error?

You can use three ways to correct errors on your credit report:

  1. Contact creditors or lenders directly via written communication/mail/directly visiting them in the branch office.
  2. Initiate a dispute with the appropriate credit bureau based on which of your credit reports include errors in it.

The above two ways are a little time-consuming because this needs lots of communication and other tiny details to work on, so here is a third way.

  1. Hire a professional credit counseling service that will work on your behalf. They are experts in this domain so you need not worry but remember, for this service they will charge you their professional fee, but it is worth paying if you do not want to take the headache of going here and there.

Before proceeding with disputing errors, you should collect some information, depending on your error, so it will be easy for investigators to investigate it.

  • Copies of credit card statements or loan documents
  • Copies of bank statements
  • If you have reported identity theft, include a copy of the police report.

The credit bureau will only remove data from a credit report that is proven to be false, so you need to negotiate with creditors. If you can do so, you can directly approach creditors and credit bureaus, or use the third way.

We understand that for many, personal finances and credit can be confusing. Many people have misconceptions and wrong information about credit that can ultimately lead to costly problems.

Having the correct information and the correct use of that information will help you boost your credit score, and you will be able to manage your finance properly. Do not be prey to fraud or identity theft by trusting the wrong information. Before making any major financial decision, check twice whether it has a significant effect or not. We have given here some glance at error handling and rectifying so that you can know which errors are impacting your credit score and which are not, which are worth disputing and which are not. In this way, you can save time and energy and get desired results.

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