How to dispute credit report errors
By Ben Woolsey
Your credit report contains information about where you work and live and how you pay your bills -- especially credit card bills. Credit reporting agencies -- also known as credit bureaus -- compile and sell your credit information 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, it's important that the information in your report is complete and accurate.
Financial advisers suggest that you periodically review your credit report for inaccuracies or omissions. This is 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 and get you a loan at the rate you deserve.
Getting your credit report
Under a 2005 amendment to the FCRA, every American is entitled to a free credit report from each of the three major credit bureaus once a year. Go to AnnualCreditReport.com to get yours for free. (And despite other well-known credit report-providing sites, this is the only one that is truly free, with no strings attached.)
In addition, if you've been denied credit, insurance, or employment because of information supplied by a credit bureau, the FCRA says the company you applied to must give you the bureau'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. Otherwise, the bureau may charge you for a copy of your report.
The three major national credit bureaus are:
- Equifax, P.O. Box 740241, Atlanta, GA 30374-0241; (800) 685-1111.
- Experian, P.O. Box 4500, Allen, TX 75013; (888) EXPERIAN (397-3742).
- TransUnion, P.O. Box 2000, Chester, PA 19022; (800) 916-8800.
Correcting credit report errors
Under the FCRA, both the credit bureau and the organization that provided the information to the bureau -- such as a bank or credit card issuer -- have responsibilities for correcting inaccurate or incomplete information in your report. To protect all your rights under the law, contact both the credit bureau and the information provider.
First, tell the credit bureau in writing what information you believe is inaccurate. Include copies (NOT originals) of documents that support your position. In addition to providing your 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 sample below. Send your letter by certified mail, return receipt requested, so you can document what the credit bureau received. Keep copies of your dispute letter and enclosures.
Credit bureaus must re-investigate 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 credit bureau, it must investigate, review all relevant information provided by the credit bureau and report the results to the bureau. If the information provider finds the disputed information to be inaccurate, it must notify all nationwide credit bureaus so they can take the appropriate actions. For example:
- Disputed information that cannot be verified must be deleted from your file.
- Erroneous information must be corrected.
- Incomplete items must be completed. For example, if your file showed that you were late making payments, but failed to show that you were no longer delinquent, the credit bureau must show that you're current.
- An account that is shown to belong only to another person, it must be deleted.
When the reinvestigation is complete, the credit bureau 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 credit bureau cannot put the disputed information back in your file unless the information provider verifies its accuracy and completeness and the credit bureau gives you a written notice that includes the name, address, and phone number of the provider.
Also, if you request, the credit bureau 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 credit bureau to include your statement of the dispute in your file and in future reports.
Second, in addition to writing to the credit bureau, 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 credit bureau, it must include a notice of your dispute. In addition, if you are correct -- that is, if the disputed information is inaccurate -- the information provider may not use it again.
You can't remove 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 seven years. There are certain exceptions:
- Information about criminal convictions may be reported without any time limit.
- 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. Criminal convictions can be reported without any time limit.
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 credit bureaus: Some travel, entertainment, gas 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 credit bureau to add this information to future reports. Although they are not required to do so, many credit bureaus will add verifiable accounts for a fee. You should, however, understand that if these creditors do not report to the credit bureau on a regular basis, these added items will not be updated in your file.
Sample credit dispute letter
Following is a sample letter that could be used to dispute an inaccurate credit report.
Your city, state, ZIP code
Name of credit bureau
City, state, ZIP code
Dear Sir or Madam:
I am writing to dispute the following information in my file. The items I dispute are also encircled on the attached copy of the report I received.
(Identify item(s) disputed by name of source, such as creditors or tax court, and identify type of item, such as credit account, judgment, etc.)
This item is (inaccurate or incomplete) because (describe what is inaccurate or incomplete and why). I am requesting that the item be deleted (or request another specific change) to correct the information.
Enclosed are copies of (use this sentence if applicable and describe any enclosed documentation, such as payment records, court documents) supporting my position. Please re-investigate this (these) matter(s) and (delete or correct) the disputed item(s) as soon as possible.
Enclosures: (List what you are enclosing)
See related: Sample letters for dealing with debt collectors
CREDIT CARD HELP: The basic fundamentals of credit cards