Consumer Protection Law

How Do I Fix Errors On My Credit Report?

Monitoring your credit allows you to gain – or maintain – control of your credit health. But what can you do if you find an error on your credit report? How important is it to correct an error on your credit reports? And what steps should you take to remove any inaccurate information? In this article, we outline some considerations when evaluating your credit report.

What's Your Credit Risk?

How do the credit reporting agencies come up with that all-important credit score? Potential lenders weigh your creditworthiness against risk on your credit score. If your credit risk is low, you have a higher chance of approval on financing applications, mortgage or rental applications, or a credit card for your favorite department store.

Can a Low Credit Score Affect Employment?

That depends on where you want to work. Government and corporate banking jobs, for example, may require a good credit score. Before any employer checks your credit history, under the Fair Credit Reporting Act, they need your consent first. And when they do look, most will look for long-term credit history and not one-off issues. Many states have specific laws protecting consumers from employers using certain information when making an employment decision.

What Information Does the Credit Report Have?

Generally speaking, your credit reports contain the following information:

  • Personal Information: Your data will include past and current addresses, past and present employers, your full name, birthday, and your social security number.
  • Public Records: Credit inquiries, foreclosures, and bankruptcies fall under this category.
  • Credit Accounts: This section includes information like your mortgage, any loans for which you are the primary or co-signer, and all credit cards and payment history.

Depending on what credit reporting agency report you are viewing, the information collected and displayed will have slight variations, though overall the reports will likely be similar.

There are three different credit bureaus. The information presented on each of your credit reports will depend on the information provided to each bureau. Your reports may vary if one has information not provided to the rest.

The information in your credit report is often referenced when a bank considers loaning you money, a credit card company considering the interest rate at which you can obtain credit, and, in some cases, a credit report may be used to determine whether you can rent a home or get a job. Therefore, it is important for your credit report to be free of errors. Your right to an error-free credit report is protected by the Fair Credit Reporting Act.

Request Free Annual Credit Reports

But what can you do if a credit reporting error is responsible for your high-risk rating? Your chances of approval for new credit opportunities will be impacted depending on your risk rating. The higher your credit risk, the lower your chance of approval.

Checking your reports helps you understand what's helping, and what's hurting, your credit score. You have the right to one free credit report per year from each of the three major credit reporting agencies, TransUnion, Experian, and Equifax, through a service called the "Annual Credit Report Request Service."

You also have the right to a free copy of your credit report if:

  • You've been denied a loan or credit application
  • You are unemployed
  • You are receiving welfare benefits

Staying on top of any potential errors or discrepancies on your credit report can help you avoid issues in the future, should you need to apply for something that relies on a credit report. Taking advantage of an annual free credit report check can help.

What If You Spot an Error?

Maybe you see a credit card checkered with a history of late payments that you know you never opened. Or perhaps your credit report names you a co-signer on a loan you weren't aware of until now. Your next step should be to notify the credit reporting agency in question to investigate your complaint.

What information do you need to provide?

  • Submit your complaint in writing
  • Explain the error on your credit report
  • Any proof you have available to support of your position

Be sure to keep a copy of everything that you send to the credit reporting agency, as well as any replies received.

Investigating Your Complaint

When they receive information about inaccuracies in a credit report, they must investigate the complaint within 30 days. As part of your request, you should also ask the credit reporting agency to remove or correct the error. As part of the investigation process, the credit bureau must notify the creditor of your complaint.

The credit reporting agency must review the information and verify its accuracy. The credit reporting agency is required to correct the error on its report and the reports of the other two major credit reporting agencies. You have the right to a copy of the report after the investigation is complete. You also have the right to a corrected copy of your credit report.

Protect Your Consumer Rights

There are laws in place that protect consumers from false or inaccurate credit reporting. Because these reports can impact so many different aspects of a person's life, the laws should be followed. If you encounter obstacles in clearing up your credit report or you need to find out more about your rights, an experienced consumer law attorney will be able to help guide you through this process.