Disputing Credit Report Mistakes
I hate to tell you something that you’ve heard before, but I’m going to say it anyway because it’s imperative that you understand it: check your credit report! Statistics say that more than 60% of the population has no idea what is on their credit report, but that around 75% of Americans have mistakes on their credit reports. And those statistics come from a 2004 report.
Most consumers don’t realize the mistakes on their credit report until they are denied credit for a loan, and only then do they order reports from the three major credit bureaus – Experian, Equifax and TransUnion.
They say – and by “they”, I mean the credit bureaus – that you can fix mistakes on your credit report by simply filing a complaint online or giving them a call. However, consumers have discovered that it is rarely that easy, and there are almost always complications.
So what should a victimized consumer do about it?
Follow these steps to dispute one or more credit report mistakes so that the problem is solved in a fast and efficient manner.
I hate to be the bearer of bad news, but approximately 40% of credit report disputes end up in front of a judge and jury. Because of this, it is important that you approach your credit report mistake with a businesslike – and litigious – perspective. This means that you always behave professionally and that you take the appropriate actions as quickly as possible.
Get all of your paperwork together, which means anything that works in your favor of the dispute. This could mean receipts, income tax returns, letters/notices from corporations and anything else that can help you prove your case. Put all of this information into one file folder for easy reference.
- Write It All Down
You are likely to make scores of phone calls and write lots of letters and e-mails in your quest to repair your credit report. Because of this, you will need to keep copious records of every conversation, transaction and correspondence conducted between you and the credit bureau or company in question. These records will be admissible in court as long as you do it while the events are taking place.
My advice is to purchase an inexpensive daybook or log in which you can record events as they happen. For example, if you call Company ABC at 10:52 a.m. on July 14, 2006, and you discuss Purchase #123, make sure all of that information has been recorded. Include Jane or John Doe’s name with Company ABC so that Mr./Ms. Doe can be subpoenaed should the case ever go to court.
If Company ABC – with which you have the dispute – fails to keep good records, then you will come out on top.
- Be Professional
Dealing with credit report disputes can make you want to pull your hair out and yell and scream until you are blue in the face. Resist the urge. If you lose your temper every time you talk with Company ABC, you will never achieve the desired result and your phone calls will be subsequently avoided.
Remember what I said about many of these cases going to court? A judge or jury will not react favorably when the representative of Company ABC testifies that your behavior was belligerent and incorrigible. They will wonder if you have something to hide, or if you are simply making this up in order to repair your credit report.
- Decide Who to Notify
Sometimes it is difficult at first to determine who exactly has provided the wrong information. In some cases, it is the credit bureau who has delivered misinformation, and you will never have to deal with the creditor at all. Other times, it is the creditor who is reporting the information incorrectly, and the credit bureau is only establishing what they have been told.
Collect all of the information that you have about the account in question, and go through it to find the necessary information. Then call the creditor and request a report from their files. What information do they have, and does it match yours?
If the conversation with the creditor does not come to fruition, contact the credit bureau and explain the situation. From there you can determine the appropriate course of action.
- Write Letters
When you call a company or agency on the telephone, there is no record of the substance of the phone call unless it is recorded by one or both parties. Telephone conversations can be misconstrued, and sometimes information is garbled. It is much more efficient – and tactful – to send a letter.
Work out on paper exactly what you want to say, and this will avoid a mistake on your part. Then send the letter by certified mail so that you have proof that the company received it.
- Get Copies
Once you have resolved a despite with a credit bureau, request a copy of the Universal Data Form (UDF) which they will send to your creditors to inform them of the correction. If they won’t send you that, request a letter confirming the same.
It will do no good if the credit bureau says they will correct a mistake, but it never transpires. Having substantial proof that you were told it would be corrected can make all the difference later when the issue arises again.
If applicable, forward the letter or UDF to all of your other (current) creditors so that they understand it was a mistake. Some lenders and credit card companies will raise your interest rate if there is a delinquency reported to the credit bureaus. This will show your current creditors that the delinquency was a mistake and that you have taken steps to correct it.
If none of these tactics work in your favor, you will have to obtain the counsel of an attorney and file a lawsuit against the offending agency. The records you have kept and your professional manner will be extremely helpful in this situation.
You can also contact the media regarding your situation as well as the FTC and any consumer advocates. Address letters to the Board of Directors of the agency or company in question and continue contacting them until you receive a favorable response.