If you were denied a line of credit or a loan, be sure to check your credit report. Credit reporting agencies, such as Equifax, Experian and TransUnion have been known to record mistakes. The privately held companies are responsible for collecting all the financial information about you, translating it to a “score” and allowing your lenders access to it. Even if the credit reporting agencies do their job correctly, you’re at the mercy of the hundreds of thousands of companies that send them information every day.
Over three billion consumer credit reports are filed each year. There are going to be mistakes made. Make sure you’re not on the receiving end of someone else’s bad reporting practices.
What Should You Check?
Credit reports contain a lot of information, but specifically, look for the following and make sure it’s accurate:
1) Credit History – Even so much as an address typo could have you looking like you lived somewhere for only a few weeks. That’s enough to lower your credit score.
2) Credit Account – A higher score requires you to have a healthy mixture of past loans. Make sure all of your responsibly paid loans are listed.
3) Identifying Information – Verify that all information pertains to you. A Social Security number typo could mean a stranger’s bad credit bringing your score down hundreds of points.
4) Payment Information – Check for accuracy of loans that you paid off. Are they showing paid and on time?
When mistakes get made, what can you do?
What used to be one of the more painful processes around has been made easier. In July of 2012, the Consumer Financial Protection Bureau (CFPB) was created. This agency handles complaints, enforces federal consumer financial laws and works to ensure the accuracy of your credit report.
If you see a mistake on your credit report, you’ll want to first contact the reporting agency to see if they will correct the inaccurate information. If that doesn’t work out, you should file a complaint with the CFPB.
After filing a complaint, you’ll be issued a tracking number. The CFPB will follow-up with the reporting agency and allow 15 days for a response. If a company insists that the information reported is accurate, you may file a dispute.
Want more information about your credit score? Head over to What’s My Score and get the FAQs or check out our previous article and learn how to rock your credit score. You can also get a free yearly credit report at AnnualCreditReport.com.