Nothing is exempt from the occasional human error, including your credit report. But just how likely are you to experience an error that potentially hurts your score? The Federal Trade Commission did a study in 2012 that showed 1 in 5 people found credit report mistakes. Mistakes that could’ve cost them higher interest rates or even be denied credit.
The best way to prevent a credit report mistake from affecting you is to monitor your credit report and dispute any errors found. You can get a free credit report from each of the three major bureaus once every 12 months at annualcreditreport.com. While it may seem pretty straightforward, there are some things you want to avoid in the disputing process.
Only Contacting the Creditor in Question
While it’s a good idea to contact the creditor involved in the credit report mistake, contact the credit bureau first. The Fair Credit Reporting Act has a system in place to investigate any reported errors. If you only go to the creditor and they insist that the information is right, you won’t be have federal law protection.
Contacting the Bureau Online or By Phone
This seems counterintuitive because the bureau advertises how easy it is to submit a credit report mistake online. Calling someone by phone seems more direct and efficient than snail mail. However, the problem with phone calls is that they are hard to keep record of. The online submission process doesn’t give you enough space to state your claim and provide sufficient evidence. You are more likely to get your dispute properly investigated and remedied if you submit by mail.
Not Keeping Good Records
You won’t get very far if you dispute a credit report mistake without proof. Retain financial documents regarding your accounts, documentation of denials of credit and inflated percentage rates due to the error. Additionally, keep records of any contact attempts you have made with the creditor and the credit bureau.
Making “Frivolous” Disputes
It’s not just a pretty word. Under certain circumstances the credit bureau can classify your dispute as frivolous, meaning that they don’t have to investigate it. To prevent this, you want to make sure to submit correct and complete information regarding your credit card mistake. If you find multiple errors, you will need to write one letter per error. A long list of disputes can be deemed frivolous. Additionally, you don’t want to dispute the same error multiple times without providing more information toward the dispute.
For personalized credit health education, learn more about Apprisen’s credit health education sessions.