A Brief Guide to Fixing an Incomplete, Outdated or Incorrect Credit Report

One of the first steps to identifying any issues on your credit report is becoming aware of the information being reported as fast as possible. This is why it is recommended that you review your personal credit reports on a regular basis.

As you know a credit report contains detailed information on your credit history and activity. The consumer credit reporting agencies are businesses that collect this data from public records, lenders and creditors with whom you have accounts with.

Credit reporting agencies then sell your report to creditors, insurers, employers, and other companies that use it to review your applications for credit, insurance, employment, or other financing needs. Because the information on your report affects so many aspects of your life it’s crucial that the information is accurate, complete, and up-to-date.

The Consumer Financial Protection Bureau (CFPB) released a report stating that Equifax, Experian, and TransUnion each have more than 200 million files on consumers. In a typical month, they receive updates from approximately 10, 000 information “furnishers, ” which are the entities that supply data on consumers. The furnishers do this on more than 1.3 billion “trade lines, ” which are individual information sources on a consumer report such as a consumer’s accounts for a car loan, mortgage loan, or credit card.

With all the enormous amounts of data being furnished mistakes do happen. The Federal Trade Commission 2012 study found that one in five consumers had an error that was corrected by a credit reporting agency (CRA) after it was disputed on at least one of their three credit reports. The study also found that about 20 percent of consumers who identified errors on one of their three major credit reports experienced an increase in their credit score that resulted in a decrease in their credit risk tier, making them more likely to be offered a lower auto loan interest rate.

So how do you order your personal credit report?

The Fair Credit Reporting Act (FCRA) requires that each of the major consumer credit reporting agencies – Experian, Transunion, and Equifax – provide you with a copy of your credit report, at your request, once every 12 months absolutely free.

To request a free copy of your credit report visit annualcreditreport.com. You can request your reports from each of the major consumer credit reporting companies at the same time, or you can order from only one or two if you prefer.

What steps do you take if you discover any incomplete, outdated or incorrect information?

Contact both the credit reporting agency and creditor that provided the information to the agency. Both of them are responsible for correcting any information that is incorrect or incomplete under the Fair Credit Reporting Act.

The good news is all three credit reporting agencies now allow you to submit disputes online. To get started go to each credit reporting agency’s website and follow the online instructions to initiate an investigation. Remember, a credit reporting agency is legally required to investigate your dispute and will typically do so within 30 days of receiving the notification.

Ultimately, you are responsible for ensuring that the information being reported on your credit report is accurate and up-to-date. It’s up to you to clear up any mistakes so it’s essential to stay on top of your credit reports and monitor them on a regular basis. Consider a credit monitoring service so you can receive alerts to any new changes to your credit reports and scores. 

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