Your credit report is one of the most important documents regarding your debts and payment history. If you have a good history of making payments on time, then a good credit rating depends on a report that is up to date and without errors. Your credit report also contains names of people who were linked to you at some time, previous addresses which may be linked to these people who may not have such a clean rating, and possibly derogatory public records. As the report is actually compiled by credit bureau from the information it gets provided by your creditors, any mistakes that they have made will not be immediately noticed by you, but will influence your rating. It is therefore in your best interest to keep a close eye on your report, at least every 6 months, but certainly once a year. And as you are permitted one free credit report annually from each of the credit agencies, there is no reason why you cannot check up on a yearly basis. But how do you get any errors removed? It’s not that difficult if you follow these steps:
Get your credit report
Contact the major credit agencies and ask for your full, free credit report. We have listed the three major ones at the end of this article. Get together all your credit reports and review them for any errors. This could be the wrong spelling or variations of your name, a debt that has been paid off still showing as unpaid, any accounts that do not belong to you and addresses that you do not recognise. Also check that your Social Security or National Insurance number is correct.
Look for errors
Next have a look for any old entries that are classed as ‘derogatory’ entries; these are items such as credit card charges, collection accounts or County Court Judgements (CCJ’s). These entries are only allowed to be on your credit record for 6 years (UK) or 7 1/2 (US) from the last date of activity and this should be stipulated in the account to which it pertains. Any entries like these can be removed as they are obsolete after this period so make a note of them before you move on.
Write to the agencies
Now take any reports that have errors on them, this could be from any of the three agencies, and go through them, highlighting with a highlighter or a red pen, all the errors that you have found. Get together any documents to support your claim that these are indeed errors, such as the original CCJ paperwork, or the final payment for an account, or a certified copy of your birth certificate, and put the evidence together with the errors. Write a letter to the credit agency, explaining why you think there is an error in your report and point to the documentation that you have included. Ask the agency to review the information and remove it as necessary.
Allow the credit agencies around 30 days to get your letter, act on your information and conduct an investigation into your claim. The Fair Credit Reporting Act allows 30 days for a full dispute investigation. After 30 days you should have heard back from them by mail with an updated copy of your new credit report. If the report has not been corrected as you had wished, you can take your dispute to the Financial Ombudsman in the UK, or you can sue the agency in Federal Court for up to $1000 in the US. Here are the addresses you need:
UK Credit Agencies:
Credit Expert Experian Equifax
US Credit Agencies:
TransUnion, Consumer Solutions, P.O Box 2000, Chester, PA 19022-2000
Equifax, P.O Box 7404256. Atlanta, GA 30374-0256
Experian, Dispute Department, P.O Box 9701, Allen, TX 75013