December 8, 2023

Bucks: How to Dispute Credit Report Errors

Credit reports have increasingly become consumers’ passport to the financial world. Whether you want to rent an apartment, get car insurance or apply for a credit card, the data in your credit report will be one of the crucial measures used to judge you.

That’s why you want to ensure that the information in your report — which is used to formulate your credit score — is free of any inaccuracies. Even if you’re not denied credit, a small error here or there can cost you more in interest.

The three big credit bureaus — Equifax, Experian and TransUnion — and the entities that provide them with data (like lenders) are required to investigate any potential errors. But, as I reported in a recent story, their investigations aren’t very thorough.

So as with most everything else, you need to be your own advocate. Here are several tips on the right way to file a dispute, compiled from consumer attorneys, credit experts and consumer advocates.

Get your report. There’s only one place you should go to get a copy of your credit report: All consumers are entitled to one free credit from each of the three major credit bureaus through this site. (In fact, you can forgo the credit monitoring services many of them sell by creating your own: simply order a report from one of the agencies once every four months.)

Create a paper trail. The credit bureaus allow you to file your dispute online, and it’s probably the fastest and simplest way to go. But don’t. Experts say it’s better to send a written dispute via certified mail (return receipt requested).

Sending a written complaint may not help resolve your problem any more than filing an online dispute. But it will help later on, say, if your problem isn’t  resolved or if you eventually need to show a record of your efforts in court.

Don’t be restricted by the dispute forms that the bureaus recommend you use. Experts recommend coloring outside of those lines. Attach a letter that explains the problem, and provide copies (not originals) of any supporting documentation, like a canceled check illustrating that you made a payment. The Federal Trade Commission has a sample dispute letter on its Web site.

The credit reporting bureaus are required to forward all relevant information to the organization that is the source of the error, though consumer advocates and lawyers told me this never happens. (In fact, the system the bureaus use to communicate with creditors doesn’t allow them to forward any attachments. Instead, workers boil down all the information you send into a one- to three-digit computer code — for instance “account not his/hers.” That’s what is forwarded to the creditor, who must then perform an investigation of its own.)

So go ahead and do it yourself: notify the creditor of your dispute and send it all copies of supporting documentation as well.  That way they can’t argue that the bureau didn’t send them enough information.

In fact, consumer lawyers and advocates said that the bureaus typically won’t make any changes unless the company that provided the information, like a creditor, says to.

Where to send your dispute. TransUnion and Equifax provide mailing addresses on their Web site.  A spokeswoman for Experian said an address can be found on its credit reports. (For the record, this is the address: Experian, P.O. Box 9701, Allen, Tex. 75013).

All three bureaus provide instructions on how to file a dispute on their Web sites. If you want to call to follow up, keep notes of the date you called and with whom you spoke. TransUnion provides a phone number on its site, while numbers for Equifax and Experian can be found on your credit report.

Do it thrice. Even if you know that your credit card company is the source of the error, it pays to send the dispute to all three bureaus as well. That will give you the right to file a suit — against the creditor or the bureau — if either institution doesn’t resolve the problem. Due to a quirk in the law, you don’t have the right to sue if you simply send your dispute to the creditor. Given the havoc a serious credit error can wreak, you want to retain that right.

Technically speaking, however, if one bureau finds an error as the result of a dispute, it must alert the other two bureaus.

After it’s resolved. Once the investigation is complete — bureaus usually have 30 days — the credit bureau must send you the results in writing, along with a free copy of your report if the dispute results in a change.

And if you ask, the credit reporting company must send notices of any corrections to anyone who received your report in the last six months, according to the F.T.C.’s Web site. You can have a corrected copy of your report sent to anyone who received a copy over the last two years for employment purposes.

And if it’s not resolved. If all else fails, hire a lawyer who is experienced in handling cases that pertain to the Fair Credit Reporting Act, which is the law that governs the bureaus. You can find a lawyer with that expertise through the National Association of Consumer Advocates.

What has been your experience in trying to have a credit dispute resolved? Do you have any additional advice for others who might be in this situation?

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