Facing the Credit Error Monster and How to fight it!

Are you thinking of seeking out a lender for a potential purchase? You’ll need to see if your credit is good first! Having a solid understanding of your credit record and subsequent credit score is a great way to plan for your financial plans. If you have a good looking score, the better the odds you have at getting approved at a reputable lending institution—with a really convenient rate to boot!

So how do you check your credit record?

You do that by getting a copy of your credit reports from credit bureaus. If you’re worried about fees, don’t worry about it. Federal Law protects your rights to request for a free copy once per year.

Before you freak out, the file they have on you isn’t that extensive. They’ll only have information from any lenders that you’ve worked with before (with your permission), any records that are made public, and other sources. Your credit record will never have your annual income on its file—that would be unethical.

When you get your credit record, it is important that you peruse it carefully and thoroughly. It is critical that you make sure that the information is up to date and does not reflect any inconsistencies. For example, you might have already paid of a loan but your credit record says that it’s still ongoing—that can be a pretty annoying issue down the road.

You find an error in your credit record! Now what?

Stay calm and get started on the process on contesting that error. The unfortunate part of this is that the process can be a lengthy one depending on what avenue you choose to pursue. What’s important first and foremost is to find where the error comes from!

Common reasons/sources for credit report errors!

Credit reports take time a lot of manpower. So while credit bureaus hold all the necessary information about you and your credit history, there are still frailties within and outside of the system that can lead to errors. Here are a few:

Clerical errors by credit bureaus

While we would love to think that the process is streamlined and all they have to do is to press a button and your information is herded together and printed out—this is hardly the case. This is often easy to track. If you have documents to show that: 1.) You did not make any mistakes in your provided information and 2.) Your bank or lender did not make any mistakes in the information they forwarded.

If you can establish that the error comes from the credit bureau, you have a great start at fixing the error.

Personal errors

We cannot stress the importance of writing legibly and triple checking the information you have on the application forms for any loans or credit establishments. If you review your paperwork and you find that you have made an error, it would be prudent for you to contact where you made the error and have it changed accordingly.

It may be a bit of a hassle, but getting that fixed is super important so it doesn’t blow up into a larger issue later on.

Clerical errors by banks or lenders

One of the more highly frustrating sources of credit report errors as it is often difficult to get them to cooperate unless you subject them to an official investigation.

When you do subject them to an investigation, make sure that all your paperwork is in order and that there are several copies prepared. Also, be consistent with your follow up.

Identity theft

This crime is one of the highest reasons for credit report errors. If you cannot spot any errors in your personal records, your bank’s record, and the credit bureau’s records—it is highly possible that you are a victim of identity theft.

You can protect yourself from having this happen to you by carefully tracking your spending. Always review your credit card statements or any bills that are under your name. If you spot anything that you personally do not have knowledge of, it is important to follow up on that right away. There are clues that you can rely on like dates of purchase or location. If you can prove that you were somewhere else during those dates, places, or times, it is easy to prove to your bank or credit bureau that the negative and false information should be stricken from your record.

Now that it’s clear where the issue is from, what do you do?

Handle the disputes in person

One of the worst things that you can do is to send a dispute or inquiry online and through the website of the source (not including identity theft). Lawyers will tell you that most establishments will have you click an “I accept” before you get to type out your dispute. This means that there is a high possibility of them hiding a clause that waives your right to sue after you prove that the error was made by them.

Protect yourself from such sneaky tactics by writing out your dispute letter and having a trusted carrier deliver it. Be prepared to have multiple copies of that letter and any evidences that you have to prove that there was a mistake in your credit report.

Prep paperwork for each dispute

If you notice that there is more than one error in your credit report, do not let that slide. Prepare a document for each separate error. While it can be a monumental hassle, it is better to fix this now before you get declined later over an erroneous report. Keep everything in clearly labeled folders for your personal copies.  Keeping organized is one of your best ways to beat off a credit error.

Get an attorney

Having someone who is fully versed in consumer law is important. They will be able to offer you insight and guides on how to safely maneuver through these troubled waters.

Now, forge ahead and fix that error!