A step-by-step guide for getting credit bureaus to correct mistakes on your report.
It’s unfortunate, but the credit bureaus don’t always have your information correct. In fact, a 2013 Federal Trade Commission study found that one in four consumers identified errors on their credit reports that might affect their credit scores. This is a pretty serious issue, as just one error could drop your credit score and cost you thousands of dollars in interest.
To ensure that your score is based off the most accurate information possible, you’ll need to dispute errors. Here’s a step-by-step guide on how to do this:
1. Pull and review your credit reports.
Thanks to the Fair and Accurate Credit Transactions Act of 2003, which was created to help consumers ensure their credit information is correct and guard against identity theft, you’re entitled to a free copy of your credit report from each of the three major bureaus every year. Simply go to AnnualCreditReport.com, enter your personal information and answer a few verification questions.
If you’ve never pulled your credit reports before, you may want to request all three to begin with and ensure that each one is error-free. Otherwise, pull a different report every four months so you can check up on your credit throughout the year. Keep in mind that your lenders aren’t required to report to all three bureaus. Before requesting a report, check with your creditor to see which bureau it reports to.
Once you’ve pulled your report, go through it page by page and thoroughly examine it for errors, circling or highlighting any inaccuracies. In particular, keep an eye out for common inaccuracies such as incorrect account details, fraudulent accounts and identity errors.
2. Gather documentation that supports your dispute.
Once you’ve identified and marked the errors on your report, you’ll need to find proof to send that shows the information is wrong and needs to be changed. For example, if your credit limit is being reported as $2,000, when it’s really $5,000, include a copy of your credit card statement that shows the correct limit.
3. Write a dispute letter.
Now it’s time to write a good old-fashioned letter to send to the bureaus. Don’t worry, it doesn’t need to be anything fancy – just use the FTC’s sample dispute letter as your guide.
4. Make copies of everything.
If your dispute is unsuccessful or gets lost in the mail, you don’t want to waste time repeating the first three steps. Take the extra precaution and make copies of your marked up credit report, the documentation that supports your dispute and the letter you wrote.
5. Send your dispute and wait.
bureaus accept online disputes, it's a good idea to dispute errors via postal mail so that you have a paper trail if you need it. Be sure to send your report, evidence and letter, and request a return receipt so you’ll know the credit bureau successfully received your materials.
Then comes what may be the hardest step – waiting.
After the credit bureau receives your dispute, set up a reminder to follow up with the bureau if you haven’t heard back after 30 days; they’re required by law to investigate your claim and will typically do so within that timeframe. They’ll also likely forward your supporting documentation to the company or organization that provided the information and have that information provider investigate and report back. If your dispute is successful, the provider is required to notify the other two credit bureaus so that they can correct your information. Then, the credit bureau will have to report the results back to you and provide a free copy of your updated credit report.
6. Take steps if the dispute is unsuccessful.
While four out of five consumers in the FTC study experienced some form of success in disputing and updating their reports, disputes aren’t always successful. Your dispute may have failed if…
- The disputed item wasn’t an error. Unfortunately, you can’t remove negative items from your report if they’re accurate. If you want to improve your credit health. you’ll need to make on-time bill payments and keep your credit utilization rate low.
- Your dispute was considered “frivolous.” If you try to dispute too many things at once, don’t have proof to support your claim or continually harass the credit bureaus, the bureaus may refuse to investigate your claim. You can attempt your dispute again, though, if you don’t consider your claim to be frivolous – just follow the steps above.
- The credit bureau claims there wasn ’t an error, but you have proof otherwise. In this case, either dispute again by following the steps above or go directly to the furnisher of your line of credit to perform what’s called a “direct dispute.” The process is similar – simply submit your dispute letter directly to your creditor, making sure to include your full name, account number with the company, the purpose of your dispute and documentation that supports your claim.
The Bottom Line: Remember that even if your dispute is successful, new errors could be introduced in the future. Continually monitor your credit to ensure your information remains as accurate as possible. With your credit score and financial situation on the line, it will be well worth your time.