How to Dispute Credit Report & Win

  • By David Lukic
  • Feb 25, 2021

Your credit report is an important piece of the puzzle when you apply for credit cards, a loan, or a mortgage. If there are errors in yours that misrepresent your financial situation, it could result in a denial of credit. More than 2 million people claim their credit reports have serious errors on them. Don’t you think it’s time you find out if yours does and dispute credit report?

What is a Credit Report?

Dispute Credit Report

There are three big companies (Equifax, TransUnion, and Experian) that collect information about each American consumer. A typical credit report contains your name, address, social security number, date of birth, and your credit history for the past ten years. A credit report indicates how well you pay your bills and if you ever filed for bankruptcy. 

The credit reporting agencies use this information to calculate your credit score, which indicates your creditworthiness. Lenders, insurance companies, landlords, and others purchase credit reports on you before deciding whether or not to lend you credit or supply you with a lease, insurance, or employment.

Credit reports are governed by the Fair Credit Reporting Act (FCRA), and the Federal Trade Commission (FTC) oversees these credit bureaus and enforces the laws laid out in the FCRA. 

You are entitled by law to a free copy of your credit report each year. You should request one from all three credit bureaus as they get their information from different sources and calculate scores differently.

You will want to check them carefully for any inaccuracies and have those corrected right away. 

How to Dispute Credit Report

If you find errors on your credit report, you need to take action and dispute credit report quickly because correcting it may take time. Follow the steps below:

  1. Get a copy of your credit report for each agency. Look for outdated information such as loans that were paid off or old home addresses. Check to be sure your birth date and social security number are also correct.

  2. Call the lender or creditor directly to see if their records show the same error. If they can resolve it with that phone call, they will update the credit reporting agency.

  3. Gather together the evidence to prove your claim. You may have to obtain copies of canceled checks or other proof that you paid off the debt. You must do this in writing. The FTC offers a sample dispute letter you can use as a template. 

  4. Send your letter and copies of proof (not originals) to the credit reporting agency either online or through the mail. If you send by mail, use certified mail with a “return receipt requested.” This will ensure you have proof they received your dispute letter. 

How Long Does It Take For a Credit Report Dispute To Be Removed From Your Credit Report

Once they receive your credit report dispute letter, the credit reporting agencies have to initiate an investigation within 30 days. They are required by law to contact the lender who provided the erroneous information and notify you in writing of the result. If the error is found to be valid, the credit bureau you contacted must let the other two agencies know so they can correct their errors as well. 

After the investigation is complete, the credit reporting agencies must, upon your request, send a corrected copy to anyone who requested your credit report in the past six months and two years for employment. If you were denied a job because of the errors in your credit report, this might help fix it. Hence in this case, credit report dispute could play a crucial role in your future.

Even after the credit reporting agency amends your credit report, it is a good idea to follow up with the lender to make sure their records are now correct as well. If they refuse to change them, ask that a copy of your credit report dispute letter be stored with the files. 

What to Avoid When Disputing Credit Report

A blemish on your credit report can stay there for up to ten years. If that negative information is incorrect, you have the right to dispute it and have it removed. However, many people make serious blunders when attempting to correct errors, which cost them the right to a clean credit report.

  • Dispute the Error Only with the Furnisher 

If you contact only the furnisher, you may not be able to get the error corrected with the credit bureau later. You must follow the proper credit reporting agency dispute procedure so that you are covered later. It is not a crime for credit reporting agencies to report inaccurate information; it becomes a crime only if they fail to initiate an investigation upon receiving a credit report dispute letter. You cannot sue the furnisher or credit bureau unless you follow the correct process.

  • You no Longer Have the Evidence

This is a big problem. If you paid off a loan or paid it on time and the lender and credit bureau show it as unpaid or in collection, you must have the documentation to back up your claim. If you lost the evidence, your letter of a dispute of credit report will be in vain. Part of that evidence is the proof (certified mail receipt) that you sent your dispute letter to the credit bureau, and they received it. In a legal battle, you won’t get past the initial hearing without evidence. If you have been denied credit because of the errors, have that put in writing, so you have something to show that this error caused you harm.

  • Too Brief a Dispute Credit Report

The more information, the better. If you simply call the credit reporting agency and don’t offer up enough details, you may have already lost the battle. Credit bureaus prefer these quick phone calls because then they can summarize your dispute as frivolous, and they won’t be required to open an investigation. Do not give the credit reporting agency the ammunition to say, “you didn’t provide enough information.” Send them every piece of documentation you have related to your issue when filing your dispute. It’s better to do everything in writing rather than by phone call. 

  • You Worked with a Debt Collector and Re-Aged Your Debt

If you work with any debt collection service, often, your debt will be re-aged to the new payment terms. The effect this has is that now a bad debt can stay on your credit report for longer than ten years, and this is a hard one to dispute. The FCRA does allow you to fight it, but you have to provide original documentation to show the actual date of the loan. 

You have the right to a clean credit report. If you follow the steps outlined in this article, you can challenge any errors and get them resolved expediently.

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