Repair Your Credit Profile Part II: Checking Your Credit Report For Accuracy
Taking Charge of Your Credit Profile
Hopefully you've already read Repair Your Credit Profile Part I and are somewhat familiar with the basics of your credit report and how it can affect big purchases.
But did you know that that some employers also run credit checks on potential employees. This means that your credit score is not only affecting big purchases but also your chances of employment?
Credit Checks for Employment Purposes?
Now I'm not saying that in order to work at your local Wal-mart you will be required to have a pristine credit score (as a matter of fact I doubt they even check this as a part of pre-employment screening) but if you’re looking for a job "higher up" in any company you can bet they will be checking your credit profile.
As time marches on this may become more and more of a common practice.
Then again it may not since the recent economy down turn and privacy matters may come into play.
BUT it's better to be safe then sorry.
So let's get down to business....
Checking Your Credit Report For Accuracy
Let's talk about fixing the mistakes on your credit report:
First off as mentioned in part 1 you must check your report for accuracy, I cannot stress this enough. There could be mistakes in your credit file that you are unaware of simply because you have not taken the time to look at your credit report.
Checking your credit report once a year should keep you in the "loop" of where you stand credit wise and it's a great habit to protect your financial future.
Here are the important things to check within in your credit report when checking for accuracy:
Is your name right? Sounds crazy but it's simple things like this that can help you achieve best credit score possible.
- Have you recently married?
- Recently divorced?
- Is this accounted for?
- Is it spelled correctly?
- Do you have a special title such as Jr. attached to your name?
If so this should be noted. Being a Jr. and not having it reflected on your credit report could accidentally tie your credit report to someone else's. Just as easy as not changing from your maiden name to married name could effect your credit report.
Always update with the credit bureaus. It's easy, takes a few minutes, and helps keep your report up to date.
Your Social Security Number
Make sure your social security number is listed correctly. Any variation in the number listed should be reported and corrected.
Updating your addresses with the credit bureaus is important to make sure you are getting the most up to date information from your creditors and any potential credit offers.
Often times you will see many addresses on your credit report. This is because from the time you started applying for credit those addresses you applied with were added to your credit report as your "history".
You want your most recent addresses showing on your credit report. If you have lived at your most recent addresses less than 2 years make sure you leave an addresses trail of two years.
Are Accounts Listed Your Accounts?
Do you remember opening up an account at XYZ retail? If so, check for account status accuracy. If not see number 4.
Look Over Accounts
Take a look at the section of your credit report entitled "Accounts".
Here there should be all the accounts you have ever been associated with.
Whether they be student loan accounts, credit cards, car loans, mortgage payments etc.
- Are you aware of all the companies listed?
- Did you do business with these companies?
Notice two accounts that look almost the same?
There's a good chance negative information was reported twice.
You'll be researching more about this later .
To jump to this information directly check out: Duplicate Accounts.
Not My Debt
Where did this account come from?
So you've found an account you can't associate with anything you've done.
It's important to mention that some companies do business with separate finance companies.
For instance, you may have a car loan with Honda but you account is managed by XYZ bank rather then Honda.
So do a little research, find out which banks are actually involved with your accounts. There should be a phone number listed on the back of your card or on a statement that will allow you to figure out which bank manages the account. Do a little research before jumping the gun.
Outdated Information on Your Credit Report
Is there any information on your credit report that is over 7 years old? If so is this information reporting negatively?
Any negative information that is over 7 years old does not belong there any longer. This information should "disappear" shortly. If not follow through with the dispute process explained further down in this article.
What Are Inquiries?
If you look towards the "end" of your credit report you'll notice a sub-heading entitled inquiries.
These are inquiries that you have made in the past for obtaining credit in some form. These can be as simple as renting a car (some car rental companies check your credit prior to renting you a car), obtaining a loan, or a recent credit application you made. There can be mistakes here too so take at look at this section as well.
Mistakes in this area can also effect your credit score so accuracy is important in all areas.
Did You Know: Credit Inquiries
Every time you apply for a loan, credit card or other financial help that calls for your social security number your credit report is receiving an "inquiry"?
Inquiries stay on your credit report for up to 24 months so before you go applying for every credit card in town think about how long you will be "paying" for that inquiry.
Rest assured however that the inquires created when you check your own credit report, a pre-employment screening, or any other time (when you’re not APPLYING for something) are not looked down upon and your credit score does not suffer from these "soft inquiries".
Fixing Credit Bureau Mistakes
What kind of information does your credit report contain that is "wrong"?
- Is it identifying information?
If so this should be an easy fix.
You can simply visit the site listed on the credit report and start a dispute. This process is quite simple and can help rectify the wrong information. Documentation may be needed such as a copy of your drivers license, your marriage license, proof of address etc.
- Is there an account that is wrong?
If so it's time to do some research.
How is the account wrong? Is it reflecting the wrong information? Is it not your account?
Either way the process is still a dispute process with the credit bureau reporting it, but unrecognized accounts can be a little more concerning then a simple spelling mistake.
Write down everything that you are unsure of.
Credit Bureau Disputes
So you've located information on your credit report that is wrong. You need to fix these errors to make sure you are able to obtain the credit you need.
What do you do?
The process is quite simple, first off who is the company that is reporting these errors? It should be one of the BIG THREE; Equifax, Experian or Transunion. These are the companies that hold your financial portfolio, these are also the people who are required by law to look into any mistakes that a consumer brings to their attention. So bring it to their attention!
Starting a Credit Report Dispute
A dispute form can be found online or can be mailed to the company directly. Anytime I have found errors on my report I have found the online process to be simple, consumer friendly and much quicker then using "snail-mail".
Simply go to the website and find the link entitled dispute inaccuracies (or something of that nature), here it's as simple as filling in a form with what you believe to be a mistake and waiting for the credit agency to do it's job.
The whole process takes anywhere from 30-60 days. Often times I have found the process to go much quicker; however, this is not always the case.
Credit Dispute Templates
- Free Sample Letters to Use in Credit Repair, Debt Consolidation, Debt Validation, and Credit Dispute
Sample letters you to use when fixing your credit. Subjects include you dispute a negative item, validate a debt, request an investigation, or request an item be removed.
- Initial Credit Dispute Letter Template | Credit Dispute Letter Templates
Start here - Dispute negative items on your credit with this FREE Initial Credit Dispute Letter Template
Mail Vs. Online Disputes
Many credit repair companies stress using the mail option to dispute any credit inaccuracies. This is because the online form only gives you so many options for dispute. Whereas by filling handwriting your dispute you can add any reason necessary without having to choose from a set of "reasons" provided.
Remember if you do decide to snail-mail your credit dispute(s) make sure to make a copy of all paperwork, send it certified mail and request a return receipt for your own records.
What Happens if The Creditor Fails to Respond to My Request?
If the creditor fails to respond to the request initiated by the credit bureau the information must be removed from your credit report regardless of it's accuracy or inaccuracy.
It's always worth it to challenge any information you believe to be wrong in your credit portfolio.
Worst case scenario no change, best case scenario you could be saving yourself thousands of dollars in interest charges.
Denied Credit Due To an Error?
If you were recently denied for credit due to an inaccuracy and have manged to get the credit bureau to side in your favor you can sometimes forward your updated credit report to the entity that denied you credit and have their decision reversed.
What Happens After I File a Credit Report Dispute?
Once you notify the credit bureau of an inaccuracy they are required to do an investigation on the matter. What this entails is quite simple:
- The credit bureau receives your dispute and forwards it to the appropriate creditor. The creditor is the entity that put this information on your credit report.
- The creditor has 30 days to investigate on their end and submit the information back to the credit bureau. The creditor must prove that the information is correct, this can be done in several ways but usually a document signed by you agreeing to said terms is proof enough.
- Once the credit bureau receives this information they forward it to you.
Depending on the information received by the credit bureau from the creditor will depend on what action is taken.
If the information is "proved" to be true by the creditor nothing in your credit file will change.
However if the information is proved to be false the credit bureau will update your credit report and send you a copy of the updated results.