Can I Dispute a Credit Report Error, and How?

Errors on your credit report can negatively affect your credit score, potentially making it harder to obtain loans, credit cards, or favorable interest rates. If you find an error on your credit report, it's important to dispute it promptly to ensure that it is corrected. Fortunately, U.S. law provides a clear process for disputing credit report errors, and you have the right to request that any inaccuracies be investigated and fixed.

Steps to Dispute a Credit Report Error:

1. Obtain a Copy of Your Credit Report
   • Check Your Reports: The first step is to obtain a copy of your credit report. Under federal law, you are entitled to a free credit report from each of the three major credit bureaus—Equifax, Experian, and TransUnion—once every 12 months through the website AnnualCreditReport.com.
   • Review for Errors: Once you have your credit report, review it carefully for errors, such as incorrect account information, late payments that were reported incorrectly, accounts that don't belong to you, or outdated information.
2. Identify the Error
   • Common Credit Report Errors: The most common errors on credit reports include:
     • Incorrect personal information (name, address, social security number)
     • Accounts or credit inquiries that don’t belong to you (e.g., fraud)
     • Duplicate accounts
     • Incorrect account status (e.g., an account marked as delinquent when it was paid on time)
     • Outdated negative information (e.g., accounts listed as overdue even though they should have been removed after seven years)
   • Gather Supporting Documentation: Collect any documents that can support your case, such as bank statements, payment records, receipts, or letters from creditors that demonstrate the error.
3. Dispute the Error with the Credit Bureau
   • Contact the Credit Bureau: You must file your dispute directly with the credit bureau that is reporting the error. All three bureaus—Equifax, Experian, and TransUnion—offer an online process to dispute errors.
     • Online: Each bureau allows you to dispute errors through their website:
       • Equifax Dispute Process
       • Experian Dispute Process
       • TransUnion Dispute Process
   • Mail or Phone: If you prefer, you can also dispute errors via mail or phone. However, disputing online tends to be faster and allows you to track the process more easily.
   • Describe the Error: When you dispute the error, be specific. Provide clear details of the mistake, explain why it’s incorrect, and include supporting documentation where possible. For example, if a late payment was reported incorrectly, attach a copy of the payment receipt or bank statement showing the payment was made on time.
   • Include Your Personal Information: Ensure that your full name, address, and any relevant account numbers are included in your dispute to help the bureau locate the information quickly.
4. Wait for the Credit Bureau’s Investigation
   • Investigation Timeframe: By law, the credit bureaus must investigate disputes within 30 days of receiving your complaint. During this time, the bureau will review your information, contact the creditor involved, and determine whether the error is valid.
   • Results: After the investigation is complete, the credit bureau will send you the results of their findings. This may include a correction to the error, an explanation if the information was found to be correct, or additional details if the dispute is still unresolved.
   • Notification from Creditor: The credit bureau will also notify the creditor that the information was disputed. The creditor will have to respond with any supporting evidence showing that the information is correct.
5. Review the Outcome and Take Further Action if Needed
   • Corrected Information: If the error is resolved in your favor, the credit bureau will update your credit report to reflect the corrected information. They will also send you a free copy of the updated credit report.
   • Dispute Denied: If the dispute is denied, you have the right to appeal the decision or request further information. If the creditor continues to report incorrect information, you can ask for a Statement of Dispute to be added to your credit report, which explains your side of the issue.
   • Further Legal Action: If the dispute is still unresolved after several attempts, you may want to escalate the matter. You can file a complaint with the Consumer Financial Protection Bureau (CFPB), or take legal action if you believe the creditor or credit bureau is violating your rights under the Fair Credit Reporting Act (FCRA).
6. Monitor Your Credit Report
   • Free Credit Report Updates: After your dispute is resolved, keep an eye on your credit report to ensure the error doesn’t reappear or affect your credit score.
   • Credit Monitoring Services: Consider signing up for a credit monitoring service to track changes to your credit report in real time. These services often offer alerts when significant changes occur on your credit report, which can help you spot and address errors quickly.

Consumer Protections Under the Law:

• Fair Credit Reporting Act (FCRA): The Fair Credit Reporting Act (FCRA) is the primary federal law governing credit reports. It requires credit reporting agencies to maintain accurate and complete information in your credit file. It also gives you the right to dispute any information that is incorrect or incomplete and mandates that credit bureaus investigate disputes within a reasonable time frame.
• Accuracy of Information: Under the FCRA, if an error is found, the credit bureau is required to correct or remove the incorrect information and notify the creditor that the information is being disputed.
• Right to Free Report: The FCRA entitles you to one free credit report from each of the three credit bureaus every year through AnnualCreditReport.com. You also have the right to a free report if you are denied credit due to information on your report.

Example:

Suppose you review your credit report and find that a credit card company is reporting a late payment from six months ago. However, you know you paid on time. You gather a copy of your bank statement showing the payment was made on time and dispute the error with the credit bureau. After an investigation, the credit bureau removes the late payment from your credit report, and your credit score improves as a result.

Conclusion:

Disputing a credit report error is a straightforward process that can have a significant impact on your credit score and overall financial health. By following the steps outlined above—obtaining a copy of your credit report, identifying the error, disputing it with the credit bureau, and following up on the outcome—you can ensure that your credit report accurately reflects your financial history. If the dispute process does not resolve the issue, you have the right to take further action, such as filing a complaint with the Consumer Financial Protection Bureau (CFPB) or pursuing legal action. Remember to monitor your credit report regularly to catch any potential errors early.