RESEARCH & LEARN

Disputing Significant Errors to Improve Your Credit Score


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TERMINOLOGY

Disputing significant errors on your credit report is vital to improving your credit score and maximizing your financial power. If you obtain a copy of your credit report and notice that there are any significant errors, you must formally challenge them to have them removed. Doing so will benefit your financial state in various ways almost immediately. Below are the steps necessary for a successful challenge.

1. You must first notify the credit reporting agency that the error exists. This must be done in writing and should be supported with other paperwork that proves why the entry should be considered an error. The initial letter should clearly identify you, including name and address. You may then list all the errors you found in the credit report and explain in a clear and concise manner why you believe the information is incorrect. 

After all errors have been identified and cited, you must request that they be removed. It may also aid your effort to include a full copy of your credit report with all errors highlighted or circled. 

2. Sending this letter is not quite like sending any other letter in the mail. You will want to make sure you send it by certified mail with "return receipt requested" so that you can keep track of the process. You must carefully document what the agency receives and when it receives it so that you can challenge the errors even before they are removed from the report.

3. Credit reporting companies usually have about 30 days to look into errors and get back to you. They must forward all the information they received from you about the potential inaccuracy to the company that provided them with the initial information. Once the company receives your information, they must perform an investigation to determine whether an error has in fact occurred. 

4. If and when it is determined that the credit report does contain an error, the reporting company must notify all three major national credit agencies so that the mistake can be removed.

5. Upon completion of the investigation, the credit reporting agency must provide you with a free copy of the corrected report. This free report does not count as your annual free report. It is always a good idea to obtain the free copy a few months later to ensure that the report is still free of errors. 

6. You may also ask the credit reporting agency to send notices of correction to any party or lender who may have received your credit report in the past six months. 

7. In the event that something you have claimed is an error is deemed correct, you may request that your credit report include a notice of dispute so that anyone who looks at your report knows that you are challenging the official report. You will have to pay if you ask the reporting agency to send dispute notices to anyone who looks into your credit report in the future.

It is important to check your credit report at least once a year to ensure that it is free of mistakes, not just for the sake of accuracy, but for the protection of your financial power and reputation.