Credit report errors are fairly common. Here's what to do if you spot one.
Your credit report is a pretty important document. Not only does it contain information about the loans and credit cards you have open, it contains details on how well you pay your bills.
But credit reports aren't always accurate. If yours contains a mistake, it could prevent you from getting a mortgage or loan, renting a home, and, in some cases, getting a job.
Those mistakes are pretty common. A good 34% of Americans found at least one error on a credit report between February and April this year, according to an investigation by Consumer Reports.
If you haven't checked your credit report for errors recently, it's time to order a copy and read it thoroughly. Otherwise, you could get penalized financially through no fault of your own.
How to check your credit report
You have more than one credit score, and similarly, you have more than one credit report. That's because there are three reporting bureaus that put scores and reports together:
Usually, the information on your credit reports is the same, but there can be discrepancies, so it's important to check all three. You can usually get one free copy of your credit report each year from each bureau, but between now and April 2022, you can get one free copy a week. You can go to each bureau's website to request your free copy, or get all three through annualcreditreport.com.
What to do if you spot an error
Credit report errors can run from having a misspelled name to showing accounts that aren't yours. If you notice a mistake, contact the bureau that issued the report and explain, in writing, what the error entails.
For example, say your credit report shows that you have an outstanding balance on a personal loan you paid off. Sending a copy of your loan payoff documents should prove that the debt is no longer applicable.
When you report an error, the credit bureau must investigate it within 30 days. And once that mistake is corrected, you have the right to request that the issuing bureau send an updated copy of your credit report to any lenders who accessed it over the previous six months.
Say you applied for a mortgage three months ago and got denied due to a red flag on your credit report. Once the error is corrected, the issuing credit bureau should send an updated copy to the lender that denied you, though you may need to request that.
Credit report errors can hurt you in many ways, so it pays to be vigilant and stay on top of them. If you can't remember the last time you checked your credit report, get a copy as soon as possible.
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