How to Resolve Credit Bureau Reporting Errors

A couple months ago my wife and I started a passive search for a new home.  We are looking to downgrade to save a bit on the mortgage, and have more money each month to put towards meeting our aggressive savings goals.  When starting the house hunting process it is a good idea to check your credit report to make sure things are being reported correctly.  Inaccuracies discovered late in the game could jeopardize the approval of your mortgage, and the ability to close on a new home.

Skeletons In Your Credit Closet?

Often times consumers have legitimate, negative blemishes on their credit history that are being accurately reflected in their credit file.  For these types of items there isn’t much you can do, but wait.  The earliest most accurate, negative information can be removed from your credit file is seven years.  However, if you are like me, and find an inaccuracy in your report is dragging down your FICO score, there is something you can do about it.  I had to contact a certain unnamed bank that may or may not be represented in the picture above to get an issue resolved with an inaccurate item on my credit report.  In addition to dealing with the bank directly, I also disputed the item at all three credit reporting agencies.  Here a few steps to take to resolve inaccurate information being reported on your credit report.

Steps to Resolving Credit Report Errors

Contact creditor and notify them of the inaccuracy.  Creditors reporting data to credit reports have the ability to wipe clean inaccuracies in your file by submitting what’s called a Universal Data Form (or U-Data Form).  Ask for the creditor to correct their records, update your data with all three major credit reporting agencies, and notify you in writing when the process is complete.  Creditors update credit bureau files every month, or every quarter, and if you don’t notify them of the inaccuracy it could wind up right back on your credit file weeks after getting it resolved through the credit bureau.

Write a letter to the credit reporting agency.  In the letter, identify the account that is reporting inaccurately, give a brief explanation why you believe the record is incorrect, and sign and date the letter.  Be sure to include a copy of any relevant documentation you have from the creditor indicating this was a mistake.

Time is on your side.  According to the federal Fair Credit Reporting Act, credit bureaus have 30 days to remove the record from your file, or provide you proof that the account is reporting correctly.  Occasionally, creditors or reporting agencies miss this window and the information has to be removed, but if it is legitimately being reported by the creditor often times it will reappear.  This strategy is commonly used by these “credit repair agencies” that are usually nothing more than a scam disguised as a legitimate service.  If you legitimately owed a debt, and were late paying on that debt, then there is nothing you can do to have it removed from your record, other than wait the required period of time.

Send correspondence via certified mail, return receipt requested.  The 30-day ticker starts when the bureau receives your letter, and the signed receipt is your proof that is was delivered.  Be sure to stash it in a safe location while waiting to hear back from the credit bureaus.

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