One of the most important chores on any financial to-do list is to regularly review your credit reports for errors and possible identity theft. If an error does appear, disputing it is a fairly simple process with a potentially big payoff: It might help build your credit score.
Keep reading to learn how to dispute a credit report and win.
Table of Contents
Key Points
• Regularly checking your credit reports is important to catch identity theft and correct any errors.
• The three major credit bureaus allow you to do this free of charge once a year.
• To dispute an error on a credit report, you’ll need to contact each credit bureau that published the error.
• Credit monitoring services can alert you if there is something suspicious on your credit report.
• If you find evidence of identity fraud on your credit report, visit IdentityTheft.gov to report it.
How to Get an Accurate Credit Report
Consumers can access their credit reports for free every 12 months from the three major credit bureaus: Experian, TransUnion, and Equifax. These credit reporting companies feature similar but not identical data, and any errors may appear on one or more reports.
There are three ways to request a report:
• Online: Visit AnnualCreditReport.com
• By phone: Call 877-322-8228.
• By mail: Download an Annual Credit Report Request Form from the URL above and mail it to:
Annual Credit Report Request Service
P.O. Box 105281
Atlanta, GA 30348-5281
You can request all three reports at once or each one at a different time without paying a fee. Helpful hint: By ordering one at a time and spacing out requests every four months, you can be fairly confident about catching major issues while they’re fresh and easier to dispute. For example, you might order the Experian report in February, the TransUnion one in June, and the Equifax one in October — all for free.
After you’ve used your free annual access in each case, you can pay to check your credit reports as often as you like. Credit reporting companies can’t legally charge a consumer more than $16.00 for a report. It’s also possible to access credit reports through specialty consumer reporting companies, some of which charge a fee.
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Why It’s Important to Correct Mistakes in Your Credit Report
Credit reports generally make it easy to spot unexpected negative financial information, such as missed payments. However, take care to review your credit report for other incorrect data, however minor, such as errors in former addresses or employers. Common credit report errors include inaccurate account balances, duplicate account info, and false late payments.
In case of an error, take steps to have the mistake removed as soon as possible. Credit report errors can lead to a bad credit score, impact loan applications, or raise the interest rates you’re offered. Bad marks on a credit report can also affect your employment options, insurance premiums, and ability to rent an apartment.
Recommended: 6 Money Habits to Develop Financial Success
How to Dispute Errors on Your Credit Report
To dispute an error on a credit report, you’ll need to contact each credit bureau that published the error. Mistakes can appear on only one report or on all three. Each credit bureau has its own dispute process, so check the instructions on AnnualCreditReport.com or the individual credit bureau sites. You’ll likely need to fill out a dispute form and provide supporting documentation that helps prove there was an error.
If your dispute is accepted, follow up to make sure the credit bureau and the business that supplied the incorrect information update their records accordingly. If a mistake is easy to prove, start with the business that made the error. Be aware that credit bureaus and businesses cannot charge you to correct errors on your report.
If a mistake on a credit report is due to identity theft, it’s important to report this to IdentityTheft.gov and get a personalized recovery plan.
Recommended: Guide to Building Credit With No Credit History
Writing a Letter to Dispute a Mistake on Your Credit Report
Usually, a dispute needs to be submitted in writing. If you submit a letter via the Post Office, send it via Certified Mail and request a Return Receipt. That way, you have proof that the credit bureau received the letter.
The following information should generally be included in a dispute letter.
Identifying Information
The date, your name, your Social Security number, and your address all need to be included in the letter.
Each Item That Needs Disputing
Whether there is one error or many, you should outline each one briefly and clearly. Identify the error, explain why the information is wrong, and supply the correct information if applicable. Then, request to have the error corrected or removed.
Copy of the Credit Report
It can be helpful to enclose a copy of the credit report with the errors circled. Don’t send any original documentation with your letter. Make copies and keep the originals safe in case they’re needed again.
Why Consider Credit Score Monitoring?
To efficiently keep an eye on your credit reports, you may choose to use a credit monitoring service. These services will update you when certain credit updates appear, such as new accounts, hard inquiries, high credit card balances, or missed payments.
Not only does credit monitoring make it easier to stay on top of your credit and work toward building your credit score, but it can also help catch fraud and identity theft early.
How to Report Credit Scams
If you suspect you’ve been the victim of a credit scam, you should first call the companies involved to secure your accounts. Then, place a fraud alert with one of the three credit bureaus, and report the incident to IdentityTheft.gov, a division of the Federal Trade Commission. They’ll provide a personalized recovery plan, walk you through the steps, track your progress, and even pre-fill forms and letters for you. Then, you should dispute any false information that appears on your credit report.
The Takeaway
Disputing and correcting errors on your credit report is usually straightforward, as long as you can prove the mistake. Whenever possible, reach out directly to the business that reported the false information. Then, follow the dispute instructions for each of the three major credit bureaus: Experian, TransUnion, and Equifax. Review your credit reports annually to catch errors before they negatively affect your financial record and your life.
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FAQ
Who tends to win a credit dispute?
No one party or side always wins a credit dispute. If you can provide evidence that an error was made, you will likely win the dispute.
What reason should I put for disputing a credit report?
The reason for your dispute could be a typo, outdated information (more than seven years old), data that belongs to another consumer, or fraud, among other things. Include any supporting documentation you have to help strengthen your argument.
Does disputing a collection notice reset the clock?
No, but a dispute does pause the clock with regard to bill collectors. Once you dispute a debt in collections, the collections agency can’t contact you again until they’ve provided you with verification of the debt in writing.
Can a dispute lower my credit score?
Disputing an error will not lower your credit score. In fact, if the error is removed, your credit score could end up increasing. However, if the debt you dispute turns out to be valid, it will continue to affect your credit score.
What are the dangers of identity theft?
If someone steals your identity, your credit score could decrease, and you could be charged for purchases you didn’t make. Identity thieves could also take your tax refunds or exploit your medical insurance.
About the author
Jacqueline DeMarco
Jacqueline DeMarco is a freelance writer who specializes in financial topics. Her first job out of college was in the financial industry, and it was there she gained a passion for helping others understand tricky financial topics. Read full bio.
Photo credit: iStock/mediaphotos
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