Errors on My Credit Report? Not a Chance!

Guess again....

In the 2004 report "Mistakes Do Happen: A Look At Errors In Consumer Credit Reports" published by the National Association of State PIRGs, it was noted that 79% of credit reports surveyed contained "either serious errors or mistakes of some kind".

79% of ALL credit reports contain errors in case you just glanced over that part!

Additionally, here is what they found.....

• 25% of the reports contained serious errors that could result in the denial of credit, such as false delinquencies or accounts that did not belong to the consumer;
• 54% contained personal demographic information that was misspelled, long outdated, belonged to a stranger, or was otherwise incorrect;
• 22% of the credit reports listed the same mortgage or loan twice;
• 8% (almost) were missing major credit, loan, mortgage or other consumer accounts that demonstrate the creditworthiness of the consumer;
• 30% contained credit accounts that had been closed by the consumer but remained listed as open.

From my own personal experience, I have seen several other issues that can affect the creditworthiness of my clients. These include:

• Accounts paid in full that show current balances. Many times the last reported date is not current to reflect the actual balance.
• The same tradeline reported in 2-3 different ways due to the way the account number is truncated. Sometimes the current balance is different even though the reporting date is the same.
• Tradelines that were discharged in a bankruptcy that still show open. They are usually reporting "in collections" as opposed to "bankruptcy". What many clients don't know and what many bankruptcy lawyers may not tell them is that it's THE CLIENT'S responsibility to make sure the bankruptcy is shown on the credit report.
• School loans that are double reporting. I have seen this a lot where loans are consolidated by another company, but the original creditor does not show them as "paid". In one instance, I had a doctor who had over $350,000 worth of student loans inadvertently reporting.

What can YOU do?

First, if you are reading my posts in order, you already have your FREE credit report from http://www.annualcreditreport.com/. If not, go get it now.

Next, check it over thoroughly. VERY THOROUGHLY! Make sure you check all the areas I wrote about in my last post, including spelling of your name, date of birth, social security number and ALL the tradeline information.

Lastly, if you find errors (and I'm sure you will), make note of what credit bureau is reporting them. It could be Experian (XP), Equifax (EF), or Trans Union (TU). Write a dispute letter to EACH of the three at the address shown on your credit report. Keep it simple when listing the errors, like as follows:

Cap 1 acct# 1234-5678-9876-5432 balance is incorrect

Home Mortgage Co. acct# 852147 paid in full as of 1-07

You get the idea. Now sign the letter! Below your signature, print your name, current address, date of birth, social security number, and, if you have lived somewhere else in the past two years, that address and the dates. You should also include a copy of your drivers license to prove your identity.

If this sounds like a lot, there are dispute forms available on the internet for free.

Remember, YOU are responsible for checking your report to make sure it is accurate. The Federal Government has laws to ensure that you have the ability to correct errors, but they have to be found to be corrected. With the creditors and credit reporting agencies processing MILLIONS of transactions per day, mistakes are bound to happen.

Just think of it as a small price to pay to help the loan process flow better and maybe help you get better interest rates on your home, car and credit cards.

Hope this helps. I'll be posting more soon.

Scott

Scott Swinford is an Executive Consultant for the US Consumer Credit Restoration Association and a Certified Mortgage Planning Specialist in Northwest Indiana. If you have any questions, you can send email to scott@USCCRAonline.com.