How To Fix Any Errors On Your Credit Report

Overview and General Tips

Carefully review your consumer credit reports for errors. There's a good chance that your credit reports will contain inaccuracies. U.S. Public Interest Research Group study found that at least 70% of reports contained an error of some kind. And one in four consumer credit reports it reviewed had errors serious enough to cause consumers to be denied credit, or other essentials such as an apartment, or insurance.

Those consumers on the threshold of subprime status face particularly dire consequences from this lack of precision. Falling below the cutoff score for a prime rate mortgage can add a tremendous financial burden to these threshold consumers and make it more difficult to meet this and other financial obligations.

Steps to fixing credit report erros

Step 1: Contact the creditor regarding the problem
Step 2: Contact credit reporting agencies
Step 3: Ensure that the error is fixed
Step 4: Write a statement if you cannot resolve a disputed item. You have the right to attach a 100-word statement, free of charge, explaining the nature of your disagreement. Your statement will become part of your credit file, and will be included each time your credit file is accessed.

Consumer Tips

Before you file a dispute with any consumer credit reporting agency, you should have and review a recent copy of your consumer credit report issued by that agency.
You should be prepared to provide details such as the name of the "furnisher" (or creditor) who provided the information about the disputed item, the reasons for your dispute and copies of any documents or information to substantiate your claim.
File your dispute in writing with the consumer credit reporting agency that issued the consumer credit report containing the error, send it "return receipt requested" and keep a copy of your letter and all documentation for your records. Do not send your original documents.
Review your report from each of the three credit-reporting agencies at least once a year. An error-free report from one agency does not guarantee that the reports from the other agencies will be accurate.
Make sure you follow up with all three agencies and any creditors of information to the consumer credit reporting agencies to ensure the corrections have been made.
Be aware that contesting an error and resolving credit problems takes time and often a lot of effort. Be persistent and be patient.

The FACT Act gives consumers new rights for disputing errors.

Expanded consumer rights under the FACT Act allows you to dispute errors both with the consumer credit reporting agency and with "creditors," that is, those who directly provide information to the consumer credit reporting agencies.

You should dispute inaccurate information with both the consumer credit reporting agency and the creditor. Disputing with both allows you to cover all of your bases to ensure that the corrections are consistently made by any source which might risk reporting an error. Consumer credit reporting agencies may be subject to civil liability if errors are not corrected.

Disputing Information Directly with a Consumer Credit Reporting Agency

Consumer credit reporting agencies have 45 days to conduct reinvestigations of disputed items resulting from free annual consumer credit report requests made under the FACT Act. (An exception to the time period is made if the consumer credit reporting agency has not been continuously providing consumer credit reports for 12 months preceding the request for the free consumer credit report.) Consumer credit reporting agencies have 30-45 days for all other dispute investigations, i.e., those that are generated as a result of information obtained from consumer credit reports other than the free annual reports you are eligible for under the FACT Act.

If the creditor of the information fails to respond within this time, or fails to adequately explain the reason for the inaccurate or incomplete information, the consumer credit reporting agency must remove the error or disputed item from your record. The consumer credit reporting agency must provide you with an updated copy of your consumer credit report by mail within the 45 day period.

Consumer credit reporting agencies must notify creditors and other providers of information when changes are made because of an investigation based on a consumer complaint about a consumer credit reporting error. Creditors must change records, delete records, or permanently block reporting to consumer credit reporting agencies of information found to be inaccurate or incomplete.

If a consumer credit reporting agency is notified by a creditor that you are disputing information supplied by the creditor, the consumer credit reporting agency must indicate that fact in each consumer credit report that includes the disputed information.

You should follow up with the consumer credit reporting agency to verify that the inaccurate or incomplete information is removed in a timely manner, then continue to monitor your credit information on a regular basis by ordering and reviewing your consumer credit reports from the three major consumer credit reporting agencies.

Disputing Incorrect Information Directly With Creditor

Before the changes in federal law that become effective under the FACT Act creditors of information were only required to perform an investigation of the accuracy of information if they received a complaint from a consumer through a consumer credit reporting agency. Effective December 1, 2004, consumers have a new right to dispute information directly with the providers of the information, also known as "furnishers" (or creditors). An exception to this is that consumers cannot use credit repair organizations to file disputes directly with creditors under the FACT Act.

The new law requires financial regulators and the Federal Trade Commission (FTC) to develop regulations outlining the types of consumer disputes that creditors and other furnishers of information to consumer credit reporting agencies must investigate. Those regulations are pending.

Other rules about filing a dispute directly with a creditor have already been developed. The questions and answers below reflect the rules which have been decided and the steps you should take when you file a dispute directly with a creditor. The pending regulations will define exactly what kind of disputes you can file directly with the creditor.

How should I dispute information with the creditor and what information should I include in my dispute?

A consumer credit report contains information about the furnishers of information in your consumer credit report. To dispute information with a creditor, do so in writing, send it "return receipt requested" and retain a copy of your letter for your records. When you dispute an error with a creditor, be sure to:

include your name, account number, identify the specific information that is being disputed;
explain the basis for the dispute; and
include copies of all supporting documentation required by the creditor to substantiate the basis of your dispute.
The creditor cannot report negative information about you during the pending investigation.

How soon does the creditor have to respond and by what method?

Once you have notified the creditor in writing that you are disputing information it provided, the creditor has a duty to investigate your complaint and to review all relevant information you provide.

The creditor must complete the investigation and respond to you within 30 days of receiving your dispute.

The 30 day period may be extended by 15 days if the creditor receives information from you during the 30 day period that is relevant to the investigation.

If the investigation finds that the disputed information was inaccurate or incomplete or could not be verified, the creditor must promptly notify each consumer credit reporting agency to which the creditor provided the inaccurate information. The creditor must provide to the agency or agencies any information that is necessary to correct the error.

Based upon the results of the investigation, in notifying a consumer credit reporting agency, the creditor shall either modify, delete or permanently block the reporting of the disputed information.

Once the consumer credit reporting agency receives the results of the investigation from the creditor, the consumer credit reporting agency must act to modify, delete or permanently block the disputed information within the 30 day period that begins when the creditor receives your notice of dispute, and mail an updated copy of your consumer credit report reflecting the results of the investigation of your dispute.

Does a creditor have any special obligations under the FACT Act?

Creditors must not report negative information about you to consumer credit reporting agencies once you notify the creditor that the negative information is the result of identity theft.

Creditors must notify consumers one time before creditors can start to report negative information to a consumer credit reporting agency. Click here for more information on blocking.

Where to complain

If you have a complaint about the way a consumer credit reporting agency or a furnisher of information handled your dispute regarding information contained in a free annual consumer credit report made available by the FACT Act after December 1, 2004, contact the FTC by telephone at: 202-FTC-HELP (202-382-4357)

Or write to the FTC at:

Federal Trade Commission
CRC-240
Washington, D.C. 20580