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How to clear mistakes from your credit report

Have you ever been horrified to discover errors on your credit report? Such inaccuracies can and should strike fear into any conscientious consumer’s heart. Here are some helpful tips.

Have you ever been horrified to discover errors on your credit report? Such inaccuracies can and should strike fear into any conscientious consumer’s heart because of their punishing consequences.

What consequences, you ask? Well, they can result in higher interest rates whenever you borrow money, and they can even affect your ability to qualify for credit, insurance, employment or rental housing.

To avoid such ominous scenarios, consider these tips for fixing mistakes on your credit report.

1. Reflect on the ways errors can creep in. Sometimes automated processes take over and creditors send inaccurate information about people’s bill-paying habits to one of the major credit bureaus. In other cases, people’s identities accidentally get mixed up at the credit bureau when a staffer enters a Social Security number incorrectly. And sometimes people with fabulous credit histories become victims of blatant identity theft.

2. Check out your credit report. You can examine your credit report carefully all on your own without paying a dime. Order free annual reports from the three major credit bureaus (Equifax, Experian and TransUnion) by visiting or calling 1-877-322-8228. (Note: This is the only place where you can get free credit reports once a year without any strings attached. The “free” credit reports advertised by other sources aren’t really free!)

3. Contact the credit bureau first. If you find mistakes in your report, take the matter up with the credit-reporting agency immediately. Rather than dispute the mistake via an online form, send a letter that includes your complete name and address, a description of each item you dispute, an explanation of why you dispute it and a request for deletion or correction of the information.

4. Keep good records. Along with your letter, enclose copies (NOT originals) of documents that support your position, as well as a photocopy of your credit report with the items in question circled. Send the letter and enclosures by certified mail, return receipt requested, so you can document what the credit bureau received. Keep copies of all correspondence, and jot down and save notes about each phone conversation you have.

5. Go to the source as well. You also should contact the creditor that’s attached to the bad information. You can send the creditor photocopies of everything you sent the credit bureau with a short letter that basically says, “I’m disputing this with you, too.”  Once you’ve taken this step, the creditor should include a notice of your dispute each time it reports the information to a credit bureau.

6. Understand how mistakes should be handled. If the information is found to be inaccurate, the creditor must notify the major credit bureaus so they can make corrections. Disputed information that cannot be verified should be deleted from your file.

7. Take a deep breath. Recognize that it can take months to clear up mistakes on credit reports – especially if more than one inaccuracy is involved. Once an error finally has been eradicated, order your free credit report again at your next possible opportunity and make sure that it hasn’t reappeared somehow. If it has, at least you won’t have to reinvent the wheel all over again. Just resend copies of all your documentation to the credit bureaus or the creditor – or all of the above – and point out the discrepancy.

8. Be alert for telltale signs of identity theft. When you review your credit report, you might notice unusual details that may not impact your credit rating but that should raise eyebrows nonetheless. For example, if you spot an unfamiliar post-office box address in your name, a stranger may have hijacked your identity to create that address.

9. Do you need legal help? Depending on the seriousness of what you find in your report, you just might need a lawyer. The National Association of Consumer Advocates can be a good place to start the process of finding legal assistance.

10. Think you’ve been a victim of identity theft? If so, file fraud alerts with all three credit bureaus: Equifax (1-800-525-6285), Experian (1-888-397-3742), and TransUnion (1-800-680-7289). Also file a complaint with the Federal Trade Commission online or by calling 1-877-438-4338, and close all accounts that were opened fraudulently.