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Construct an Effective Credit Report Dispute

Posted In:  credit cards


Credit CardCredit reports are typically of interest to insurance companies, mortgage lenders, loan companies, banks and potential employers. Although we all know the importance of having good credit score, many of us have never actually seen our own credit reports. It is important to check your credit report from time to time to ensure its accuracy. If an inaccuracy in your credit report ever puts you in a troubling situation, you can file a dispute.

 Understand Report Contents

A credit report generally includes all of your financial information obtained from credit card companies and other lenders. However, not all creditors report your information to credit agencies. For example, local retailers, gasoline or travel credit card companies and credit unions do not always report.

If you have negative information on your credit report, it will automatically be removed after seven years. Bankruptcy information, however, will be removed after 10 years. An unpaid cash judgment due to a court will remain on your credit report for seven years. If the statute of limitations on the case is longer than seven years, the debt will remain on the report for that time period. There are no time limits on reporting criminal convictions, applications for jobs with an annual salary greater than $75,000, or applications for $150,000 or more of credit or life insurance.

Request Copies

If you suspect an error in your credit score, the first step in filing a dispute is to get your hands on hard copies of your reports to check their accuracy. There is potential for human error on the reports, so never assume they are 100 percent correct. The three major companies that produce credit reports are Experian, Equifax and TransUnion. You can easily access your reports from all three companies' websites for a nominal fee.

Send a Letter

Once you have a hard copy of the information you wish to dispute, write a letter to the credit bureau from which it came. Electronic dispute and correction may be more convenient, especially for less troublesome errors, but it's always wiser to leave a paper trail of correspondence. Send the letter as certified mail with a return receipt requested.

Write a formal, concise letter. State clearly the items you wish to dispute, and give a reason why they are incorrect. Attach supporting documentation as well. Make sure to send copies of documentation and retain the originals for your personal files. Include your name, address, phone number and email so the credit bureaus can contact you if necessary. If you have multiple disputes, include two or three, wait for a reply, and then file another dispute later. Avoid filing a long list of disputes at once since the credit agency may refuse to investigate.

Wait for a Response

Once your letter has been received by the credit bureau, it has 30 to 45 days to investigate and respond. You will typically receive a letter containing the results of the dispute. If the dispute was accepted, you will receive an updated copy of your credit report. If the claim was rejected, the letter will tell you why.

Request Updated Information

If your updated report includes a change that will affect, say, a home mortgage loan, you can ask the credit bureaus to send a notice to anyone who received your credit report within the last six months. If your dispute was denied, you can ask to have a copy of it included in your future credit reports.

Dispute Misinformation at Any Time

You can dispute anything on your credit report that is incorrect at any time. By law, credit bureaus are obliged to remove any information that is incomplete, inaccurate or unverifiable. Items might include an incorrect social security number or address, timely payments noted as late, closed accounts reported as open, accounts in another person's name, accounts discharged during bankruptcy but still noted as delinquent or other negative financial information that occurred seven years ago, or 10 years ago if you filed for bankruptcy.

Jessica Bosari is a freelance writer and blogger for various publications and her own blog. You can read more of Jessica's work here. If you have any comments or questions about SavingTools or about saving money, leave your comments in the form below or email jessica@savingtools.com. Thanks!

 

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