Just How Accurate is My Credit Report? Examples of Common Mistakes Found

In the past few years, the economy took a serious hit and so too did the finances of millions of Americans. Consequently, many of them learned the hard way just how important the information listed on their credit reports may be, as a large percentage likely saw their scores take a serious dive.

However, now that conditions are once again improving, so too are people’s financial standings, and with them their credit scores. Unfortunately, though, many may still be weighed down considerably in bringing their ratings up to where they deserve to be simply because, in certain cases, they may have some errors on their credit reports. These documents, and the accounts listed on them, are used by the three major credit bureaus to create the scores lenders and other organizations rely upon to not only grant access to credit in the first place, but also to set the terms of those accounts. The higher the score, the lower the interest rates, and the fewer the fees.

It is for this reason that you should be aware of exactly what kind of issues can lead to these problematic entries, and how to go about addressing them.

Inaccurate entries

One of the most common types of errors often comes as a result of a simple mistake. For instance, you or your lender may, at some point in the application process for a new type of credit, mistype your Social Security number or other crucial information that can lead to a bit of a mix-up. This can also happen when someone else applies for credit. For instance, if someone with a Social Security number that is just a digit off from yours applies for an account, and the person submitting that information presses the wrong button, that can certainly create an issue or two for you.

Identity theft

This is certainly the type of credit reporting mistake that gets the most media coverage, and for good reason.

“It can haunt you for many years,” San Benito, Texas, police detective Rogelio Banda told the Valley Morning Star.

Benito, however, knows that not because of his work as in law enforcement, which often has to deal with identity theft cases, but rather because he was victimized by identity thieves two decades ago, and his information was only recently used to obtain an auto loan without his knowledge hundreds of miles away in Houston. This is the most insidious kind of reporting mistake because it’s really not a mistake at all; instead, it’s a deliberate attempt to use your personal information to obtain credit that the thieves have no intention of ever paying back.

The problem with this, too, is that in cases for which your Social Security number is exposed, there’s actually relatively little you can do to make sure you’re fully protected from this type of crime. As with Banda’s case, once that data, which cannot be changed like a legal name or address, is exposed, the only way to truly protect yourself from this type of problem is to put alerts on your credit report permanently, so that you’ll know when someone is trying to use that information.

Mistakes that can linger

In some cases, another type of error can be one that you thought you’d already cleared up. A woman named Joanna Yang was recently rejected for a mortgage she wanted because an issue she’d reported to the credit bureaus and with the debt collector that created the erroneous entry was not taken off her report, according to a report from the Boston Globe. This issue left her in the lurch when it came to obtaining that mortgage, and any other loans she might want within the several weeks or more, because that’s how long it may take for corrections to show up on her documents.

“I was told that it will take 30 to 90 days for the change to be reflected on my credit report,” Yang told the newspaper. “And I won’t be able to buy a house during these 30 to 90 days, while the market is moving so quickly.”

What to do?

When you’re dealing with this kind of issue, one of your first moves should be, as Yang did, to contact the major credit bureaus as well as the lender or other company claiming that you’re responsible for such a debt, and let them know you think the entry was made in error. By law, this will spark an investigation into the situation, after which point you may be required to provide evidence to support your claims.

Of course, you should also be checking your credit reports with regularity, particularly well in advance of any planned applications for credit, to make sure no such entries appear in the first place. It might also be helpful for you to work with a credit repair company at this time, as these may be able to help move the process along more quickly.

Posted in Credit Report
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