by Amer Numan

Created on: January 13, 2009   Last Updated: January 27, 2009

Why should you care if your credit report has errors?

Your credit is a reflection of your responsibility and business ethic to lenders. The reason credit accuracy is vital is the fact that it is your only way to your next vehicle, home, or college loan. It is even used by some employers as part of a background check before hire.

How do you know if your credit report has errors?

The first step is obviously to obtain your own credit report and examine it, from the 3 major credit bureaus: Experian, TransUnion, and Equifax. You can do that by signing up for a free trial* at their websites;

www.experian.com

www.transunion.com

www.equifax.com

Or by calling them and asking if you qualify for a free annual copy of your report (most states do);

Experian: 1-888-397-3742

TransUnion: 1-800-888-4213

Equifax: 1-800-685-1111

*If you choose the on-line free trial, and do not want to pay for a regular monitoring service, make sure you cancel your free trial within the trial period, or you will be charged a monthly subscription fee.

What errors should you look for?

1. Personal data; Your name, social security number, full address, previous addresses, and any recorded phone numbers.

2. Accounts; Make sure all listed accounts actually belong to you, keeping in mind that the name of an account on your credit report may not exactly match the consumer-friendly name on a credit card or paper statement.

3. The way an account was closed; Many creditors may claim that your account was closed due to non-payment, when you may have called in and chosen to voluntarily close your line of credit. Some will claim that you agreed on a partial settlement when you actually paid the account in full. This makes a big difference to lenders and is very important to resolve.

4. Length of delinquency; Some creditors will claim that an account was delinquent for, say, 120 days, when you may have reached a settlement with them a while before that. Generally speaking, you have more red flags with each 30-day period an account is delinquent.

5. Recorded credit limits; One of your active or closed accounts may show an erroneous line of credit. Make sure that if you handled a credit card or loan worth, say, $2,000, your report really shows that exact amount.

After you have a list of errors, what do you do?

At their websites, all 3 credit bureaus have a way of reporting errors after you run your report. There is usually a check box or button next to each account that allows you to flag it as an erroneous item. The website guides you through submitting your flagged items and allows you to fill in your reasoning and comments.

If you choose to do this in writing, or in reply to a paper report that was mailed to you, make sure you detail ALL account names, account numbers, and any associated dates of the error, with a very brief reason why you believe it is an error, and use the following mailing addresses for each respective report issuer:

Experian: P.O. Box 2002, Allen, TX 75013
TransUnion: P.O. Box 1000, Chester, PA 19022
Equifax: P.O. Box 740241, Atlanta, GA 30374

In my own experience, I have had replies to my inquiries and corrections within 3 weeks of mailing them in. Credit bureaus have 30 days to issue some sort of reply to you after you catch a discrepancy, so make sure you demand a resolution if they near that 30 day deadline.

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