Credit report errors are common and can seriously damage your financial life. Mistakes can lower your credit score, result in denied applications, and cost you money through higher interest rates. Finding and fixing these errors protects your financial health.
How Common Are Credit Report Errors?
Studies suggest that one in five consumers has an error on at least one credit report. Errors range from minor (misspelled names) to severe (accounts that aren't yours, incorrect payment history). Given these odds, regular credit report review is essential.
Types of Credit Report Errors
Personal information errors: Wrong name, address, Social Security number, or employment information.
Account errors: Accounts that aren't yours appearing on your report, incorrect account statuses (showing closed accounts as open), wrong credit limits or loan amounts, and duplicate reporting of the same account.
Payment history errors: Payments reported late that were actually on time, incorrect payment amounts, and accounts incorrectly showing collections or charge-offs.
Balance errors: Incorrect current balances or outdated balances.
How Errors Occur
Errors happen through data entry mistakes by creditors, mixed files (your information confused with someone with a similar name or Social Security number), identity theft, failure to update after disputes or corrections, and incorrect reporting by collection agencies.
Getting Your Credit Reports
You're entitled to free annual credit reports from each bureau—Equifax, Experian, and TransUnion—at AnnualCreditReport.com. Review all three, as they may have different information.
You're also entitled to free reports after being denied credit, if you're unemployed and seeking employment, if you receive public assistance, or if you believe you're an identity theft victim.
Reviewing Your Reports
Check every section carefully. Verify your personal information is correct. Review each account—is it yours? Are the balances, credit limits, and payment history accurate? Check the inquiries section for unfamiliar creditors.
Compare all three reports—errors might appear on only one.
Your Right to Dispute
The Fair Credit Reporting Act (FCRA) gives you the right to dispute inaccurate information. Credit bureaus must investigate disputes and correct or remove unverifiable information, typically within 30 days.
Starting the Dispute Process
You can dispute online (quickest), by phone, or by mail (creates a paper trail). For significant errors, written disputes are recommended—you have documentation of exactly what you claimed.
Identify the specific error, explain why it's wrong, and include supporting documentation (payment records, account statements, etc.).
What Bureaus Must Do
After receiving your dispute, bureaus must investigate within 30 days (45 days if you submit additional information), forward your dispute to the data furnisher, review their response, and notify you of results. If they can't verify the information, they must remove or correct it.
If Your Dispute Is Rejected
If the bureau verifies the information is accurate but you disagree, you can request reinvestigation with additional evidence, add a personal statement to your credit report explaining your position, file complaints with the Consumer Financial Protection Bureau, or sue under the FCRA.
Impact on Your Credit Score
Removing negative errors can significantly improve your score. Correcting a late payment that was actually on time, removing an account that isn't yours, or fixing an incorrect balance can all boost your score.
Getting Legal Help
Consumer attorneys handle credit report error cases, often on contingency. If bureaus fail to properly investigate or correct errors, you may have FCRA claims for statutory damages, actual damages, and attorney's fees.