Tag Archives for " Credit Reporting Act "

Credit Report Dispute: Ways to Dispute Credit Report Errors

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Ways to Do a Credit Report Dispute

In the early 70’s the Fair Credit Reporting Act (hereafter “FCRA”) was enacted as a way to set guidelines regarding credit reporting industry practices, procedures and consumer protections.

That Act has evolved over time, and thanks to multiple amendments the current version gives consumers a variety of options when it comes to challenging information on their credit reports.

Those options are:

1. The Most Common Method – Direct to Credit Bureau
By far the most common way consumers challenge information on their credit report is by filing a dispute directly with one or more of the national credit reporting agencies; Equifax, Experian and TransUnion.

You can file a direct-to-bureau dispute via the credit bureaus’ websites, a letter or over the telephone.

When the credit bureaus receive your communication they are obligated by the FCRA to show the offensive item as being “in dispute.” They are also obligated to contact the furnishing party, normally a bank or collection agency, and verify the accuracy of the information in dispute.

This process cannot take longer than 30 to 45 days and if the mistake is on all three of your credit reports then you have to repeat this process–times three.

The form sent by the credit bureaus to banks and collection agencies is called an “ACDV”, or automated consumer dispute verification form. This form is normally sent electronically via a system called e-OSCAR.

2. The Not So Common Method – Direct to Furnisher
It’s not a huge secret but consumers are also allowed to file disputes directly with the party that furnished the allegedly incorrect information to the credit bureaus.

So, instead of trying to reach someone with the credit reporting agencies all you have to do is call your bank or the collection agency and let them know you are disputing the credit reporting of some item and you want it corrected.

When you file your dispute direct-to-furnisher, they are also obligated to communicate to the credit bureaus, all of them, that you are challenging the item and the alleged mistake is properly noted as being “in dispute.”

The furnisher also has the same obligation to perform an investigation. If they determine that the item is in fact incorrect, a correction must be sent to all three of the credit reporting agencies.

This process is called “carbon copy.”

The form sent by the banks and collection agencies to correct their credit reporting is called a “UDF”, or universal data form. This form is also normally sent electronically via the e-OSCAR system. More at 3 Ways to Dispute Credit Report Errors

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Disputing Credit Report

“Sometimes, it’s not easy disputing a credit report. Read these tips, as they are sure to help. Check them out now!”

Ways on Disputing Credit Report

Checking the accuracy of your credit report is important, given recent reports that 5 percent of consumers may have errors in their reports that can result in higher interest rates on a loan.

The National Foundation for Credit Counseling has developed a list of “do’s” and “don’ts” for managing your report, which tracks your individual borrowing history. The major credit bureaus — Experian, TransUnion and Equifax — use information in the reports to create a credit score, which lenders use to decide if you are a good candidate for a loan and what interest rate you qualify for. Scores can also be used to determine eligibility for other financial products, like insurance.

Here’s the foundation’s list:

Review your report for accuracy at AnnualCreditReport.com. You’re entitled by law to one free report from each of the three major bureaus every 12 months, so you can check a different one every four months. Despite the availability of free reports, few consumers check them, the foundation says. Reviewing your report at least three months before a major financial move gives you time to dispute any errors and have them corrected.

Understand your rights. The federal Fair Credit Reporting Act provides protections for the accuracy and privacy of information in your credit file. The credit bureaus have dispute resolution processes in place. But it is up to the consumer to initiate the process by submitting the dispute form, either online or by phone.

Tara Siegel Bernard, writing for The Times, found that it’s better to submit a dispute in writing, to create a paper trail in case you need it later and to submit disputes to all three bureaus.

Credit reporting companies are required to investigate the items in question, usually within 30 to 45 days of the dispute being filed. The bureau receiving the dispute must forward all relevant information to the source of the information to begin the investigation process. After the provider’s investigation is complete, the results are sent back to the bureau. If the information provider finds the disputed information to be inaccurate, it must notify all three credit reporting companies, allowing each of them to correct the information in their files.

Not all errors have an equal impact. Some mistakes are more serious because they may have a negative impact on your credit score, like accounts that don’t belong to you, or credit lines listed with lower limits than they actually have or negative information that has stayed on the report longer than allowed. Those sorts of errors should be addressed immediately. More at Tips for Disputing Credit Report Errors

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How to Check Credit Score for Free Tips

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Ways to Check Credit Score for Free

The Fair Credit Reporting Act required consumer reporting agencies, like credit bureaus, to provide their records of you at least once ever twelve months. Since your credit report, and credit score, as so important in your financial life, it makes sense that the law mandates you are able to review it annually without cost. This is why credit experts recommend that you check your credit report at least once every twelve months for errors, omissions, or other inaccuracies so that your report is an accurate reflection of you.

There was one crucial aspect of the credit reporting system that the FCRA did not address—credit scores. When it comes to credit of any kind, whether it’s a mortgage or a new cell phone, your credit score is what creditors look at.

Oftentimes, when someone pulls your report they only get your FICO credit score. My friend is a landlord and when he pulls credit he only get their score and a few stoplight metrics like payment history and age of credit lines. He doesn’t get a full report.

It is only a matter of time before the credit score will be a required annual disclosure in conjunction with your credit report. Until then, the only way to see your credit score for free is to sign up for a credit monitoring service trial and canceling before the trial ends.

I won’t recommend any one service, they’re all pretty much the same, but I recommend one that promises to give you an official FICO credit score, not a credit bureau score. One reputable company is Fair Isaac Corporation, the originators of the FICO score, and they have a consumer facing site called myFICO (they always have plenty of myFICO promo codes flying around).

If you don’t go with Fair Isaac, choose one associated with one of the credit bureaus (Equifax, Experian, TransUnion). I don’t recommend signing up for these programs for no reason. If you are planning on getting a loan and are curious about how good your credit score is, then getting your official FICO score is important. It’s a soft inquiry so you won’t have to worry about taking a credit score hit.

If you aren’t planning on getting a loan, I wouldn’t worry about it. Checking your credit report annually is good enough and already more than what most people are doing. As long as your credit report is accurate, your score should be accurate. By checking your score prior to getting a loan, you give yourself a better idea of what your payments will likely be. More at How to Check Your Credit Score for Free

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