Credit Report Errors and How to Fix Them
There can be many reasons for errors on your credit report. Some errors are caused by incorrect reporting while identity theft can cause others. Either way, these errors need to be fixed.
Keep in mind in many cases correcting these errors are not fast and easy. It is recommended that once errors are detected, they should be fixed as soon as possible. It can take months to remove errors, and if you are planning to apply for a large loan like a mortgage, it is important to start repairing these credit reporting errors immediately.
Sometimes errors might not be mistakes. Sometimes you may have debt from years ago that was not paid, and you don’t even remember. It can be difficult to identify because sometimes the creditor company has changed names further confusing the situation. In the case of items on your report that you do not remember to do a little research. Determine whether the debt is yours or if fraud causes the debt. If this debt belongs to you, pay the whole amount if it is small. Call the creditor up and asks for a settlement if the debt is significant. The reason you want only to ask for an agreement with massive debt is that when you ask for an amount lower than the balance owed it will report that way and it will have a lesser effect on improving your credit. Always pay the whole amount if possible. That will look better on your credit report.
If you are a real victim of credit fraud, do not pay the debt off. You did not incur that debt, so you are not responsible for it. It is important to dispute fraudulent credit charges. Writing letters to the credit bureaus over time will remove those marks off your credit report. Mistakes and errors can be on your for seven years or more.
The last type of error is a mistake made by the credit reporting agency or by the creditor. This is a very common type of error because there are millions of pieces of information reported each day. Mistakes are bound to happen. It is the same in this situation as it is with the others. You need to contact the credit bureaus individually and report the error. Through time and perseverance, the record will be corrected.
Remember you need to tackle errors, fraud, and forgotten debt immediately if you are planning a large purchase such as a house. It can take months to straighten out the mistakes. Fixing these problems can help boost your credit score and earn yourself a better interest rate.
Some people hire an outside service to write letters on your behalf. I have done that and found that the company I hired did a reasonable job of writing the letters. What was helpful was that a basic form letter was sent out repeatedly stating that there was an error with a particular account. I had several mistakes, and these letters were sent to all three credit bureaus. I paid $40.00 a month, and I believed it helped me get a lower interest rate on my mortgage. When all the errors were corrected, I canceled the service. Please be careful when hiring one of these services. Not all are as reputable as the one I hired.
Once you have taken care of these problems, your real estate broker may recommend you get a rapid rescoring to get your credit report updated within just a few days. Rapid rescoring is not free, but it may be worth it to help you get approved and get the best interest rate on your loan.
Do you have errors on your credit report? Not sure? Review your credit report now.