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Fixing Surprise Credit Report Errors

Have you checked your credit report lately?

Most of us know that we can get one free credit report a year from each of the three credit bureaus. Here’s why it’s important to take them up on it: Studies have shown as many as 79 percent of credit reports contain errors of some kind. About a quarter contain errors that would lead to denial of a loan.

Common credit report errors

It’s best to check out your report on a regular basis, before you need a loan. That will give you time to dispute any errors (or build your credit) so they can get taken off your report. You can get a free copy at www.annualcreditreport.com.

When you receive your report, you should check it for these common errors:

  • Names that are not you
  • Social Security numbers that aren’t yours
  • Address where you’ve never lived
  • Accounts and delinquencies that aren’t yours (this is the big one)
  • Negative items older than seven years
  • Hard credit inquires that you didn’t authorize

These errors can occur after instances of identity theft or may be tied to debts that you’ve forgotten about. Clerical errors are also fairly common.

Disputing errors

If you find mistakes in your report, it’s important to dispute them as quickly as possible. Contact the credit bureau in writing to notify them of the information you believe is inaccurate. You should also contact the company that furnished information to the bureau in writing to tell them you dispute the items. Both the credit bureau and the creditor are legally obligated to investigate your dispute. You also have the right to add a summary explanation to your report if the dispute is not resolved to your satisfaction.

Fixing errors faster

It can take about 2-3 months for these errors to be corrected. If you’re in the market for a mortgage and need your credit score to rise faster than that, you can ask your mortgage advisor about rapid rescoring. A rapid rescore is essentially an unofficial updating of the credit files. It requires evidence that a mistake needs to be corrected, such as a letter from a creditor admitting that they intend to remove the error from your credit history.

Your mortgage lender can contact a rapid rescorer to clear the matter up in 72 hours to a week instead of months. A rapid rescore is not a form of credit repair—it won’t erase negative information from credit reports (unless there’s proof those debts aren’t yours).

Diane Jones can be reached at (865) 766-3014 or diane.jones@pnfp.com.

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