What Kinds of Errors May Appear on a Credit Report?
People often think that because their credit reports are tied to their name, birth date, Social Security number, and address, it’s uncommon to find errors in the reports. Unfortunately, that’s far from true. Discover the importance of monitoring your credit report and the errors that may be revealed.
Credit Report Errors
There are numerous types of errors that may show up on someone’s credit reports, and fixing them can become a complicated process.
Errors can include:
- Incorrect identity information (wrong name, address, telephone number, etc.)
- Wrong person (someone with a similar name is added incorrectly to your credit report)
- Improperly opened accounts (tied to identity theft, where someone else steals your identity and opens accounts in your name)
- Incorrect credit usage data (closed accounts listed as open, incorrect amounts due, on-time payments not reported, accounts reported delinquent when they should be current)
- Duplicate accounts (the same account appears more than once, sometimes with a variation on the name)
- Incorrect credit limit
What Can Happen as a Result of Having Errors on My Credit Reports?
It might not sound like a severe issue. Still, the Federal Trade Commission (FTC) reports that more than a quarter of Americans have errors on their credit reports that are significant enough to cause them to be considered bad credit risks.
Those errors could cause any of the following problems.
- Disqualified for mortgage or car loans.
- Unfavorable interest rates, loan length, or insurance required to qualify for the loan.
- Reduced eligibility for insurance or higher insurance rates.
- Landlords may refuse to allow you tenancy.
- Declined other forms of credit, such as credit cards, or only offered unfavorable terms (low credit limits, high interest, steep late penalties).
- Negative impacts on other credit situations.
How Do I Fix Errors on My Credit Report?
The quick answer is that you need to file a dispute with the credit reporting agency (the big three in the U.S. are TransUnion, Equifax, and Experian). However, that may be easier said than done. The dispute process can be lengthy and involve several requirements, which, if missed, could slow the overall proceedings or even require them to be restarted. It can take months, and your credit could continue to be severely affected during those months.
That’s one of the reasons it’s crucial to work with an experienced attorney who’s experienced in consumer law when working to resolve credit report errors.
What Is the Fair Credit Reporting Act?
The Fair Credit Reporting Act (FCRA) is a federal law that regulates how creditors collect and share consumer information and how they allow consumers to access their credit information, including credit reports. Among the rights granted to consumers in the FCRA is the ability to access their credit reports at no cost at least once a year.
The FCRA also restricts who is legally allowed to access someone’s credit report.
Companies that issue credit to people (credit cards, mortgages, car loans, etc.) are allowed to review credit records when considering whether or not to extend credit to someone. An employer may access them when considering hiring someone, but only if they’ve received explicit permission from the individual in question.
The federal government sometimes has the right to access a credit report. This may involve someone applying for a federal license, someone under a court order, or someone under a federal grand jury subpoena.
How Often Should I Check My Credit Report for Errors?
The FCRA guarantees that everyone can check their credit report annually at no cost. However, that may not be often enough. If feasible, people should consider checking at least quarterly so an error doesn’t have enough time to spin out of control and cause long-term credit damage. You don’t necessarily need to check all three of the major credit reporting companies that often; one of them each quarter will usually give you the information you need.
Once you’ve accessed your free credit report for the year, it could cost about $15 to check in the upcoming quarters.
What Is a Credit Freeze or Lock?
Credit freezes and locks have similar purposes but different ways to enable them. Both block anyone from accessing your credit report. That helps prevent identity theft. If someone pretending to be you tries to open new lines of credit, the creditor won’t be able to pull the credit report, and they’ll likely deny the credit application.
The difference between a freeze and a lock is this:
- A credit freeze (also called a security freeze): This is a free service offered by credit reporting agencies. A consumer can log onto their credit report account and set the freeze themselves, and they can also unfreeze the account at any point they may want to apply for credit themselves.
- A credit lock: This is done through a credit reporting app and is often bundled with other services for a fee.
What Should I Do if I Found Errors on My Credit Report and Am Being Harassed by Creditors?
Resolving this complex situation can be very frustrating, especially when it’s caused by someone else’s errors. Our team of experienced, knowledgeable consumer law attorneys can review the specifics of your case and help you understand what the next steps might be. We know the stress this causes and will work diligently to alleviate it.
Contact Us Today
Monitoring your credit history and report is more than just a routine financial task—it’s a crucial step in protecting your financial well-being. Errors in your payment history, unauthorized accounts, or signs of identity theft can go unnoticed without regular reviews, potentially impacting your ability to secure loans, rent a home, or even find employment.
Since credit bureaus and credit card companies handle vast amounts of financial data, mistakes can happen, and it’s up to you to catch them early. If you discover inaccuracies or fraudulent activity, taking swift action can prevent long-term damage to your credit score.
Our consumer law attorneys help individuals navigate credit disputes and fight for the fair and accurate reporting they deserve. Don’t let errors on your credit report hold you back—take control of your financial future today.
Call the Atlas Law Group as soon as possible at 331-321-4748 to request a free consultation.
