What to Do With an Inaccurate Credit Report?

Having an inaccurate credit report can prevent you from getting credit cards, lines of credits and home loans. Inaccurate information contained in your credit report can also hinder job searches when certain types of background checks are involved and even cause you to pay more for car or home insurance premiums. Dealing with an inaccurate credit report is a methodical paperwork process.

Investigate

If you suspect there is inaccurate information contained on your credit reports, you'll want to order a copy of your credit reports from Experian, Equifax and TransUnion. These are the three major credit-reporting agencies responsible for most credit reporting. Once you get a copy of all three, examine each one from top to bottom. Keep track of each section on a piece of paper, noting any discrepancies you find.

Check the spelling of your name along with your current and former addresses and of any alias you've used in the past. Determine if each line of credit noted on the report actually belongs to you. Then make sure each is showing in a correct status.

Dispute

Follow the dispute process contained with your credit report. Each agency has a slightly different process. They all involve filling out forms they provide, detailing any inaccuracies you found, comments you would like to have added to your report files and the ability to send in any additional supporting documents. It can take 30 to 90 days to have each credit report updated correctly. Unfortunately, there is no speeding up this process.

Paper Trail

Until the credit reports are corrected and updated, consider keeping detailed records of dispute process transactions, including a copy of the dispute forms and supporting documents you may have sent back to the credit reporting agencies. When the credit reporting agencies receive your documents, they can update your reports with comments noting that certain items are in dispute and why. That way, when a potential lender, employer or insurance company looks at the credit reports, they can see certain things are in dispute and consider those in their decision-making processes. In these cases, some companies may require to see the supporting documents you sent to the credit-reporting agencies as proof of the inaccuracy.

If you have a paper trail proving the inaccuracy, it may allow the company you're trying to work with to proceed with employment or lending processes. Some examples of supporting documentation can include awarded separation or divorce decrees, letters from financial institutions noting closed accounts, or receipts or statements from companies showing a debt has been settled or paid in full. It's also recommended that you check your credit reports once a year to catch and reduce inaccuracies due to simple reporting errors and identity theft. You can request a free copy of your credit report once a year from all three credit bureaus.