One of the first steps to spotting any issues on your credit report is to check the information being reported as quickly as possible. That’s why it’s recommended to review your personal credit reports regularly.
A credit report includes detailed information about your credit history and activities. Consumer credit reporting agencies collect this data from public records, lenders, and creditors you have accounts with. These agencies then sell your report to creditors, insurers, employers, and other companies that review your applications for credit, insurance, employment, or other financial needs. Since the information on your report impacts many areas of your life, it’s vital that it’s accurate, complete, and up-to-date.
The Consumer Financial Protection Bureau (CFPB) shared a report revealing that Equifax, Experian, and TransUnion each have more than 200 million consumer files. Typically, they receive updates from about 10,000 information “furnishers” each month. These furnishers provide data on over 1.3 billion “trade lines,” which include various accounts such as car loans, mortgage loans, or credit card accounts.
Given the massive amount of data being provided, mistakes can occur. A 2012 Federal Trade Commission study found that one in five consumers had an error on at least one of their three credit reports, which was corrected after being disputed. Additionally, about 20 percent of consumers who identified errors saw an increase in their credit score, which could result in better loan interest rates.
So, how can you get your personal credit report? The Fair Credit Reporting Act (FCRA) requires the major consumer credit reporting agencies – Experian, TransUnion, and Equifax – to provide you with a free copy of your credit report once every 12 months, upon request. Visit annualcreditreport.com to request your free report. You can request reports from all three agencies at once or select just one or two.
What should you do if you find incomplete, outdated, or incorrect information? Contact both the credit reporting agency and the creditor that provided the information. Both parties are responsible for correcting any inaccurate or incomplete information under the Fair Credit Reporting Act.
Fortunately, all three credit reporting agencies now allow you to submit disputes online. Visit each agency’s website and follow the instructions to start an investigation. The agency is legally required to investigate your dispute, generally within 30 days of receiving your notification.
Ultimately, it’s your responsibility to ensure that the information on your credit report is accurate and up-to-date. You need to clear up any mistakes, so it’s crucial to stay on top of your credit reports and monitor them regularly. Consider using a credit monitoring service to receive alerts about any changes to your credit reports and scores.
