Your credit report and credit history are some of the most important aspects of your financial life. Did you know that the credit report was invented in 1989. To this day, my dad goes to his credit union and tells them what he wants to buy and they check his deposits only to make sure he can afford the payment. They have never pulled a credit report.
For the rest of us, credit directly affects your ability:
- to get approved for a mortgage
- buy or lease a car
- get a consolidation loan
- obtain a personal loan
- open a credit card
When lenders are considering approving you for credit, they’ll check your credit report to determine if you’re creditworthy enough for them. If you're looking to increase your credit score, here's the fastest way to get a credit score of 800.
If your credit report has any mistakes or innaccuracies, it could be hurting your credit score. We recommend using a free app called Credit ZO that scans your report and locates any errors. Download the Free Credit Report App for Free
The app is easy to setup. You just create your free account, authorize it to dispute on your behalf and connect your credit report. Takes about 3 minutes. The software will locate and dispute any negative items on your report, and it's free. Click Here to Get Started
How to Dispute Credit Report Mistakes
You can also do this manually without the app.
This process will take 30-45 days. But it’s well worth it to remove any negative marks on your credit report. You can also use companies like The Credit Pros (the fastest growing credit repair service company).
Let’s take a look at exactly what you need to do to dispute credit report mistakes.
Order Your Current Credit Reports
If you’ve recently been turned down for credit because of something on your credit report that you know to be incorrect or if you’ve seen a mistake while monitoring your credit, it’s time to dispute that error with the credit bureaus — Experian, Equifax, and TransUnion.
The first thing you need to do is order your current credit reports from the credit reporting agency that is reporting the incorrect data. If multiple agencies are reporting incorrect data, order one from each bureau.
Related: How to Remove Negative Information on Your Credit Report
If you want to shortcut the process, TransUnion has a 3-for-1 special that allows you to pull reports from all three credit bureaus. I prefer this deal because you get unlimited score & access to your reports daily. Click Here to Pull All Three Reports from TransUnion.
The three credit bureaus: Experian, Equifax and TransUnion. Here's how to request free annual credit report from each of the credit bureaus.
Order one from each credit bureau to make sure you don't have any information being reported inaccurately. You're entitled one free report from each of the three credit bureaus every 12 months.
If you have already ordered one and want an updated report, you can pay less than $16 for one. Once you receive your credit report, it’s time to find every mistake on it.
The Fair Credit Reporting Act (FCRA) promotes the accuracy and privacy of information in the files of consumer reporting agencies. Here's a quick summary that shows you what you're entitled to under this act.
Find Any and Every Mistake on the Report
Let's go through your credit report and look for inaccurate information.
Common Mistakes Found on Credit Reports
- Incorrect Personal Information: The most common mistake found on a credit report will list the wrong address or use the wrong middle initial in your name. That could be two reasons: either the credit bureau synced a credit letter with the wrong consumer or they received inaccurate / typo's from the credit application.
- Inaccurate Payment History: Make sure your report has accurate payment history for each account opened. If you have any late or missed payments, this will lower your credit score by 80 to 115 points.
- Outdated Balance: When I pulled a credit report, mine still showed student loan balances after I had consolidated student loans. My debt to limit ratio was sky high which dropped my credit score 200 points.
- Too Much Credit Card Debt: Your report will show you all the accounts you have open, including your balance on each account. If you want to clear those balances out, we recommend consolidating them into one payment using Payoff.
- Close Accounts Still Open: Check old credit accounts that have already been closed but still show open on your credit report. This affects your credit utilization ratio and lowers your credit score up to 100 points. Related: What is a Good Credit Score?
- Wrong Account Sync: If you see an account that you don't recognize, let's request more information on that account. Occasionally, the credit bureau will sync someone else's account with you or your identity may have been stolen.
- Outdated Credit Limit: Your debt-to-income ratio makes up a large percentage of your credit score. One way to lower that ratio is to increase your credit limits without using that extra space. Check your credit report to make sure every card has the correct credit limit.
Dispute Your Credit Report
Disputing your credit report seems fairly simple if you just go to the credit bureaus websites. You can quickly and easily make a TransUnion dispute, Experian dispute, or Equifax dispute online in a short amount of time. Do not dispute information online due to lack of space to document your findings.
The best way to dispute your credit report is to mail a physical letter to the credit bureau. You want to send these dispute letter templates through certified mail and request a return receipt so that you know the credit reporting agency has seen your dispute.
In the dispute, you want to type up a letter stating that include these items:
- What the issue is.
- Why the information they’re reporting is incorrect.
- Add your social security number.
- Include a copy of your driver's license.
- Include a copy of the highlighted mistakes that you made earlier so they know exactly what you’re referring to.
Here's a Dispute Letter Template for the Credit Bureaus
Keep a spreadsheet of what items you dispute, the date and the outcome.
How to Dispute Inquiry or Hard Inquiry
When a lender requests a credit report, they will check your credit report. That credit report check is known as a “hard inquiry” and it will be listed under your inquiries on your credit report.
Have you ever called a company who pulled a credit report and didn't tell you they were going to pull it & you didn't realize it until later?
Types of Hard Inquiries
- Purchasing a New Car
- Applying for Credit Card
- Apartment Lease
- Cell Phone Contract
- Purchasing Insurance
- Personal Loan
- Debt Consolidation
- Job Application (occasionally)
- Department Store Credit Cards
When you apply for any of the above and they pull a credit check, that goes on as a hard inquiry. Hard inquiries affect your credit score. Too many lowers your credit score. When a pre-approval letter arrives in the mail, chances are they did a “soft inquiry” to pre-screen you for offers. They inquiries do not affect credit score.
How to Remove Hard Inquiries from Your Report
The best method to remove a hard inquiry is to send a certified letter to each credit bureau. Click here if you need the dispute phone number or dispute addresses for Equifax, Experian or Trans Union.
Your credit inquiry removal letter should include:
- the reason you are writing is to dispute an inquiry
- the company that requested your information
- the reason you are disputing
- unauthorized activity
- your request to have the item removed.
I always include a copy of my credit report with highlights to the suspected hard inquiry. If there are multiple inquiries, it may be best to do two a time and wait a few weeks until you send the next letter for the next round of inquiries.
Wait to Hear Back and Escalate if Needed
Once the credit bureaus receive your dispute, they legally have 30 days to address the issue. This could include them right out fixing the issue and everything is peachy, which is the ideal scenario.
You could also wait only to hear back from them stating that the information they're reporting is correct and that they don't intend on fixing the error.
If the bureaus are refusing to fix the mistake — and you're 100% sure that the information is incorrect and you're right — then send another letter stating again why it is incorrect.
Also, inform the agencies that you are reporting the same information to the Better Business Bureau, the Consumer Financial Protection Bureau, and your state attorney general (and actually do so).
How to File a Complaint
If you're looking to file a complaint with the BBB, you can start your complaint here.
If you're looking to file a complaint with the Consumer Financial Protection Bureau, here's how to file. You will need the dates, the amounts and other details about your complaint. They will forward a complaint to the company and work to get you a response. You can start your CFPB complaint here.
If you need to locate the attorney general for your state, you can find your state here.
This is more likely to get the attention of the credit bureau(s) and have them take it more seriously. If they don't there's still another step you can take.
Hire a Credit Repair Company
If the credit bureaus are refusing to take your dispute seriously and fix the mistake, you may want to hire an expert credit repair company.
You’ll want to speak to high-quality consumer law attorneys and get an idea of what their thoughts on your dispute are. We recommend the fastest growing credit repair company:
Keep Records of Everything
When we say keep records of everything, we mean keep records of EVERYTHING! You want to have records of everything you've done during all of this.
Some of the most important things you'll want to have organized records of during a credit reporting dispute include:
- The initial denial or notice where you found out the information in your credit report.
- Your order when you requested the reports just to show when you requested them and what you asked for.
- Keep the initial reports you were sent, unmarked — this is why you made copies earlier
- Exactly what you sent to the credit bureaus — including the letter, the evidence, everything.
- Anything the credit bureaus sends back.
- Your response(s) to the credit bureaus as well as anything you sent to the Better Business Bureau, the Consumer Financial Protection Bureau, and your state attorney general.
- Anything about your involvement with a consumer law attorney.
It’s just a good idea to have records of every single thing that has to do with your case. This will help you prove the issue if you ever end up having to go to court, and it’s just a great habit to get into for many different facets of life.
It will also be good to have all of this information on file just in case the same error ever appears again even after the credit reporting agency says it has been fixed.
Keep a Dispute Letter Log
Disputing a credit report mistake can take a long time. We’re talking weeks, months, and even years in the worst-case scenarios. You might stop trying or give up, but keep this schedule & remove any emotion. Business is business.
This isn’t true in many cases and it’s well worth the wait to have the error removed from your report. For this strategy, I want you to use a letter log that documents when you've sent a letter and the outcome. When the outcome is not in your favor, send another letter in 60 days.
Repeat this 60 day routine until the outcome is in your favor.
Losing your patience is never good during any disagreement, as anger can lead to you making all sorts of rash decisions that won't help your case and can make it entirely impossible to win. Remember, kindness and courtesy goes along way when dealing with any “human ran” company.Write thank you letters and letters of gratitude to everyone you meet or work with, and doors will start opening for you. Click To Tweet
Just stay calm and stay the course. If you keep at it and you're correct, the issue will eventually get fixed. If it’s a big mistake on your credit report that’s preventing you from buying a new car or getting a mortgage, it’s more than worth it to wait it out as long as possible to get it handled.
At this point, the issue is resolved and it’s all fixed, or you play the waiting game. The important thing to do moving forward even after it’s been fixed is credit monitoring. You want to keep your eye on your credit report to make sure that it has, in fact, been fixed and it isn’t popping back up on your report.
As mentioned earlier, you are entitled to free credit reports from the main credit reporting agencies once every 12 months, but don’t let that be the end of your credit monitoring.
Frequently Asked Questions About Disputing Credit Reports
Absolutely not! The actual act of disputing your credit score does not affect whatsoever, positive or negative, on your credit score. But disputing a mistake on your credit score can potentially raise it significantly depending on what the issue was. There are no consequences on your credit score for filing a dispute against the credit bureaus, they can't retaliate against you.
Free credit reports can be ordered online using AnnualCreditReport.com. Remember that you can only get a free report once every 12 months or if you meet one of the exceptions stated in the Fair Credit Reporting Act (FCRA). Ordering is all done online and is a fairly simple process.
Just go to the above website and place an order. You will have to provide some personal information to prove your identity and select which bureau you’d like to order from — TransUnion, Equifax, or Experian. After that, you will be asked some very specific questions about your finances and your history. Some of these questions might even require you to get your old records out and pull out some information that you don’t know off the top of your head.
This is all done to protect you though so that identity thieves can’t easily access your credit information.
These factors make up your credit score. First, your payment history counts around 30% of your credit score. The amount you have available also counts as 30% of your score. The length of time you have counts as 15%. The rest is diversification of credit mix. Click here for what factors can negatively affect your credit score.