Your credit score is a key factor taken into account when a lender is reviewing a loan application. These scores are formulated by analyzing your past credit performance, but the information gathered and included on your credit report may not be accurate. Having inaccurate data on your report can lead to lower scores and less favorable loan terms.
With just a little effort you are on your way to making sure your credit report is clear of false information. The main credit reporting agencies are Equifax, Experian, and TransUnion. They have made it fairly easy to request and receive a free copy of your credit report. It makes sense to look at all three agency reports because they might have different information recorded on them. A wise borrower will keep tabs on all three reports because lenders will often look at all three before making a lending decision.
Once you have a hard copy of your credit report then look closely at all the information included. Make sure that all the loans shown are actually yours, that the available credit amount is listed correctly, and most importantly that your on-time payments are reflected correctly. Pay close attention to any loans listed as slow-pay or in default. This information can have a negative impact on your credit score so be absolutely sure this kind of data is correct.
The credit reporting agencies have taken on an enormous task in collecting, sorting and entering all the raw data into their databases. It is no wonder that mistakes happen with all the common and similar names that people have and with the rarity that people review their credit files.
Count yourself lucky if there are no mistakes, but if there are be sure to go straight to the reporting agencies website where you can find a claim form to start the appeal process. When you fill this out make sure you explain why the data is incorrect and include any other documentation that can support your position. Remember that old information will be easier to correct than new records.
After an appeal or claim is filed the agency will spend the next 30 days or so investigating the situation. The information they discover will make the difference between having the data removed or not. Quite often the creditor will not reply to these credit investigations. When this happens the bureaus are required to remove any information included in the claim.
