How to Correct an Error on Your Credit Report?
How to Fix an Error on Your Credit Report? Have you ever spotted an issue with your credit report? You’re not alone. A recent study indicates that 30 per cent of people in Australia have found an error on their credit report at least once in the past year.
If you’re the type of person that likes to stay on top of your finances, you’re probably familiar with having a credit report. If you aren’t careful, mistakes can be made in your credit report, leading to a lot of headaches down the road.
Your credit report includes a ton of information about you, from your credit history to your bank accounts. This information plays a role in how lenders look at you when applying for a loan or a credit card. When errors occur on your credit report, it can hurt your ability to borrow money – whether that be a mortgage or a loan for a new car – as well as impact your job prospects.
For this reason, the data on your credit report must be accurate and complete. Today, we will discuss some common errors on credit reports and fix them.
Learn More: Good Credit History: Do You Have One?
The Reasons For Errors On Your Credit Report
The first step toward credit fixing is knowing what’s wrong. You can check your credit score to see where you stand, but it won’t show you all the information that makes up your report. Here are some of the most common mistakes on people’s credit reports:
1. You or someone else has made a mistake
The report has been amended with incorrect information. You may think you’ve made a mistake when in fact, someone else has; for example, if you’ve changed your name, the report will reflect this.
You or someone else has made an error on the report. Your credit report will show the date of birth listed as today’s date; this is wrong because it’s based on information from two years ago.
The correct procedure is to contact the creditor who provided the information and correct it. You should also request that you be notified if there are problems with your account so you can take action immediately before more negative information appears on your credit report.
2. Late payments
If someone has missed a payment, or more than two or three, it will show up on your report and probably make it look like you’re not paying your bills on time. Late payments may adversely influence your credit score, and they can prevent you from getting the best interest rates.
Sometimes a late payment isn’t a mistake — maybe you were hospitalized and had no way to pay for treatment, but it can reflect in your credit report if it happens often enough.
3. Bankruptcy.
This is an especially big deal with credit cards. If you’ve declared bankruptcy, all of your card accounts will be severely affected by the outcome of that action (and it’s hard to get them reinstated afterwards).
Even if you didn’t file for bankruptcy, if there was a judgment or lawsuit against you and the outcome was bad enough to impact your credit score — such as an unpaid bill — it could still show up on your report as a result of something else going wrong with the case.
4. Charge-offs and collection accounts.
Multiple collections can affect your score just as much as multiple late payments — think about all those missed payments that were charged off as uncollectible debts.
The more information that goes into a collection account, the worse it looks on your credit report, even if everything turns out OK for you down the road.
5. Accounts opened in your name by other people.
Somebody opening an account in your name is going to make you look more responsible for its liability than if they had done so under their name.
It also means that they have access to more of what you owe them, which could make a big difference when collecting from them later on down the line.
Fix errors on your credit report- the easy way!
How can you fix errors in a credit report if someone has made a mistake?
1. Mistakes on your part
Things like incorrect addresses, wrong names or dates of birth can be fixed through simple phone calls to the credit reporting agencies. It usually takes about a week to send a corrected version back to the agency that originally received it.
If you’re having trouble with a particular creditor, you’ll need to file a dispute with the credit bureau that provided its information to others. That will also help repair your credit score.
Mistakes by others
It often happens when you apply for a loan or mortgage, for example. If you’ve applied for a loan and there’s been an error, just wait until they tell you what’s going on and then correct it through the same process as above.
If the error occurred in your report, it’s not something you can do much about. One thing you can do is to contact the credit bureaus and have them report the error.
2. Late payments are the single biggest reason for errors in credit reports.
Even if you’ve made all your other payments on time, if you miss one payment, it is quite probable that it will appear on your credit report.
Here are some things you can do to fix these errors, though many of them are voluntary:
- Pay all outstanding bills on time.
- Appeal the disputed items on your credit report where possible. If you’re denied, you can ask legal help to remove the item from your report for good.
3. Bankruptcy.
Bankruptcy is typically reported to credit bureaus within ten years of filing for bankruptcy protection, but if an individual files more than one bankruptcy in their lifetime, the original filing date for each will be included on their report.
If you filed for bankruptcy more than ten years ago but haven’t confirmed that fact with your creditors, view your report closely to ensure all of your bankruptcy information is correct.
4. Charge-offs and collection accounts, also known as “accounts in collections,” are common sources of errors in credit reports.
They may reduce your credit usage ratio, lowering your credit score. To fix errors in your credit report, keep track of all your debts and all the information related to them at all times, so you always have an accurate account of how much you owe on each account.
If you find that debt is inaccurate or you want to dispute a debt that appears inaccurate, contact the creditor to get more information about the status of the debt you’re disputing.
5. Accounts opened in your name by other people.
There are many reasons why this error in credit reports happen, but usually, it is due to identity theft. The term “identity theft” refers to when someone steals your identity to open accounts or take out loans without you knowing about it. You might not notice any signs of identity theft because you could be using different names or similar names to make the process seem more legitimate.
When this happens, it’s important to act quickly and get help from a qualified identity theft recovery service to get your accounts frozen and cleaned up. The sooner you act, the better chance you have at getting your credit back.
If you become aware that someone has opened an account in your name but did not permit you, don’t ignore it! Contact a credit repair lawyer to handle the account right away and let them know about the situation so they can take action on it.
If you have bad credit, here are some extra tips to help you fix it
Bad credit can be fix with a mix of hard work and smart decisions.
- Improve your credit record. This is generally the most straightforward step for the majority of individuals. The sooner you pay your bills on time, the better off you’ll be. You can also get new lines of credit with good scores, but make sure the interest rate is reasonable.
Some products are designed to help you improve credit scores. Paying down your debt is another useful strategy that helps your score, but it’s important to keep a keen eye on it if you want to prevent having bad credit in the first place.
For example, you should close old accounts that are no longer used so they don’t show up on an annual report.
- Lower your interest rates. Credit card companies often have higher rates than banks do. That means if you charge too much on a card with a low rate, you will pay higher interest than if you did not use the card at all. If the charge wasn’t completely necessary, try paying off the balance in full instead of making just one payment each month on time.
- Start saving more money regularly through automatic deductions from your bank account or direct deposit into savings or checking accounts that don’t allow access to debit cards or checks.
These accounts typically compound interest over time and increase your average savings even if they aren’t immediately available for spending. This can help reduce debt levels and improve credit scores over time.
- Finally, keeping track of all expenses using a budgeting tool or spreadsheet can help you determine how much money remains after paying for what you need and want and seeing where any extra dollars go.
What to do if errors can’t get corrected?
Work with a credit repair company. It’s important to work with a credit repair company that treats your case as a serious one.
Credit repair companies or firms can help you fix errors on your credit report that may be costing you money. A good credit repair company will go through the process with you step by step, explaining what’s happening and why. They can also work with the original creditor to correct errors on your behalf.
But some companies will try to make a quick buck by taking advantage of your desperation, even if it means putting your entire credit history in jeopardy. Here are some signs a repair company is a scam:
They charge a fee for credit repair but no other services. Insurance agencies and law firms typically charge for credit repair and offer other services such as identity theft protection and bankruptcy assistance. Some companies will charge for just the credit repair while giving free loans or robot-signing services.
There is no legitimate reason why they might be able to correct errors on your report — such as typos or minor mistakes — when you cannot. If there isn’t an unassailable case for the error, don’t pay them until you’ve checked out their legitimacy.
Why Choose Us
Australian Credit Solutions is a reputable credit repair company specialising in credit repair services for Australian residents. Australian Credit Sokutions have been repairing clients’ credit reports since 2009. We have helped thousands of clients clear the negative entries from their credit reports and restore their credit rating without resorting to bankruptcy.
Most people don’t know that you have a legal right to access your credit report and correct any incorrect information. If you have been continually declined or had problems obtaining credit, chances are a negative entry on your report, which prevents you from getting the loan or credit card you need.
Australian Credit Lawyer will make sure any negative entries are removed by working with the reporting agencies to amend your report, remove errors and restore your credit rating; for more information about how we can assist and help you, contact us immediately on 1300 368 302.
Conclusion
Your credit score has the opportunity to benefit or ruin you. You may feel like nothing you can do to improve your credit score. Don’t fall into that trap! Indeed, there are a variety of possible actions.
The steps in this article can help you fix any mistakes on your credit report, including working with a reputable credit repair company. It’s not quite as tricky as you imagine to elevate your credit score and fix those errors on your report.