Disputing Credit Report Errors is the Right of a Citizen
Credit reports are important for anyone and determination of eligibility of any person for obtaining financial assistance. A lender will always look at the credit report of the prospective borrower before granting any loan though it is not the only criteria for such approval. Yet it is one of the most vital aspects for consideration of loan approval. That is why; any error in the credit report could be a major problem leading the lender to wrong assessment of the borrower. Disputing credit report errors is not only essential but also the right of a citizen.
Types of Errors
Various types of errors could occur in the credit report. It could be identification information, ways of paying the bills and times when one has become defaulter, and when one has got involved in litigations. In addition the error could occur in respect of the information relating to insurance, rentals, and employment of the borrower. Any wrong negative reflection could be disastrous for sanction of loan reducing the eligibility of the borrower. It is therefore important knowing the right way of disputing credit report errors in time.
Know the Laws
Before anything else it is necessary knowing the legal provisions effective in the country as well as in the specific state. Federal Fair Credit Reporting Act or FCRA makes it mandatory for the credit reporting agencies to make the report accurate while maintaining the integrity and transparencies in the report. It also gives every citizen the right of disputing credit report errors following the prescribed procedure.
How to Go For It?
It is not only the right but also the veritable responsibility of every citizen to ensure that errors do not creep into their records due to negligence of reporting agencies, defaulting lenders who have failed to report loan clearance, or any other reason. Everyone should ensure that his or her credit report is accurate, complete, flawless, and up to date. Disputing credit report errors is necessary, but the question is how to go for it. A few precise steps can help the client facing such problem out of trouble.
Receiving Free Credit Report
One can identify the errors in the report only when he or she goes through it. Obtaining the report would be the first step in disputing credit report errors. Under the amendment to FCRA it is mandatory for each of the three major credit reporting agencies; Experian, Equifax, and Trans Union; to provide every citizen a free credit report on request once in a year. However, the reports are available only on request. A person is also eligible for free report when a company takes adverse action like refusing a loan basing on such report.
Steps for Error Correction
Both the reporting agency and provider of incorrect information are responsible for correcting the same. Affected person should right to credit reporting company about the inaccurate information and their accurate substitute clarifying why he or she is disputing credit report errors. Every correspondence made should be recorded and documented. On receipt of dispute it is mandatory for the reporting agency to investigate the claim and intimate the results.
Once the dispute is filed it will be mandatory for the lender to report it to the credit reporting agency and if the claim is correct, the error would be erased from the report.
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