What Errors to Look for on Your Credit ReportWritten by Carly Simon-Gersuk
You have been doing what you can to build and maintain a high credit score but your report does not reflect that. So what could it be? A study conducted by the Federal Trade Commission found that one in five people have an error on at least one of their credit reports. Errors on your credit report can lower your score and be costing you money. But what errors could impact your score and how do you fix them?
Fortunately, you can get free copies of your credit report from one of the three credit bureaus - Experian, TransUnion and Equifax - as well as do soft credit pulls throughout the year from various institutions, such as your financial institution and Mint.com. Once you have a copy of your report here are common errors you should look for and how to check for them.
Any errors in your identity - wrong name, misspelling of your name and contact information like address or phone number - can lead to inaccuracies. Pay close attention that your accounts all belong to you and not another person with the same or similar name. Also, accounts that have your name and information that you did not open may be a result of identity theft. So make sure that all the accounts listed were open by you.
Various account errors can be negatively affecting your score. One incorrect status is if a closed account is reported as open or vice versa. Check the date of when an account was opened or closed. There could also be accounts where you have been making on-time payments but they are reported as late or missing. Another status to check is that you are named correctly on any possible shared accounts, such as the primary account holder or an authorized user.
It is possible that under different names or creditors the same debt is listed more than once. This could be a result of when a lender undergoes a name change or acquisition.
Accounts with incorrect current balances or incorrect credit limits will affect your credit score by either reporting higher or lower. It is important to make sure that your balances are correct so that your credit utilization ratio will be reflected properly on your score.
Now that you have identified the errors, it is time to fix them. Contact the credit reporting company who sent you the report, as well as your creditor or lender. Reporting errors does not cost you anything, it just takes some time. It is important to report errors as soon as they are spotted to get that information corrected and your credit score accurate.
Written by Carly Simon-Gersuk