How to Have Errors Removed From Your Credit Report

Estimated read time: 2 minutes

Errors on your credit report drag down your credit score. Think of your credit report as your personal financial report card. This "report card" passes through the hands of creditors, lenders, and other financial professionals to grade your credibility. Having an accurate credit report is an important part of building good credit. Gaining credibility is your way to finance your future house, car, boat, or even business.

How to initiate a dispute

Inaccuracies such as a wrong mailing address, name misspelling, or an account balance need to be addressed as quickly as possible. One simple way to report these mistakes is through initiating a dispute. A dispute is a process which places your credit account in a suspended state where it is investigated by the credit reporting agency. The credit reporting agency analyzes the information you provide to confirm the validity of your dispute. Disputes can be initiated online, over phone, or through mail with each of the three main agencies: Experian, Equifax, and Transunion.

What you need to initiate a dispute

Before you initiate a dispute, you will need a copy of your credit report, the details of the incorrect information, and a completed credit dispute letter. Here is a sample dispute letter. Each year you are entitled to one free credit report from each of the three credit reporting agencies. Any supporting evidence such as credit card statements, letters from the credit company, or payment invoices that shed further light to the accuracy of your dispute help to support your dispute claim.

What you need to understand about the dispute process

The dispute process can take between 30 to 45 days. If they find the credit dispute is resolved, your credit report will be updated to reflect a change in the disputed information. If your dispute is not resolved, you have the right to enter a 100 word statement about your dispute that will be included in future credit reports.

How to prevent future errors on your credit report

You can reduce errors by checking your credit report at least once a year for mistakes. Make sure to keep any digital or physical records of credit payments safely stored and organized. Consider these records important evidence to present to officials who review your claim. In cases like identity theft or credit fraud, you can place a credit freeze on your accounts. A credit freeze will prevent anyone besides yourself from applying to open new credit accounts. Keep in mind that this will also prevent you from opening credit until you officially remove this alert.

How to use disputes effectively

Disputes, when used wisely, can be a way to accurately portray information about your credit history. Initiating disputes sparingly, as such practices will not help your credit score over the long run. Some lenders may require you to remove disputes before approving a loan. Used effectively, disputes are a helpful way to improve your credit profile.