Most people know they’re entitled to a copy of their credit report once a year from each of the nationwide credit reporting agencies for free. But many don’t realize that, if you see something in your credit report that’s wrong, there’s something you can do about it: You can and should dispute incorrect or inaccurate information in your credit report.
If a consumer notifies the credit reporting agencies (the “big three” are Equifax, TransUnion, and Experian) that he or she disputes the completeness or accuracy of any item in the report, the agency has 30 days to conduct a reasonable reinvestigation to determine whether the disputed information is inaccurate and to either (1) record the current status of the disputed information or (2) delete the item from the file. 15 USC §1681i(a)(1)(A).
Note that this right is only for inaccurate information. The agency doesn’t have to do anything if the consumer gives a reason for not paying a debt (e.g., due to illness or other extenuating circumstances), but doesn’t challenge the accurateness of the information about the debt. Although, it may accept the consumer’s statement of the reason and may charge a fee for doing so. 16 CFR pt 600 App §611-4.
Within 5 business days of receiving notice of the dispute, the agency has to notify anyone that provided any of the disputed information with all relevant information on the dispute. 15 USC §1681i(a)(2).
The agency must give the consumer notice of the results of the reinvestigation within 5 business days of completion. 15 USC §1681i(a)(6)(A). If it finds that the disputed information is inaccurate or incomplete, or that it can’t be verified, the agency has to promptly delete or modify the item and notify the furnisher of the information that it has done so. 15 USC §1681i(a)(5).
Unfortunately, errors on credit reports are not uncommon, despite their potentially huge consequences. As noted by Brian O’Connell of Investopedia.com, “there are steps you can take to redress the situation. It’s most important to stay persistent, and document the process.” The Federal Trade Commission provides a handy document with the steps to take.
Want to know more? CEB’s Privacy Compliance and Litigation in California, chap 6, has excellent coverage of credit reporting agency requirements and consumer rights, including those related to credit reporting.
© The Regents of the University of California, 2012. Unauthorized use and/or duplication of this material without express and written permission from this blog’s author and/or owner is strictly prohibited.