In spite of all our technological advances nearly 20 percent of all credit reports have some sort of error. Identity theft has reached epidemic proportions. Almost every day there is a news report of credit card or social security numbers being compromised. Yet, in spite of this rather high margin of error, the three credit reporting services, Equifax, Experian and TransUnion, still seem to have enough reputation for banks, and other financial institutions.

Check Your Credit Report Yearly

With all the errors and identity theft in the US it just makes good sense to check your credit report at least once a year. DON’T USE “FREE CREDIT REPORT.COM!” This is a company that will try to sell you a credit monitoring service. You can obtain a free copy of your credit report from each of the three credit-reporting agencies once every 12 months through

How Much Damage Can an Error Cause?

The short answer is — a lot. It can lower credit scores making it harder or nearly impossible to get a reasonable mortgage or car loan rate, a credit card, insurance policy, rent an apartment, or even to qualify for a job in some cases.

There are roughly 8 million disputes filed each year. The frustration is escalated when the credit-reporting agencies almost always take the word of the creditor over the word of the customer. So much for your day in court. Well, actually that’s where many of these cases eventually end up.

What Do You Do When You Find An Error?

The first step most people would take would be to contact the reporting agency with all your proof and documentation. In many cases this is a waste of time because the agency is just the middleman. Someone at the bottom of the food chain — a paper shuffler, who has little or no authority to help, will be the only one to see your request.

At best they will simply call the reporting company and ask them to re-verify that the report is correct. In most cases they will do just that. Dead end. Your real dispute is with the company that reported the error to the agency.

Deal With The Source

When you find an error take your proof of the error and any documentation to the owner or manager of the company and have them issue a correction to the credit reporting service.

It’s not a bad idea to make sure that there is a record of your contact with the creditor. Send a certified letter, return receipt requested, with copies of your documentation and explanation of what’s in error.

Follow up with the creditor to make sure the report has been corrected. Call as often as necessary, as this is very important to all the things listed above that an error might cause.

Some Final Thoughts

Last but not least, the late night TV credit repair services are just going to take your money and leave you where you were or worse. It’s best to take the bull by the horns and make the necessary contacts yourself.

Federal law requires any business that reports information to a credit-reporting agency to investigate all consumer complaints regarding that reporting, and if errors are found, the corrections are to be submitted to all three reporting agencies within 30 days.

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