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4 Ways to Deal with Credit Mistakes that Kill Your Ability to Get Good Rates

To err is to be human. Life happens, and along the way we end up making poor choices for one reason or another – often about money and credit.

Even worse is when your credit report has inaccurate information on it that you know is not true that is now tarnishing your creditworthiness. Once these credit mistakes are on your report, they can be difficult to be cleared from your record. This means you will struggle to get a decent interest rate or even a loan when the lender sees those mistakes on your credit report.

Lenders always believe the report – not you. If you own a business, you want to verify that the credit report is good so you can leverage that score for loans.

However, there are steps you can take that will deal with these credit mistakes and help remove those blemishes, including misspelled names, outdated addresses, duplicate accounts, fraudulent accounts and inaccurate payment history. Here are four steps you can take to boost your credit history and credit score.

1. Review your credit report to see what is correct, what needs to be fixed, and what needs to be addressed

You can get a free credit report from each of the three major credit reporting agencies once a year. You can also sign up for a credit monitoring service if you want to keep a closer eye on any changes in your status or check that the work you are doing to clear up the credit mistakes really is doing its job. It’s important to stay on top of your financial position and monitor how other people are reporting that position.


2. Collect and send documentation that proves that there are errors.

This includes all relevant financial records, including monthly statements, which can be used to prove your case. If you have already contacted the financial institution involved and they have cleared you of anything related to that claim on your credit report, the next step is to get it off your report ASAP.

It helps to send the credit reporting agency a letter from the credit source that acknowledges there was a favorable outcome and it no longer needs to be on your credit report. Most banks or financial institutions are okay with sending a simple explanation to clear your credit.

3. Personally contact a credit reporting agency when there is a mistake on your credit report.

“Write a good old-fashioned letter detailing your dispute. Don’t use the credit bureaus’ online dispute form because you simply can’t possibly fit all the necessary details in the space they give you. Using those forms simply puts you at a disadvantage from the start,” says Howard Dvorkin, Chairman of Debt.com.

If you need more assistance, the Federal Trade Commission (FTC) also provides good advice on how to address these credit report errors, including a template for a letter that can help ensure you have covered everything. It’ll also ensure you have all the information included in a way that the credit reporting agency can understand, and they will actually then be able to do something to help you.

4. Request that the credit reporting company send notices of corrections to anyone who received your report in the last six months. 

You can also get a corrected copy of your report and send it to anyone who received your poor, mistaken report over the last two years in relation to a job. This will help you by establishing credibility with those people in regards to your real credit score and history rather than having them base their decision on incorrect and erroneous information.

Remember that credit mistakes do happen and they will show up on your credit report. Any error, real or mistaken will take time to fix. This is not something that will be solved in 30 days. Be patient and methodically address each error until all problems are removed. However, if the mistakes have not been corrected and you are unhappy with the response from the credit reporting agency, you can also file a claim with the government through the FTC or the Consumer Financial Protection Bureau.

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