It’s important for your credit report to be accurate. If you are planning to apply for a mortgage or rent an apartment, your credit report will come under close scrutiny. Mistakes or omissions could prevent you from getting the best rates or even cause a lender to not extend credit to you. Here are steps you need to take so that you can clean up your report and qualify for the best rates.
1. Order your credit report
Before you can start the process, you’ll have to obtain a recent copy of your credit report. Thanks to an amendment to the Fair Credit Reporting Act, all consumers are eligible to receive one free copy from each of the three major credit reporting bureaus every 12 months. You can order a free copy from annualcreditreport.com or you can place an order over the phone when you call 1-877-322-8228.
2. Write a letter
If you discover a mistake or omission while reviewing your credit report, you can dispute it by writing a letter explaining the error and sending it (via certified mail) to each of the three major credit reporting agencies. You should also send a copy of this letter to the lender who reported the information. You can see sample dispute letters at the Federal Trade Commission and Consumer Financial Protection Bureau websites. In addition, you can submit a complaint through the credit reporting agency’s online dispute process. The Consumer Financial Protection Bureau also accepts credit reporting complaints.
“To help clarify the dispute, if available, enclose the portion of your credit report that contains the disputed item, and circle or highlight the disputed item,” advises the Consumer Financial Protection Bureau.
3. Include supporting documentation
Also attach documents that support your dispute. Make sure that you send copies, and not originals, because it’s unlikely they will be returned. Some supporting documents you could send include a paid bill or a police report (in the case of identity theft, for example). If you’re not comfortable mailing sensitive documents, you can also fax the information or upload documents through the online dispute process.
4. Wait for the decision
The credit reporting agency is required to conduct an investigation within 30 days of receiving your complaint. However, sometimes there are exceptions. For example, if your dispute is made after you receive your free credit report, the credit reporting agency is allowed to take up to 45 days to look into your complaint. Plus, if you decide to send additional information to support your dispute during the investigation period, the reporting agency is allowed 15 more days to review your material, according to the Consumer Financial Protection Bureau. Once the investigation is complete, you will receive a summary of the decision. If you don’t agree with the decision, you have the right to re-dispute the items.