Who Else Would Like to improve their Credit Score?
Do you have derogatory items on any of your Credit Reports? Have you been denied credit because of damaging information on your Credit Reports?
A Bulletin published by the U.S. Federal Reserve Board sites evidence that exposes this fact;
Nearly 79 percent of credit reports have errors.
There are dozens of disturbing reasons why may need to file a dispute to fix errors on your credit reports. This article will count down the 10 most disturbing reasons why you may need to dispute credit errors to remove them from your credit reports.
Lenders use Credit Reports to score your credit-worthiness. Many Lenders rely on Credit Reports which use bewilderingly scientific models and data to determine how much of a Credit risk. you are. Your Credit Scores are calculated using the information on your Credit Reports.
Errors on your Credit Reports and Credit Scores can severely damage your reputation, I encourage you to review your credit reports t least once per year. After checking your Credit Reports you may find that you need to file a dispute to correct errors on your Credit Reports.
10 Most Disturbing Reasons Why You May Need Dispute Credit Errors
1. Nearly 79% of Credit Reports Contain Errors.
If you’ve been a responsible paying Consumer, you may be startled to find errors on your Credit Reports. But as evidence from the Federal Reserve Board shows, that up to 79% of Credit Reports Contain Errors. There are reasons galore for this startling fact. So the question is; are there errors on your Credit Reports? If there are errors you may have to dispute them to become a Borrower that Lenders prefer.
2. Inaccurate Status of Stale Accounts.
A disservice to your Credit Worthiness as a Consumer is the inaccurate status of accounts on your Credit Reports. For example, what if you’ve never missed a payment on your Credit Card, but closed the account, but due to a clerical error you’ve got a missed payment listed on your Credit Report? This is not a hypothetical example because according to a 2004 Federal Reserve Bulletin, 15% of Credit Reports List ‘Stale Accounts’ as ‘Major Derogatories’. This evidence proves the existence of inaccuracies on Credit Reports.
Check your Credit Reports and the status of all accounts listed on them.
3. Some Creditors Provide Incomplete Information to the Big Three Credit Reporting Agencies.
The Big Three Credit Reporting Agencies are; Equifax, Experian and Trans-Union. Creditors voluntarily report Consumers information to the Big Three Credit Reporting Agencies. Credit records generally list the following types of details:
- The date that the Account was established;
- The type of Account (revolving, installment, mortgage etc.);
- The highest balance owed;
- Credit Limits (where applicable);
- Payment Performance Information.
So, as you can see, there are multiple details that can be missing from Accounts listed on Credit Reports. Some Sub-prime lenders intentionally don’t include Credit Account information. Withholding details allows the Sub-prime Creditor to keep other potential competing Creditors from offering a responsible consumer a more beneficial interest rate.
Make sure that all of your Credit Accounts list at least most of the details listed above (for every account). For example, make sure that if you’ve been making payments on-time (Payment Performance) that those payments are listed on your Credit Reports. If you find that positive payment performance is not included, feel free to inquire with the Creditor to find out why. You may have to file a dispute if the information is listed incorrectly.
4. Collection Agencies often Mismanage Collection Accounts.
The General Accounting Office, in a Consumer Credit Study, found that there are data quality issues regarding Consumer Files within Collection Agencies. For example, a Collection Account that is Stale can be incorrectly updated and appear to have recent activity on the account. This shocking fact can disrupt your chances of getting a new loan or line of credit; opening a Bank Account, Renting an apartment, or landing a new job.
What Can You Do?
Check your Credit Report for any Collection Agency Accounts. If you find any, don’t be too alarmed. As evidence from the General Accounting Office shows a decent chance of that information being reported incorrectly. But you may have to file a Credit Dispute to change the status or remove the account from your Credit Report.
5. Collection Agencies Often Post Duplicate Accounts on Credit Reports.
Collection Agencies have been known to duplicate accounts. For example; say Collection Agency “A” attempts to collect on a delinquent account. While trying to collect the debt, Collector “A” reports the account (in question) to the Credit Reporting Agencies. After a few months of failure to collect on the account, Collector “A” gives up and sells the account to Collector “B”. Collector “B” updates the account on your Credit Report as well. The result is a duplicate derogatory item listed on your Credit Report. Duplicate Reports can severely damage your Credit Score and shrink the chances of securing a Loan.
Evidence shows that Collection Agencies handle claims in an inconsistent manner. What this evidence further shows is that Collection Agencies arbitrarily handle collection files. For this reason, duplications of collection accounts may need to be investigated and corrected if need be.
What Can You Do?
Check your Credit Report for Collection Accounts. Double-check for duplicate collection items listed. If you find a duplicate record, it would be wise to Validate both accounts to determine if any of the duplicate collection accounts are valid claims against your good name.
6. Miss-assigned Collection Accounts.
Sometimes after validating a delinquent account you may be shocked to find that Collector “A” has miss-assigned the account (in question) to Collector “B”. Miss-assignment of Collection Accounts occurs quite often.
Don’t be afraid to validate the debt and if needed file a Credit Dispute to correct the records of both Collectors “A” and “B”.
7. You May Need to Address Major Derogatories.
A Good Lender will not extend a new loan until the Borrower addresses all “Major Derogatories”. For example, if you’ve tried to refinance your Auto or Home Loan, and have been denied, it may be because of a Major Derogatory listed on your Credit Report. But how do you know if the account is listed correctly? Right or wrong, a Major Derogatory can prevent your Credit Application from being accepted.
Address all Major Derogatories in advance of applying for Credit. It can be very embarrassing trying explain a Major Derogatory to a Lender after it has been discovered on your Credit Report. For best results check your Credit Report and if you find any derogatory information, investigate it. If the derogatory information is inaccurate, you can consider filing a Credit Depute to correct the record.
8. Credit Reporting Agencies Gather Information that the Courts Have not Yet Acted upon.
Once a Lawsuit is filed, it becomes Public Record. One of the most reviewed items on Consumer Credit Reports are Public Records. Lenders, Landlords, and even Employers check the Public Records section of Credit Reports to see what actions have been taken against the Borrower, Lessee or Employee.
Due to no fault of their own, Credit Reporting Agencies have been known to gather information that the Courts have not yet acted upon. In other words you may not have been to Court, but you’ve got a Lawsuit against you listed as a Public Record, although no other legal action has been taken.
For example, let’s say you’ve fallen a couple of day’s behind on your rent, but you made arrangement’s to pay up on payday. The Landlord agrees, but has filed an eviction notice to make sure that in case you don’t pay, they can legally evict you. That eviction filing then becomes Public Record and may find it’s way onto your Credit Report. Now let’s say that you paid the rent as agreed? You didn’t get evicted, but your Credit Report may have an eviction filing listed against you, on your Credit Report.
9. Inconsistent Reporting of Dismissed Items in Public Records.
Nothing can be more frustrating than looking at your Credit Report and seeing items that were dismissed listed as Public Records. This occurs more often than people would like to believe. That is because Credit Bureau’s often report dismissed item’s inconsistently. Sometimes, dismissed items are reported and sometimes they are not.
10. Inaccurate Information Regarding Lawsuits.
This one ties into the last two above. For example, the eviction from example eight was dismissed, but when you you examine your Credit Report you find that it’s listed as an eviction. You were never evicted, but your Credit Report states that you were. This information may be an unfair assessment of your Credit-Worthiness and you may need to file a dispute to correct the false information.
Credit Bureau’s are not bad.
They collect the information that participating businesses provide them. It is up to the Consumer to check their Credit Reports at least once per year and if needed, file a dispute to remove negative and inaccurate information from the Credit Reports.
[...] 10 Most Disturbing Reasons Why You May Need Dispute Credit Errors [...]