Credit report errors and fixing them

If credit report data turns out to be false, it can take years to fix, and in the meantime, the ability to take out a loan is seriously in jeopardy. A large number of lenders or creditors rely, maybe too much, on data contained in a credit record.

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What happens when credit report data is in error? By now, everyone, or most everyone, is aware that their financial histories are contained within information assembled by the three major credit bureaus - Experian, Equifax and Trans Union. Credit information, sold to lenders in the form of a credit report, tells lenders or creditors what they need to know before they decide whether or not to lend money or extend credit to a customer.

According to the law, the bureaus are supposed to reply to a query about mistakes in thirty days, but in practice, it can take a great deal longer than that. Even though credit report mistakes often are fairly minor, up to one quarter of all reports have errors that are significant enough to stop someone from acquiring credit. The credit report troubles that take the longest to repair are those where the lender or creditor insists that the information is right, even if the person can demonstrate evidence to the contrary. A recent study shows that almost eighty percent of credit records have mistakes. Some of the more challenging cases frequently involve mistaken identities or identity or credit theft, or just plain, old, garden variety typographical errors.

Wrong ID - If the credit bureaus think you are deceased, you are out of luck, as nobody will loan money to someone who is deceased. There have been cases of consumers who could not qualify for loans because the credit bureaus believed they were dead. Living may seem to be a straightforward thing to prove; after all, a telephone call from the individual should indicate otherwise, but that does not seem to be the case. Most of the time, credit reports that note the borrower is dead are a case of mistaken identity, but if there's a death certificate involved, it may take phone calls, attorneys and even lawsuits to straighten out.

Fixing some mistakes can take a long time, due to the complexity of the information involved. Most frequent mistakes are quickly fixed; easily fixed problems involve incorrect home addresses, ages, phone numbers, and the like.


While these problems are being sorted out, the consumer's FICO, or credit score score is hurt, and he or she cannot acquire a loan, or a charge card, or possibly work or a house. Legislation to fix the problem of incorrect information seems improbable, though, as Congress is these days rather content with some of their recent financial laws, like the bizarrely named Bankruptcy Abuse and Consumer Protection Act. There does not seem to be any Federal legislation on the horizon to help straighten this situation out, but Government intervention would be useful. With greater reliance on computer generated fiduciary information taking over our lives, the least the bureaus could do is help to ensure that data is accurate.