An accurate report
One of our rights under the FCRA is the right to an accurate credit report. And the law clearly states that it is the credit bureaus’ obligation to maintain accurate files for us. So if you find an error on your credit report, such as a wrong address, a misspelled name, or incorrect information about your payment history on one of your accounts, the FCRA tells us to notify the credit bureau about the error so they can “investigate” it and remove or change it as necessary. Sounds like a simple process right? Just a quick call to the credit reporting agency and, poof! The wrong info is gone! Not quite, unfortunately.
Too huge to get to the bottom of disputes
The problem is that the credit bureaus are huge, and maintain millions of files across the country and the world. They receive way too many disputes to seriously look into them all, and many credit repair firms and consumers have used the dispute process to try to game the system (that is, they submit disputes to the bureaus claiming that negative info is incorrect and should be removed, when in reality it is accurate and belongs on the credit report). So the bureaus have gotten into the habit of simply responding to disputes by labeling them as “frivolous.”
If the bureaus do take the time to “investigate” an error, like a past payment you swear you made but shows as delinquent on your report, the bureau will contact the creditor who reported the delinquency in the first place. And guess what? The creditor will most likely say, “Yep, she was delinquent that month.” And the “investigation” will be complete and the delinquent information will remain on your report. You are the free to launch the dispute process again. Ugh.
This part of the FCRA has never made sense to me. Why does it encourage us to take disputes up with the credit bureaus about errors that our creditors are reporting? Wouldn’t it be better to just cut to the chase and speak with our creditors directly?
New dispute rules
Fortunately, the Federal Trade Commission has seen how inefficient the dispute process has become, and has passed amended rules effective July 10, 2010. At that point, consumers will be allowed to “dispute inaccurate information about them directly with furnishers, the financial institutions and other entities that furnish the information to the credit reporting agencies.”
You’ll still be able to take your dispute up with the credit bureau, if you prefer, but the new FCRA amendment puts more of the burden on creditors to do their part in ensuring you have an accurate credit file. If you can resolve the dispute with your creditor, it will then report the accurate information to the credit bureau and your report will look like it should.
Note that this does not apply to errors related to incorrect personal information listed on your report. You’ll still need to take those up directly with Equifax, Experian, or TransUnion. And remember, negative information on your report that is true has a right to stay there for up to seven years.
Have a credit report dispute horror story? Share it in the comments section below.