Did you hear about the woman who sued Equifax for $18 million because they wouldn't fix errors on her credit report even after she diligently stayed on top of them for two years?
Having black marks on your files could mean denial of job offers, higher interest rates on loans, higher insurance rates, or outright denials for credit. Disputing an error on your credit report is difficult, but it can be done.
Recently, I took the step of checking my credit report for free at AnnualCreditReport.com as I was preparing to do a big financial transaction. My reports from Experian and Equifax were absolutely clean with good scores from both of them. But then I had a big black mark on my TransUnion credit report.
I noticed TransUnion was reporting a lien supposedly filed against me in state court. It wasn't there last time I checked, but it had come on my report through a TransUnion public records search. So there it sat demolishing my credit score.
Knowing that I didn't have any lien filed against me, I challenged this item by first going to the state court's website. On their site, I put in the supposed case number for the alleged tax lien and quickly confirmed that the case number did not exist. Nor did the docket number did exist. Yet it was eating me up on my score.
So I told TransUnion. They did the same fact-finding I did and then I got back a letter from them in two weeks. It said simply that the item was removed from my report. No more, no less (and no apology!)
My resolution was pretty painless and didn't require much effort. If you discover an error on your credit file, here's how to handle it:
- Begin by filing your dispute at the same time with both the credit issuer and the credit bureau.
- Do not use the automated system to dispute. Always use the manual form.
- Equifax's manual form is available here. TransUnion's manual form is available here.
- Send all documents by certified mail, return receipt requested.
- If the problem is not fixed, re-dispute it with the bureau and the credit issuers.
- If that fails, you must sue both the credit issuer and the credit bureau in small claims court. Talk to a clerk of court for guidance on the process.
- Find out where the registered agent of both the issuer and the bureau is in the state by calling your state's corporation commission. That way you'll know who to serve with the suit.
- Know that most of the time, the offenders will usually cave before the court date and remove the black mark from your report.
- If all else fails, contact the Consumer Financial Protection Bureau for help.
This requires persistence and guerrilla tactics on your part. And again, I have to stress: You must use the manual dispute form. Because you can send all the supporting documents in the world and the credit bureau won't pass them on when they get in touch with the credit issuer. They simply send a 3-digit code that describes the nature of your dispute to the issuer.
Clark Howard's new book, Living Large for the Long Haul, came out on August 6.
For more money-saving tips, visit ClarkHoward.com. Money in Your Pocket. Advice You Can Trust.