If you notice an error on your credit report, it's in your best interest to get it fixed as quickly as possible.
About 25% of Americans have an error on their credit reports, according to a 2012 study by the Federal Trade Commission (FTC). And a 2015 follow-up study found that 70% of consumers with a least one unresolved dispute from the original study still believe the dispute was not fully resolved.
Credit report errors can lower your credit score, impact your chances of qualifying for new credit and result in less favorable loan terms. If you notice an error on your credit report, follow CNBC Select's five steps to dispute it.
How to dispute a credit report error
- Review your credit reports
- Gather documents to dispute errors
- Dispute credit report errors
- Review the results of the dispute
- Check your credit reports
1. Review your credit reports
The Consumer Financial Protection Bureau (CFPB) provides examples of common credit report errors, including: identity errors (wrong name, phone number or address), incorrect reporting of account status (closed accounts reported as open or you're shown as the owner of an account when you're just an authorized user), data management errors (reinsertion of incorrect information after it was corrected) and balance errors (incorrect current balance or credit limit).
You can easily check your credit report for free from annualcreditreport.com, CreditWise from Capital One and Experian, among other resources.
Before you contact the credit bureaus to report an error, make sure you've got a legitimate claim. There's a chance you may initially think something, such as a late payment, is a mistake, but it is correct.
Update April 20, 2020: You can now receive 3 free credit reports each week for the next year
2. Gather documents to dispute errors
Once you confirmed that a discrepancy on your credit report is an error, gather any supporting documents and information that can assist your dispute, such as credit card statements, bank statements, emails or letters. This information will help support your dispute and may speed up the process.
3. Dispute credit report errors
After you have gathered supporting documents, it's time to begin the actual dispute process with each credit bureau. This can be done online, by mail or by phone. We recommend disputing online or by mail so you have proof of your dispute.
If you decide to dispute by mail, send a detailed letter to the credit bureaus and attach copies of any supporting documents. The FTC has a sample letter you can use. The CFPB recommends that if you send a letter, do it via certified mail with return receipt requested so you have a record that your letter was received.
Here's how to submit a dispute with the three credit bureaus:
Equifax
Online: equifax.com/personal/credit-report-services/credit-dispute/
By mail: Download the FTC dispute form
Mail the dispute form with your letter to:
Equifax Information Services LLC
P.O. Box 740256
Atlanta, GA 30348
By phone: (866) 349-5191
Experian
Online: experian.com/disputes/main.html
By mail: Download the dispute form
Mail the dispute form with your letter to:
Experian
P.O. Box 4500
Allen, TX 75013
By phone: (888) 397-3742
TransUnion
Online: dispute.transunion.com
By mail: Download the dispute form
Mail the dispute form with your letter to:
TransUnion LLC
Consumer Dispute Center
P.O. Box 2000
Chester, PA 19016
By phone: (800) 916-8800
You may also want to dispute the error with the company that provided the information to the credit bureau, known as the "furnisher." This may be a credit card issuer or bank. You can send a letter to the furnisher or contact them by phone.
4. Review the results of the dispute
The timeline for resolving a dispute varies, but generally credit bureaus have to respond to your dispute within 30 days.
If the credit bureau agrees
The credit bureau will provide the results in writing and a free copy of your credit report, if the dispute results in a change. In addition, you can request the bureau to send notice of any corrections to anyone who received your credit report in the past six months. Legally, the credit bureau has to report the issue to the other two bureaus.
If the credit bureau disagrees
The credit bureau may deny your dispute for various reasons, such as your claim is deemed frivolous or the information included in your report is accurate. If that's that case, the bureau can choose not to investigate the dispute, but they must send you a notice within five days of the decision.
If your dispute was denied, all hope isn't lost. You can still file a written statement of dispute with the credit bureaus that can be included in your credit report. You can ask the credit bureau to provide this statement to anyone who received a copy of your report in the recent past, but there may be a fee.
And if you think the credit bureau didn't take reasonable action to resolve your dispute, you can also file a complaint with the FTC or the CFPB.
5. Check your credit reports
It can take time for any updates to your credit report to appear, so be patient. Regularly monitor your credit reports to ensure the change is made. If you don't see the corrections within a few months, contact the credit bureaus and furnisher to verify the information was updated.
Bottom line
If you find an error on your credit report, make sure you dispute it as quickly as possible. A credit report error may not seem like a big deal, but it is. What you may think is an insignificant error can cost you in the long run when you apply for a credit card, mortgage or auto loan. To protect against credit report errors, we recommend you freeze your credit and regularly check your credit score and credit reports.
