Credit reporting errors are fairly common. The FTC has said that 21% of credit reports have errors, and that of that 21%, approximately 14% have errors that impact credit scores.
What Is The Fair Credit Reporting Act And What Does It Do?
The Fair Credit Reporting Act is the federal law that gives consumers an opportunity to make sure that the information in their credit report is accurate. In addition, it allows for curing mechanisms when there are problems with a credit report.
What Are The Most Common Errors That You See In Credit Reports?
There can be a variety of errors in credit reports. For example, sometimes debts are reported as being owed when they are not owed, or there are misreports of delinquency dates. Sometimes the errors are more dramatic, such as total credit profile mix-ups. These mix-ups can occur when there are two people with similar credit data. In other cases, there can be mistakes in information on credit reports due to identity theft.
How Serious Can Credit Reporting Errors Actually Be?
Credit reporting errors can be really significant. Errors related to identity theft or identity mix-ups can be very pervasive and take up large portions of someone’s credit report. It can be fairly complicated to cure those types of errors because they can apply to multiple accounts. Because of this, you have to have more detailed activities to correct the error.
Can You Further Clarify The Severity Of These Errors?
Identity theft and total mix-ups can result in multiple accounts ending up on a report erroneously. Those types of severe errors essentially compromise the totality of an account, and have significant impacts on credit reports. In contrast, simple errors are limited or isolated in nature. For example, a report may show a missed payment when in fact the payment was made, or there may be one detail that is illegitimate, while the rest of the account is legitimate.
How Do People Generally Become Aware Of These Errors?
There are several ways that people can become aware of these errors. In corroboration with the three major credit reporting bureaus, the federal government allows consumers to get free copies of their reports at annualcreditreport.org. In addition, many people use secondary services such as Credit Karma, and that’s how they become aware of errors on their reports.
What Steps Should I Take After Discovering These Errors?
After discovering errors, the first step would be to contact an attorney who helps with FCRA claims. For the most part, an attorney will consult and review the error for no cost out of pocket. In addition, they will usually give some recommendations on how to address the error. Typically, the next step will include a dispute to the credit reporting agency and a request that they correct the error.
Is It An Easy Process To Fix An Error On A Credit Report?
If the credit reporting agency and the furnisher correct the error after the initial dispute, then it’s a relatively straightforward matter. But on many occasions, the credit reporting agency and the furnisher will not correct the error after the first request. In those instances, the issue may have to go to litigation.
Should I Hire A Credit Repair Company?
Each credit repair company stands on its own merits, and generally speaking, I am cautious about the methodology that is often used by credit repair companies. This is because in many instances, credit repair companies are not looking at the actual legitimacy of the information that they are disputing. Rather, they are just generically disputing anything that appears negative in the credit report. It is my perception that information which is objectively accurate should probably not be disputed. Credit repair companies should be approached cautiously to make sure that their methodologies are consistent with the consumer’s ethical obligations.
At What Point Should Someone File A Lawsuit In This Regard?
FCRA cases should almost never be brought by the consumer without representation. This is because they are technically complicated lawsuits. Furthermore, the laws are structured so that the party who is performing the improper reporting would essentially pay the consumer’s attorney’s fees. So, there is no reason why a consumer should approach a case like that without having an attorney to support them.
Who Am I Actually Filing The Lawsuit Against?
Lawsuits are typically filed against the credit reporting agencies (Experian, Equifax, and TransUnion) that improperly reported or investigated the information. In addition, they are filed against the furnisher who provided the information to the credit reporting agency.
How Do I Know If I Should Hire An Attorney To Rectify Credit Report Errors Or Not?
In order to make the decision of whether or not to hire an attorney, it is best to schedule a consultation with one. During an initial consultation, we will evaluate whether or not we are able to take the case and/or make recommendations. This is something that my firm does not charge for.
What Is The General Outcome In These Cases?
The outcome of a case depends on a number of factors. Primarily, we look at what sort of remedy is appropriate given the impact of the improper reporting. So, a case where there has been no impact at all may have a different outcome than a case where improper information has led to credit denials, increased cost of credit, employment impairment, or an impaired ability to rent property. We take all of these things into consideration.
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