ThinkstockBy Farnoosh Torabi for CBS MoneyWatch.com
When was the last time you checked your credit report?
I know; it's not the most exciting way to spend your lunch break - but you may want to take advantage of your annual free credit report (available at annualcreditreport.com) and review it for possible errors. Nearly 75% of respondents in a recent poll by CardRatings.com said they had found at least one error in their credit report.
Mistakes on your credit report can be costly. Your credit score could suffer, making it more difficult to qualify for the best interest rates on credit cards and consumer loans. Depending on the severity of the error, you also could find yourself at risk when applying for a rental or even a job.
CardRatings offers the following steps to properly fixing your credit report inaccuracies.
1. Gather the Evidence
Once you've detected an error - whether it's a false record of credit card delinquency or a loan that you never took out - start collecting any and all evidence that proves you're right, such as canceled payment checks or bank statements.
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First, submit your dispute in writing to the credit reporting agency that lists the error. In your letter include as many details as possible, including the account numbers, check numbers and payment dates. Submit attachments and any copies of the above evidence you've gathered. Explain that you need the information correctly updated. If you're sending in a paper copy, don't forget to sign the letter and make a copy of it before sending via certified mail (with a return-receipt to prove the letter was received).
Or you can send in your dispute online, which is secure and much faster. You could even submit your dispute both ways - just make sure you indicate on each correspondence that you've filed disputes both online and off.
To submit an online dispute with any of the three major credit bureaus, click on the following links:
3. Be Patient
The credit reporting agency is required to begin investigating your dispute as soon as it receives your letter and reach a conclusion within 30 days - although it usually takes no more than 10 days. Meanwhile, the agency must alert the creditor or bank related to the dispute that it's looking into the issue. From there, the creditor or bank has to launch its own investigation, as well.
If the creditor verifies that the information is, in fact, wrong, the FTC says the creditor must alert all three credit reporting agencies - Experian, Equifax and TransUnion - so they can update it in your file (assuming the mistake is incorrectly listed on all three reports).
If there's no update in 30 days, the law states that the information will be erased from your credit report. It's like traffic court: If the cop doesn't show up - you win, by default. But if you want to check to make sure your credit report has in fact been updated, contact the credit reporting company: It must provide the results in writing and a free copy of your report if your dispute yields a change, according to FTC rules.
©2011 CBS Interactive Inc., a CBS Company. All rights reserved. Used by permission.
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