Finding errors or incomplete information on your credit report is frustrating but not uncommon. One in five consumers has an error on at least one of their credit reports, according to the Federal Trade Commission (FTC).
Fixing credit report errors is best addressed with a credit bureau dispute. If you've never been through the process before, here's an overview of what happens when you dispute something on your credit report.
How Credit Reporting Works
Your credit report is a compilation of information about how you keep up with your credit obligations. Many of the businesses that you have a financial relationship with send your account information to the three major credit bureaus—Equifax, Experian, and TransUnion—who then put the information together in your credit report. Whenever you make an application for credit, your credit report is reviewed to make a decision about you.
You can also review your credit report to make sure the information included is correct. Under the Fair Credit Reporting Act, you can have errors removed by submitting a written credit report dispute to the credit bureau(s) listing the inaccurate information.
Once you submit your credit report dispute, the credit bureau(s) and the business providing the information have some steps to follow.
Credit Bureau Process After You Submit a Dispute
Credit Bureau Investigation
The credit bureau must review all of the information and documents received from you and then investigate your dispute within 30 days of receiving it. The credit bureau has to notify the business who provided the information—the "furnisher"—of the dispute within five business days of receiving it. The credit bureau also must give your dispute information to the furnisher.
The credit bureau may get 15 additional days to investigate your dispute if you send additional information pertaining to the dispute.
The information furnisher must review the information provided by the credit bureau and investigate the dispute. When the furnisher has reached a conclusion, it's required to report the results to the credit bureau. If the investigation results in a change to your credit report, the furnisher is required to let all three credit bureaus know.
Credit Report Update
If the credit bureau finds that the information you disputed is inaccurate or unverifiable, it's required to correct the information or remove it from your credit report. The credit bureau must also notify the furnisher that it's been removed.
With your permission, the credit bureau can send your updated credit report to any business that has requested your credit report within the last six months.
The credit bureau can terminate the dispute process if it deems your credit report dispute frivolous. If that happens, the credit bureau must let you know within five business days and tell you what you must do to restart the dispute investigation.
Next Steps if the Credit Bureau Doesn't Correct a Disputed Error
If the credit bureau does not correct the information that you know to be inaccurate, you also have the right to dispute it directly with the business that listed the information on your credit report. That way, you can bypass the credit bureau—which sometimes uses an automated process to "verify" information on your credit report—and have the information furnisher take a closer look at its records.
Sometimes, the source of your credit report error originates in a computer system that needs to be corrected by a human. Initiating a dispute directly with the creditor or lender can help you with this process.
If you're not satisfied with the results of the investigation, you have the right to submit a 100-word statement to be added to your credit report. If you believe that the credit bureau has violated the law while processing your dispute, you can send a complaint to the Consumer Financial Protection Bureau.
You may also have the right to sue a credit bureau that does not correct credit report errors. Talk to a consumer rights attorney about your case to see whether you have grounds to file a lawsuit under the Fair Credit Reporting Act.