One of the reasons the Fair Credit Report Act allows you to view a free copy of your credit report annually is so you can review it to ensure that all of the information contain in it is correct. If you do find errors, you can dispute them so that your credit report is corrected and it does not negatively affect your credit score.
How Often
You can dispute any incorrect information on your credit report whenever you find it. If you are getting your free annual copy of your report, then you may find yourself disputing information once a year. However, should you ever be denied credit or a loan because of information in your credit report, you may want to purchase a copy of your report and review it to see if there is information that needs to be corrected. If something is wrong in the report, whoever provided the incorrect information is responsible for changing it.
What's In Your Report
The type of information you'll find in your credit report is a listing of all your credit accounts and loans with balances and payment history. You'll also see entries for instances where you may have been sued or filed for bankruptcy. Review all of the information to ensure that it is correct. You can't do anything about negative information that is accurate except wait for enough time to pass so that it is removed from your report. For example, if you really did pay your credit card late for six months in a row, you won't be able to get that information removed. You need to be able to prove that the information is inaccurate.
The Importance of Correct Information
The information contained in the report is used to calculate your credit score, which lenders review to decide whether you are likely to pay back a loan or not. If your report contains inaccurate information that is pulling down your score, you may find yourself being turned down for loans or credit cards or at the very least having to pay a higher interest rate on them if you are approved.
Process
The Federal Trade Commission recommends submitting your disputes with your credit information in writing. This is because you need to include copies of any documents that support your position in the dispute. You also need to include a letter explaining the problem you have with the information and pointing out what the correct information should be. The credit reporting agencies will then review your dispute within 30 days. The information is sent to the organization that reported it for investigation. If it is found that the information was inaccurately recorded, it will be corrected with all three credit reporting agencies. You will then get a free copy of your corrected credit report.
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