How To Write An Effective Credit Report Dispute Letter

How To Write An Effective Credit Report Dispute Letter

Whether you like it or not, your credit report affects almost every areas of your life. First, it is evaluated by employers who are considering you for a job. Second, landlords, insurance companies, utility companies and lenders review it and use it as the decision barometer to determine whether or not to to engage in any business transaction with you. Unfortunately, as much as 80 percent of credit reports contain errors and, according to Smith(2012), roughly 25 percent of those errors are serious enough  to cause a denial of credit. So if you find a mistake in your credit report, a letter disputing the errors should be your first course of action. Generally speaking, in order for your complaint to be addressed properly, it is very important for your dispute letter to contain the right, convincing information. Below are the tips for writing an effective credit report dispute letter.

Be Informed About What You Can Dispute

One important thing you need to know is that you have the right to dispute anything in the trade section. This include information regarding student loans, auto and personal loans, credit cards, as well as items in the sections for collections and public records. You can also challenge anything that is outdated or is incorrect and is only allowed to stay on your credit report for a certain period of time, such as bankruptcy. Another item you are allowed to challenge is fraudulent credit inquiries. However, among the things you cannot dispute are items such as a negative information like foreclosure and chapter 7 bankruptcy when they are actually correct and if they are within the statute of limitations for reporting. Note that a foreclosure will stay on your report for 7 years while a chapter 7 bankruptcy will stay on it for 10 years(Smith, 2012).

Be Elaborate – Consolidate Disputes

Consolidate all your disputes in one letter. It is not smart to send a letter for each issue on the report. In addition, send the letter via a certified mail and don’t forget to request for return receipt. By following this approach you will avoid lengthening the response time.

Include the Right Items

Keep your dispute letter simple and direct. To do this, you will need to stick to the basics such as identifying information(such as name, address, last 4 digits of your social security number, and so on) and the credit report reference number. Note that the credit reporting agencies usually include the credit report reference number on any copy of the report they send to you. Don’t forget to clearly identify the item you disagree with, the reason for questioning the item and the action you want the credit reporting agency to take to correct the error. Of course, as a way of proving your case, you should enclose any supporting documentation with the letter while, at the same time, keeping a copy of the letter and the supporting documentation.

Be Honest and Stick to the Facts

It is not smart to write an angry and  rambling letter to a credit bureau. The bottom line: you are more likely to get a better response if you write a polite letter that states the fact clearly than by writing  an angry and  rambling letter.

Be Creative – Take A Two-Pronged Approach

Being creative means that you should file  disputes with each of the major nationwide credit reporting agencies. It also means that you should submit the same dispute directly to the collection agency or the creditor. The effects of this approach is clear: since the collection agency or the creditor are required to share corrections with any credit reporting agency to which they have reported the mistake, disputing directly with these agencies might make the credit bureaus to fix the errors quicker.

Don’t Give Up – Be Persistent

If you did not get a response(which is very rare), you can file a complaint with the Federal Trade Commission(FTC), your local Better Business Bureau and the Consumer Financial Protection Bureau. When filing these complaints, be sure to copy the credit reporting agency. If you have the financial means, you can also contact the National Association of Consumer Advocates – they will help you to contact a good consumer protection attorney.

Reference

Smith S.H.(2012, November): 5 Keys to An Effective Credit Report Dispute Letter. Black Enterprise, 43(4), 32-33.