A quarter of Americans say they have encountered problems with their credit report, according to a new survey by FindLaw.com, the most popular legal information website. Problems include inaccurate information, identity theft, incorrect credit scores and being denied credit.
All together, according to the FindLaw.com survey, 23 percent of Americans said they have had a problem with their credit report at one time or another.
The most commonly reported problems were:
- Incorrect or outdated credit history information (e.g, delinquent payments, payment history, bankruptcies, etc.)
- Incorrect or outdated personal information (e.g., address, work history, marital status, criminal history, etc.)
- Identity theft or information mixed up with another person
- Credit score incorrectly reported as being too low
- Denied credit because of incorrect information in a credit report
The encouraging news, however, is that the vast majority of people who had problems with their credit report say they were able to correct the problem. Sixty-eight percent of people who found a problem said that the problem was later corrected to their satisfaction. An additional 14 percent of people encountered multiple problems but were able to get at least one of the problems corrected. Eighteen percent of people who had problems with their credit report were never able to get their problems corrected.
“It’s important to check your credit report periodically to ensure the information it contains about you is accurate and up to date,” said Stephanie Rahlfs, an attorney and editor with FindLaw.com. “The credit reporting agencies all have detailed procedures for correcting errors. And our survey found that people are generally having success in getting the agencies to correct those errors.”
“Your credit report contains a large amount of information drawn from a wide range of sources,” continued Rahlfs, “and there is always the potential for your credit report to contain inaccurate or outdated information. A credit report can have an enormous influence on a person’s ability to obtain a mortgage, credit card, auto loan or other credit, and can also be used in making hiring decisions.”
Despite the high percentage of people reporting problems with their credit report, another recent survey from FindLaw.com found that 22 percent of Americans have never checked their credit report to verify the accuracy of the information, even though by law, credit reporting agencies are required to provide free copies annually upon request.
A credit report is an overview of how much debt a person currently has, as well as whether he or she has a history of making debt payments on time. It also contains personal information such as recent home addresses, employers, and bankruptcies and court judgments.
Credit reports are used by lending institutions, such as mortgage and credit card companies, as part of their decision-making on whether to grant credit. In addition, in most states, credit reports can be used as part of employment background checks. Credit reports are different from credit scores, which are numerical values applied by the credit reporting agencies as a measure of credit risk.
Under the Fair and Accurate Credit Transactions Act, all Americans are entitled to a free credit report from each of the three major credit reporting agencies once every 12 months. Federal law also sets requirements for resolving disputes involving the accuracy of information in a person’s credit report.
Free, helpful information on credit reports and other aspects of consumer credit can be found online, including at FindLaw.com’s Financial Consumer Protection site: http://consumer.findlaw.com/credit-banking-finance/