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Think again. According to this week's 60 Minutes on CBS, none of this is probably true.
Are you one of the 40 million or 20 million?
According to one expert, 40 million of our credit reports contain errors and 20 million have errors so serious that they could be affecting peoples’ credit ratings. This suggests that one in four Americans have errors in their credit reports.
Do you review your reports regularly?
There are only three credit reporting bureaus. They are TransUnion, Equifax and Experian. If you are not getting and reviewing your reports from the three on a regular basis, you may be making a serious mistake. The odds are that at least one of your reports contains an error or maybe even multiple errors. You can get your reports free once a year by contacting each of the three bureaus or you can get them simultaneously – again free – at the website www.annualcreditreport.com.
It’s unlikely anyone will ever see your letter of dispute
The same expert said that if you file a letter of dispute, it's highly unlikely that anyone will ever see your letter who has the authority to do something about it.
Here's what typically happens
Here, at least according to 60 minutes, is where things really get shocking. Let's suppose you do find an error. You dispute it by sending a letter to the relevant bureau’s PO box. The bureau is supposed to then contact the company that reported the transaction and ask for proof that the information is accurate. However, this is apparently a bunch of baloney. Again, according to CBS's 60 minutes, all letters mailed to the three bureaus’ PO boxes are sent offshore to places such as India and Chile where people simply give them a two digit code and that's basically the end of it. In other words, no one who could do something about fixing the error will ever see your letter.
Not the same credit report as you see
The program also had evidence that the credit report that's sent to you by the credit bureaus is not the same as the ones they send to creditors. You could review your report, find nothing wrong and believe you’re in good standing. But your creditors could be seeing different information. You might be turned down for credit and never know why.
An American horror story
As evidence of how bad this can get, 60 minutes showcased the horror story of a woman who was unable to get any credit because one of the three bureaus had mistaken her with another woman who had a very bad credit history. This woman spent years doing everything possible to get the problem corrected but to no avail. She ultimately had to get an attorney and sue the credit bureau, which settled with her for “an undisclosed amount”.
The moral of this story
While everything 60 Minutes revealed may not be totally true (it does tend to exaggerate), there is a moral to this story. It's that you need to stay on top of your credit report. If you do find an error, your best option might to be contact the company that reported it instead of the credit bureau. Beyond that, you best option is to just hope there are no serious errors in your credit reports.
Stay on top of your debt
It's also important to stay on top of your debt because if it gets out of control, this will have a very negative effect on your credit score. Contact us if you're having a serious problem with debt and let us explain how debt settlement could help. We charge nothing up front so you have nothing to lose.