Recently, Kevin Horrigan, a columnist working in St. Louis, was looking to re-finance his mortgage. After his initial request the bank responded with some shocking news – according to their records, he was dead. After getting to the bottom of this obvious mistake, Horrigan realized that the source of this error was the credit agency. Horrigan’s case isn’t isolated. Federal lawsuits have been filed in Missouri to address concerns from consumers against the three major credit agencies (Equifax, Transunion, and Experian) – they’ve alleged the agencies would not respond to requests seeking to correct the errors.
One would think that correcting an error as egregious and evident as the one in question would be a simple fix in the interests of both parties, but that often isn’t the case. Credit agencies are notoriously slow to fix erroneous information on credit reports. Even though the Fair Credit Reporting Act (“FCRA”) generally obligates credit agencies to respond to, and correct errors within 30 days, a Federal Trade Commission study found that only 21% of requests by consumers were addressed in a timely manner.
An error on your credit report can be a serious issue, as it can lead to a drop in your credit score making it harder to secure loans, refinance debt, or purchase items on credit. Further, provided you can get a credit agency to fix errors in a timely manner, it can longer for your credit score to return to where it was prior to the erroneous reporting.
The best way to prevent this potentially serious situation is to regularly check your credit reports, regardless of if you are applying for credit. You are entitled to see your credit report one time a year for free, and as we have suggested before, we recommend staggering your request from each of the three agencies throughout the year. The process required to fix errors can be complex and frustrating. An experienced attorney can help guide you through this process and make sure it’s done properly the first time and address the situation if the errors are not corrected.
As always, contact us if you have any questions.