3 Good Reasons to Question What’s on Your Credit Report
October 6, 2015 | Posted by Blair Warner | No CommentsAre you sure that everything on your credit report is yours and is correct?
Recently a friend of mine recently built his first house from the ground up. Unfortunately, he said he would never do it again. All the horror stories you hear about dealing with permits, contractors (and sub-contractors), material suppliers, time-lines, budget-overages, etc. are all too often true. Some consider it worth the hassle and many, like my friend, do not. Like anything, experiences differ.
My friend’s biggest regret was that he didn’t monitor the process and details enough. I hate to say it, but he put too much trust in the hands of his builder. It’s not that builders can’t be trusted, most can, but the fact remains, they are building YOUR house, FOR YOU, and it is in your best interest to stay on top of things.
When it comes to your personal finances and debt management, including how items are reported on your credit reports, it is no different. It is your responsibility to “stay on top of things”, because it is in your best interest to make sure everything on you credit report is yours, and is correct.
One or two errors can have as much as a hundred point influence on your score, depending on the circumstances. It is important to question what is on your credit reports. Tweet this….
3 Good Reasons to Question What’s on Your Credit Report
1. Credit data furnishers make mistakes
I am sure this comes as no surprise, but the furnishers of your credit data make mistakes. Credit furnishers include anyone that has extended you credit and reports to the credit bureaus like banks, credit unions, auto lenders, credit card companies, cell phone providers, delinquent medical bills, even unpaid taxes, just to name a few. They either have your information incorrectly in their files and when they send it to the credit bureaus it is reported incorrectly, or the error actually occurs in the transmission of data. There are some that even intentionally and unscrupulously report your information wrongly so that they can get more money out of you or, at the very least, make life difficult for you when you apply for new credit somewhere else. To make matters worse. The credit bureaus are not required to verify the accuracy or validity of information sent them until you, the consumer, initiates it.
2. The big 3 credit reporting agencies are separate, independent companies
Unfortunately, it is not common knowledge that the big 3 credit bureaus, Experian, Equifax and Transunion are 100% independent of each other. They are not government agencies or even GSEs (government-sponsored enterprises), like Fannie Mae or Freddie Mac. They are for-profit companies no different than Walmart or Apple, and are publicly traded. This means they are competitors in this fiercely competitive, and lucrative credit reporting and data market. Not surprisingly, then, they do not share or cross-check information about you or your credit history with each other, and an error caught and corrected at one does not effect the others. Additionally, since not all credit data furnishers (creditors) report to all three bureaus, your reported credit information will be different for each bureau, resulting in different profiles and scores.
It is a widely publicized fact that over 70% of credit reports have errors and as much as 33% of those are significant enough to effect you getting the credit you need. Tweet Tweet
3. Identity Theft
Someone’s identity is stolen once every 2 seconds in the United States. Need I say more? If you don’t monitor your credit reports on a regular basis, and question anything that looks suspicious, especially if you don’t recognize it as your debt, you could be a victim of identity theft and not know it until it is too late. The sooner you can catch it, the least damage will occur. Believe me, you want to catch it early. We help people who have been a victim of identity theft, and it is a nightmare. This reason alone should be enough to prompt you to check your credit reports regularly.
There are a few other good reasons to question what is on your credit report, but we will go over them in our next post. Stay tuned.
Don’t regret not “staying on top” of what is reported on your credit reports. We at Upgrade My Credit recommend checking your credit reports as often as possible, but at a minimum, a couple of times a year. There are two ways to get and monitor your credit reports, and we cover them in a recent post. How To Get Your Credit Reports
Related Article: Can you really get your credit reports for free?
If you remember only one take away from this article it is this:
If you see something on your credit reports that is not yours or looks suspicious, let your doubts turn to questioning it, and do something about it. Don’t delay! Click to Tweet
If you need help, we are here for you!
By Blair Warner – Certified Credit Consultant
