Dennis' Mortgage Blog

Are you familiar with the Napoleonic Code?  It has come to mean "guilty until proven innocent", essentially the opposite of our legal system that presumes innocence.  Credit bureaus operate under the guilty until proven innocent application of justice.  If a credit company reports to the credit bureau(s) that you were 30 days late with your payment in June 2006, the credit bureau accepts the report as fact and it shows on your credit record that you were 30 days late in June 2006.  It is up to you to prove to the credit company and/or the bureau(s) that you made your June 2006 payment on time and to have the late payment removed from your report.

Real pain in the assets isn't it?  You make your payment on time, some how it gets keyed in late and now you have to take the time and energy to correct the problem.  And believe me it takes time and energy.  Ideally you contact the credit company, explain the situation, the person on the phone with you agrees and the matter is taken care of within a short time frame.  Key word? "Ideally"

Do not trust that someone working in the customer service department of a credit company will take the steps necessary to inform all of the credit bureaus that his/her company had made a mistake.  At best get the representative to commit to sending you a letter or email acknowledging the misreporting.  Before terminating your call try to get the representatives name and/or identification number and extension to put in any correspondence you will send to credit bureaus disputing the late payment on your credit report.

If you have an account, or accounts, that are misreported on your credit bureau reports it is not difficult for you to get them removed--although it may take a couple of attempts and some patience.  First, write a letter that includes your name, address and social security number (if a joint account with you and your spouse include both names and social security numbers), the name of the creditor, account number and the date of the late payment as stated on the credit report (i.e. Sears, acct. #12345678 reporting 30 days late June 2006), then state that the account was not late and should be reporting current and attach any documentation or information of calls you made in this regard.  Include a line/paragraph for each account you are disputing.  Make a copy of the letter for each bureau and send it to addresses below.

Finally regarding the blemish(es) on your record.  If you have otherwise good credit and all your accounts but maybe one or two report you always on time I would not worry about one or two accounts misreporting a 30 day late.  I understand the pride of having a "clean" or "spotless" report; I also understand the time and frustration of trying to get an item removed.  Unless you need something removed to improve your score to get a loan, know you are right, they are wrong and move on.  As time goes by late reports diminish in impact on your credit score and the one or two blemishes eventually will fade.  This is hard, impossible for some, for many of us to ignore, but trust me between dealing with the customer service departments, the letters, follow up, etc. if you can ignore the mistake.

Each bureau is obligated to provide you with one free credit report per year, take advantage of that to see what is on your report and monitor the activity.  Rather than getting all the reports at one time, space them out, say Experian in January, Equifax in May and Transunion in September.  If one of the reports show something in error, assume all the bureaus are showing the same error and send off your letter.

There are several companies out there charging fees for credit reports and alerts and other features.  With one free report every four months from a different bureau you can save the fees and monitor your own reports.

In my next post I will address FICO scores and some of the common myths associated with credit scores and what the scores mean and how they are used.

Experian

P.O. Box 2002

Allen, TX 75013

www.experian.com/reportaccess

Transunion

P.O. Box 1000

Chester, PA  19022

www.transunion.com

Equifax

P.O. Box 740241

Atlanta, GA  30374

www.equifax.com

Dennis

 Monday, July 09, 2007