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Report: Credit report inaccuracies have increased dramatically

Updated: May. 7, 2021 at 6:44 PM EDT
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CHARLOTTE, N.C. (WBTV) - Have you checked your credit report lately? Now might be the best time. A new report by the Consumer Financial Protection Bureau found credit report inaccuracies have increased dramatically.

“A credit report is more or less like a report card for consumers. It lets lenders, banks, mortgage companies see how the client or how the consumer pays their bills,” said credit coach and owner of Kiser Financial Solutions, LLC Lucy Taylor.

Taylor says, if you haven’t checked your credit report, now may be a good time.

The Consumer Financial Protection Bureau reports “credit or consumer complaint volume increased dramatically in 2020 . . . Complaints about credit reports . . . had the greatest change in volume that year.”

In fact, there was a substantial increase in complaints about inaccurate information from credit reporting agencies, Equifax, Experian, and TransUnion.

“Oh, there are so many inaccuracies from personal information, addresses in past employers and even accounts. I’ve had clients come to me with medical bills that weren’t theirs, credit cards that weren’t theirs. Some people are victims of identity theft and they don’t even know it.”

The CFPB notes the CARES Act allowed many people to suspend payments of federal loans, but unfortunately, that didn’t happen.

Borrowers reported companies marked their suspended payments as deferred payments instead of as “current.” As a result, their credit scores took a hit.

“Oh, it can impact your credit score tremendously. The biggest chunk of your credit score is payment history. That’s 35%. So if you have one 30 day late, that can drop your credit score 50 to 100 points.”

And Taylor says that can affect you getting credit later on.

“I’ve had clients not be able to get a mortgage because of that.”

She can’t stress enough—review that credit report.

“If you see any account that’s not yours that you’ve never been associated with, that’s how you know there’s an error and then look at those collections too.”

Once you find those inaccuracies on your credit report, Taylor advises you to send out a 609 letter to the credit bureau, disputing the inaccurate information.

They have to prove that information is yours or they have to remove it.

You are entitled to a free credit report once a year. You can get a copy from all three credit bureaus - Experian, Equifax, and TransUnion.

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