Your credit report is one of your most important financial documents. It contains a complete record of your financial affairs. This includes auto loans, home loans, business loans, credit
card applications and payment history. If you apply for a loan, banks and other lending institutions will review your credit report as part of their approval process. If your loan is approved, the bank will use the information from your credit report to determine the interest rate of the loan.
Unfortunately, it’s not uncommon for your credit report to contain inaccurate information. Most often, this occurs when service providers send information to the credit bureaus. Service providers include financial institutions, credit card companies, retail stores, insurance firms and cell phone companies. In fact, any company that has extended credit to you will provide this information to the credit bureaus (TransUnion, Experian, Compuscan and XDS).
There is a tremendous amount of information flowing between the credit bureaus and the service providers. Occasionally, this information is not handled properly between the two parties, which usually results in an error on your credit report.
The most effective way to prevent inaccurate information on your credit report is to thoroughly review a copy of the report on a regular basis. As a citizen of South Africa, you are entitled to a free copy of your credit report every 12 months. Each credit bureau is required to provide a free copy. However, it’s probably a good idea to review the report 2 to 3 times per year. It’s very important to remove erroneous information from your credit report as quickly as possible. Therefore, you should make an effort to examine the report a few times per year.
Filing a Dispute with the Credit Bureau
If you discover inaccurate information on your credit report, there are steps you can take to remedy the situation. All disputes should be initiated with the credit bureaus. You should not contact the credit providers, such as your bank or credit card company. The bureaus are responsible for resolving all disputes concerning your credit report.
“Lodging a dispute” is the proper term for filing a complaint with the credit bureau. There are two ways to begin the process of lodging a dispute. You can call the credit bureau or you can complete necessary paperwork on the bureau’s website.
The credit bureau will ask you to complete a Challenge Form. This document contains basic questions pertaining to the inaccurate information on your credit report. For example, if your credit report shows a late payment with your auto loan, the Challenge Form will ask you to provide specific information concerning this loan payment. You will be required to provide the name and address of the lender, the loan number, the amount of your monthly payment and the specific due date of the loan.
When you submit the Challenge Form to the credit bureau, you should include as much supporting documentation as possible. Most likely, the bureau will not remove the disputed information on your credit report unless you provide sufficient evidence which verifies that your loan payment was made on time. The best type of supporting documentation would be a receipt from your lender verifying the date of your loan payment. Additionally, you could provide the credit bureau with a copy of your cancelled cheque. It’s always best to send as much information as possible.
Many consumers believe that the credit bureau will remove the inaccurate information from their credit report simply by completing a Challenge Form. This is not true. Consumers must include supporting documentation along with the Challenge Form.
In addition to the Challenge Form and supporting documentation, you must send the credit bureau a copy of your ID and your address. Please be aware that there is a time limit for submitting a Challenge Form and filing a formal dispute. You must file a dispute within three months of receiving your credit report. As an example, let’s assume you requested a copy of your credit report in March. If you discover an error on the report, you must submit a Challenge Form (along with supporting documentation) by June.
Upon receiving the Challenge Form, the credit bureau will send you a notification verifying the receipt of your documents. The bureau will provide you with a reference number. It’s very important to remember the reference number. If you communicate with the credit bureau during the process of the investigation, the bureau will ask you to provide the reference number. Therefore, you should keep the number in a safe place.
The credit bureau will investigate your compliant after they receive your documentation. They must provide a response within 20 business days. If the bureau finds that your credit report does indeed contain inaccurate information, they will promptly correct the mistake. It’s always a good idea to order another copy of your credit report after the bureau has corrected the information. This will give you the peace of mind to know that your entire credit report contains accurate information.
Please be aware that one credit bureau will not send the corrected information to the other three bureaus. It’s your responsibility to contact all four credit bureaus to verify the accuracy of your credit report. Unfortunately, if your credit report contains inaccurate information with one credit bureau, this inaccurate information will probably be linked to all four bureaus. That’s why it’s important to order a copy of your report from each bureau.
The best course of action is to make a habit of examining your credit report on a regular basis. In fact, it should become part of your overall financial plan. Make a schedule to review your credit report at least two times per year.
Credit Bureau Contact Information
Checklist for Maintaining an Accurate Credit Report
- Your credit report is one of your most important financial documents
- Reviewing your credit report on a regular basis can prevent inaccurate information
- You are entitled to a free credit report every 12 months
- All credit report disputes should be filed with the credit bureau
- If you discover an error, you should immediately lodge a dispute with the credit bureau
- The credit bureau will ask you to complete a Challenge Form
- In addition to the Challenge Form, you should include supporting documentation
- There is a 90-day limit for filing a dispute with the bureau
- Upon receiving your Challenge Form, the bureau will provide a reference number
- The credit bureau will investigate your dispute within 20 business days
- If the bureau agrees with your Challenge Form, they will promptly correct the mistake
- A credit bureau will not share your Challenge Form with the other major bureaus
- It’s your responsibility to verify the accuracy of your report with each credit bureau