There are many reasons to review your credit report regularly, with the potential to pinpoint a mistake at the top of your list.
It’s difficult enough to obtain and maintain a good or excellent credit score without a mistake (or several) on your credit report. But if one of these is present, it could hold you back from reaching a high score that can benefit your finances in a variety of ways.
Here are six common mistakes found in credit reports:
- Inaccurate personal information: Most commonly, this is a mistake associated with your name or address. It’s a red flag that the credit bureau has you confused with another individual.
- Closed accounts showing as open: If you close an account, make sure it shows as such on your credit report. Old debt on your credit report, for example, can lower your credit score.
- Accounts you don’t own: It’s not out of the question to spot an account that doesn’t belong to you, such as a loan or credit card. If you don’t know what the account is, dig around for more information. It’s often a sign that your identity was stolen.
- Duplicate accounts: When the same account is listed twice, it will raise your credit utilization ratio. While that doesn’t sound like a big deal, a high utilization ratio can drag down your score.
- Payment history errors: This can include but is not limited to accounts marked with missed or late payments. If you know you’ve paid on time, contact the credit bureau to dispute the information. A missed or late payment can reduce your score.
- Outdated information: For instance, if your credit limit or balance is inaccurately reported, it will affect your credit utilization ratio.
These are just some of the many mistakes you could come across in your credit report. If you do, don’t hesitate to take action by reporting the error and requesting an immediate change.
Unfortunately, a credit report mistake has the potential to affect your finances, such as your ability to secure a loan, purchase car insurance or even land a job.
If credit report mistakes have hindered you in the past, it also makes sense to learn more about your legal rights in Minnesota. You may be able to take action against the negligent party.