A credit dispute letter is a written document sent by a borrower to a lender or a credit reporting agency to dispute information. Often, a credit dispute letter is sent to a credit reporting agency to address a consumer’s disagreement with erroneous information in a credit report. However, the term can also refer to other types of correspondence that involve credit negotiations, fraud, non-payment of debts, and other financial issues between a lender and a borrower.
It is not only individual consumers who might want to dispute a credit report. A business may also want to correct mistakes in the business’s credit report. For example, a business might have repaid a loan in full, but its credit score may be negatively affected if its credit report does not reflect the payment of the loan. So it is as important for businesses to monitor their credit reports as it is for consumers to do so.
If a company finds information in its credit report that is incorrect, they can write a credit dispute letter to the credit reporting agencies. Agencies are required by law to investigate and report their findings on issues raised by the borrower. They are required by law to correct or delete incorrect information from a credit report within 30 days of receiving information about it.
The same 30-day rule applies to consumer credit dispute letters. The Fair Credit Reporting Act (FCRA) requires a credit reporting agency to investigate and resolve a consumer’s dispute of information in a credit report within 30 days.
What Should a Credit Dispute Letter Contain?
If a person wants to dispute information in a credit report, experts recommend sending a dispute letter to both the institution that provided the information to the credit reporting agency, called the “information furnisher”, and the credit reporting agency as well.
It is important to dispute inaccurate information with both the credit reporting agency that generated a person’s credit report and the company that provided the inaccurate information to the credit reporting agency.
A person can contact the three credit reporting companies online, by mail, or by phone, but it is probably best to contact a credit reporting company in writing, so there is a clear and accurate record of what they were told and when.
When disputing an item in a credit report, a person should refer to their credit report. They should do this so the agency or business that receives the letter can correctly identify the information that the person is disputing. A credit report contains a consumer identification or report number that should be included with any communication about the dispute to allow the credit reporting company to identify the person.
There is no charge for submitting a dispute to a credit reporting agency. A person can make sure that an error has been removed from their credit report by requesting confirmation from the credit reporting agency.
A person can get each credit reporting agency’s dispute form online or write their own letter. The goal of a letter is to provide the credit reporting agency with enough information to identify the person and the specific accounts or tradelines that they are disputing. A person should include a copy of their credit report with the items they want to dispute marked or circled. This would make it easier for the credit reporting agency to identify the items that are disputed.
A person may also wish to include copies of any supporting documentation, such as a statement from their lender, which shows the incorrect information a person is disputing. The three credit reporting agencies are Equifax, Experian and TransUnion. Each has a website with information about how they can be contacted.
When sending a credit dispute letter to a credit reporting agency, a person should include the following content in the letter:
- The full name of the person writing the letter;
- The person’s consumer report or credit agency identification number;
- The person’s date of birth;
- The person’s address;
- The date on which the consumer writes their letter;
- The name and address of the credit reporting agency to which the letter is being sent;
- The name and address of the company that provided the disputed information;
- Disputed items;
- The person’s account number;
- The dates of disputed information;
- A brief explanation of why the information is inaccurate;
- The type of information that is disputed;
- A list of any documents that are included with the letter.
When a person deals with any kind of information furnisher, such as a lending institution or debt collection agencies, the dispute letter should contain the following information:
- The full name of the person writing the letter;
- The account number of the account to which the dispute is related;
- The person’s date of birth;
- The person’s address;
- The date on which the person writes the letter;
- The name of company and its address;
- A brief statement of the nature of the dispute;
- The name of the report in which the disputed information appears;
- A numbered list of the items a person wants corrected;
- Dates associated with the disputed information;
- A list of any documents that are included with the letter.
The goal is to provide the information furnisher with enough information to identify the person who has written the letter and the specific account and transaction that the person disputes. To make it easier to identify the items that a person disputes, they should consider including a copy of their credit report with the disputed items marked or circled. This will make identification of the items that the person disputes easier.
All companies that report information to credit reporting agencies are required to accept disputes from consumers. The address for the information furnisher can be found in a person’s consumer report or by calling the information furnisher’s customer service. Some companies may require additional documents, particularly in cases involving identity theft.
A person should keep a copy of their own credit dispute letters for their records, and should also keep copies of any correspondence or letters they receive from the other party.
What If a Dispute Letter Does Not Fix the Issue?
If a dispute letter does not fully resolve the problem, a person may need to take legal action to have the matters settled. Note that if a person’s complaint involves identity theft, they may want to take additional steps. A person can find additional information at the website of the Federal Trade Commision (FTC) at identitytheft.gov. This website has additional information about how to combat identity theft.
More serious or complex problems may require filing a lawsuit. This is especially true for cases involving fraud, serious debt, or breach of contract. A lawsuit may result in a remedy such as an award of damages or reworking of the credit terms.
Or a lawyer may know of strategies to assist a person with a credit report dispute. For example, if a person is able to either pay off a debt or negotiate a debt settlement for a loan that is in collection with a debt collection agency, they should make their payment contingent on the debt collection agency deleting the item from the person’s credit report.
A “debt settled” notation can be damaging to a person’s credit, so it is better for the debtor to have the item removed from their credit report or marked “paid in full.” Debt collection agencies have a high turnover of personnel, so a person should get any agreement about how the payment or settlement is to be reported to credit reporting agencies in writing.
If a debt collector or a credit bureau violates the FCRA, the victim of the violation is entitled to file suit against them. If they are found to have violated the law, the victim is entitled to actual damages, statutory damages of between $100 and $1,000, and court costs and attorney fees.
Should I Hire a Lawyer to Help Me with Credit Dispute Issues?
If you have been unsuccessful in trying to correct faulty information in your credit report, you may wish to hire a credit lawyer to help you handle the dispute. Your lawyer may be able to resolve the situation with additional letters or negotiations.
Or, they may advise that a complaint to a government agency or lawsuit might be necessary to resolve the issue completely. In any event, your lawyer will know what options are available and what actions you can take to ensure that your rights are not being violated.
