There are various kinds of errors that can have a serious implication on your Credit Score. Once fixed, you may spot an increase in your score.
While it’s important to have a healthy Credit Score in itself, it also helps to examine your credit report to remedy potential mistakes from hurting you later on. If you look at your credit report regularly, and not only at the time of applying for a loan or Credit Card, you can fix these errors in time following the correct procedures.
Types Of Errors
There are various kinds of errors that can creep into your credit report. However, minor discrepancies in your name, address, and date of birth may not necessarily ruin your Credit Score.
You should check your credit report regularly. This will help you keep a tab on more serious errors like the presence of another individual’s loan or Credit Card account on your credit report. Yet more errors that can dent your score are inaccurate dates of payment, or your account and loan status.
Role of Credit Bureaus
Credit Bureaus are responsible for tallying details received from lenders and supplying a relevant credit report. While they cannot change any information, they can perform certain logical checks to accept or reject some data.
Lenders generally manually enter details like an individual’s name and address. Hence, there could potentially be mistakes at the data entry stage.
Note: All data sent by the lender to the bureau usually appears with a time lag spanning around a month.
It is advisable to look at your credit report at least once a year. This will help you identify errors and fix them accordingly. If you believe that a loan has been incorrectly reported, you can take up the issue with the lender. The lender will then verify the details and submit the fresh information to the bureau who will, in turn, update your credit report.
On the other hand, if your report shows the presence of a loan not taken by you, for example, you can approach the bureau who will advise you on this issue. If such an error is because of data supplied by the lender, the bureau will press for the lender to fix this issue – and they have a time of 45 days to rectify the issue.
Many a time, you may spot an increase in your score after such errors are fixed. This will help you avail of a loan easily and without hindrance.
The post Why It Is Important To Regularly Examine Your Credit Report appeared first on BankBazaar - The Definitive Word on Personal Finance.