Since your credit score plays a large role in your ability to qualify for a mortgage loan, it’s important to review your credit report once a year.
According to data from the Federal Trade Commission, about 20 percent of credit reports have an error on them. Errors can occur from wrong information supplied by a creditor, a mistake by a credit reporting firm or from fraud. Be sure to verify the data on your credit report is accurate. Spotting a mistake can boost your number fairly quickly - no matter where you score currently falls. Typically, the better your score, the better your interest rate.
But what do you do if you find a mistake? Take these steps to dispute any errors on your credit report.
- Send a dispute letter to the reporting company. Your letter must include your name and address and should document each error on your report. Explain why you dispute each item and request that the errors be removed or corrected. Include copies of documents that support your position.
- Send a letter to the creditor who provided the incorrect information. Include copies of the documents that support your position
- Keep a file with your credit report and any dispute letters or documentation sent.
- If your dispute results in a change to your report, the company must give you a free copy to review. Ask the company to send notices of correction to anyone who requested your credit report in the last six months.
Make sure you include enough details and evidence when filing a dispute. For additional information, visit the Federal Trade Commission's website.
Interested in additional tools to help build your credit, speak with Home Loan Advisor today!