Bad credit reports can have substantially adverse effects on the credit rating and scores of a consumer. While in most cases it is the result of wayward financial habits and mismanagement of financial affairs, in certain cases, such problems result from erroneous entries in the credit report. It is therefore essential clearing the credit reports. A consumer should therefore learn about how to clear credit reports and the steps he or she needs to take in this regard.
Finding How Errors Can Occur
First and foremost step that a consumer should take is to find out how the errors could occur in the credit report affecting the credit scores adversely. Such errors can occur due to the following reasons.
Usually lenders report to one of the credit reporting agencies and the others do not have the information in time and erroneous reports about non payment of dues continue in their reports.Accidental mix up of identity like two persons having same name and wrong entry of social security number can also result in such erroneous reports.At times the erroneous reports could be result of identity theft and misuse by unscrupulous elements of the credit information of the consumer concerned.
Checking Out Credit Report
One of the essential parts of clearing the credit report is to check the credit report of all the three major credit reporting agencies from time to time.
Hence knowing the contents of the credit report will help identify the wrong contents and contesting them for removal or rectification.
Under the Fair Credit Reporting Act (FCRA), every consumer is eligible to get a free copy of his or her credit report once in every 12 months from the three major credit reporting agencies, Experian, Equifax, and Trans Union.In other circumstances of refusal of credit, employment, or insurance, and adverse effects on financial prospects also the consumer is entitled for a copy of free credit report from them.
How to Clear Credit Report
So; how to clear credit report when it is found to be defective or bad? One of the primary tasks of the consumer is to dispute wrong entries that is rendering the credit report bad and adversely affecting the credit scores.
Consumer should contact the credit bureau to find out the source of reporting and then contact the reporting organization for clearing the mistakes. If it does not work, arbitration would be the ultimate resort. In case of identity theft, it would be necessary contacting the three credit reporting agency and put the account on hold.
Contact Equifax at 1-800-525-6285; Experian at 1-888-397-3742; and Trans Union at 1-800-680-7289 and file a complaint with the Federal Trade Commission or call them at 1-877-438-4338. Also constantly monitoring the credit report is the best way how to clear credit report.