How to Dispute a Credit File Impact

It’s important to always keep a close eye on your credit score. Not only does this help you recognise any changes to your credit utilisation, but this makes it possible to catch problems early. If you have a poor credit score, there are a lot of ways to make improvements. However, what happens when you need to dispute a credit file impact?

A credit file impact is anything that’s affecting your credit score. This could be a missed payment, a new line of credit, or even fraud. Unfortunately, mistakes do happen. If you notice something unusual on your credit file, you might need to dispute this impact to repair your overall credit rating. Luckily, this doesn’t have to be complicated.

What’s on Your Credit File?

To begin, it’s important to familiarise yourself with the type of information found on your credit file. Your credit history is all of the information used to evaluate whether you’re a good fit for lending.

Higher creditworthiness means you reliably pay back your debts on time, and you don’t spend more than you can afford. On the other hand, lower creditworthiness could come from late payments, overspending, and so on. Here’s what’s on your credit history:

  • Enquiries: Any time you apply for a line of credit (loan, credit card, etc.), this search into your history shows up as an enquiry. If you have too many inquiries, it could show you’re desperate for money.
  • Defaults: A default notice is when you haven’t made any payments after a set period of time, usually 90 days.
  • Judgements: A court judgment is when a lender took you to court over a debt.
  • Bankruptcy and agreements: Both bankruptcy and debt agreements also appear on your credit rating.
  • Payment history: Your payment history, both positive and negative, is listed on your credit file as well. This is a way to improve your rating by paying on time.

How to Identify Mistakes on Your Credit File

Now that you know what type of information you can find on your credit file, how do you spot mistakes? You should get in the habit of reviewing your credit regularly. You can do this through the credit reporting bureaus, and you have access to a number of free reports each year. Additionally, you can set credit monitoring alerts to get notified of any changes immediately.

Always check your credit file to make sure all loans and debts listed are yours. Sometimes, these are filed under the wrong names and you don’t want to be on the hook for someone else’s debts. Similarly, check to make sure all of your personal details are correct. If you’ve applied for a hardship waiver or an informal debt arrangement, take extra care. The lender could mistakenly report a late payment (even if you did pay within the 90-day window or get a waiver) as a default.

Steps to Dispute Your Credit Report

If you did notice something wrong on your credit report, don’t fret. Errors happen, and they can happen on both the credit reporting agency side and your lender side. There is a process in place for solving these problems so your credit file accurately represents your lending history.

Error from a credit reporting agency

To begin, if you notice an error from a credit reporting agency, contact them directly. This is the most straightforward way to solve these problems. They can usually correct debts listed twice, personal information, and more right away. Alternatively, they can direct you to the proper lender for the option below.

Errors from a provider

On the other hand, if you spot an error from a credit provider, you can contact them directly. They can ask credit bureaus on your behalf to remove the error from your report. You might need to share supporting evidence to prove a payment was made, hardship was approved, etc. This is why it’s essential to have a clear record of your own budget and payments.

However, you can’t change or delete any information from your file that’s correct. Even if it’s a negative impact on your report, you have to wait until the full reporting period for it to be removed. For example, payments (both late and on-time) stay on your report for two years. When in doubt, consult with a debt professional on your payment history and status.

Monitor Your Credit with Confidence

Ultimately, you’re the only one who will take the extra time to look through your credit file. Though it’s the responsibility of your lender and agencies to report your history accurately, mistakes do happen. If you need to dispute a credit file impact, take action as soon as possible.

Your credit rating is more than just a number. Not only should you understand your credit score, but you should have a plan to improve it. Need help? You’re not alone. Contact our team at Debt Busters on 1300 368 322 for personalised credit coaching.

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