Let’s face it, Credit Reporting agencies employ people just like me and you and, as we all know, me and you can sometimes make mistakes. The Big 3 can (and do) make mistake all the time and these mistakes can affect your ability to get a home loan or buy a car, which can be very frustrating to say the least.
Identity Theft is not a problem that the credit agencies cause (usually) but, if your identity is stolen and your credit ruined, it can affect you for literally years to come.
That’s why, in 2004, the Public Interest Research Group (PIRG) did a study of nearly 200 credit reports (not that many in my opinion) and found that there were mistakes, some quite serious, in almost 80% of them! That’s a lot of mistakes and, when you consider that nearly 5 BILLION pieces of data are collected EACH MONTH by the Big 3 agencies that means that there are a whole lot of errors being made all the time.
What are some of the most common mistakes? Well there’s;
- Credit info on your report about someone else with the same name as you.
- Info that is reported twice.
- Public info about you that is wrong or wrongly recorded.
- Negative reports caused by someone who stole your identity.
- Improperly recorded credit limits.
- Different reports from different addresses.
That’s a LOT of room for error and, with identity theft one of the most common crimes in the United States, it is costing Americans literally billions of dollars a year. Thankfully the incidence of identity theft id dropping but still it only takes one time to destroy your credit for years.
To make sure that you don’t become a victim you can actually use your credit report to see what’s been going on in ‘your’ credit life and see if maybe you’ve been cloned by some thieving a-hole. You can see this if you look for accounts and names that you don’t recognize, loan apps that you never filled out and addresses where you never resided. You can even see ‘soft’ inquiries by employers or landlords that you don’t recognize.
Today there are paid credit monitoring services that will notify you of any changes in your credit report and make sure that there are no signs of suspicious activity. Simply requesting a credit report from time to time and checking it yourself is also a good way to make sure your credit, and your financial life, aren’t being ruined.