If you are preparing to buy a Katy home soon, one step you should take is to obtain a copy of your credit report, especially if your credit score seems lower than it should be. As your Katy real estate agent, I am here to tell you that errors on credit reports happen more often than you’d think! Not only that, but an error could lower your credit score and could prevent you from getting qualified for a mortgage.
If you do find an error on your credit report, then you must begin the daunting task of trying to get it removed. While this can take a while and might be frustrating, here are some steps you can take to make it go as smoothly as possible:
1. Check your credit report. Even if you aren’t buying a Katy home right now, you might at some point in the future. It’s smart to check you report occasionally, so you catch any misinformation that might show up. The sooner you catch it, the better. The rule of thumb is that you can receive one free credit report per year from each major credit bureau. Stagger the free reports every few months throughout the year.
2. Dispute online or in writing. If you find a small error, like a $50 debt that you never owed, you can fill out an online dispute form on each of the major credit bureau’s websites. If you find a major error, like a bankruptcy you never claimed, experts advise that you send a hand-written letter to each credit bureau. This is because by disputing it online, you give up your right to arbitration. In the letter, clearly identify the item at hand and clearly explain why it is an error.
3. Provide documentation. If you can find any documents that prove that the item at hand is an error, include copies of these with your letter. Documentation will significantly help your case, if it can prove the error.
4. Make a phone call. If you don’t hear back from the credit bureaus, or you have questions or disputes, you can call the customer service line at the credit bureaus. You can also attempt to call the company which you supposedly owe money to, and try to prove the error to them. If you succeed, they can send documentation to the credit bureaus of the error.
A 2013 FTC study concluded that five percent of American consumers have an error on one of their credit reports. While this may seem low, it’s worth checking to see if you are part of this percentage. If you are, you may be paying more interest for everything you owe, from mortgages to car loans to credit cards, because of an error. While fixing the error might seem like a hassle, it might also be worth the savings you’ll experience in the long run.
When ready to buy a Katy home, or when ready to sell your Katy home, contact me, your Katy real estate agent! I am here to guide you through the process and to help you achieve your goals in the Katy real estate market!