Imagine you spent years working hard, saving diligently, and dreaming of buying your first home. You ound the perfect place, and you are ready to make an offer.
However, when you apply for a mortgage, you are shocked to learn that your credit report contains errors, causing your loan to be denied. This nightmare scenario is all too common, but there are steps you can take to rectify the situation and get back on track.
Sarah’s Story: A Credit Report Nightmare
Sarah, a 32-year-old nurse, had always been responsible with her finances. She paid her bills on time, never maxed out her credit cards, and had been saving for a down payment on a house.
When she finally found her dream home and applied for a mortgage, she was devastated to learn that her credit report contained several errors, including a defaulted student loan that was not even hers.
Disputing Credit Report Errors
If you find yourself in a situation like Sarah’s, the first step is to dispute the errors with the credit bureau (also known as the credit reporting agency) that issued the report. You can do this by writing a letter or filling out an online dispute form, clearly explaining the inaccuracy and providing any supporting documentation. Although online forms are convenient, they often make it difficult to retain proof of your dispute. Therefore, sending a dispute letter by mail is often the best way to go.
The credit bureau usually has 30 days to investigate your claim and correct any verified errors.
Sarah gathered all the necessary paperwork and submitted disputes to all three major credit bureaus – Experian, Equifax, and Trans Union. She also contacted the student loan company that had erroneously reported the defaulted loan and requested that they correct their records and notify the credit bureaus of the mistake.
The Path to Resolution
While Sarah waited for the credit bureaus to investigate her disputes, she continued to house hunt, hoping that the errors would be corrected in time. She also reached out to her lender and explained the situation, asking if they would be willing to reconsider her mortgage application once the errors were removed from her credit report.