Category Archives: Disputing Credit Reports

Information related to disputing inaccurate information on your credit report in Fairfax, Arlington, Alexandria, Sterling, Manasass, Woodbridge, Fredericksburg, Stafford, and Richmond, Virginia.

How do consumers have mixed credit files?

If you are a mixed credit file victim in Herndon, Virginia, a credit report lawyer can help you sort out the mess of an inaccurate credit file or a mixed up credit file.

A mixed inaccurate credit file occurs when a credit account belonging to another individual becomes associated with your credit file. This can happen in any number of ways, for example:  incorrect spelling of names, transposition of social security numbers, similar names, two people with nearly identical social security numbers, or the mixing of generational differences like Jr. and Sr.

Our law firm in Reston, Virginia has conducted jury trials involving inaccurate credit reports containing mixed credit files.  From deposition and trial testimony, we have learned that the matching process for associating credit accounts does not require a nine for nine social security number match, does not require a date of birth match, and does not require a name match.  The computer systems simply associate data with other data that may be an appropriate match or may be the credit of a completely different person.  In identity theft cases, we have also seem the identity thief’s actual bad credit become associated with the victim’s good credit.

Consumers do not have a credit file like you would associate with a file in a traditional filing cabinet.  Credit reporting agencies simply maintain data in a cloud like environment.  When a credit reporting agency receives  data from someone requesting a consumers credit file, the credit reporting agency uses the provided information to match the data it maintains, with a credit reporting agency then providing a credit report containing information that best matches the associated data at that particular time.  When credit information contained in the agencies records is incomplete or inaccurate such that it becomes associated with the wrong person, the credit report provided will contain mixed and inaccurate information.  This can be a real problem in dealing with abusive debt collectors because they will collect on an account that is actually the debt of another person with a similar name.

Solving an inaccurate credit report or mixed credit file usually requires the services of an experienced credit report lawyer.  Having dealt with the problems on other occasions, we know how to best solve your particular problem.  If you would like to speak to me about your mixed credit file, I can be reached at 703-390-9205.  Our office also accepts inaccurate credit report cases for mixed credit file victims in Pittsburgh, Pennsylvania.

How does a credit reporting agency violate the FCRA?

Two core provisions of the Fair Credit Reporting Act require credit reporting agencies (Experian, Equifax, and TransUnion) to adopt reasonable procedures to assure maximum possible accuracy and to investigate consumer disputes of credit information.   Violations can occur if the credit reporting agency creates an inaccurate mixed credit file by placing another person’s information on your credit file, notes a judgment on a consumer’s credit file that a court vacated, or provided any other inaccurate or misleading information on a credit report. 

One of the most common  FCRA violations for a credit reporting agency is based upon the failure to conduct a reasonable investigation of inaccurate information in a credit file after receiving a credit dispute letter from a consumer, which violates 15 U.S.C. 1681i.  After receiving notice of a consumer dispute, the credit reporting agency has a legal duty to review information provided with the dispute and conduct a detailed systematic investigation into the information that is reporting.  Experian was found liable for a negligent investigation of a consumer credit dispute, and the court stated, “When conducting a reinvestigation pursuant to 15 U.S.C. 1681i, a credit reporting agency must exercise reasonable diligence in examining a court file to determine whether an adverse judgment has, in fact, been entered against a consumer.  A reinvestigation that overlooks documents in the court file expressly stating that no adverse judgment was entered falls far short of this standard.” Dennis v. BEH-1, LLC 520 F.3d 1066 (9th Cir. 2008).  There are many other instances when a credit reporting agency can be held liable for violating the FCRA, and a consumer with inaccurate information on a credit report should not hesitate to contact a consumer credit report law specialist. Our office in Reston, Virginia has handled numerous cases involving inaccurate credit reports, and we have litigated inaccurate credit report cases in the Alexandria, Richmond, and Pittsburgh federal district courts.

As for maintaining reasonable procedures for maximum possible accuracy, 15 U.S.C. 1681e(b), requires a credit reporting agency not to just establish reasonable procedures, but to follow reasonable procedures for credit report accuracy.  The remedial purpose of the FCRA to protect consumers would not be achieved if the credit reporting agency simply maintained pro forma procedures without any meaningful effort to follow those procedures to assure accurate credit information.  Credit reporting agencies violate the FCRA when inaccurate information appears on a consumer credit report and the consumer presents evidence that the credit reporting agency failed to follow a procedure maintained to assure that type of inaccuracy does not occur on a credit file.  Because these procedures are confidential in nature, a highly specialized consumer lawyer that has reviewed credit reporting agency procedures for several years will typically be a consumer’s best resource to have inaccurate information removed from their credit report.

As with any credit report problem, I would be happy to speak with you at (571) 313-0412 regarding your inaccurate credit report for potential representation or referral to a specialist in your particular area.

How do you fix an inaccurate credit report?

Using the provisions of the Fair Credit Reporting Act (FCRA), 15 U.S.C. 1681, is the best way for a consumer  to solve problems associated with inaccurate information on their credit report.  Passed by Congress in 1971, the FCRA is part of the federal Consumer Credit Protection Act and regulates various entities involved in credit reporting.  The stated purpose of the statute at 15 U.S.C. 1681(b) is “to require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a  manner, which is fair and equitable to the consumer regarding the proper use of credit information, as well as assuring confidentiality, accuracy, and relevancy.”

The banking system depends on accurate credit reports and inaccurate credit reports in Virginia, Pennsylvania, and throughout the United States hurt  consumers as well as lenders because inaccurate judgments, tax liens, and other trade lines undermine the integrity of the entire lending process.  Credit evaluation is a vital part of the life of consumers everywhere and can greatly impact the life of its victims.  Through the mechanisms and rights afforded by the FCRA,  incorrect items on credit reports for consumers in Virginia, Pennsylvania, and elsewhere can be removed and damages recovered for the entities responsible.   Please review this previous post for information on how to dispute inaccurate items in your credit report.

3 Notices From The IRS Indicating An Identity Theft Problem

Identity theft involving IRS tax returns has become an ever increasing problem over the last four years. According to Treasury Department reports, more than five billion dollars in improper refund checks may have been issued to identity thieves in 2011 alone.  If you have an IRS identity theft problem, the agency has established a procedure to assist victims on the identity theft page of the IRS website. As identified on the IRS website, three types of IRS notices can indicate that you may have an identity theft problem with the IRS. The three notices or letters indicating a problem are:

  1. You filed more than one return.
  2. You have a balance due, refund offset, or collection action for a year that you did not file a return.
  3. You received wages from an employer that you do not recognize.

If you receive any of these notices and think that you may be a victim of identity theft, the IRS requests that you take immediate action via an IRS identity theft affidavit.  The details regarding how to complete the affidavit and more information about the process can be found on the IRS website.

If I believed that I had an IRS identity theft problem, after notifying the IRS,  I would also immediately obtain a copy of all three of my credit reports from the credit reporting agencies and look for the signs indicating an identity theft problem on my credit file. If you think that you have been the victim of identity theft, you can review my previous post on the actions that you can take to combat your identity theft problem including links to assist you with identity theft reporting in Virginia.  if you have any questions about how to review your file, I have also discussed how to review your credit file disclosure . For additional questions about identity theft or inaccurate credit reports, you can always contact me at 703-390-9205.

 

Why am I not getting my credit report after my request?

Previous topics have discussed how to obtain a free copy of your credit report, and how to review your credit report.  However, in some instances consumers have an initial credit report problem because they cannot get a copy of their credit report upon request.  Simple reasons like entering incorrect data, transposition errors, and incorrect responses to security questions could be the reason that a consumer does not receive a copy of their credit report, but a larger problem could exist because of the manner in which credit reporting agencies store data.

Credit reporting agencies receive information about consumers in bulk from furnishers, and they maintain that information as data in their computer system.  When a potential creditor or consumer requests a credit report, the credit reporting agencies place the information provided into a matching algorithm system that compares the data input with all the data that the CRAs maintain.  Because the matching algorithms are proprietary, we do not know exactly how they work, but it has been revealed in trial testimony that a nine for nine match of social security numbers is not a requirement for a particular piece of credit data to match to a credit file.  As a result, if pieces of furnished data are incomplete or inaccurate, the data will not match to an existing file which can cause mixed files, merged files, or multiple files.  Please see my previous post on mixed and merged credit files.

When consumers try to get a copy of their credit report and they are unable to receive the report, the cause could be that the credit reporting agency has a mixed or multiple credit file concern about the data.  The credit reporting agencies do not want to release the wrong consumer file about a consumer that did not request the information, so they typically ask for additional identifying information and release no credit file.  Credit reporting agencies do not want to release the wrong credit file containing another consumer’s information because they could be in violation of the FCRA at 15 U.S.C. 1681b, which regulates how consumer reports can be disclosed.

The problem for the consumers that I have seen is that even after providing verifying information regarding their identity, like driver’s license, social security card, or utility bill information, the credit reporting agencies are still not providing a consumer file disclosure as required under the FCRA at 15 U.S.C. 1681g.  Consumers have real problems in this scenario because they are unable to review the information that may be inaccurate and the source of credit denials.  If you have suffered through multiple attempts to obtain a copy of your credit file without receiving the report, I recommend that you talk to a FCRA lawyer about your situation.  Please feel free to contact me for ideas or suggestions to help you resolve your problem.

Obtain A Free Copy of Your Credit Report After A Credit Denial.

When a consumer suffers an adverse action after applying for credit, the Fair Credit Reporting Act requires the user of the credit report to send the consumer a notification of the credit denial if that user took the adverse action in whole or in part because of information contained in the credit report.  The credit denial letter has various requirements including notification of the reason(s) for the credit denial, notification of the credit reporting agencies that provided the user with the credit report, and notification that the consumer has the right to obtain a free copy of their credit report from the CRA.  The full rights of the consumer can be found at 15 U.S.C. 1681m(a).

Given that 15 U.S.C. 1681j(b) of the FCRA requires a credit reporting agency to provide a consumer with a free copy of their credit report after credit denial, consumers should obtain their credit file after receiving notice of the credit denial.  To enforce this right, the statute requires that the consumer request the free report within 60 days of receipt of the notification of credit denial.

It is always good to review a copy of your credit file even if you think you know the source of your credit problems. In many instances, consumers have derogatory credit accounts on their credit report that belong to another consumer, unauthorized accounts, or accounts that are reporting too much negative information for the circumstances.  Carefully review all of the accounts that appear on your credit report.  For suggestions on how to review the contents of your credit report, please see my prior post on the topic of how to examine your credit report:

Finally, adverse action letters can be your first notification that you have been the victim of identity theft.  If a consumer has an existing credit line and the bank closes that credit line because of derogatory credit references, the bank must send you notice of that adverse action including the identity of the credit reporting agency that provided the creditor with the credit report.  For identity theft victims, the derogatory identity theft related accounts will cause their creditors to close or limit existing credit lines because of the change in credit history.  Accordingly, a consumer should never ignore a notice of credit denial letter because it can be the first clue that an identity theft problem exists.  Remember that are important items to consider if you may have been the victim of identity theft.

Should you dispute your inaccurate credit accounts on-line with the CRAs?

Credit Reporting Agencies are offering consumers the ability to dispute information on their credit report via a direct on-line option under the premise that the dispute will be resolved quicker and faster.  While CRAs are probably correct that the dispute can be processed faster on-line, I believe that it is difficult to provide the type of information necessary in an on-line dispute that is necessary to obtain the desired result of the removal of an inaccurate credit account from your credit report.  In my opinion, the best way to dispute an inaccurate credit report is with a descriptive written letter about the inaccuracy that includes attachments that support your position.

Under 15 U.S.C. 1681i (a)(1) of the FCRA, a credit reporting agency must conduct a “reasonable investigation” of disputed credit information after receiving notice of the dispute from the consumer.  Moreover, the CRA must provide the furnisher with all relevant information about the dispute after receiving the dispute from the consumer. By engaging in the on-line dispute process, a consumer is limiting the amount of information that can be provided, which could alter the quality of the reinvestigation process.

Credit Reporting Agencies presumably like on-line disputes because it allows them to process the disputes cheaper by eliminating the need for an employee to review a dispute letter with attachments. Because the consumer is directly entering information for the dispute, the CRA has the ability to blame the consumer for not providing enough information in the event that the dispute results in an otherwise inaccurate account remaining on the consumer’s credit report.  Given the siginificant drawbacks of engaging in the on-line dispute process, I personally would not dispute an inaccurate credit account on-line through the credit reporting agency. I would always send a full and complete written dispute letter with supporting documentation for the best chance to have the bad account removed from your credit report. For additional information about what happens to your dispute letter after you mail it to a credit reporting agency, please see my previous post:

http://yourfaircreditlawyernow.com/?p=61

 

 

Should you hire a credit repair company?

Boastful advertising claims promising to remove bad credit and raise credit scores are found on the Internet by companies that claim the ability to clean your credit history. Many of these claims are false, the actions taken to “repair” your credit may actually do more harm than good, and credit repair could impede your ability to raise your credit score. Given that you can dispute inaccurate information on your credit report for free, I  do not believe that consumers need to hire a credit repair company.  Moreover, the Federal Trade Commission often prosecutes unscrupulous credit repair companies under the Credit Repair Organization Act (CROA), and therefore, in my opinion,  a consumer is really taking a chance when hiring one of these companies.

The CROA is a federal law that regulates how a credit repair company contracts and performs its credit repair services for consumers. The stated purpose of the CROA is “to protect the public from unfair or deceptive advertising and business practices by credit repair organizations.”  15 U.S.C. 1679(b).  To achieve this purpose, the CROA requires that a credit repair organization provide mandatory disclosures at the the time of contract.  Among the required disclosures are: the total cost of the services as well as the payment requirements; disclosure as to all promises related to performance; and a description of what the credit repair organization will do for the consumer. In addition, the CROA prohibits the credit repair organization from receiving payment for services until those services are fully performed. The CROA also requires that the credit repair organization provide a prospective purchaser of its services with a three day right to cancel after the consumer signs the contract.  For more information on the pitfalls related to credit repair organizations, I recommend that you visit the FTC’s website at

http://www.ftc.gov/bcp/edu/pubs/consumer/credit/cre13.shtm

An unrealized problem for many consumers that hire credit repair organizations is that credit reporting agencies are prepared for the tactics employed by the credit repair company, and consumers may hurt their credit file as result of engaging in “credit repair.” Many credit repair organizations try to game the credit reporting system by engaging in numerous and repeated credit disputes in an effort to trip up the credit reporting agency or furnisher based upon the timing requirements of the FCRA reinvestigation duties. In the long run, these activities can hurt a consumer because the efforts are often associated with deceptive statements regarding legitimately past due debt. A consumer should never make a deceptive statement about a credit account or allow a deceptive statement to be made on their behalf by a credit repair organization. Moreover, consumers with legitimate inaccuracies on their credit report and victims of identity theft are better suited to write their own credit dispute letters with attachments supporting their arguments.  Credit repair organization letters that I have seen are often short generic form letters that do not describe properly the consumer’s credit dispute.  You will get much better results in the long run by writing your own dispute letter without the cost of hiring a credit repair organization.  For my previous post on how you can write your own credit dispute letter, please see

http://yourfaircreditlawyernow.com/?p=36

 

 

 

 

How to Examine Your Consumer Report For Inaccuracies

When you request a copy of your “credit report” from a consumer reporting agency, you are actually receiving a document that is a consumer report often referred to as a consumer file disclosure.  Under the FCRA, a credit report is consumer credit information that a CRA provided to third parties like banks, car dealers, and mortgage brokers.  A consumer report is simply that same credit information, however it sent directly to you the consumer not a third party.  Pursuant to Section 1681g of the FCRA, you are entitled to receive an exact copy of the entire contents of the credit file that the CRA maintains on you that it sends to third parties as a credit report.

The consumer reports provided by Experian, Trans Union, and Equifax all have a different appearance and layout, but the types of information maintained on the report are basically the same.  Some furnishers only report to one of the three main CRAs, so an account may appear on only one out of the three credit files.  Moreover, if you obtain a consumer report from a third party vendor, the appearance and ordering of the information can change.  In general, there are five main groups of information that appear on all consumer reports including: background information, public record information, prior credit account history, inquiries, and FCRA required disclosures.

On the top of your consumer credit report, the CRA provides you with the background information associated with the credit file as well as a credit file number.  The background identifying information includes: name, address, former addresses, date of birth, partial social security number, and employment data.  You should check this information carefully to make sure that none of the information is inaccurate.  If you are the victim of identity theft, many times you will see information related to the identity thief such as addresses and dates of birth that are unrelated to your actual identifying information.  Make sure you dispute any of the information that is inaccurate as incorrect background information can cause erroneous credit accounts to be associated with your credit file. For information on how to dispute inaccurate information in your credit file, please see my prior post:

http://yourfaircreditlawyernow.com/?p=36

Following your background information, you will see public record information, which can be some of the most damaging information on a credit file.  Many credit denials are the result of inaccurate judgment information, inaccurate bankruptcy information, or inaccurate tax liens.  You should carefully review the reported public record information to make sure that no information related to another consumer has been mixed up with your credit information.

Next, you will typically see information related to your past credit accounts.  Some CRAs will list the adverse accounts in a separate section of the report, while others will simply report the accounts in alphabetical order.  Attention to detail is vital as you review these accounts because account number and creditor names can change. Because of these changes, it can be difficult to determine if a particular account is yours.  If you see credit accounts that are not yours or accounts that are reporting inaccurate late payments, include a description why the account(s) are inaccurate when you send a credit dispute letter to the credit reporting agency.

Following your credit account information, you will see information related to third party inquires into your credit history.  These inquiries will include both “hard inquires” and “soft inquiries.”  When reviewing your inquiries, please make sure that you either authorized the credit inquiry or that the creditor had a legitimate business reason for acquiring a copy of your credit report.  “Soft inquiries” do not affect your credit score and can be acquired by companies that want to establish a business relationship with you.  Be careful when dealing with companies that have acquired your information via a soft inquiry as in some instances they can be companies that have poor records with organizations like the Better Business Bureau.

Finally, all CRAs are required to provide you with important notices regarding your rights under the FCRA.  At the end of the consumer report, you should receive a summary of your consumer rights as well as a list of regulatory agencies that you may contact.  If you are reviewing your consumer report and notice anything unusual, inaccurate, or wrong, please do not hesitate to contact me at my office, 571-313-0412.

Inaccurate Credit Reports Because of Mixed Credit Files and Merged Credit Files

A mixed credit file or a merged credit file occurs when another consumer’s credit information is placed erroneously on your credit report.  Despite the fact that the responsibility for the debt is that of another consumer, a credit reporting agency will attribute that information to your credit report.  This situation can lead to disastrous consequences because the information can cost you a mortgage, a job, or to pay higher interest rates.

As you would expect, both furnishers and credit reporting agencies can be the source of the incorrect credit account that appears on your credit report.  Mixed credit files and merged credit files occur for consumers because of the manner that credit reporting agencies acquire and organize their data.  Originally, furnishers provide information to credit reporting agencies about consumer accounts.  Furnishers provide this data electronically by including identifying information like name, address, and social security number.  If the information provided by the furnisher to the credit reporting agency is incorrect or missing, then the credit reporting agency can match the information to the wrong consumer’s file.  Incorrect file matching occurs because the credit reporting agencies do not maintain one file for each consumer.  The credit reporting agencies maintain pieces of individual data in their records and then associate and match similar data based upon complicated algorithms that are proprietary secrets.  While these algorithms are closely guarded secrets, we know some information about the process through discovery in litigation of mixed and merged credit file cases.  Typically, a nine for nine social security number match is not required to associate one piece of credit information with a particular credit file,  and other criteria like name and address are factors into the decision as to which file to place a credit account.  A name and address alone may be enough for incorrect data to match to your file and cause a completely different credit file to ultimately merge into your credit file as part of the computerized matching process.  Accordingly, people with common names have a higher chance to be the victim of mixed and merged credit files.  Inappropriately merged credit files typically occur when an existing credit file begins to more closely match your credit file with the credit reporting agency. Identity theft victims also can have the identity theif’s actual bad credit merge into the good credit of the victim.

Common mixed credit file and merged credit file causes include:

  1. Transposition errors in social security numbers.
  2. Incorrect name being attributed to a social security number.
  3. Different versions of your name like nicknames and maiden names.
  4. Mismatching information related to Jr., Sr., and III suffixes

Correcting inaccurate credit information as a result of mixed credit files or merged credit files is accomplished in the same manner as any other credit report inaccuracy.  Please review my previous blog post on how to dispute inaccurate information information on your credit report.

If you would like to contact me with any questions, or potential referral to a lawyer in your area, please contact me at 571-313-0412.