Annual Free Credit Report – Your Legal Right #4

Your Credit Report: Legal Right #4

You Have a Right to Tell Your Side of the Story

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What happens if you dispute information as wrong, but the credit bureau and the creditor refuse to change it because the creditor says it’s correct? What else can you do? The FCRA gives you the right to tell your side of the story. You can add a statement to your file explaining your version of the dispute. This statement will become a permanent part of your credit file and must be given to all creditors who receive the disputed information.

Unfortunately, statements aren’t always helpful. If your application for credit is being evaluated by computer, which many are these days, the creditor may not even see your statement. If you’re applying for a loan in person, or a live human being is reviewing your credit report, then it’s more likely to at least be read. If your statement seems plausible and it seems accurate and consistent with other information in your file, then it can be helpful.

The credit bureau may limit your statement to one hundred words or less, but if it does, it has to help you summarize it. Some consumers have complained that credit bureaus automatically summarize statements without getting their input. If you see your file after you have added a statement, and don’t like the summary of the statement, ask that your own words be used. Steve Rhode, president of the financial crisis organization Myvesta.org, generally does not recommend people add statements to their credit files because they can remain on the report long after the problem is resolved.

When writing your statement, be factual, brief, and clear. Ranting and raving about how unfairly a creditor treated you is unlikely to impress other creditors. If you have documentation supporting your version of the dispute, be sure to mention that it’s available.

The FCRA right to add a statement to your file applies only to cases where you are disputing the accuracy of information in your file. It doesn’t include situations where you are trying to explain the circumstances that led to credit problems. If, for instance, your ex-spouse illegally opened an account in both your names after your divorce and the creditor refuses to take it off your report, you can add a statement to your file because that information is not accurate and should not be on your report. If, however, your divorce caused financial problems and you fell behind on some bills, you do not have a legal basis for adding a statement explaining why your report contains late payments.

Some credit bureaus, like Experian, will allow consumers to add statements that explain circumstances but they don’t encourage it. Others, like Equifax, encourage it. For example, during the 1994 floods that caused so much damage in the Southeast, Equifax notified local and regional media that consumers could call a special toll-free number (set up for that purpose) to add statements to their credit files explaining that they were victims of the flood.