Credit Check—Repairing Credit Mistakes Just Got Easier

June 2015 View more

Credit score on a digital tabletThere is good news on the horizon for consumers whose credit reports have been negatively impacted by medical debt and reporting errors. Thanks to a settlement reached by New York Attorney General Eric Schneiderman, the nation’s three largest credit-reporting agencies are overhauling the way they handle these issues on consumers’ reports. This overhaul is being hailed as the biggest reform to credit reporting in more than a decade.

Credit Report Information

Your credit report contains details about your loans and credit history, including how much credit you are using, how much you have available, whether you are behind on any bills or have been sent to a collection agency. Credit reports also disclose whether you have been sued, arrested, or have filed for bankruptcy. Three national credit reporting companies, Equifax, Experian and TransUnion, collect this information and disseminate it to credit card companies, insurers, employers and other businesses that use it to evaluate applications for credit, loans, housing and even jobs.

“Credit reports touch every part of our lives,” Schneiderman said in a statement. “They affect whether we can obtain a credit card, take out a college loan, rent an apartment or buy a car and sometimes even whether we can get jobs.” Not only does your credit report affect whether you can get a loan, but it also affects the interest rate you will pay.

Reporting Errors

The three major credit reporting agencies keep records on more than 200 million individuals. A 2013 Federal Trade Commission study found that one in five consumers had an error in at least one of their three credit reports. Errors occur when creditors accidentally send incorrect information or if a consumer is a victim of identity theft. While federal law allows consumers to challenge inaccuracies, many have complained about the difficult resolution process. Under this new agreement, credit reporting agencies will be required to use trained employees to review all supporting documents and resolve the dispute even if a creditor says information is correct. If a consumer’s report is corrected, the agency will provide consumers a free revised report. Consumers who are not satisfied with the outcome of their dispute will receive further information on what they can do.

Another major consumer benefit under this agreement is how the agencies will report medical debt. More than half of all unpaid collections on credit reports are due to medical expenses, according to a Federal Reserve Board study. The Consumer Finance Protection Bureau reports that 43 million Americans have past-due medical debt on their credit reports. Under the new agreement, medical debt won’t be listed on credit reports until after a 180-day waiting period to allow time for insurance payments to be applied. In addition, medical debts will be removed from the report after the debt has been paid.

How to check your report

Federal law requires each credit reporting agency to provide consumers with a free credit report once every 12 months. Because Equifax, Experian and TransUnion get information from different sources, what is contained in each report may vary. You can access your credit report online at or order a report by calling 877.322.8228. You may opt to receive all three reports at once or stagger your requests to review them throughout the year.

Once you receive your report, make sure the accounts and loans listed are correct. If you find errors, contact the credit reporting company that provided the report as well as the company that provided the information (the store, bank or other institution). Details on how to correct your credit report can be found on the Federal Trade Commission’s website at or the Consumer Finance Protection Bureau’s website at