Checking your credit report, an important personal finance management tool, has taken on new significance in the wake of COVID.
Your credit report contains your credit history: how much debt you’ve incurred and what type, your debt payment history, loan balances, repossessions or foreclosures, liens, judgments, and bankruptcies. It contains a list of every credit account you’ve opened.
Credit history is used to formulate your credit score which determines eligibility for all types of credit, from obtaining a mortgage, getting a car loan, renting a home, to qualifying for an advantageous interest or insurance rate.
Credit reports are compiled and maintained by credit reporting agencies. The three major national ones are Experian, TransUnion, and Equifax.
We are emerging from COVID but due to the financial hardships it wreaked, many of us struggled and are still struggling to pay our bills. Some creditors offered relief, such as payment postponements, payment plans, or temporary forbearance. Under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, when providing information to the credit reporting agencies creditors are generally required to report accounts benefiting from this relief as current.
Erroneous information can be contained in your credit report when a business mistakenly reports a payment as delinquent when in fact it isn’t. For example, if you received temporary loan forbearance because of COVID hardships, under CARES your credit report should likely not reflect any negative payment history for your not making payments during the forbearance period.
During COVID, Experian, TransUnion, and Equifax provided weekly credit report access to consumers to enable them to monitor their credit report for free; this benefit has been extended until April 20, 2022. Take advantage of this opportunity and check your credit report regularly to make sure it’s accurate. If you received COVID-related payment arrangements or temporary forbearance, check your reports often to make sure the reports are not reflecting any negative payment activity when they shouldn’t. Checking your credit report will not affect your credit.
You can obtain your weekly free reports through AnnualCreditReport.com, by calling 877-322-8228, or by mailing a request to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281.
Under the law, the credit reporting agency and the reporting entity must correct inaccurate information. If your credit report contains inaccuracies, fix any errors or mistakes by notifying both the credit reporting agencies directly as well as the information provider. The report contains contact info and instructions for addressing disputes.
The FTC provides detailed information about disputing errors on credit reports on its site and sample correspondence to use
The information contained in this column is provided for informational purposes only and should not be construed as legal advice.
By Gille Ann Rabbin, Esq., CIPP/US, CIPP/E