FTC: 25% of Consumers Have Errors in Credit Reports

Nearly 20 percent of credit reports reviewed by consumers and experts contain errors, according to a congressionally mandated ""study"":http://www.ftc.gov/os/2013/02/130211factareport.pdf by the ""Federal Trade Commission"":http://ftc.gov/ (FTC).

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The study, based on the findings of 1,001 participants reviewing 2,968 credit reports issued from Transunion, Experian, and Equifax, showed that approximately 25 percent of consumers identified errors that might affect their credit scores. About 5 percent found errors large enough to trigger higher payments for mortgages or other financial products.

""These are eye-opening numbers for American consumers,"" said Howard Shelanski, director of the FTC's Bureau of Economics. ""The results of this first-of-its-kind study make it clear that consumers should check their credit reports regularly. If they don't, they are potentially putting their pocketbooks at risk.""

Among other findings: Nearly 20 percent of consumers had an error that was corrected by a credit reporting agency (CRA) after it was disputed, and 80 percent of consumers who filed disputes experienced some modification to their credit report. Slightly more than 10 percent saw a change in their credit score after the CRAs modified errors.

Out of those who saw their scores change, about 5 percent had a maximum score change of more than 25 points, FTC reports, and one in 250 consumers (about 0.4 percent) had a maximum score change of more than 100 points.

""Your credit report has information about your finances and your bill-paying history, so it's important to make sure it's accurate,"" said Charles Harwood, acting director of the FTC's Bureau of Consumer Protection. ""The good news for consumers is that credit reports are free through ""AnnualCreditReport.com"":https://www.annualcreditreport.com/cra/index.jsp, and if you find an error, you can work with the credit reporting company to fix it.""