Having a positive credit report and its significance have been discussed extensively in every blog you read nowadays. An excellent credit report is like a bonus that you wouldn’t want to lose, and don’t forget the benefits and rewards that come along with it. But did you know that credit reports can occasionally indicate negative aspects for reasons you might not even be aware of? Well, errors in credit reports or credit scores happen frequently. Worse yet, if they go unreported or are not corrected in a timely manner by you, it has far-reaching effects. It may have a negative effect on your creditworthiness and prevent you from receiving perks like reduced loan interest rates, more flexible loan options, and others.
Common Errors in Your Credit Report
Your CIBIL report may contain one of two types of errors: it could be major or minor. A minor inaccuracy could be as straightforward as a name that is misspelt or a date of birth that is incorrect, etc. These issues are simpler to fix. The second kind of inaccuracy is the main issue, and it is as bad as a loan that was incorrectly credited. In all of these situations, the credit score will go down. Therefore, if you’ve asked for a loan or credit card, this is a really severe issue, and if you have detected this while doing credit monitoring, it is important for you to get it rectified as soon as possible. The first step to identifying errors involves knowing how to read CIBIL report. Afterwards, download a copy of your credit report and look for the following errors:
Inaccurate balance: It’s critical for you to verify that the credit balance listed in your credit report accurately corresponds to the total of any loans or credit cards still owed by you. Pay close attention to inaccuracies of this nature in your CIBIL report, as they could be overlooked easily.
Inaccurate personal data: The applicant’s name, gender, residence, or even contact information can occasionally be incorrect. You must carefully check the CIBIL report and while doing so, make sure that each entry printed is accurate. Make sure the PAN card number and/or Aadhaar card number are appropriately stated as well in your report.
Current balance not updated: The applicant’s outdated current balance is the most frequent mistake in a CIBIL report. For instance, there is always a lag between when you pay your loan and when your credit history is submitted to CIBIL. These flaws are, therefore, obvious, but when you are doing credit monitoring, you can always dispute this if it is not updated on time.
Incorrect overdue: The amount that you owe your loan or credit card provider is called the overdue amount. There may be inaccurate mentions of past-due loans that you never requested at all. You need to know how to read CIBIL report to be able to identify such inaccuracies. You must carefully examine the report to identify any such inaccurate overdue because they could negatively affect your CIBIL score.
Outstanding loans: To make sure the amounts are reported correctly, read the section describing the outstanding loans or the amount you owe. The loans’ details must be accurate. If not read properly, you can even end up on a list of loan defaulters if the amount changes.
Duplicate account: Many instances have been seen where multiple accounts are registered in one’s name. Since the transactions on those accounts could have an effect on your credit history even if you don’t actually own them, you should view this as a serious mistake. In general, check your CIBIL report for inaccurate dates, amounts, and parties to make sure that all the information is true and accurate.
The Steps You Should Take to Correct Error in Your Credit Report
First, get a copy of your credit report: Every customer has the right to ask credit reporting companies for a copy of their credit report once every 12 months. Obtain a copy of your credit report and familiarise yourself with the facts of your credit history.
Examine your credit record and verify the inaccuracies: Review your credit report and, if required, take the help of someone who has expertise in this and knows how to read CIBIL report. Recognise errors and gaps in the credit. Errors in personal information rarely lower your credit score; instead, they can serve as a warning sign for identity fraud or a reporting problem. In any case, be vigilant and watch out for the following mistakes:
Personal information: Your name, current and past addresses, your employer, and other personal information.
Public records: These include foreclosures, repossessions, and bankruptcies
Dispute the error in your credit report: After identifying the issue while you are credit monitoring, get in touch with the credit bureau where your report was obtained and ask for them to get rectified. You can even look up instructions and specifics on how to contact the bureau by phone, mail, or the internet at their websites. The credit bureaus begin their investigation as soon as they receive the letter of dispute from you. They communicated with the source of information, which made the disputed item report with the pertinent information. The provider then looks into the complaint and informs the credit reporting agency. If your claim is validated, the information provider is obligated to contact the four main credit bureaus so they can update the data in your credit reports.
Remain Alert: It is wise and strongly advised to know how to read CIBIL report and review it once a year. It helps you locate inconsistencies that can lower your score without you being aware.
Takeaway
Everyone aspires to have good credit, but doing so requires consistent credit monitoring and effort on your part. Maintaining a solid credit report and credit score depends on a variety of factors, including your ability to know how to read CIBIL report, pay your loan EMIs on time, and plan in advance to limit credit usage. All of your efforts, though, could be in vain if you don’t correct the errors on your credit report. Therefore, maintain a tight eye on your credit reports and immediately file a dispute if you come across any inaccurate information. As soon as you identify any of the aforementioned problems with the report, you must get to work fixing them. It is necessary to “submit a CIBIL dispute request” in order to formally request that an error be resolved.
