How do you dispute your credit report

Are you one of the nearly 50% of Canadians who have never reached out to one of Canada’s credit bureaus (Equifax and TransUnion) to request a copy of your credit score and credit report? Then now might be the perfect time to get more involved in monitoring the health of your credit file.

What is a credit report dispute?

Having inaccuracies on your credit report can have devastating financing consequences. You could be denied credit cards, loans and even mortgages, and also potentially lose out on an apartment or a job. You’ll also not be able to get favorable interest rates and be stuck with low credit limits on your credit cards. Worse yet, an error on your credit report could be the result of credit fraud or even identity theft.

Luckily, mistakes on your file don’t have to lead to financial fallout. In this article, we’ll go over the errors to look out for and the steps you can take to defectively dispute your credit report. Knowing how to fix mistakes on your credit file will empower you to fix any discrepancies and restore your financial reputation. By understanding the dispute process, you can have more control over your credit file and enjoy a brighter financial future.

What do I do if I spot incorrect information on my credit report?

If you notice mistakes (which can be anything from errors relating to your personal data to credit account inaccuracies) on your credit report, the first step is to initiate a dispute with the credit bureau that is reporting the inaccurate information. Note that you may have to file separate disputes with both TransUnion and Equifax if your credit report with both companies has the same errors. That’s because creditors may not send information about your accounts to both credit bureaus.

How to dispute an error on your credit report

It’s important to note that there are slightly different processes to report a dispute to each of Canada’s two credit bureaus, Equifax and TransUnion, which you can find on their individual websites. That being said, the overall steps to launch a dispute are very similar:

1. Carefully monitor your credit report: Make it a habit to regularly review your score and credit report. You can get a free copy of your report by contacting Equifax and TransUnion or by signing up for a Borrowell account and accessing your credit report and score. Borrowell gets your credit information from Equifax, one of the major credit bureaus in Canada, and provides you with regular updates and insights for free. Take time to review your report to find any issues such as incorrect personal information, credit accounts you don't recognize, or incorrect payment details.

2. Gather supporting documentation: Collect documents that support your credit dispute. This can include items like credit card statements, payment receipts, correspondence with any of your creditors, or any other relevant documents.

3. File a dispute: Contact the credit bureau that is showing the incorrect information on your report. (See below for more details.)

4. Contact your creditor: If the incorrect information is related to a specific creditor or lender, it's a good idea to reach out to them as well. Contact them via email or phone and explain the inaccuracies that you found on your report and provide any necessary supporting documentation that shows they are in error. If the creditor is willing to help and agrees that there is an error, they can reach out to the credit bureau on your behalf and get the error fixed much more quickly than if you have to go through the entire resolution process via the credit bureau.

5. Follow up and document all the steps you’re taking for the dispute: Keep a detailed record of all your communications, including dates, names, and reference numbers. Follow up with the credit bureau to ensure that the dispute process is progressing.

6. Credit bureau investigation: Once your dispute is received, the credit bureau will investigate the issue. In Canada, credit bureaus are legally required to contact your creditor and verify the accuracy of the information within a certain timeframe and at no cost to you.

What should I expect after filing a dispute?

Review the results: After the investigation, the credit bureau will provide you with a response via mail or email detailing their findings. If your dispute is successful, the error will be corrected or removed from your credit report. You should ask for an updated copy of your credit report reflecting the changes. Be aware that if you’re not satisfied with the results of the dispute, you have the option to include a consumer statement in your credit report that explains your side of the story.

Adding a consumer statement to your credit report is free. TransUnion allows a statement of up to 100 words (or 200 words in Saskatchewan), while Equifax lets you include a statement of up to 400 characters. It’s up to each lender whether or not to consider your consumer statement when deciding if they want to give you credit.

Continue to monitor your credit report: Stay on top of your credit reports to ensure that the corrections have been made and there are no more errors. You can get a free copy of your credit report from each of Canada’s major credit bureaus.

Remember, the dispute process may take several weeks so patience is needed. By diligently following these steps, you can rectify any incorrect information and protect your creditworthiness.

How do I submit a credit dispute?

As noted previously, each of Canada’s two credit bureaus has a slightly different process for filing a dispute resolution:

For TransUnion: You can initiate your dispute online, by mail, or by phone. Clearly state the information you’re disputing and provide supporting evidence. Lodging a dispute is free of charge. According to TransUnion, the investigation process for a dispute resolution may take up to 30 days.

For Equifax: You can dispute your credit report online or via the mail. Equifax will review your dispute and contact your creditor regarding the disputed information for verification. Electronic submissions take approximately 10-15 days, while mail submissions take around 15-20 days for processing. Equifax will send you a confirmation letter or email with the investigation results.

What documents do I need to submit a credit dispute?

The documents you’ll need to file a dispute may depend on whether you dispute your credit file with TransUnion or Equifax, as well as the nature of your dispute (i.e., are you disputing personal information versus a missed payment on a credit card, for example). Here are some of the documents you may need:

• Government-issued ID (like a driver's license or passport) to confirm your date of birth, personal info and address.

• Birth certificate.

• A document verifying your name and address, like a utility or phone bill.

• Bank statements.

• Letters from a creditor that support your dispute.

• Bankruptcy discharge or other court documents.

• Release letters from lenders, collection agencies, or satisfaction of judgment.

Be sure to consult the credit bureau’s official website to get precise instructions on what documents they need.

Will a dispute affect my credit score?

In most cases, disputing something on your credit report won't have a significant effect on your credit score. If the credit bureau agrees that there was incorrect information on your file and they then fix the error, your score could actually rise, depending on the nature of the inaccuracy. However, if the disputed information is actually correct (like you did have an account that went to collections or often made late payments on your credit card) it will have a negative impact on your score. How severely negative information affects your score and how long it stays on your credit file will depend on what caused the decrease (for example, a hard pull on your account will have much less affect than a bankruptcy).

If your dispute to a credit bureau is unsuccessful and your credit report is harming your creditworthiness, you may want to consider KOHO’s Credit Building tool as a way to give your score a boost. KOHO's Credit Building feature offers a collateral-free way to enhance your credit score. With a provided unsecured credit line of $225, KOHO takes care of making monthly payments on your behalf, and they then report these payments to the credit bureau, which in turn increases your score.