A short TV interview (Aug 2013) with Louis Barajas offering practical guidance on obtaining and correcting errors on consumer credit reports. He cites an FTC study finding ~21% of reports contain errors, directs viewers to annualcreditreport.com for free annual reports, explains the dispute process (online or by letter, firms must respond in ~30–45 days), notes you can attach a 100‑word explanation if disputes fail, and clarifies that checking reports or multiple pulls for loan shopping does not lower your score.
Chapters
Well, this week, an Oregon woman was awarded more than $18 million after suing one of our nation's major credit bureaus.
Yes, she claimed Equifax failed to fix major mistakes on her credit report. Joining us now is the author of the book My Street Money, luis Baragas, who is here to offer us some advice. We want to welcome you back. And, you know, first things first. Federal law says we can get that credit report. But how do you go about getting it and what do you do with the information?
Well, let me take a step back just so we can kind of take a look at. There was a Federal Trade Commission study that they did, and they took 1,000 people. They pulled out their three credit reports, and they found that 21. There were 21% errors on their credit reports. Now, of those, 5% actually could really create some critical damage on your personal credit. So what you just basically said is that we've got to do something about it. So the very first thing is you should really take a look at your credit report. You need to go to annualcreditreport.com and pull out your credit report. Now you can do it for free. Now, be careful of imposter websites. That's the most important thing. That there are other people who tell you that you're going to get a free credit report and they're going to charge you for it. This is by law. You must get it for free annually and you get all three of them. You can also go to credit.com and get actually a credit score by Experian, and that's also free. Okay, Just be careful when they try to upgrade you to pay some other stuff.
Exactly. And how often are these mistakes found? Is this something that's out of the ordinary or does it happen a lot?
Well, again, like going back to the study, you know, they said almost 21. They find on credit reports for a lot of people, 21% most of the time. You're going to find some problems. Now, the problems may not be on the actual credit. It might be on your misspelling of your name. It may be that they got the wrong employer. But even those things matter in your credit report. So you need to fix that.
And this is important because the woman who sued and won so far, it was just a mix up of names. She had the same name as another.
Person with and they were using the wrong Social Security number. But again, it affected her with her life. And so what you want to do is once you pull out the credit report, you want to take a Look at it and take a look at everything and see if there are any problems. Because if there are, you need to take care of them immediately.
But how do. I mean immediately. But how do you go about doing that?
How do you do that? So the next step is, what you want to do is once you find that there's an error, you're going to go Back to the annualcreditreport.com, take a look at which credit report had the problem. You're going to write them a letter. And actually now you can go online and dispute the error. So it will go much faster. You write them a letter and then by llama, send it to their creditor and say, hey, this person says that this is not correct on your credit report. They have to get back to you within 30 days to 45 days. If they don't, basically they have to remove it from your credit. It's like getting a ticket and the police officer not showing up to traffic port, and then they wipe it out. So that's one thing.
And Louis, you were saying for the public and those who are watching us now, don't be intimidated. Just go after it if you think you have to.
Right. A lot of people are intimidated because there are a lot of companies out there, businesses that say that we can fix your credit report for $300 or $500, and they try to make it intimidating. It's really not. They're not going to be able to do anything for you that you can't do yourself. So again, go to annual credit report, pull out the credit reports, review it, and if there's a problem, write them a letter and they'll get it cleared up. Now, if there's a problem and it doesn't get cleared up, you can actually attach an explanation to the credit report. You write it in, you can do it online, and as long as it's 100 words or less, kind of like a little Twitter on your credit report. And that also helps going forward.
And before we let you go, I once heard that if you get those credit reports, it can actually impact your credit. Is that true? Does it take points away?
No, absolutely not. And also what people do is when they actually go buy a car, you know, they'll take a look at different places and they'll pull their credit reports. If you do that within like a month or you're trying to refinance your house and look at different mortgage brokers, it won't affect your credit.
