Credit score reset: 5 simple steps to spot and fix errors on your credit report
Your credit score is a three-digit number; it serves as a financial report card and generally ranges from 300 to 900. This is a number provided by leading credit bureaus across the country, such as CRIF High Mark, Experian, Equifax, and TransUnion CIBIL. Furthermore, any score of more than 750 is generally considered excellent, whereas scores in the range of 650 or lower are considered weak.
It is important to keep in mind that a credit score is a powerful metric that can easily influence how quickly you get a loan, the applicable interest rate, and even the terms offered by lending institutions. What many borrowers overlook is that managing this number and overall credit profile is indispensable and extremely important.
This is because even a minor inaccuracy in entries on a borrower’s credit reports can eventually end up pulling their credit score down. Therefore, the primary step towards a credit score reset is knowing how to spot, shortlist, and rectify such errors, and prevent them from turning into major financial events that can disrupt your overall credit profile. Regularly checking your credit report is a must to maintain a healthy credit score.
Ashish Lath, Founder & CEO, SaveSage, explained this aspect in detail, stating, “Most credit report errors are simple to catch if you check regularly. Look for accounts you don’t recognise, loans marked open after you’ve closed them, incorrect payment statuses, or duplicate entries. Raise a dispute directly with the credit bureau (CIBIL, Crif, Experian, etc), attach proof, and follow up. Bureaus must resolve genuine errors within 30 days.”
Nicky Sehwani, CBO, InstaMoney, on the other hand, discussed how such credit report errors can impact a borrower’s ability to secure meaningful credit in future, stating, “Credit report errors can quietly affect a borrower’s access to credit and the terms they receive. Consumers should regularly review their report for unfamiliar accounts, incorrect late payments, duplicate entries or outdated balances. Any discrepancy should be disputed promptly with supporting documents. More importantly, borrowers should track the correction rather than assume that raising a dispute automatically resolves the issue.”
Keeping these important factors in mind, let us look at several simple steps to spot and fix errors on your credit report:
5 steps to spot and fix errors in your credit report
1. Get your credit report and check it regularly
Don’t wait till you apply for fresh credit. Diligently review your report regularly and examine personal details, balances, credit accounts, payment history, and recent inquiries for anything that appears suspicious, incorrect, or unfamiliar. Vigilance is indispensable here.
2. Look for accounts you do not recognise
Check for any unfamiliar personal loan, home loan or any other credit line in your name. Such an entry can account for a serious reporting mistake. In some cases, it can also be a clear indication of fraudulent activity. If you find a loan account, missed payment, or default that you never made, do not wait; flag it immediately with your respective credit bureau and the concerned lending institution.
3. Verify your payment history
Be clear, even one late or missed payment reported incorrectly can hurt your credit profile. Match the payment history on your report with your bank records, loan statements and payment receipts to identify discrepancies.
4. Check for closed loans, balances and duplicate entries
A loan that you have fully repaid should not continue to appear as ‘active’, ‘settled’ or show an incorrect outstanding balance. It should be marked as closed. Also, check for duplicate accounts, as repeated reporting of the same debt can distort your credit profile.
5. Raise a dispute in case of errors and track the correction
Once you identify an error, write it down. Match corresponding facts, data and dates again. Then submit a dispute to the relevant credit bureau with clear supporting documents. Do not stop after raising the complaint; track its progress, ask legitimate questions with the concerned officials by reaching out to them and verify your updated report once the correction is made.
In summary, a credit score reset does not always require major financial changes. In reality, all it takes is rectifying basic information and the factual matrix. Consistent review of your credit report and following through on disputes can help ensure that your credit profile reflects your actual financial behaviour.
