A credit score is a crucial piece of statistic. Loan approvals depend on them. But, is your credit score always accurate? Can errors creep into the credit history report thereby projecting an incorrect picture of our credentials? Yes, it is possible.
There are four credit bureaus in India, namely Equifax, Experian, CRIF High Mark, and CIBIL. The Reserve Bank of India has stated that individuals can approach any of the four credit bureaus and receive one credit report free once a year.
Banks stipulate that you need a credit score in the range of 700 and above to be Eligible for a Personal Loan or a Credit Card. Banks may reject your loan application stating due to a poor credit score. You cannot fault banks because they go by what the credit report indicates. If there is an error on your credit report, it is your responsibility to rectify it. You should follow the steps mentioned below as soon as you get your copy of the credit report from the bureau.
Check your credit report for inaccuracies
The credit report consists of five sections.
- Personal Information
- Contact Information
- Employment Information
- Account Information
- Inquiry Information
Errors can creep in at any point. The typical mistakes that affect your credit score are as follows.
- Non-updating of current balance–It is a standard The credit report might not have accounted for the latest balance. They procure their information directly from the lenders.
- Inaccuracy in the current balance – It can happen that you might have closed the loan account. However, the lending institution might not have reported the matter to the credit bureau. Hence, the report can show an open position thereby affecting your credit scores.
- Amounts overdue – The customer should ensure that there are no overdue amounts in the credit report. It indicates that the customer has been irregular in repaying the loans.
- Error in personal details – The personal information includes your name, address, date of birth, PAN, and so on. There can be errors in these areas as well.
- Ownership of accounts – The credit report presents the complete list of all accounts owned by the customer. The customer must check the genuineness of these accounts.
- Duplication of accounts – It is a standard The customer should check for duplication of accounts. Such errors present a completely incorrect picture of the credentials of the customer.
Effect of such errors on your credit score
- If there are errors in personal details, credit bureaucould report accounts that you never own. Hence, it becomes crucial for you to rectify such mistakes
- Duplication of accounts can result in the inflation of your liability thereby affecting your total outstanding balance.
- Not updating closed accounts can also result in a similar situation.
Rectification of errors in the credit report
CIBIL or any credit bureau cannot unilaterally change any financial information on your credit report. In case the reports have errors in personal details, you can provide the correct information for CIBIL to update their records.
How do you deal with financial errors?
- You have to raise a dispute with CIBIL. The dispute form is available online at the official website of CIBIL.
- You need to furnish the control number for raising a dispute. You can find the control number at the right-hand top corner of your CIBIL report. It is a 9-digit unique number. It enables CIBIL to identify the credit report about which the customer has raised the dispute.
- On receipt of the dispute, CIBIL verifies the details with the respective banks. Customers get regular email notifications about the status of the dispute.
- On resolution, the customers can apply fora new CIBIL report.
- In case the inaccuracies persist, the customers can raise a dispute again.
- CIBIL has a time frame of 30 days to resolve any dispute. It depends on the time taken by the credit institution to respond to the queries from CIBIL.
- Customers can also directly take up the matter by writing to CIBIL.
Remember, a CIBIL report is a document wherein factual errors are possible. It is not necessary that the report presents the actual picture. Thus, it is the customer’s responsibility to verify and dispute the inaccuracies as soon as they detect the same.
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