Your credit report plays a critical role in many areas of your life—whether you’re applying for a loan, buying a home, or even landing a job. A mistake on your report can be a serious obstacle, so it’s important to check your credit report regularly and know how to correct any errors you find.
“You need to be proactive about checking your credit report on a regular basis just in case there are any problems that do come up,” advises Jeff Schwartz, executive director of Consolidated Credit Counseling Services of Canada. It’s far better to catch an error early than to discover it when you’re in urgent need of credit.
If you find an error, it’s up to you to correct it, explains Richard Moxley, spokesperson for eCredit Fix, an agency that helps consumers improve their credit scores. “It can be a tedious process, and it takes a lot of patience and initiative,” Moxley warns.
You should pull your credit report from both Equifax Canada and TransUnion Canada at least once a year. If you use credit frequently, Schwartz suggests quarterly checks.
Common Errors to Look Out For
When you review your credit reports, keep an eye out for these common mistakes:
- Personal Information Double-check that your full name, home address, date of birth, and phone number are correct. Errors here can occur due to a common name, but they might also signal fraud. Moxley notes that multiple versions of your credit report can exist, especially if you’re new to Canada or newly married. If you see addresses or phone numbers that don’t belong to you, it could mean your account is being confused with someone else’s or, worse, that you’re a victim of identity theft. Make sure your Social Insurance Number (SIN) is accurate as well—a single digit mistake can cause major issues.
- Accounts and Payment History Verify that every credit card, line of credit, and loan you’ve opened is listed on your report, and check that your payment history is accurately reflected. If you’ve been making payments on time, your report should show that. However, sometimes creditors fail to update payments, which can hurt your credit score. Incorrect balances, duplicate accounts, and misreported statuses are also common issues, says Schwartz. Moxley adds that car financing accounts are particularly prone to errors—often showing as unpaid even when the debt has been cleared.
- Resolved Accounts The public records section of your credit report, which includes accounts that went into collections, bankruptcies, and judgments, is often riddled with errors, according to Moxley. He states that people with these incidents in their financial history are most vulnerable to mistakes. “Ninety-nine percent have errors on their report, and they stay on longer,” he says. This happens because even after an account is resolved, creditors may be slow to update the information unless you follow up.
- Signs of Identity Theft or Fraud Be alert for any credit inquiries you didn’t authorize or credit accounts and loans you didn’t open. These are red flags that could indicate identity theft or fraud.
How to Correct an Error
If you discover an error on your report, contact the creditor handling your account immediately. Simple mistakes, like a name or address change, can often be resolved with a verification of your ID and a recent piece of mail. However, for accounts that aren’t yours or unauthorized credit inquiries, you might need to work with the creditor’s fraud department, which will investigate the issue.
For disputes over a paid debt, gather evidence such as receipts, credit card statements showing the balance was cleared, police reports if you were a fraud victim, and any other relevant documentation. If the creditor agrees with you, get their agreement in writing. They should inform the credit bureaus, but you should confirm that they have done so.
With all your evidence in hand, fill out the necessary forms, such as Equifax’s credit report update form, which asks for your account details and the reason for the investigation. Write a concise dispute letter, attach your supporting documents, and send the package to both credit bureaus by registered mail. Be sure to keep copies for your records.
“You need to be meticulous every step of the way,” Schwartz advises. “Hang on to correspondence from your creditor and your credit bureau for future reference.”
Equifax will log the dispute in its tracking system and contact the creditor. Once the creditor verifies the information, you’ll receive a confirmation letter and the file will be updated. According to Tom Carroll, an Equifax spokesperson, if the dispute isn’t completed within 30 days due to the need for additional information, Equifax will notify you that the investigation is ongoing. However, such delays are rare.
By law, both Equifax and TransUnion must respond to your error request within 30 days.
Steps if You’re Still Unsatisfied
If you’re not happy with the outcome or if you need to share your credit report while waiting for a correction, you can add a consumer statement to your report. Moxley advises, “Don’t be aggressive, but state that you’ve disputed this, it’s erroneous, and you have documentation to prove it.” Most agencies allow you to include about 400 words to explain your position. If you’ve already received confirmation from your creditor that the error is on their end, this documentation can support your claim when applying for loans or housing.
Finally, if the issue remains unresolved, you can contact a lawyer or file a complaint with your province’s consumer affairs department. Agencies like Service Alberta, Consumer Protection BC, and others are equipped to handle disputes between creditors and consumers.
By staying vigilant and addressing errors promptly, you can protect your credit score and ensure it accurately reflects your financial history.
