You do your research. You rifle through tons of credit card offers until you find just the right one; the one that meets your financial needs and preferences. Maybe it even offers that neat little option of designing the card and you spent valuable time picking the perfect photo. Then you spend time either online or with pen and paper and fill out all the little details. Finally, you send it off or submit it online and wait… only to see that dreaded or unexpected: “Denied.”

Sometimes the creditors who report to the credit bureaus make a mistake. The credit bureaus themselves make mistakes. Examples of mistakes include:

• Reporting a payment as late when there was no late payment.
• Including creditor and payment information from another person’s file in your profile.
• Showing a paid off account, such as a mortgage, still outstanding by hundreds or thousands of dollars.
• Showing an account discharged in bankruptcy as still owing.

A report from a consumer protection group called the United States Public Interest Research Group reports that nearly 80% of credit reports have some type of mistake, and 25% contain a serious mistake that could result in an unnecessary denial of credit.

Therefore, when you receive the letter in the mail that the credit company is required to send and it sounds vague or even questionable in some other way there are actions you can take. If you know your credit is okay (and you should know if it is or not) and the denial is vague; such as “The credit denial is based on information received from the credit bureau or other sources …” then you have the right to challenge the denial and make it right. You will want to write, yes, put-it-in-writing, a letter to the company denying credit to request explanation of denial.

The letter should read something like this:

Please be advised that, pursuant to Section 615(b) of the Federal Fair Credit Reporting Act, I am entitled to request, and I hereby do so, a full disclosure of the factual information disclosed to you by persons other than Consumer Reporting Agencies, so that I may refute, challenge or dispute its accuracy.

Please take further notice that you are required to render such notification to me within a reasonable period. The Federal Trade Commission has defined such reasonable time as 30 days after you receive this request. Please send the information to the address stated below.

Be sure to include all of your personal information such as full name, social security number, date of birth, current address, previous address, etc. Not providing all of the necessary personal information will only cause another letter, requesting more information and taking more time. Also, send the letter by certified mail requiring a signature, so you have proof you mailed it.

In that reasonable amount of time, you should receive a reply and can begin to narrow down the culprit. The reply letter should contain all the information you need including details of their decision. If you find that the decision was based on inaccurate information, the next step is to contact the credit bureau or company from whom the information was obtained. The contact information of that bureau or company should be contained in the reply. If not, it should not be too hard to find.

Once again, write to the bureau or company involved that you want them to conduct an investigation of inaccurate information.

For example:

I am requesting that the following inaccurate items be immediately investigated. Please delete this misleading information in order to show my true credit history. By the provisions of 15 USC section 1681i of the Fair Credit Reporting Act of 1970, I demand that the following items be re-verified and deleted from my record.

Make a complete list of all information necessary information including company name(s), address, account numbers, etc. Be aware that pursuant the Fair Credit Reporting Act there should be no charge for this notification. Additionally, ask them to provide you with the name, address and telephone numbers of each credit grantor or other subscribers that they contacted for follow up.

If all of this seems like a lot of work, that is because it is. However, there is no avoiding it if you have inaccurate information on your credit report and it is well worth the effort to make it right. Never fear, by this time, you should be almost at the end of your journey. You should receive a letter from the credit bureau with one of two replies. Either they found the information to be inaccurate and have adjusted your credit report to reflect the correction or were unable to prove the information or they believe the information to be accurate. If so, you can make a second request to review and start the process again.

Hopefully, everything was found in your favor and you’re good to go to reapply for that credit card of which you already have the perfect photo picked out!

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