Thursday, January 22, 1998

If info is incorrect, keep changing the credit report

By Edmund Sanders / The Orange County Register

Q. I recently complained to Experian after learning that someone else's negative credit information had been reported on my report. It seems that this person has a similar Social Security number (one digit off). I'm getting the problem fixed, but I'm worried about it happening again. I was told that I can only have my credit report changed once a year. Is this true?

A. No. If you find legitimate mistakes on your credit report, you have the right to dispute the information and ask that the credit bureau remove it from your file, no matter how many times it occurs.

If this is a recurring problem, you probably want to get to the root of the issue. Call 888-EXPERIAN and have a representative investigate the problem. Perhaps the same lender or creditor is using the wrong Social Security number. You'll save time and countless frustration by tracking down the problem rather than waiting until it appears on your credit report.

The only time you may encounter restrictions on the number of times you can dispute information in your credit file is when you attempt to dispute the same item repeatedly, says Maxine Sweet at Experian.

For example, let's say you dispute a negative item in your credit file. Experian will investigate the problem and ask the creditor to verify that the information is correct. If the creditor fails to verify the information, it will be removed. But if the creditor still insists that the information is accurate, Experian may decide to leave the information in your file.

When this occurs, some consumers simply wait a few months and then dispute the same information again. Some people use this process to attempt to hide negative information from their files, even though the facts are accurate.

When Experian notices that a consumer is disputing a negative item that has already been investigated, it may decline to look into the problem again, Sweet said.

Q. My father-in-law owns a one-bedroom condo, but no longer lives in it. Five years ago, he and his daughter (not my wife) refinanced the loan with a five-year balloon. In October, the loan is due in the amount of $50,000. The property is no longer worth that much. He is 85 years old and will not borrow money again, so there is no need to worry about his credit rating. My concern is that the bank may have recourse to other assets (his savings account is with the same bank). Should I be worried?

A. Probably not. It's unlikely that the bank will sue your 85-year-old father-in-law for the shortfall on a $50,000 loan. The legal costs alone would probably cost more than the shortfall. But since the loan was refinanced, the lender technically probably has the legal right to sue. Whether it exercises that right will depend upon the lender.

You need not worry about your father-in-law's savings account. The bank has no right to attach or to seize it without a court judgment. I suppose if the bank noticed that your father-in-law had a lot of money in the account, that knowledge may factor into their decision about whether to sue.

Finally, remember that since your sister-in-law also signed on the loan, she too is liable for repayment. Again, it's unlikely that the lender would sue her for such a small amount, but her credit also will be damaged by a foreclosure.