A Credit Report is a comprehensive report of a person’s credit history. The report contains personal details such as name, contact number, date of birth, and social security number; and credit account details like payment history, account opening and closing date, lender’s name, and types of credit accounts hold. Every consumer is entitled to receive a free copy of the report from credit rating bureaus, which include CIBIL, Experian, Mark High, and Equifax. The agencies have been established and licensed by the Reserve Bank of India. CIBIL is the first agency to be licensed by the Indian central bank.
Banks, Non-Banking Finance Companies (NBFCs), and licensed lenders in the Indian banking system are required to submit the financial details of their customers to the rating agencies that generate reports. A wealthy report shall be fairly rated. One aspect that should be noted is that the parameters used by the credit bureaus to assess the credibility of an individual are most common. But, the relevance placed on each parameter may vary. This will cause a minute variation in Credit Scores.
How frequently can a credit report be checked? It is the most common question asked by many. Once a year seems feasible. A free copy of reports can be gotten by each agency. It is necessary to review reports to ensure the validity and correctness of your financial data. The wrong information can impact your credit rating. The further section of this article gives you a few useful tips with respect to errors in reports.
Errors in Credit Reports
Reports may contain errors sometimes. The most common errors include incorrect personal information like name, contact number, email address, mailing address, family details; outdated information, incorrect account details, wrong notations for closed accounts, and more than one delinquent date on an account. Errors can be of two types: major and minor. Inaccurate account and credit details can be considered major. Errors in personal information can be considered minor. Major errors are more likely to have adverse effects on credit scores. These errors should be reported.
How to get your Reports right?
Step 1: Each Credit Rating agency has an online dispute form that can be obtained from the website. You just have to fill it and report to the concerned agency.
Step 2: The agency shall verify the error report and send it to the respective bankers, NBFCs or licensed lenders for additional investigation.
Step 3: Banks shall cross check the error report and share an audited report with the concerned agency. If there are no errors, the agency shall contact you with a revised report.
Step 4: If there are errors, banks shall correct internally and share revised details to the concerned agency.
Step 5: Finally, the credit bureau will send you an updated report.
Why should Credit Reports be Reviewed Periodically?
- To Safeguard against identity theft
- To Ensure the completeness and accuracy of details
- To Track the progress