There is no denying that errors can and do appear in credit reports. The July 2000 issue of Consumer Reports cited a study where more than 50% of the credit reports checked contained errors.

There are two main reasons errors may appear on your credit report. One is when you have been mistaken for another person with a similar name and their information ends up in your file. The other more serious cause of error is fraud. Someone may have intentionally gained access to your personal information and obtained credit in your name. Instances of identity theft are increasing. See PRC Fact Sheet No. 17, "Coping with Identity Theft" www.privacyrights.org/FS/fs17-it.htm and Fact Sheet 17a, "Identity Theft: What to Do if It Happens to You" www.privacyrights.org/FS/fs17a.htm.

Both state and federal laws provide you with the right to have errors corrected. Credit bureaus are regulated under the California Consumer Credit Reporting Agencies Act (California Civil Code section 1785 et seq.), the laws of other states, and the federal Fair Credit Reporting Act (15 USC 1681 et seq.). For information on the law in your state, contact your state�s consumer protection bureau or office of the Attorney General. National credit bureaus must have a toll-free number so you can contact them with your questions. Also, credit reports must provide an address to request an investigation of inaccurate information.

Once you have notified a CRA of your dispute, both federal and California law allow 30 business days for an investigation. The bureau must consider all the relevant evidence you give it, and errors must be corrected. If the CRA cannot verify negative information, it must be deleted from your file. You are entitled to receive a free copy of your corrected report. You may ask the credit bureau to send a corrected report to anyone who has requested your file in the past six months, as well as to anyone who has requested it in the last two years in relation to employment.

If you disagree with the result of the CRA�s investigation, you have the right to submit a 100-word explanation. The credit bureau must include the explanation in your file although the negative information will not be removed.

Some consumers who have had errors corrected find the incorrect information reappears in their files at a later date. Both federal and California laws require credit bureaus to notify the consumer within five days of reinserting information. Negative information cannot be reinserted into your file unless the credit bureau takes the added step of having the source of the information certify that it is complete and accurate. Credit bureaus must provide the subject of the report with a toll-free number to dispute the reinsertion and the opportunity to include a dispute statement. However, even if you have had errors in your report corrected, it is wise to periodically check your credit report to make sure the errors do not reappear.

These questions and answers are provided for IowaMotors.com users' general information. Although we make every effort to insure accuracy in the information provided, we cannot make any guarantees as to this accuracy. We urge you to consult your lawyer, accountant or tax advisor for specific legal or tax advice.