Severe Errors in Credit Report

Credit report or simply termed as your financial health certificate managed by credit bureaus contains all the money related transactions done by an individual in the past and deciding on whether he/she is credit worthy enough in the future. But despite of having a good credit score; sometimes severe errors in credit report due to negligence of either the credit bureau or it's members cause financial worries to the credit applicant resulting in his/her application getting rejected by the banks/insurance companies & others.

So what are these severe errors in credit report. To understand this, first have a look at what details does credit report contain. Here are few of the most important details:

1) Personal Details: Name, Date of Birth, Gender, Telephone Nos., Address, State, PIN

2) Account History: Account/Loan Type, Account Status, Sanctioned Amount

3) Payment History: Date of last payment, Date opened & closed,

4) Identity Details: Passport No., Income Tax ID, Voter ID No., PAN No.

5) Current Balance

6) Overdue Amount

7) Ownership Details

8) Asset Classification

Now the errors in credit report related to your personal details do not fall under the category of severe errors as they don't have much impact on your credit history. However if found, dispute should be filed.

But severe mistakes in credit report that can cause big trouble for you are:

1) Overdue amount is very high as compared than the actual loan taken

2) Loan amount is not yours but instead of some other person

3) Errors in date of payment, status of your loan account etc.

4) Date of loan closure

Effects of Credit Report Mistakes

All these errors can result in loan denial, higher costs for loan and insurance, and when not corrected can even result in the individual getting blacklisted by banking and financial institutions offering credit. In case of incorrect name, person might be denied house on rent, Therefore it is advised to every individual to at least check their credit report every six months and in case of any mistakes disputing the same.

The main reason for such errors is the non-verification of the data given to the bureaus by the lenders or while collating the same. And also the time lag i.e. data sent by the lenders has some time lag and final data updation in the data collation takes further time.