Your credit score might be misleading.
The Federal Trade Commission in a new survey released Monday found that one in five consumers had at least one error on their credit report from one of the three leading reporting services, and 5 percent of consumers — one in 20 — could end up paying more for mortgages and auto loans because of these mistakes.
“These are eye-opening numbers for American consumers,” Howard Shelanski, director of the bureau of economics at the FTC, said in a statement. “The results of this first-of-its-kind study make it clear that consumers should check their credit reports regularly. If they don’t, they are potentially putting their pocketbooks at risk.”
The study, which was commissioned by Congress, found that one in five consumers had to dispute their credit score to get an error corrected.
One in 20 consumers saw their credit scores change by more than 25 points after the error was corrected.
The FTC recommended that consumers use AnnualCreditReport.com to check their scores for free.
“Your credit report has information about your finances and your bill-paying history, so it’s important to make sure it’s accurate,” Charles Harwood, acting director of the bureau of consumers protection at the FTC, said in a statement. “The good news for consumers is that …if you find an error, you can work with the credit reporting company to fix it.”
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Tim Devaney is a national reporter who covers business and international trade for The Washington Times. Previously, he worked for the Detroit News, Grand Rapids Press, Portland Press Herald and Bangor Daily News. Tim can be reached at firstname.lastname@example.org.
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