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Recovering From Identity Theft: Repairing Your Credit Reports

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Finding out your identity has been stolen is tough. You’ll face anger and shame that the crime even happened to you. But worse than that will be the frustrations you encounter as you’re trying to clean up the mess.

Since identity theft tends to start as a financial crime in most cases, the most important part of clearing up the damage is fixing credit report errors or unauthorized charges and accounts opened in your name. The key to cleaning up your credit report is to move quickly and be patient. The faster you catch and dispute errors, the easier it will be to clean them up. Just understand that even when errors are caught early, disputing a credit report entry will take time.

Fixing Your Credit Report

If you’ve noticed errors in your credit report, the best thing to do is make a complete list of the errors. Look at your personal information as well as your credit information. It’s estimated that about 75 percent of consumer credit reports contain at least one error, and it’s like that a majority of those contain multiple errors.

Once you’ve made a list of errors, follow these steps for each error on your report. Errors should be reported separately; one at a time until they are all fixed. Reporting multiple errors at once or submitting multiple disputes could result in the CRA missing or discounting your disputed items. It could also be cause for the CRA to decide that you’re being frivolous and denying your request of dispute.

  1. Write a letter of dispute. It’s tempting to use a form letter from the Internet rather than writing your own, but don’t do it. Instead, create a personalized, professional letter for each incorrect credit report entry and each CRA you’ll be sending the letter to. Briefly, describe your dispute in the letter.
    Don’t bother with an explanation of why you’re disputing an entry. The CRA will ignore the explanation in favor of its own investigation. Instead, include a copy of your credit report (don’t include the original), with the error highlighted and any supporting documentation that you might have. In the case of identity theft, you need to include a copy of the police report you filed, as well as any other documents that support your position that the entry is an error.
  2. Send the letter by certified mail. Certified mail will give you a tracking number and when you’re trying to clean up the mess after identity theft, you need to track everything. Send copies of documents, but keep the originals. Track phone calls, and paper and electronic correspondence. Keep notes about the dates and content of conversations. And keep everything together in one place so you know where it’s at.
  3. Contact other financial institutions. As soon as you’ve begun the process of disputing incorrect credit report entries, contact the affected financial institutions, in writing, to apprise them of the situation. A letter similar to the one you send to the CRAs, including copies police reports and other documentation is best.

Prepare to be patient as you work through these steps for each mistake or error on your credit report. It's going to be a time consuming process. And just because you dispute a credit entry doesn't mean that the credit reporting agency will find in your favor. Sometimes, you might have to be firm to get someone at the credit reporting agency to listen.

If you know, before you start the process, that it's going to be long and difficult, you'll be better prepared to handle the frustration that you face. Just don't let it discourage you, and realize that you're the victim, not the criminal, in this case. And as a victim, you have some rights.

Keep Records of Everything

One more thing. Keep records of everything. Keep copies of all the documents you collect as you work through the process of discovering and repairing the damage that has been done. Keep copies of all of the police reports that you file, and all of the letters that you send out to credit reporting agencies, credit card companies, banks, medical institutions, or anyone else.

It's also smart to keep a record of the people that you talk to, with notes about the conversation. A spiral bound notebook works best for keeping a call log. Divide each page into columns for the date, the name of the company, the name of the person you spoke with, contact information for that person (as well as any identifying information like extensions or employee numbers), and a column for notes.

Make an entry, by date, for every person that you talk to, and be sure to make notes about the conversation, either while it's happening or immediately after you finish it.

Collect all of this information in a single place, where you can get your hands on it if you need to. A large three-ring binder works well for keeping all of your documents in a single place. You can place folders or dividers inside the document if you want to separate everything by company, but it doesn't really matter how you organize it, so long as it's a useful resource for you as you're trying to put the pieces back into the right places as you clean up after identity theft.

Identity theft is a crime that affects much more than what's immediately obvious. Yes, there will be financial damage, and possibly even damage to your reputation, but there will also be emotional damage. Don't get discouraged. It might take a lot of time and effort to clean up the mess left behind by identity thieves, but eventually, you can do it. It just takes consistent, thoughtful effort. And lots of patience.

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