When you check your credit report, the last thing you want to see is incorrect information. Unfortunately, errors in student loan credit reporting are more common than most borrowers realize. One significant issue that has caused headaches for consumers is the appearance of duplicate balances—when the same loan shows up multiple times, inflating your total debt.
These errors not only impact your financial health but can also cause undue stress and frustration. Understanding the most common credit reporting mistakes and knowing your rights can help you take the right steps to protect yourself.
What Are Duplicate Balances?
Duplicate balances occur when the same student loan is reported multiple times on your credit report. This often happens due to the following:
- Loan Servicer Changes: When your loan is transferred from one servicer to another, the same loan may appear twice under different names.
- Reporting Errors: Credit bureaus or loan servicers may incorrectly update information, leading to duplicate entries.
- Consolidation Issues: If you’ve consolidated your loans, the original loans and the new consolidated loan may both show up, creating the appearance of double the debt.
Duplicate balances can significantly inflate your reported debt-to-income ratio, making it harder to qualify for new credit, like a mortgage or car loan.
Top 3 Most Common Errors in Student Loan Credit Reporting
In addition to duplicate balances, student loan borrowers frequently encounter these credit reporting errors:
- Incorrect Payment Status: Loans may be incorrectly reported as delinquent or in default, even if you’ve been making payments on time.
- Misreported Loan Amounts: The balance or original loan amount may be overstated, making it seem like you owe more than you actually do.
- Closed Loans Still Showing as Open: Paid-off loans or those that were closed during consolidation may still appear as active, artificially inflating your debt.
These inaccuracies can lower your credit score, affect your eligibility for new loans, and create long-term financial challenges.
Your Rights Under Federal Law
If you discover errors on your credit report, it’s essential to know that you have rights under the Fair Credit Reporting Act (FCRA):
- The Right to Dispute Errors: You have the right to dispute inaccurate or incomplete information on your credit report. Both the credit reporting agency and the company providing the information (e.g., your loan servicer) are required to investigate your claim.
- The Right to Accurate Information: Credit bureaus are legally required to maintain accurate and up-to-date records. If they fail to do so, they must correct the errors upon receiving notice.
- The Right to Take Legal Action: If errors are not corrected after you’ve filed a dispute, or if the mistakes cause you harm—such as a denied loan or damaged credit score—you may be able to sue the responsible parties for damages.
How to Dispute Errors on Your Credit Report
Follow these steps to dispute credit report errors:
- Review Your Credit Reports: Obtain free copies of your credit reports from the three major bureaus (Experian, Equifax, and TransUnion) through AnnualCreditReport.com.
- Identify the Errors: Highlight any duplicate balances, incorrect payment statuses, or other inaccuracies.
- Submit a Dispute: File a dispute with the credit bureau(s) reporting the error. Include documentation, such as loan statements or payment records, to support your claim.
- Follow Up: Monitor your credit report to ensure the errors are corrected. If the issue isn’t resolved, consult a consumer protection attorney.
How a Consumer Law Firm Can Help
When credit report errors persist, a consumer law firm can step in to protect your rights. Experienced attorneys can:
- Hold Loan Servicers and Credit Bureaus Accountable: They’ll demand that your records be corrected and pursue compensation if the errors caused financial harm.
- Represent You in Legal Action: If necessary, they can file a lawsuit against negligent companies.
- Guide You Through Complex Cases: Errors related to student loans can be particularly tricky, but attorneys specializing in credit reporting issues have the expertise to handle them effectively.
Don’t Let Errors Damage Your Financial Future
Errors like duplicate balances on your credit report can feel overwhelming, but you don’t have to deal with this alone. If you’ve spotted inaccuracies in your student loan reporting, act quickly to dispute the errors and protect your credit.
At Francis Mailman Soumilas, P.C., we specialize in helping consumers fight back against credit report errors and hold companies accountable for their mistakes. Contact us today for a free consultation and take the first step toward resolving your credit reporting issues.