Credit Disputes

I was speaking with Chad Kusner at Credit Repair Resources and he passed along the following information on one of the biggest hot button issues we see: credit report disputes. One of the biggest misconceptions of the credit dispute process is that consumers think that when they dispute an item on their report and human being actually reads the dispute and forwards the full inquiry to the creditor or debt collector. This is far from reality. Truth be told, the credit reporting agencies do everything they can to automate the process and have as little human interaction as possible.

The more a line item has to be touched, the more it costs the bureau to process. This is where two little know acronyms come into play: OCR and E-OSCAR.

OCR or Optical Character Recognition systems are used to read your dispute letters and turn everything you have written into a 2 or 3 digit code. This code is then input into E-OSCAR or the Online Solution for Complete and Accurate Reporting. E-oscar then sends that code to your creditor and or debt collectors. Once it is received, that entity has 30 days to respond to the inquiry. The response is sent electronically either verifying or deleting the disputed item. There is little or no verifying documentation sent to the bureaus. The bureaus in essence take their word that verifying information is on file. So the best way to handle a dispute is to work with the creditor directly or enroll the help of a reputable credit repair company that can force them to document the disputed issue.