Credit bureaus generate your credit score based on information that is contained in your credit file. The data in the file can sometimes be corrupted or can include information about another consumer that is by mistake. Credit mistakes are more common than you may initially think.
Specifically speaking this is about mixed credit files which happens when information about another person is put into someone else’s report.
This won’t be your fault so you needn’t worry about being to blame for this mistake being made; however, if you notice it, it is best to report the issue immediately to avoid any further mistakes that could impact your credit score.
Many things can cause a mixed credit file such as having a common name or maybe it has been mixed with someone in your family.
They can sometimes look like identity theft so if this is the case you should sort the issue out as soon as possible because things like identity theft can often result in a long process. If these issues apply to you and you fail to resolve them it can impact negatively on your credit score and you will end up with higher interest rates when you next apply for a loan or a credit card.
Two Names In One File
A mixed file will occur when the information put in your credit report contains a different person than you. Obviously because everyone has a different social security number it is hard to believe that these types of errors can occur.
But they do. These are in fact not just common errors but the type of error that happens the most. The whole idea of a credit report is so that a creditor can find a single report that will show information on a specific person.
It is required by law that bureaus provide the most accurate report that it can so if you notice this issue they will try to rectify it if you can in fact prove that it is a mistake. The report should show the entire credit history of a person and the person that it is intended for only.
The issue with a mixed file with regards to the consumer is that a credit berries computers are not able to tell the difference between consumers. This is because they are programmed to be very inclusive. This will tend to lead to the wrong data for the consumer.
Meaning it will contain information about other people. Instead of the expected 1 to 1 relationship. Like mentioned creditors don’t want to make this mistake and once notified about it they will be sure to fix the error as they are required to by law so you won’t have anything to worry about once you have notified your creditor.
Again like stated prior you should do this as soon as possible to avoid incurring higher interest rates or maybe even being rejected for a loan because something has damaged your credit rating.
Common Names Lead To Mixed Files
Credit bureaus will mix files when they find multiple sources of identification that can match with another person. Mainly being that you have the same name as someone.
This will lead to the files becoming mixed and can have negative effects on you and your credit score if once you become aware of the issue you do not resolve it with your creditors. If you live closely to the person who has been mistakenly added to your credit file this can also be an impacting factor.
If the name of a person is also part of a small ethnic community with many other people who also have that name the issue will appear more frequently so if that issue can apply to you, you should enquire for your annual credit statement and file the error with you creditor so the issue can be fixed immediately or as soon as possible once the correct information has been provided and verified by the creditor.
Like mentioned this is simply because of the way that credit bureaus computers identify people and the lack of ability to separate the correct information when they find multiple points of similarity.
Family Members Can Mix As Well
If you are part of a large family this is also something that you can expect to happen. This will happen because bureaus will also look at last known addresses.
If some of your family live with you as well as having the same last name as you it can correlate through their computers and make a similar mistake leading to a mixed credit report.
As this is mixed with your family member it should be a much easier issue to resolve once you realise the mistake as long as the people it includes can provide the correct information to differentiate you to your creditors.
Mixed credit files are an extremely common problem and at first this may sound like an issue that isn’t directly to do with you because after all it’s not really your fault, however it will be left for you to notify your creditors of the issue.
Things that can lead to a mixed credit report are, having a common name, family members or if someone has your address as their last known address.
As soon as you are aware of the issue it’s best to deal with it as it can have negative results for you, it can impact your credit score and credit ratio if the other person’s spending habits aren’t healthy and they are consistently missing payments.
If you are part of an ethnic community where your address may be the same as someone else’s whilst also having the same name you should definitely enquire for your annual credit report to make sure that this issue hasn’t occurred.
If it has then you again will need to report the issue to your creditors to get the issue fixed as soon as possible.