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Mortgage rejection reveals credit error

Posted by Mitch Lipka  June 17, 2013 08:39 PM

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When Joanna Yang applied for a mortgage pre-approval she received a jolt. Two of the credit scores her lender ran were nearly 100 points lower than the first. The reason: A vet bill showed up as being in collection. It was a mistake that was supposed to have been cleared up a year earlier.

So, with the mortgage on hold, the Winchester woman tried to straighten out the mess as quickly as she could. "I was told that it will take 30 to 90 days for the change to be reflected on my credit report," she said. "And I won't be able to buy a house during these 30 to 90 days, while the market is moving so quickly."

She appropriately filed disputes with both credit reporting agencies that showed the bill in collection and had lengthy dealings with both the veterinary chain and the collection agency. Credit expert John Ulzheimer, president of consumer education for, said it's important to take these steps in the right order. File the disputes, and get the company that made the error to acknowledge it. The company then has to tell the collection agency.

After doing that, Yang got written confirmation from the vet acknowledging the mistake and from the collection agency saying the entry would be removed from her credit history. The Fair Credit Reporting Act says such mistakes should be cleared up immediately.

Yang was concerned the collection agency, I.C. System, was not moving very quickly. The company's president, John Erickson, said "due to confidentiality requirements and I.C. System’s own internal policies" he couldn't comment. He also declined to explain how such situations are supposed to work.

Ulzheimer said when an error is found it should take a day or two to make the correction.

Clifton O'Neal, spokesman for TransUnion – one of the credit reporting agencies that received the erroneous collection notice – acknowledged that once the determination is made that an item is in error it can be fixed that quickly. And, by the end of the day, TransUnion had updated Yang's credit report.

To avoid such urgency in correcting a mistake, O'Neal suggested: "It is always a good idea to check your credit report 30 to 60 days before making a big purchase, such as a house or car, to ensure there are no surprises on your credit report. It also gives you time to correct any issues you might find."

This blog is not written or edited by or the Boston Globe.
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About the author

Mitch Lipka is one of America's leading consumer journalists and advocates. He is an expert in product safety, recalls, scams, and helping consumers get out of jams. He is a nationally known consumer columnist and runs He lives in Worcester. You can find him on Facebook or reach him at


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