You may know who you are, but can your creditors say the same? It doesn’t take an identity crisis to affect your finances. Millions of Americans deal with credit reporting errors—including mistaken identity—every year. Read on to learn how yours may be affected.
Mistaken identity stems from many causes, including:
1. Family names. Are you a Junior, a II or a III? Inheriting your mother or father’s name may be a nice tradition, but it can wreak havoc on your credit score:
Carlos Sr. died of cancer two years ago. When applying for a mortgage, Carlos Jr. was denied because his credit report showed several accounts in collection status. Carlos Jr. later discovered that some of his father’s accounts had remained open, gone into collections and had been mistakenly transferred to him.
What to do: Use your identifier whenever possible to discourage mistaken identity and ask your namesake to do the same. If your credit reports have already been affected, contact us immediately before more damage is done.
2. Collection errors. As we learned from Carlos Jr.’s plight, collection errors can damage even the best credit score. Whether it’s a wrong name, address or clerical problem, shouldering another person’s debt is not to be taken lightly.
What to do: Alert your credit repair lawyer, who will begin the repair process as soon as possible by demanding debt verification and asserting your innocence.
3. Inconsistent identification. Identifying yourself in different ways can cause confusion on your credit reports, affecting your identity and creditworthiness in the process:
Jane Riley recently married Mark Strauss. Although Jane initially decided to take her husband’s name, she changed her mind after some consideration. Unfortunately, Jane already applied for two credit cards and a home loan with her married name. Her credit accounts show varying identities, including Jane Riley, Jane S. Riley, Jane S. Strauss and Jane Riley-Strauss. It’s no surprise that Jane’s credit reports house inconsistent and incomplete information.
What to do: Pick a name and stick with it. If you’re recently married, contact your existing creditors and notify them of the change. Don’t lead your credit scores down an unfamiliar path.
4. Social Security Number mistakes. The wrong Social Security Number can lead to serious and long-term credit damage:
Claudia is a 24 year-old teacher from Maryland. She recently received a letter from the federal government notifying her of a wage garnishment. They claimed that she has an outstanding tax bill of $23,000 from 2009-2011, an impossible amount for a low-income teacher with a new career. Claudia contacts her credit repair lawyer for help. It’s later discovered that Claudia’s tax preparer transcribed the wrong SSN on her returns last year.
What to do: Take a lesson from Claudia and take action fast. A mistaken judgment or lien can affect your credit and your livelihood.
5. You’re dead. Don’t check your pulse just yet. If you have a common name, it’s possible to be mistaken for a recently deceased person in the same vicinity.
What to do: If your credit cards, bank accounts or credit reports are frozen, assert your existence immediately.