The credit bureau thinks I'm dead

My Equifax credit report says that I am deceased. Is there someone linked to my report? When filing a dispute there is nothing concrete on my report that is incorrect. I did not finish a dispute because all of my information is correct. I am at a standstill with this issue and would love advice. –Genna

Hi Genna –

Being mistakenly flagged as deceased on your credit report is a pretty distressing error to have to deal with, but a more common error than you might think.

In almost all cases, an erroneous death indicator originates with a real death. If you shared an account with someone (either as a joint holder or as an authorized user) and that person passed away, the account may have been flagged as belonging to someone who is now deceased. This is done to prevent potential fraud. Unfortunately, sometimes the tag is placed on the wrong account holder (or on both).

Being flagged as deceased on one account triggers the notification to potential lenders (again, to prevent fraud). If you’re flagged on a single creditor account, you’ll need to contact the creditor and have them update their reporting. They may require certain documentation to prove that you are in fact alive. If your entire credit file is tagged, however, the problem may have originated with documentation provided by the deceased’s estate or with the Social Security Administration. If that’s the case, you may need to provide a letter from Social Security in order to fix the problem.

The whole process is admittedly a bit of a hassle. Thankfully though, it’s just a clerical error and not a bad omen. Good luck!

I have three credit cards and I want to consolidate my debt. I'm thinking of doing debt settlement. Or should I do a debt consolidation? What is the difference and what will do less damage to my credit score? –Carla

Hi Carla –

I’ve written about consolidation and debt settlement before, so for more detail check out the following articles:

In your case, a debt consolidation would involve opening a new account (either a new credit card or a consolidation loan) and transferring your three credit card debts to this new account. It’s impossible to say what the exact impact on your credit score would be, and even whether the change would be positive or negative.

Part of your credit score is based on the age of your accounts, so it seems likely that your score would drop as the older accounts were closed and replaced by a brand new account. Long-term, however, the damage would probably be minimal, especially if you successfully managed and repaid your new account.

In a debt settlement, all three accounts would go unpaid until they reached the point where the company holding those debts (likely a collection agency by that point) was willing to accept less than the full debt amount as payment. Your credit score would be essentially ruined. The missed payments and settled accounts would negatively impact your score for years after the fact.

There may be circumstances where debt settlement works for you, but if you’re concerned about your credit and your ability to make major future purchases, consolidation may be a better option.

If you’re struggling to make the minimum payment on your credit accounts, consider speaking with a credit counselor. There may be an alternative solution that works better for your unique situation. Good luck!

I was laid off for over four years, during which time I was turned down for unemployment, had absolutely zero income aside from food stamps, and was entirely unable to make any payments on my student loan. I have been working now for over a year. I completely paid off my student loan a few months ago. My credit score is still low, and since then I read closing out a loan can actually be bad. I have absolutely no outstanding loans or debt at this point. I also have no credit cards. Someday I would like to buy a house. What is the best way to build a good credit rating in the meantime, so someday I can qualify for a lower-interest loan to buy a house? –Howard

Hi Howard –

Congratulations on turning things around and paying off your student loans. You’re definitely moving in the right direction.

The best way to build your credit history is by using credit wisely. Start by opening a credit card. I don’t know exactly what your credit rating looks like at the moment, but if your previous hardships make it difficult to get a card, trying applying for a secured credit card. After you’ve used your card responsibly for a year or so, your financial institution will usually convert the account into a regular credit card.

Use your card often and pay off your balances before they incur interest charges. If you find an offer for another card with attractive terms, consider opening a second account. If you find it’s time to buy a new car, start hunting for a loan. Simply use credit and pay it back as agreed upon. It takes time to build a history of positive credit usage. Just stay responsible and you’ll eventually have the credit score you deserve. Good luck!

Jesse Campbell is the Content Manager at MMI, focused on creating and delivering valuable educational materials that help families through everyday and extraordinary financial challenges.

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