What Causes Duplicate Tradelines?

As if bad credit wasn’t bad enough, some furnishers add even more trouble to credit score woes by reporting the bad credit twice to the same credit bureau.  When a furnisher double reports bad credit to the same CRA, it hits like a one two punch to the belly of a FICO score.  In a previous article, we discussed a similar problem in cases where collection agencies and factoring companies are mutually exclusive.  You can read about that in Removing Duplicate Collection Accounts.  Now let’s take a look at what causes duplicate tradelines to be generated by a single furnisher.  Would you believe me if I said the biggest offenders are collection agencies and student loans?

Section 6-11 of the 2005 Credit Reporting Resource Guide (Metro 2 Manual) states:

Question: What causes duplicate tradelines?

Answer:  Any change in Account Number, Identification Number, Portfolio Type and/or Date Opened may cause duplication if the consumer reporting agencies are not notified prior to the change.

National Consumer Law Center’s May 22, 2006 comments to the FTC:

Another example in the student loan context are status 88 cases, which have been referred to the Department of Education for payment of the insured balance on the loan.  If the claim is denied, the lender or servicer must delete the account and furnish afresh information about the debt, using the original date opened, status, and other attributes.  If the lender or servicer does not report this correctly, an error may result in the same student loan debt being reported twice.

The existence of the duplicate tradeline problem highlights the need for credit report vigilance to discover these errors beforehand.  Once identified, simply send a credit report dispute letter to the CRA to block the duplicate tradeline.  The end result will undoubtedly be a higher FICO score.