It’s becoming more common unfortunately but identity theft and fraud is a big business. It seems every week there’s a story somewhere about a company’s website getting hacked and stealing thousands upon thousands of private customer data including social security numbers, addresses andavoid credit theft everything needed to open up credit in someone else’s name.

And while credit bureaus are constantly on the attack for making mistakes on someone’s credit report or not alerting someone when a stranger is trying to open up a new account the fact that is that credit reporting agencies only report the information that’s given to them.

Businesses subscribe to these bureaus and report the payment patterns of their customers while also receiving credit histories of potential borrowers. If the business reports bad information, it’s not the bureaus’ responsibility to check for accuracy. The bureaus report and let you decide if the information is real or not. That’s why credit protection services have blossomed over the years to alert consumers when something fishy’s going on with an account.

Say that you’re applying for your construction loan to build that new rental property. You’ve taken care of your credit and have no reason to believe there’s an issue. Yet the bank calls and your loan officer explains that they can’t approve your application due to an outstanding collection account. An account that you know nothing about.

When this happens, the bank will provide an adverse action report stating why the application was denied. The credit report will list the lender and contact information for the offending company. You will need to document your side of the story and if it’s an issue of stolen identity there are steps you can take to have the bad information removed. But at this stage, you’re losing time as your construction loan is being held up do the bad information. Making periodic checks on your credit report will make sure your credit report is clean when you need it to be. You may or may not pay for the service as it’s easy enough to do, but keeping a wary eye on your credit profile is the prudent move.