Metro 2, e-OSCAR, and the Credit Repair Dispute Process – Credit Countdown

Metro 2, e-OSCAR, and Credit Disputes - PinterestIn credit repair, the credit dispute process involves the use of two systems called Metro 2 and e-OSCAR. If you are unfamiliar with these terms, as is likely the case for most consumers, then keep reading this article. Credit expert John Ulzheimer takes us behind the scenes of the consumer dispute process and explains the importance of the Metro 2 and e-OSCAR systems in consumer credit disputes.

The Right to Dispute Information on Your Credit Reports

The Fair Credit Reporting Act (FCRA) is a federal statute that confers rights to consumers with regard to their personal credit reports. 

One of these rights you have under the FCRA is the right to challenge information on your credit report that you believe to be inaccurate.

Where Does the Information on Your Credit Reports Come From?

The information on your credit reports is provided by data furnishers, such as your lenders, to the three major credit reporting agencies (CRAs): Equifax, Experian, and TransUnion.

According to the Consumer Financial Protection Bureau (CFPB), there are approximately 16,000 of these data furnishers in the United States.

Here are some examples of data furnishers that may report information about your credit accounts to the credit bureaus every month:

Banks
Credit unions
Financial service providers
Mortgage lenders
Auto lenders
Student loan servicers
Debt collector

Disputing Information With the Credit Reporting Agencies (Indirect Dispute)

One way to dispute something on your credit report is to file a dispute with the CRAs. This method is called an indirect dispute because rather than taking your dispute directly to the furnisher itself, you are asking the credit bureau to investigate the claim on your behalf.

The credit bureau is then obligated to conduct a “reasonable investigation” into your dispute, which typically includes contacting the furnishing party and asking them if there is any validity to your credit dispute.

To understand how indirect disputes work, we first need to define Metro 2 and e-OSCAR. Then, we can take a look at each step in the procedure and see how Metro 2 and e-OSCAR play important roles in the dispute process.

What Is Metro 2?

Metro 2 is the “language” used by data furnishers to communicate information to the credit bureaus. It is the standard (and only) language used for this purpose. The previous version of this language, Metro 1, is outdated and is no longer used.

The Metro 2 language consists of alpha, numeric, and alphanumeric characters. These characters go into different fields on your credit report which indicate certain things.

Metro 2 is communicated through the Consumer Data Industry Associate (CDIA) using a manual called the Credit Reporting Resource Guide (CRRG).

When the data furnishers receive dispute forms from the credit bureaus, the information on those forms is encoded in the Metro 2 language.

What Is e-OSCAR?

e-OSCAR is a communication protocol analogous to a phone line between the credit bureaus and the companies that furnish data to them. It is used to transmit information such as dispute forms back and forth between the credit bureaus and data furnishers.

Like Metro 2, e-OSCAR is universal, meaning it is the only communication method used in the dispute process and therefore it is used by all three credit bureaus.

How the Indirect Dispute Process Works

You challenge information on your credit report by filing a dispute with a credit bureau.
The credit bureau assigns a dispute code to your claim, which is meant to indicate the nature of your dispute.
The credit bureau sends an automated consumer dispute verification form (ACDV) to the data furnisher using e-OSCAR.
The furnishing party logs into the e-OSCAR system to view the disputes.
The data furnisher looks at the dispute code on the ACDV indicating the reason for the dispute. For example, the consumer may have stated that the disputed information does not belong to them.
The data furnisher goes into their internal system to review the consumer’s account in order to verify or refute the disputed information.
The furnishing party then reports the results to the credit bureau by indicating this on the ACDV and sending the ACDV back to the credit bureau via e-OSCAR.
The credit bureau updates your account in their records to reflect the correct information and sends a copy of the report to the consumer.

You can read more about the forms used in the credit dispute process in another article.

Filing a Dispute is Free for Consumers

As a consumer, you do not have to pay to dispute information on your credit report or to have that information corrupted. The right to be able to dispute items for free is mandated by the FCRA.

This includes the updated credit report that the credit bureau sends to you once their investigation is complete.

Summary of Metro 2, e-OSCAR, and the Credit Repair Dispute Process

The FCRA gives you the right to dispute information on your credit report for free.
Data furnishers, e.g. lenders, report information about your accounts to the credit bureaus every month.
You can dispute something on your credit report by going to the CRAs, which is called an indirect dispute.
The CRAs and data furnishers communicate dispute information using forms and codes via the e-OSCAR platform and the Metro 2 language.
Once a credit bureau finishes their investigation into your dispute, they confirm or update the information on your credit report and send you a copy.

Want to see the video version of this article? Watch it below or visit our YouTube channel, where we drop new educational credit videos every weekday!

 

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Which Forms Are Used to Complete the Credit Dispute Process?

When you file a credit dispute, there are certain forms and processes that are used in order to resolve the dispute.

To help familiarize you with the credit dispute process, let’s go over:

What these forms are used for
When these forms are used
The information that is included on these forms

The specific forms that are required depend on which type of dispute you are filing.

Indirect Disputes

The credit bureaus get your credit data from the individual lenders or companies you have accounts with, also known as data furnishers. Some examples of these businesses include financial services companies, banks, credit unions, credit card issuers, and debt collectors.

When you file a credit dispute with the credit reporting agencies rather than contacting the business that is furnishing the disputed data, this is called an indirect dispute, since you are not going directly to the company that is providing the incorrect information.

Automated Consumer Dispute Verification Form (ACDV) or Consumer Dispute Verification Form (CDV)

Indirect disputes involve a form called the Automated Consumer Dispute Verification form (ACDV) or the Consumer Dispute Verification form (CDV). The ACDV is simply the modern digital version of the CDV, which refers to the analog format of the original document on paper.

When you initiate a dispute with a credit bureau, the credit bureau generates an ACDV that contains the information about your dispute.

The credit bureau then sends the completed ACDV form to the data furnisher using a communication system called e-OSCAR.

At this point, the lender furnishing the disputed data investigates the claim, updates the ACDV, and sends the form back to the credit bureau.

Finally, the credit bureau reviews the form, makes the appropriate changes to the consumer’s credit report, and notifies the consumer of the results of the dispute.

Direct Disputes

If you choose to dispute the inaccurate information on your credit report with the furnishing party, that is called a direct dispute, because you are going directly to the lender without involving the credit bureaus.

Automated Universal Dataform (AUD) or Universal Dataform (UDF)

When you make a direct dispute with the furnishing party, the data furnisher should correct the error and fill out an Automated Universal Dataform (AUD) reflecting the correction. The AUD is the automated digital version of the form, which was originally called the Universal Dataform (UDF).

Once the AUD has been prepared, the furnishing party sends it using e-OSCAR to all of the credit bureaus where the error is appearing on your credit report. The data furnisher is obligated to contact each credit bureau to ensure that the error has been removed from all three of your credit reports.

Watch the Credit Countdown video on this topic with credit expert John Ulzheimer below.

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