Why did my credit score drop after raising a dispute?

Raising a dispute with a credit bureau involves challenging any information on your credit report that you think is inaccurate. If the challenge is valid, your credit score improves. On the other hand, if the dispute is proved incorrect, your score may decrease.

Raising a dispute itself does not cause your credit score to drop or increase. When you raise a dispute, a code “XB” is placed on the item to indicate it is “in dispute.” So, if your credit scores are calculated during the investigation, the item will be treated differently.

The FICO® scoring model does not count the item while calculating your score. This is why you may see an increase in your credit score when you raise a dispute if it is something that significantly affects your score.

Now, the reason you may see a dip after the dispute is if the information in the report is accurate. Until the dispute was being investigated, the disputed item would not be included while calculating your score. However, once the dispute proves incorrect, your score can go down again.