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What To Check When You Review Your Credit Report

admin — Wed, 17 Feb 2010 18:43:10 +0000

You hear it all the time. You need to request your credit report on a regular basis to make sure that everything is correct. But what exactly are you looking for? If you have your credit report staring you in the face then what do you need to look for? You have gone to all the trouble to order your credit report. Now you need to know what to do next.

What You Will See On Your Credit Report

You will see an assortment of information on your credit report. It will begin with some of your basic personal information. This will include your last three addresses. You will also be looking at a full list of any businesses that have run credit checks on you as well as a comprehensive list of all your credit accounts. Your credit report is a general overview of your credit history. Now you need to know exactly what to check section by section.

Basic Personal Information

You just want to make sure that the names and addresses listed on your account are correct and up-to-date. Mistakes in this information could indicate that a simple error has been made or that someone is using your credit accounts for themselves. Just make sure all the information is accurate and current.

Credit Account Information

The information for each of your credit accounts will be listed here. You will need to review the balance for each account, when the account was opened, and the credit limit. If you had any late payments then the details will be listed. If you see any late payments that were, in actuality, not late then you will need to follow up on them.

If you see any suspicious activity in any of your accounts then go back and see if the activity really is fraudulent. If it is then you will need to take action immediately. You never know when someone could be taking advantage of your credit accounts for their own financial gain. Checking your credit report is one way to get wise to the situation.

Credit Inquiries

This section, clearly, lists all the inquiries made regarding your credit. It gives you a chance to see who received your name and credit information. This section will show you a record of all the times that you applied for new credit or when your credit was checked by others such as potential employers or insurance companies.

A Basic Overview Of What To Check

In short, you will just be going section by section and scrutinizing all the details to make sure that they are correct. It is not a difficult process usually. It just takes some time. Doing so can help you to rectify any genuine clerical errors that were made on your credit report or any fraudulent activity that is revealed on this report. Your credit report is just a tool for you to make sure that all your credit information is listed accurately and so that various businesses and agencies can determine if you are a suitable candidate for credit or other opportunities.

Your credit report is in a constant state of flux because new credit information is always finding its way back to credit bureaus. One small mistake or faulty bit of information can have dramatic consequences. This is why you always need to know what your credit rating is and that it has been calculated with accurate information.

What Credit Is And What It Means

admin — Tue, 28 Jul 2009 14:54:41 +0000

Your credit is your financial lifeline in this world. It tells the tale of how you have managed your money in the past, and financial institutions use it to foretell how you will handle your money in the future.

It can affect your ability to buy a car, a house, and what kind of mortgage rates you get. Your credit has a major impact on your life so the more you understand about it the better.

What Makes Up Your Credit Score?

A credit bureau collects information about your financial history. This information comes from your payment habits with banks, finance companies, credit unions, and retailers. It is basically made up of your credit history.

This includes information such as when you opened each account, the credit limit or amount of the loan, your current balance, and your monthly payment. This report also includes all of the more negative aspects of your credit history which could include bankruptcies, payments that were late, and liens. This information is collected into a comprehensive report that is then accessible to both creditors and lenders.

What Your Credit Score Means To You

Everyone knows that having good credit is important. There are many times in life when your credit score will affect what you are able to do financially. If you do have a good credit rating then lenders will look upon you more favorably.

Because you have a history of paying off your debts and doing so on time, you are seen as someone who is not a risky investment. Lenders want people who are going to pay back loans so a good credit score means that you would most likely fall into this category.

Your credit score can directly affect your mortgage rates. A higher credit score will mean that you will get lower mortgage rates and lower payments while a lower credit score means that you will be paying more for higher mortgage rates. If your score is extremely low then you may even be denied credit.

Is A Low Credit Score The End Of The World?

Low credit is not the end of the world, but you want to do everything you can to keep your credit score as high as you can. You will end up paying more if you let your score get low. There are special loans for those with extremely low credit, but this is not the most desirable route. You want to keep your credit score high.

To maintain your credit score, you need to know what it is. This is why it is imperative that you check your credit score on a regular basis. By checking your credit report even once a year, you can be aware of what your credit is and you can check for any mistakes on your credit report. You never know when some sort of error could occur on your credit report, and you do not want to find out about it when you are applying for a home loan. Regular checks avoid uncomfortable situations.

Knowing what credit is and what that means for you helps you to understand the importance of maintaining good credit. It also helps you to understand just how you can maintain that good credit and how important it is that you check up on your credit score. Low credit is not the end of the world, but good credit helps guarantee smooth sailing.

Actions That Wreck Your Credit Score

admin — Sat, 25 Jul 2009 14:56:07 +0000

Sometimes it is easier to know what not to do than to know what you should do. Often you know what you should do to keep your credit score high or to improve it, but do you know which actions are sure to ruin your credit score fast?

These actions may even seem like good ideas at the time, but your credit will suffer for them. Here is a list of actions that you should not take.

Close Your Accounts

Closing credit card accounts is a good thing, right? You do not want extra credit cards lying around when you do not need them. Your goal is to pay them off and then close off the accounts.

There is a problem with this way of thinking. Your credit score is based on your amount of available credit. When you close down your credit card account then you just removed a portion of your available credit and lowered your credit score.

Your credit is partially measured as the amount of credit you have as compared to your amount of debt. When you close that account your debt is the same but your amount of available credit just dropped. It may seem like a smart move, but you just lowered your score.

Just In Case Credit Cards

Some people also think it is a good idea to have credit cards in case of emergency. They only use these cards if absolutely necessary because it is better to not use it if you do not need it. After all, you do not want to spend money you don’t have. That is how debt grows.

Credit companies may close down accounts that have been inactive for extended periods of time. The account may even still be open, but if it has not been utilized for a long enough period of time then the company can stop reporting it as part of your credit. That means that it no longer is added in as a part of your available credit and your ratio of debt to available credit can take a sudden dive.

One possible solution is to use the card regularly or even periodically in some small way. As long as you keep using the card and then paying off the balance then it will have a positive impact on your credit. You want to use it enough that the account stays open and the credit from that account is still counted toward your available credit.

Having High Balances

Having one high balance on one credit card can be worse for you than carrying lower balances on several different credit cards. The problem is that you are carrying a balance that is close to your credit limit. Strangely enough, this can even come across negatively if you pay off these high balances on a monthly basis. Lenders see the regularly high balances and see that you constantly have a high balance as compared to your credit limit. This does not give the best impression.

There are many ways to destroy your credit score. Three that you may not have known about are closing credit card accounts, having credit cards you do not use, and having high balances on your credit cards. Now that you know how these situations impact your credit, you can avoid them or at least consider the repercussions before you undertake any of these actions.

Federal Credit Bureau?

admin — Thu, 12 Jun 2008 13:40:37 +0000

So many people have the mistaken idea that the major credit bureaus in the United States are under the total control of the Federal government. This belief is so widespread that many people think that there is a Federal credit bureau! The companies that send Americans a free credit report once a year are not owned by the government. They get no kind of government funding. The only thing that the government does is make laws that state some things that the Federal credit bureaus can and can not do.

This law is called the Fair Credit Reporting Act. This law states that the three main credit reporting companies, Trans Union, Expedia, and Experian, must be accurate in their record keeping and recording of the personal credit information of America’s consumers. The credit reporting companies must also by law protect the privacy of consumers and their information.

The Fair Credit Reporting Act states that a consumer must be notified in writing if any of the information in their credit file has been used against them, such as when you are turned down for any type of insurance or a job because of bad credit. Normally, you will get a letter in the mail when this happens, and the credit bureau that was used will be listed at the bottom so that you may contact them if you feel the need.

The Fair Credit Reporting Act gives you the legal right to dispute anything that is in your credit report that you do not think is correct. All three credit bureaus have a thirty day period in which to investigate your file. If they cannot verify any of the information that you claim is incorrect with the company who issued the credit to you, or find that you are correct and the information is wrong, they have to delete the information from your file.

The Fair Credit Reporting Act also states that if you are turned down for a job, credit, or any kind of insurance, you have 60 days from the date you were refused to request a copy of your credit report so you can check things out for yourself. You will receive a letter about this as well, and it will tell you which credit reporting company was used.

If you are turned down for credit or insurance because of inaccurate information in your credit report, once it has been corrected, you have the right to request that the credit bureau send a corrected copy to anyone who requested a copy in the last 6 months. If you were turned down for a job anytime within the last two years, you can request that the companies you applied to be sent a copy as well.

Recent additions:

Credit Reporting Agencies – The Basics

admin — Wed, 11 Jun 2008 05:37:15 +0000

There are three credit reporting agencies that have the authority to gather information about your credit history, and to share this information with other businesses that have a legitimate reason for wanting to see it.

These three agencies are –

You may not like the idea of these agencies having such personal information about you and giving it out to others, but this is necessary in order for you to get credit. Many consumers mistakenly believe that credit reporting agencies are affiliated with the government, but the only thing that the government has to do with these agencies is to control their actions.

The three credit reporting agencies are basically set up as a business to make money while they are also keeping track of the credit records of millions of people.

Credit reporting agencies get their information about your credit history from your creditors, of course. They can also get information from public records and other sources that have proven to provide reliable information.

Some people make the mistake of getting their credit report from just one of these agencies, thinking that all three keep the same information. However, these are three separate agencies, all competing for business. They all work in much the same way, collecting information from the companies who grant credit to individuals or to businesses. But, they do not all get the exact same information. Each of the three gathers from many different businesses, banks and credit card companies, but not necessarily the same one.

Here is how this works.

The three credit reporting agencies go to all of these different companies and try to talk them into joining their individual lists. Some join all three, and some do not. The ones that do can use the records of the credit reporting agency to check the report of anyone who wants to take out credit or receive services that they offer. Potential employers, insurance agents and landlords also view your credit report. Therefore, if you want to get an accurate look at your credit report, you will need to request a copy of it from each of these three agencies.

You are allowed to get one free copy of your credit report from each of the three credit reporting companies once per year. That adds up to 3 per year, enough to let you get a good idea of how your credit looks.

How To Read A Credit Report

admin — Tue, 27 May 2008 13:12:59 +0000

A credit report is an important piece of information that is used to determine eligibility for jobs to the amount of a consumers annual percentage rate. Being so important, it is certainly surprising to discover that the average consumer does not know the basics of how to read a credit report. Given that everyone will have their credit report pulled at least once in their life it is vital that consumers understand what can be found on the report and how it can affect them and their financial future.

Every twelve months consumers are able to receive a free credit report. While this information can be looked at whenever necessary consumers can only receive the report for free once every year. It is advised that consumers take advantage of this opportunity so they can, at least, determine that all information on the report is accurate and correct. Experts advise that consumers get a credit report from all three of the major credit bureaus which are Experian, TransUnion, and Equifax as each agency may have different credit information on the report. This is quite natural and is to be expected actually as the information offered is voluntarily provided by the credit companies.

When looking at the credit report, consumers will notice that it is divided into four sections. These four sections contain different information concerning the consumer and their payment and credit history.

The first part of the Credit Report is the Identifying Information. This section will contain the consumer’s general information such as name, address past and current, and telephone numbers. Consumers may also find names of employers and the consumer’s driving license located in this section. It is important for consumers to read this section over carefully and make sure all information is accurate. There may be some discrepancies such as a misspelling of the consumer’s name or a wrong telephone number, such mistakes are fine and to be expected even yet consumers will want to call the agency and report the mistake.

The Credit History portion of the report will contain the bulk of the information and is where consumers need to really focus. This section may be lengthy or short depending upon the consumer’s habits. This is the part that potential lenders, employers, and others that require a credit report will look at to determine if the consumer represents a high risk or is eligible for whatever benefit or job they are applying for.

The Credit History section will have the name of the creditor along with the account number. It is possible that the consumer will have multiple account numbers from one creditor. Other information will include the date the account was opened, the kind of credit, along with the total amount of the loan, and how much is still owned on the loans. Consumers should read over this section of the Credit Report several times to ensure that all information represented is accurate.

Below the Credit History section will be the Public Records which should ideally be blank. In the Public Records sections consumers will see any financial data such as tax liens and bankruptcies. If there is a mistake in this section, consumers should immediately contact the collection agency listed and inquire about the mistake. It could simply belong to someone with a similar social security number or name or can be a sign of identity theft.

The last section of the Credit Report simply lists the names of the companies who have requested to see the consumer’s report and information.

As you can clearly see, it is important to understand and check Credit Reports on a regular basis.

Recent additions:

Non-profit Cooperates With Credit Card Bureau to Help Small Business Owners Build Credit

admin — Sun, 25 May 2008 07:14:48 +0000

Experian, one of America’s three major credit reporting agencies, has declared that it will work together with the Credit Builders’ Alliance (CBA) to help lower-income individuals – especially lower-income entrepreneurs – work on building their credit history. This will help the lower-income small business owners borrow microloans from community organizations to qualify for bigger loans from mainstream financial institutions.

What are microloans? They are loans of much smaller-than-average sums of money to individuals who lack even the minimal resources to qualify for traditional loans, have already demonstrated their utility to lower-income individuals. Many microloan borrowers have used microloans from community lending organization to build wealth and escape from poverty.

Now, microloans promise to become more effective than ever before. CBA – a non-profit organization dedicated to collecting loan payment data from lenders servicing lower-income communities – intends to share borrowers’ microloan repayment histories with Experian. Already, over 3,000 microloans made by United States financiers, including Community Development Financial Institutions (CDFIs), have been collected in Experian’s databases.

Vikki Frank, the executive director of the non-profit Credit Builder’s Alliance is optimistic about this turn of events. Frank stated earlier today, “This partnership… is a great opportunity for micro-lenders to provide information to the credit bureaus and give small business owners a fair opportunity to build stronger credit profiles and…. access the formal banking system.”

Experian is the first of America’s credit bureaus to take this independent step towards helping lower-income individuals run their own businesses, obtain wealth, and participate more fully in the economy. Zaydoon H. Munier, the senior vice president of Marketing, Product and Data development for the Experian Group, said that Experian is “very pleased” with the decision that has been made.

Community lenders are also pleased. Emily Talley, senior director of community affairs at Capital One, reported that Capital one is “proud to support this initiative.”

Recent additions:

A Beginner’s Guide to Credit Scores

admin — Sun, 25 May 2008 06:10:48 +0000

Do you know what your credit score is? You probably do, because that little three digit number is almost as important as your Social Security number when it comes to getting things like a job, a home, a car, insurance, or a credit card. This number can change, depending on the state of your credit. If your credit is AAA, you will have the highest possible credit score. If your credit is not so good, then you will have a pretty low credit score. A score of 760 or above is considered excellent, while a score below 620 will tell anyone who checks that you are a bad credit risk.

Why is your credit score so important? If you want to take out a loan or get a credit card, your chances are a lot higher if your credit score is on the high side. If your credit score is low, it will be difficult, though not impossible to get credit. You will just have to pay more than most people for the things you want in the form of high interest rates tacked onto loans. About the only type of credit card you can get with a low credit score is a secured credit card, where you have placed money in an account to secure your credit. If you want a card with a $1000 limit, then you must put $1000 in the bank.

A high credit score means that your payments on your credit cards, car, mortgage, insurance, and even your cell phone will be lower. With a high credit score, you don’t have to worry about paying a deposit for utilities like electricity, gas, water, telephones and the like. You also don’t have to worry about not being approved to rent that apartment or home with a good credit score. Landlords will check your credit score before renting to you to insure that you are conscientious enough to pay your rent on time. They figure that if you pay your bills late, your rent will be late, too.

More and more employers are performing credit checks on each applicant they get for a job, especially in the retail sector where you will be handling money. You will know that your credit is going to be checked when you apply for the job, as you will have to sign a form that gives your consent before the employer can proceed. Many a person who was well qualified for the job and thought they had it “in the bag” has been dismayed to find out that bad credit kept them from being hired.

It’s a good idea to check your credit report once a year in order to keep on top of your credit score. Most people have a pretty good idea of their credit standing and also how much money they owe to creditors, but your credit report will list everything that has been done in your name, and could help you to deter identity theft. There could also be other mistakes on your report that need to be corrected.

You can get a free copy of your credit report once per year from each of the three credit reporting companies.

Contacting The Credit Bureaus

admin — Tue, 20 May 2008 10:00:24 +0000

The law states that you have a right to see your credit file at times other than the once a year free credit report that you can request from the three major credit bureaus. If any of the following circumstances apply to you, you can contact TransUnion, Experian, or Equifax at any time.

Did you apply for credit, but you were denied because of something that is in your credit file? This happens more than you think, but if you are sure that there should be nothing in your credit file that would keep a company from granting you credit, contact the credit bureau listed at the bottom of the letter you will receive.

Did you fill out a job application, go to an interview, and leave with a good feeling, sure that you were going to get the job? Then you wait anxiously for the phone call, telling you when to report for your first day. Instead, you get a letter from the company you applied to, telling you that you were not suitable for the job. At the bottom of the letter is some information which you follow up on, only to find out you were denied the job because of your credit report! Get in touch with the credit bureaus and see what the problem is!

Were you denied home, auto, or renter’s insurance because of something that appears in your credit file? You will more than likely get a letter informing you of this, and at the bottom there will be a paragraph that will tell you which credit bureau was contacted. Be sure to follow up with the credit bureau and do what you need to do in order to correct this information so that you can get your insurance!

Are you out of work? Will you be searching for a job anytime within the next 60 days? If so, you can request a copy of your credit report so that you can see what is listed there. This will prepare you for your job search. If your credit is lackluster, you may want to limit your search to those employers who do not check the credit records of potential employees.

Are you on welfare? Or, were you denied the opportunity to rent a home or apartment because of something listed on your credit report? Check with the credit bureau to see what is going on with your credit report.

Are there any errors in your credit file that you already know are there because of fraud or identity theft? If so, you have a right to request a copy of your credit report whenever you need to check and see if any of the erroneous information has been removed from your account.

Checking your credit report for any of these reasons is free. Do it today!