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What is a credit Report?
Credit reports are supplied by credit bureaus, which are companies that compile information about your credit history and sell it to businesses that use your credit report to assess you as a credit risk: automobile and mortgage lenders, banks and credit unions, credit card companies, department stores, insurance companies,.etc.
Credit bureaus get most of their data from the creditors. Other public records such as court records for lawsuits, liens, judgments, and bankruptcy filings are also included in the report..
Credit reports also include noncredit data such as maiden or other names, past and present addresses, Social Security number, employment history, marriages, and divorces. Credit data includes the names of your creditors, type and number of each account, when each account was opened, your payment history, your credit limit or the original amount of a loan, and your current balance. The report will show if an account has been turned over to a collection agency or is in dispute.
Know what information is contained in your credit report! Some of the biggest reasons that many suffer credit maladies are the lack of knowledge or sense of apathy concerning their own credit file. We see this literally almost every day. Don't take it for granted that all of your positve credit information has been reported. Statistics have shown that over 60% of all credit reports contain some form of wrong information. Learn how to read your report and decipher the information that is supplied there. For example, check your name, social security number, date of birth, and address for accuracy. Look at the accounts and compare them with what you know to be your true credit history experience. Are there collections that you have paid that are showing unpaid. Are there any other debts that have been satisfied that are showing open? Has there been an account, (i.e. your mortgage) that should report to the bureau that is not on your report. If so, then these situations must be disputed, and/or corrected as soon as possible. (See included forms.) Just simply wishing a bad credit issue away will not work. Only application of your rights as a consumer, and retraining your thinking about credit will cause a positive effect.
Take the time to identify problem areas on your credit report and make a plan for improvement. If you’ve had a hard time paying your bills on time, sign up for an automated payment service, or consult a non-profit service such as Consumer Credit Counseling Service If your debt levels are above 50% of your available limit, you must create a payment plan to help reduce your balances. Set goals for improving your credit and be sure to celebrate when you reach a milestone.t in the future of your credit file.
Find out if there is expired information on your credit report. The Fair Credit Reporting Act allows only a specific period of time for a derogatory incident to be reported on your file. After that period of time it should be no longer reported, or can be removed at your request to the credit bureau. Here is a guide for those specific periods of time:
Bankruptcy = 10 yrs. - no matter what the chapter (7,11,12 and 13).
Charged-off accounts = 7yrs.
Collection accounts = 7yrs.
Judgments = 7yrs.
Late Payments = 7yrs.
Tax Liens = can report up to 15yrs if unpaid
How can I get a copy of my credit report?
There are three major credit bureaus: Equifax, Trans Union, and Experian. It's best to order your report from all three. The federal Fair Credit Reporting Act (FCRA) entitles you to a copy of your credit report, and you can get one for free if:
you've been denied credit because of information in your credit report and you request a copy within 60 days of being denied credit
you're unemployed and looking for work
you receive public assistance, or
you believe your file contains errors due to fraud.
In addition, you can get one free copy each year if you live in Colorado, Georgia, Maryland, Massachusetts, New Jersey, or Vermont.
The law says that if you don't qualify for a free report, you should pay a fair amount (not more than approx $20) this amount usually goes up at the beginning of each year)
To learn more you can go to the following websites to obtain information on your personal credit report:
www.myfico.com
Equifax P.O. Box 740241, Atlanta, GA 30374, 800-685-1111, www.equifax.com
Trans Union P.O. Box 1000, Chester, PA 19022, 800-888-4213, www.tuc.com
Experian P.O. Box 2002, Allen, TX 75013, 888-397-3742, www.experian.com
Inquiries
Inquiries, Inquiries, Inquiries, Inquiries, Inquiries...........................!!!!!
What about inquiries? Won't they hurt my credit report?
WARNING! Every time someone requests, or pulls the information on your credit report it is called an inquiry. Inquiries can remain on your credit report for up to 2 years, after which they are required to be removed. Excessive inquiries will hurt your credit file by lowering your credit score, however occasional inquiries will not damage your report. There are two types of inquiries that can appear on your credit report;
a. Hard Inquiries - are made by creditors or lenders and can stay on your report for up to 2 years. They can cause a slight decrease in your credit score if there are too many in too short of a time period.
b. Soft Inquiries - are made by businesses such as a potential employer, also can remain on report for up to 2 years but, won't effect your creedit score at all.
Regardless of the type of inquiry, it is best to be prudent when having your credit pulled. If you are shopping for a loan, ask sales person or loan officer what your credit score is and record it so that you can tell the next salesperson or loan officer if you are shopping for the same item. (i.e. home loan, or car loan) This can save unnecessary inquiries from being added to your report.
The bottom line concerning your credit report is to be proactive! Don't continue to be passive concerning your report. Cultivate the information that is reported in your credit file. After all it is this information that could mean hundreds, or thousands, of dollars paid in extra interest every year because of a faulty report. Be sure to browse through and use the links provided below.
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YOU AND YOUR CREDIT REPORT
