YOUR CREDIT REPORT
Marks on your credit report can cost you, it can cause you to not be able to buy
a car, home or even not get that dream job you want and deserve. Poor credit can
even cause you to be turned down when trying to rent an apartment.
The good news is that it is never too late to become credit worthy. Rebuilding
and monitoring your credit can happen, but it will not happen overnight.
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Things you should do to build your credit
Find out what the top three credit bureaus (Equifax, TransUnion and Experian) are saying about you. Remember that information on file with all three companies will most likely to be different.
Credit reporting is voluntary, and creditors are not required to report to all three bureaus. Most large national lenders do, however, smaller lenders will most times report only to the one that they subscribe for pulling reports.
Credit reports should be reviewed at least twice a year for accuracy.
If you've been denied credit, insurance or employment because of your credit report, you are entitled to a free copy of your report from the reporting agency the lender/insurance company used. The company you applied to must supply the credit bureau's name, address and telephone number. You have 60 days after receiving the denial notice to request your copy.
Examine your reports carefully
Nearly one-third of credit reports contain serious errors that could cause consumers to be denied access to mortgages, car loans and credit cards. That's because credit bureaus don't verify the information they receive from your creditors. Like it or not, keeping your credit report clean and true is your job. Once you get your three reports, look carefully for everything from typing errors to outdated and incomplete information. Make a thorough list of items you dispute and why.
If the negative information in your report is true, only time and improved habits can change that for the better. Late payments and charged-off accounts remain on your report for seven years, bankruptcies for 10 years. Most creditors, however, look for a steady pattern of payments rather than focusing on one-time or rare occurrences, so consistent on-time bill payments will improve those blemishes.
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add stability to your credit file
You can also work to add positive information to your credit file. You may have been denied credit because of an insufficient credit file, even though you do have credit. That's because some creditors (local banks, credit unions, and travel, entertainment and gasoline card companies) may not report your credit history to the bureaus. Try asking the credit grantors to report your account information and monthly payment history to a credit-reporting agency. This is not a requirement and you will not be able to force them to do so. In the future, before opening a new account, ask if your on-time payments will be reported monthly to all three credit-reporting agencies. If the answer is “no” then think about using another lender who will. If you have really bad credit or even filed for bankruptcy, don't let your credit status go dormant. The faster you jump back in and begin to re-establish good credit by paying regularly on time, the faster you'll improve your credit scores. A secured credit card offers those with no credit and those rebuilding their credit an opportunity to start over and establish a new and solid credit history. Shop around for the best deal available, but limit your applications. Credit scoring models look at how many new accounts you've opened, as well as the number of "inquiries" for those new accounts. A sudden flurry of inquiries can result in a lower score.
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dispute and document
Since a bad report can cost you money, it pays to be thorough. You can either complete the dispute form provided with your credit report or write a letter. Clearly identify each mistake and state why it's wrong. One recommendation is to send a photocopy of your credit report with the mistakes circled to the reporting credit bureau with copies of your supporting documents.
Keep copies and records of all the forms, letters and documentation that you send the credit bureaus, plus dates sent. In short, document, document, document. The credit bureau must investigate any relevant dispute within 30 days of receiving your letter. Any item that is not verified as accurate by a creditor is removed. If the credit bureau makes any changes to your credit file, it will send you the results along with a free, updated copy of your credit report. Once a negative item is removed from your report, the credit bureau cannot put it back on unless a creditor verifies its accuracy and completeness after the fact -- and sends you written notice.
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© 2008 YourCreditWorth.com
