Posted by: irene | December 1, 2009

How to get and then tidy up your credit report.

The first thing you get to do in checking your own credit is to order a report from the top three credit bureaus.  You need to request reports from all three because every business does not use the same bureau.  You are entitled to one free report a year from each of them.  Ordering this way will not have a negative impact on your credit.  Why check at all?  It is your money they are messing with, when that credit report results in a poor FICO score, your interest rates go up, way up and your borrowing power goes down and it costs you money. Also, with the increase in identity theft it is important to know what your report looks like.

Equifax:  PO Box 740241,Atlanta, GA 30374-0241     www.equifax.com

Experian, PO Box 2104 Allen, TX  75013-0949 www.experian.com

Trans Union Corp, 760 W. Sproul Rd, Springfield, PA 19064-0390  www.tuc.com

When they arrive read them carefully, there will be an explanation of the codes used.  Look for everything: typing errors, misspelling of your name, outdated information and account histories  which are incomplete or incorrect. You may find cards you have not used in years listed there, or mortgages and loans you paid off!   It is your job to make certain that your credit report is accurate.  Your creditors’ job is to report what they have done and the bureau’s only job is to make that report available.  If the information was not presented correctly the bureau will not know it until you tell them!   So get ready to tidy things up.  If you see gross errors like cards you never use that show big balances and suspect an identity theft, you will have to bring in the big guns immediately.  The place to start is the Federal Trade Commission: www.consumer.gov/idtheft

If the negative information on the report is true, and you did it all on your own, then only time and effort on your part or professional assistance can change it.  Late payments will remain on your report for 7 years, bankruptcies for 10.

Be very clear, specific and brief when you identify each mistake and state why it is wrong.  Short and to the point is good.   Copy the part of the report you are questioning and include it with any other documentation that will help correct the error.  You may accumulate several communications with each mistake, so keep copies of everything and keep them together.  I suggest a folder for each mistake and a huge one for the whole collection.  Don’t be bashful about sending copies and dates of everything each time you respond.  The credit bureau is required to investigate your dispute within 30 days of receiving your letter.  (A good reason for sending it certified mail or return receipt)

If you have a low FICO score indicating a less than super credit report, you may need the assistance of one of the many credit-counseling services.  If you just want to polish it a bit, consider canceling department store credit cards and unused visas.    The pros say you should have only 2 to 4 major cards!  Another good reason for canceling unused cards is that lenders consider them available and potential debt and will take the total available amount as a debt when considering your ratios for a new loan!

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