Your Credit Information And How It Effects Your Shopping Power

By • Oct 20th, 2008 • Category: Credit


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You can repair your credit information if you have the know-how and the tenacity. Often, it involves calling your lenders, creditors and collection agencies to barter and negotiate with them. You may have to send them a letter or hassle them every single month until an item is removed, but you can often get lesser items off your report. Things like charge-offs, collections accounts, settlements and late payments can all be negotiated. Sometimes, people hire a credit counselor or debt relief company to manage these negotiations for them. If you have a bankruptcy, foreclosure, lien or judgment against you, then this negative credit information will be on your account for 7-10 years without much you can do. But for the rest, you may want to micromanage a little to see what you can get.

Once you have your credit information, you should focus on improving credit scores. Check out your free credit score reports from Equifax, TransUnion and Experian. Credit reporting is voluntary, so the files may all be slightly different. Once you have this credit info, examine your reports for errors. Roughly one-third of credit reports contain serious errors because the credit bureau doesn’t verify the information your creditors send to them. Therefore, keeping clear credit is your responsibility. Some of the items may come off through a dispute, where you send a letter or a photocopy of your credit report with circles around the mistakes and supporting documents to validate your dispute. As for the legitimate blemishes, they’ll be on your credit for up to seven years and will likely only be fixed through consistent on-time bill payment. You can phase out the use of unneeded credit card accounts but do not close them. Simply stop using them and pay then off. Lastly, a secured credit card can help you re-establish regular on-time payment history again.

To file a dispute about your credit information, you can write a dispute letter to all three of the credit bureaus, which are Equifax, Experian and TransUnion. On the letter, put the date, your name, address, phone number and social security number. Just write “The following data is incorrect and should be updated,” then list each inaccuracy, explaining why it’s wrong and what it should be updated with. Attach a marked copy of your credit score report and include any communication, account records or statements that will help verify your version of the truth. By letter is the best way to dispute with Equifax and TransUnion, although Experian only allows online disputes. The credit bureaus then have 30 days to check and repair your credit information. Once they have done, they will write you a letter including what was or was not updated. If you’re not satisfied with the letter, then you can try repeating the process but with different documentation or get in touch with the creditor to try and resolve.

Often, having a look at your credit information is the only way of finding an identity theft if you are not using one of the identity theft products such as Life Lock who monitor your credit information for you and watch for any weird activity. If you find strange in your credit information that you have absolutely no explanation for, an unpaid loan, a new camera on credit etc. get in touch with the 3 credit agencies immediately and police for help. Without any type of protection, checking your credit information is really the only way to avoid identity theft running amok. It cannot prevent it from occurring it but at least it stops it getting worse.

There’s no tool greater than credit information. If you’ve suffered poor credit scores in the past, then you can still rebound from a foreclosure or collection account by paying regular bills in full and on-time. The best way to stay ahead is to bring in more income, see where your spending problems lie and save sufficiently. “What works” in this department varies for each person. Some need to put the money out of sight, out of mind, while others can manage it in their checking account. Whether it was a one-time “oops” or a pattern of “I didn’t know,” seeking credit info is the first step toward financial recovery.

More on credit information:

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  1. [...] have no previous credit history as you have never borrowed [...]

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