LandLordDocuments

What is credit? What is a credit report? What is a credit score? Where can I safely get a copy of my credit report for free? These are some of the most important questions in personal finance and they will be addressed in this article. The subject of credit scoring has become an increasingly hot topic, and for good reason. For many years, the general public only associated the concept of credit scoring with the need to purchase high−ticket items such as a new car or a home. Today, credit scoring goes much further. Your credit score can affect your ability to get a good rate on commodities such as car insurance, cell phones, or even determine whether or not you get the job that you want. Indeed, the financial snapshot provided by the credit score has also become a gauge for many employers, especially those who seek to place employees in a position of financial responsibility.

What is Credit?

Credit is like a report card telling you how well you have paid your bills. Credit is a record of how you pay your credit cards bills, auto loans, mortgage loans, etc. Whenever you buy something with a monthly payment, the people who you collect your bill report this information to create a credit report. Examples include buying furniture on credit or using a Best Buy store card to purchase a computer. Exceptions include utility bills, cell phone bills, and rent payments. Collection accounts, court judgments where you owe money, and bankruptcies are also part of your credit.

Who Collects My Information?

There are only three companies in the U.S. that collect all your credit information. They receive this data from all of your creditors, like the credit card company or your auto loan company. The companies are Equifax, Transunion, and Experian, also known as credit reporting agencies or credit bureaus. They compile all the information they receive and create a credit report on you.

What is a Credit Report?

A credit report is a document that shows all the information collected by the credit bureaus. A “tri-merge” or “merged” credit report contains the information from all three credit bureaus in one report. This report lists all your past credit accounts that have been reported to the credit bureaus. The report lets you know how much money you owe to creditors, what your available balance is, and your complete payment history, including any late payments. The credit report can also list your current and former addresses and even employers. Additionally, the credit report will also give you a number that each credit bureau assigns to you, called a credit score.

What is a Credit Score?

A credit score is a number from 300 on the low end to 850 on the high end. Each of the three credit bureaus will evaluate your credit to determine your score, and each bureau will give you a score. The higher the number, the better the credit history. But, exactly how do they assess what’s on your credit report to give you a number?

What Makes Up My Credit Score?

There are five parts to your credit score (also known as FICO score). Points are awarded for each of these five parts, and a high score is most favorable. The factors are listed below in order of importance.

1. YOUR PAYMENT HISTORY − 35% IMPACT on your credit score

Have you paid your credit accounts on time? Paying debt on time and in full has the greatest positive impact on your credit score. Late payments, judgments and charge−offs all have a negative impact. Missing a high payment will have a more severe impact than missing a low payment, and delinquencies that have occurred in the last two years carry more weight than older items.

2. HOW MUCH YOU OWE vs. AVAILABLE CREDIT − 30% IMPACT on your credit score

This factor marks the ratio between the outstanding balance and available credit. Ideally, the consumer should make an effort to keep balances as close to zero as possible, and definitely below 30% of the available credit limit when trying to purchase a home. The more you owe compared to your credit limit, the lower your score will be.

3. LENGTH OF CREDIT HISTORY − 15% IMPACT on your credit score

This portion of the credit score indicates the length of time since a particular credit line was established. A seasoned borrower or longer credit history will always be stronger in this area. However, you can get a high score with a short credit history if the rest of your credit report shows responsible credit management.

4. TYPE OF CREDIT − 10% IMPACT on your credit score

A mix of auto loans, credit cards, personal lines of credit, and mortgages is more positive than a concentration of debt from credit cards only.

5. INQUIRIES − 10% IMPACT on your credit score

This percentage of the credit score quantifies the number of inquiries made on a consumer’s credit within a six−month period. Each hard inquiry can cost from two to 25 points on a credit score, but the maximum number of inquiries that will reduce the score is ten. In other words, 11 or more inquiries within a six−month period will have no further impact on the borrower’s credit score. Note that if you run a credit report on yourself, it will have no affect on your score. Credit scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. If you need a loan, do your rate shopping within a focused period of time, such as 30 days, to avoid lowering your credit score.

Additional Resources:

To order your free credit report, go to this outlet established by the U.S. Congress:

www.annualcreditreport.com

To read the Fair Credit Reporting Act, go to:

www.ftc.gov/os/statutes/frca.htm

For the Federal Trade Commission’s information on consumer credit, go to:

www.ftc.gov/bcp/conline/edcams/credit/index.html [http://www.ftc.gov/bcp/conline/edcams/credit/index.html]

To get additional education about your credit and how to improve credit scores, go to:

www.ivanbarriga.com [http://www.ivanbarriga.com]

Have you ever been denied a credit card or home loan, and you simply just didn’t know why? The credit provider or lender told you that your credit history just wasn’t up to par in order to qualify for the line of credit or loan.

Well sure you made a few mistakes in the past, perhaps a few late payments, and of course there is some debt that you are aware of. But then again, doesn’t everyone? You certainly didn’t believe that your credit report history was bad enough to not qualify for a credit card or loan, even at a higher interest rate.

Let me tell you a secret, many people have absolutely no idea what is on their credit report! Your credit report has, in the past, been something not readily available to you, or an expensive item to attain. Many people are just not aware that your credit history can determine your financial activities for your entire life. This is becoming more prevalent as credit awareness and education is deemed necessary. So it is important to always be apprised as to what is really on your credit report!

There can be either two items on your credit report: accurate or inaccurate. Credit providers may have reported inaccurate information on your report! Mistakes happen that you may not even be aware of. A move, changed phone number, lost mail, open credit cards from 15 years ago that you simply didn’t know existed, and other easily overlooked or forgotten items do happen, more than one might think. Hey, who has time to keep track of every single financial item when life, as we know it (busy, fast paced) is hardly ever forgiving?

Many people get down on themselves for having a bad credit score. But this is not necessary! It is not a reflection of who you are. Really. You may have never been educated on how to handle your finances or extenuating circumstances may have greatly effected your credit. So in order to stay on top of your credit history, and not be blind sided by an embarrassing, unexpected rejection, check your credit report!

Credit reports are no longer some far off document that is hard to get a hold of. After all, it is YOUR credit report, right? Shouldn’t you have easy access to it? Well somebody else thought you should too, and the Fair Credit Report Act (FCRA) was enacted just for this reason. Here are the terms:

o Every person is entitled to a free credit report if a credit company takes an adverse action against you, or if your application for credit or insurance is denied.

o You are entitled to a free credit report if you are unemployed and plan to get a job in 60 days, are on welfare, or if your report is inaccurate because of fraud including identity theft.

o Equifax, Experian and Transunion, all nationwide consumer reporting companies, are required to provide you with a free copy of your credit report every 12 months.

Now there is no excuse for you not to keep on top of your very important credit report. All you have to do is go to http://www.annualcreditreport.com and request your free report! Or, you can call 1-877-322-8228. Always check your credit report before you apply for any mortgage loan or line of credit.

So you have your credit report, what next? Evaluate each item as accurate or inaccurate. Which items can you clear quickly by simply closing a card or calling a creditor and paying off an old debt? If there are inaccurate items, you must make a dispute in writing with supporting information. This means copies of any documents that support your claim. You must send this information to both the credit consumer company as well as the credit provider.

If your dispute is accepted and changes are made, the company must send you the changes in writing as well as send you a new credit report with the inaccurate information removed. The credit provider may not make the same claim against you again. If you find inaccurate information and get it fixed, then your credit report will be better, and another step towards getting that lower mortgage rate has been made!

If there are negative items that are accurate on your report, then you must take action towards fixing them! If you are not sure what to do, consult a financial advisor at your bank who can help you set up a repayment plan, consolidate debt if need be, or even investigate debt forgiveness.

Negative items will stay on the credit report up to seven years, but if you make an effort to begin paying back debts, and show you are serious about qualifying for a mortgage loan, then you are yet closer to proving to a mortgage lender that you are both willing and able to pay back a loan. And these two things: willingness and ability are exactly what a lender evaluates when considering a person for a loan.

Fixing your credit of accurate negative items takes personal effort and time. However, fixing inaccurate information that can greatly increase your credit score, can be done fairly quickly. If you are serious about getting a mortgage loan, or even a better mortgage loan to save you money, consult your credit report before you take any steps at all!

By understanding where you stand, you can either choose to go forward and find a mortgage loan that is within your limits, or repair your credit before making a move. Even if you are not considering a loan or line of credit, always stay on top of your credit history because you never know when a better score can save you time, money, and huge headaches!

We have all seen the advertisements on the Internet telling us that we are entitled to free credit reports. But many people want to know if they can get their free credit report without a credit card? In short the answer is no, because if you want to check your free credit report without a credit card, you will be hard pressed to find a company that will be willing to do that.

The reason that you can’t check your free credit report without a credit card is because you need a credit card for the verification process. This then shows that you are who you say you are. Credit cards are a good way to prove your identity and a lot of people from all over the world have a credit card partially for this purpose. But of course you can’t apply for a credit card unless you know your credit score; this then saves you the hassle of possibly getting turned down for a credit card.

If you want a free credit report without a credit card, then there are ways to do this. You can write to one of the credit-reporting agencies with a copy of a recent bill, or a copy of your driving license. You then mail them your request for your free credit report. There is another way to get a free credit report without a credit card and that is by making a telephone call to one of the credit reporting agencies; they will be happy to oblige with your request.

It is almost impossible to get a free credit report without a credit card on the Internet. Credit cards are the only way to prove to these companies that you are who you say you are. But if you are not heavily concerned about your credit score, then you can wait for your annual credit report, which means that you will always get a free credit report without a credit card.

There are hundreds of websites that offer you the opportunity to view your free credit report with no obligations–no obligations, that is, until your 30-day free trial runs out. That is the main problem with these companies; they will let you see your free credit report with no obligations. But if you do not cancel your membership with them before the end of your 30-day free trial, then they will start to charge you for a service that you are no longer using. That is hardly fair, considering you only joined them to view your free credit report with no obligations.

These companies understand that you will want to view your free credit report with no obligations. So that is why they are only offering their customers 30 days free membership. Remember that you must cancel your membership before the 30 days are over, otherwise you will be charged a month’s worth of use. They will always let you know how you can cancel. The information on how to cancel will usually be printed in the small print on the bottom of the webpage; write that information down, so you can become a free member. Then you can check your free credit report with no obligations.

If you want to view your free credit report with no obligations, then you have options. You can check either through the Internet or you can get it through the mail. You can do this by getting in touch with an official credit-reporting company. The best thing about these official credit-reporting companies is that you will receive your free credit report with no obligations and you won’t have to give them your credit card information. Going with an online company for your credit report is a good idea if you need to keep a constant eye on your credit reports, but if you are happy with just your annual report then there is no real reason for you to sign up to one of these credit websites.

In a 2004 amendment to The Fair Credit Reporting Act (FCRA), a new system providing free credit reports was initiated. The amendment requires each of the three national Credit Reporting Agencies (CRAs), Equifax, TransUnion, and Experian, to provide free copies of an individual’s credit report once every 12 months. The free reports require a request to be submitted to a centralized office, in accordance with procedures defined by the Federal Trade Commission (FTC). The FTC is charged with consumer protection and ensuring compliance to the FCRA from the Credit Reporting Agencies.

The amendment was undertaken as a way to help individuals access the information contained in their credit reports. Prior to the amendment, credit reporting agencies were able to charge individuals for every copy of their credit report that they requested. Only under specific circumstances, such as searching for employment, were credit reports provided free of charge. This undermined fair access for individual’s to access information about them collected by the CRAs.

Understanding what information is in your credit report is important. Only then can you ensure that the information being reported about you is accurate and up to date. Your credit
report impacts your life in many ways, from the ability to obtain credit to the amount of money you will pay for that credit.

Fair access to such important information is critical. The unfortunate reality is that reporting mistakes do happen. Any errors or misinformation contained on a credit report can have a tremendous impact on a person’s financial wellbeing, job prospects, and housing prospects.

The amendment mandated the three CRAs to implement a centralized website, toll free number, and mailing address as methods individuals may use to request their free credit reports. Although the centralized website was implemented as a way to offer consumers a quick and easy way to request their reports, it has come under severe criticism by various consumer
protection groups.

There are problems that plague the centralized website annualcreditreport.com. Some of these problems are related to difficulties inherent with the Internet and search engines. Others, some groups claim, are the result of poor planning and implementation on the part of the three Credit Reporting Agencies.

Many of the consumer protection groups, including the Privacy Rights Clearinghouse, urge consumers who are unfamiliar with the Internet to avoid using the centralized website to order their free credit reports. They further encourage those who choose to use the website to beware of a number of potential pitfalls the internet, and the website itself, present.

The first problem has to do with the Internet itself. The three Credit Reporting Agencies purchased the website address (also called a URL (uniform resource locator) or domain name) annualcreditreport.com. It is common for unscrupulous webmasters to purchase domain names similar to others, with the goal of intercepting customers or consumers who search for the
genuine website. These webmasters purchase domain names very similar to the real domain, and unsuspecting consumers mistakenly believe they’ve reached the correct website. These
consumers are then redirected to paying sites, have their personal information collected without their knowledge, or signed up for services they don’t want or need. In this way,
unscrupulous webmasters make money.

The FTC calls these websites ‘imposter’ websites.

Unfortunately, consumer groups and the FTC have reported that some Credit Reporting Agencies are linked to some of these imposter websites. Recently, the FTC filed and settled a lawsuit against a subsidiary of one of the Credit Reporting Agencies. The lawsuit alleged “deceptive and misleading” claims on the subsidiary’s website. This website was advertising free credit reports, and then automatically signing up consumers to a credit monitoring system that charged a fee if not cancelled by the unsuspecting consumer. In addition, the website was
collecting personal information about the consumer.

The World Privacy Forum reports that over 100 domain names with close misspellings of annualcreditreport have been purchased. Many of these have been purchased by the Credit Reporting Agencies themselves. In some cases, these websites lead consumers to websites that demand payment for services, and others lead consumers to the Credit Reporting Agencies
websites themselves, where they are charged for copies of their credit reports. The second of these is largely the result of the CRA’s affiliate marketing programs, whereby the CRA pays a website for a referral.

The second problem with the centralized website lies in its implementation. Initially, the website was set up so that only the 3 CRAs and the FTC were able to provide a live web link to annualcreditreport.com. This prevented other legitimate websites, such as news and consumer group websites, from offering a live link on their website. In response to these
concerns raised by Privacyrights.org, this situation has changed. The change is welcome, as consumer groups correctly pointed out that the initial web link block only served to make it easier for rogue websites to redirect consumers to illegitimate websites.

There are two ways to find these imposter websites. One is to perform a search in any search engine, which results in a display of many websites. Clicking on anything but the genuine
website can land a consumer on an imposter website. The other is by incorrectly typing the genuine website address into the address bar of a web browser. Many of these unofficial websites contain small typographical errors, designed to lure in just such a web surfer.

Avoiding Imposter Websites

Many consumer groups, including World Privacy Watch, urge consumers to avoid potential imposter sites by avoiding the internet altogether. Instead of ordering free credit reports
online, use the toll free number or regular mail.

The toll free telephone number is 1-877-322-8228. The mailing address is Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. If ordering by mail, a form
must be completed and can be found on the FTC’s website.

Those consumers wanting to order online are urged to:

1) Ensure that they are using the genuine website. The only website address is annualcreditreport.com.

2) If the website you reach features a pop up, advertises itself on television or radio, or redirects you to a different site, know it is not the genuine website. Your credit card
number is not required information, and you are not required to purchase or pay for any additional services. The genuine website will not send you any emails.

3) Understand that you are required to provide only certain personal information, including your name, address, social security number, and date of birth. If you have had a change of
address in the past 2 years, your old address may be requested. In addition, you may be asked about a personal financial detail that only you would know. This is to prevent anyone else accessing your credit report.

Access to free annual credit reports is a welcome change to the laws governing credit reports and protecting consumer’s rights. Every citizen should take advantage of this free service to ensure that the information being reported about them on their credit reports is accurate and up to date. As with any other service, consumers need to be aware of the potential danger that lurks behind the scenes by imposter websites and unscrupulous webmasters.

Do you know what’s in your credit report? Because of the terms of the Fair Credit Reporting Act (FCRA), you have the right to know exactly what credit reporting agencies are putting on your credit report. That’s only one of the rights that the FCRA guarantees you – and every consumer.

The Fair Credit Reporting Act was enacted to ensure the accuracy and privacy of your credit report. All Businesses that use information on your credit report to determine whether or not, to lend you money or offer you credit are bound to follow guidelines that are set out by the Fair Credit Reporting Act. In addition, any company or agency that collects debts must also follow certain guidelines that are set out by the law. The provisions of the Fair Credit Reporting Act detail how long particular financial information may be retained on your report, specify ways for you to make corrections to information that is contained on your credit report, guarantee your right to see your credit report, and give you rights when dealing with creditors.

What specifically are these guidelines and how can they help you if a credit agency is reporting untrue or misleading information about your credit history?

1) You have a right to see your credit report.

If you have been turned down for credit, housing or employment based on information provided by a credit reporting agency, you have a right to know which agency provided the report. Upon your request, the creditor must give you the name and address of the credit reporting agency that they used. Further, the credit reporting agency must provide you with your credit report upon your written request for it, and they must do so for no more than the cost of copying and postage.

2) You have the right to correct your credit report.

If the credit report you receive contains inaccuracies – for instance, a paid or settled debt is still listed as unpaid – you have the right to request that it be corrected with the accurate information. The request must be made in writing, and the credit reporting agency to whom you make the request must investigate it within 30 days of their receipt.

3) You have the right to receive a corrected copy of the report at no additional charge. You may have to pay for postage.

You may make a written request to have a corrected copy of your credit report sent to you, or to any agency that has requested your credit report in the past six months for credit purposes, or in the past two years for employment purposes.

4) You have the right to fair collection practices.

If a creditor is trying to collect a debt from you, they must follow guidelines designed to prevent you from being harassed. Among those guidelines are:

1. They can only call you within certain prescribed hours.

2. They can not share information about you to any third party without your permission. This includes the fact that they are attempting to collect a debt.

3. They can not attempt to contact you at work without your specific permission.

4. They can not use false or misleading statements to extract information or payments.

5. They must honor a written request to cease further contact with you.
In a world where your credit report is often your ticket to a better-paying job, housing, credit and many other things, it’s important to know what credit agencies are reporting about you. Most consumer protection agencies strongly recommend that you request and carefully read your credit report every year so that you can correct any inaccuracies, or request that reports of special circumstances be attached to the report. It’s a small task that could save you a lot in the long run.

Now that you have obtained your credit report, the first thing you need to do is read through it and understand what it all means. Don’t feel bad if you don’t understand what the credit report is saying to you. Most credit reports are coded because it allows shorter time for the computer to transmit all the information between the reporting agency and its clients. All reports should have the codes print directly on the back of the report itself or on a separate attachment telling you what the codes stand for.

Credit Bureaus may not all have the same format on how the report should look, but they all have the same information included on the report. Equifax is the only credit-reporting agency that provides consumers with a credit report in a column format. This means that Equifax reports are easier to read and easier to understand. In this chapter you will be shown examples of what is on the report from Equifax, Trans Union and Experian/TRW.

EQUIFAX: They often separate out the accounts with the different collection agencies. The Company Name is the name of the business reporting the information. In many cases, just below the company name is a description of the type of account (such as student loans, credit card or line of credit), some payment history and or the account’s status (such as charge off, collection account, payment deferred, account transferred or account closed by consumer.)

o The Account Number is the number from the company reporting the information and who is responsible for the account and what type of obligation you have. Here are sample codes explaining what they are:

A = Authorized user (of someone else’s account)

B= On behalf of another person

C= Co-maker/Co-signer

I= Individual

J= Joint

M= Maker

S= Shared

T= Terminated

U= Undesignated

o Date Opened is the month and year you opened the account.

o Month’s Review is the number of months for which your account payment history has been reported to the credit bureaus and when it was last looked at.

o Date of Last Activity is the date of the most recent month and year that something happened on the account. This may be the last time you made a payment or when the account was charged off or sent to collections. This date is important because negative information can stay on your report for up to seven years after the date of the last activity.

o High Credit is the credit amount of any loan you took out, your credit limit or possibly the highest amount you have ever charged on that specific account.

o Terms indicate either the number of installments you have (indicate by an M) to pay off the debt or the amount of your monthly payment.

o Balance is the amount you owed on the account when the creditor last provided the credit bureaus with the information.

o Past Dues is the amount past due on the account when the creditor last provided the credit bureaus with information.

o Status indicates both the type of account and your payment history that you have made.

o Type of Account: I stands for (Installment) meaning payment amount is fixed each month; O stands for (Open) meaning entire balance is due each month); R stands for (Revolving) meaning payment amount is variable each month.

o Payment History Codes: 0= too new to review; 1= Paid as agreed; 2= 30+ days past due; 3= 60+ days past due; 4= 90+ days past due; 5= 120+ days past due or account sent to collection; 6= Making regular payments under wage earner plan 7= Repossession 8= Charged off to bad debt.

o Date Reported is the date the creditor last provided Equifax with the information. Creditors who have requested a copy of your report are listed in the final section with the date they requested your report. Under Equifax’s policies, coded inquiries are given only to you and other creditors are not allowed to see them.

TRANS UNION: Breaks down the credit information into several subsections.

o Public Records. This section includes information obtained from local, state and federal courts and offices including lawsuits, bankruptcies and liens. Any information that is public accessible.

o Accounts with Negative Marks. Trans Union separates out the accounts that contain information which some creditors may consider to be adverse and highlights the negative information by enclosing it in brackets. The bracketed information usually includes the account’s status, any past due amount and information on any late payments that you have made.

o Accounts without Negative Marks. Immediately following the negative accounts, Trans Union lists the accounts that are reported with no adverse information. Both the accounts without negative marks and those with no adverse information contain the following information: the name of the company, account number, the type of credit extended to you, the date the creditor last provided Trans Union with the updated information, the amount you owed on the account when the creditor last provided Trans Union with your balance, the person who is responsible for the account, the month and year you opened the account, the amount of any loan you took out, or the highest amount you have ever charged on that specific account, your credit limit on a revolving or open account, or the amount of your monthly payments and number of months that it took you to pay off an installment debt, the month and year you or the creditor closed the account, and the status of your account as of the last date the account was updated. Items such as charged off as bad credit, collection account, paid as agreed, payment after charge off or collection are also on the report.

o Inquiries-Full Disclosure. Trans Union divides your inquires into two sections. The first section lists the companies that received your full credit report in response to your request for credit. These inquiries stay on your credit report for at least two years.

o Inquiries-Partial Disclosure. Some companies received only your name and address for the purpose of making you a credit offer or to review your accounts. These inquiries stay on your credit report for up to a year and are not seen by other creditors.

EXPERIAN / TRW: This credit bureau summarizes the contents into two categories,
one section for listings of creditors who receive your report for offering you credit, and the second for their own purpose of marketing.

o The report starts off with potentially negative items such as public records and accounts with creditors and others and then is followed with accounts in good standing. On each page of this report, the consumer’s name and a unique number appear on the top corner.

o Experian / TRW provides you with information affecting your credit worthiness. The items listed with dashes before and after the number, such as -3-, may have a negative affect on your credit.

o Those items are listed first; beginning with public records and followed by credit accounts. After the negative entries, the item for which there are no negative entries follows.

o For all accounts, negative or positive, Experian / TRW includes the creditor’s name and address and the account or court case number. To protect your identity and lessen your risk of identity theft, Experian/TRW does not include the full account number. They only include the first few numbers and leave the final few digits out.

o Experian/TRW notes the date the account was opened and how long the account has been reported with them, date of the last activity on the account, the type of account, your payment terms, your monthly payment amount, who is the responsible person for paying, the original amount that was borrowed, your credit limit or your highest balance, and any recent balance or payment. Finally, the comments paragraph tells the status of the account and for past due accounts, and when the information is scheduled to come off your report.

o Following the list of credit accounts, Experian/TRW provides more detailed information for certain accounts. This detail includes your monthly balances for you for the past 24 months and your credit limit, high balance or original loan amount you borrowed.

o Towards the end of the report, Experian/TRW separates out credit inquires into two sections. The creditors who reviewed your report for the purpose of offering you credit and creditors reviewing their own accounts or who reviewed your report for marketing purposes. For the first set of inquiries, each entry indicates how long the item will remain on your record.

o The end of the report contains identification information, which includes your name and all other names you have used in the past, your current and previous addresses, your social security number, date of birth, and current and previous employers. Remember that once a credit bureau gathers information about you, they can report that information and that information can and will stay on your record. The items listed below tell you how long each of these items will stay on your credit report. This will give you an idea of what you need to avoid or fix, if at all possible.

o Bankruptcies from the date of the last activity may be reported for no more than ten years. Though the date of the last activity for most bankruptcies is the date you receive your discharge or the date your case dismissed, credit bureaus usually start counting the ten-year period from the earlier date of filing. Some credit bureaus report successfully bankruptcies for only seven years. That may not always be the case.

o Lawsuits and judgments may be reported from the date of the entry of the judgment against you up to seven years, or until the governing status of limitations has expired, whichever time period is longer. Credit bureaus usually delete all lawsuits and judgments after seven years.

o Paid tax liens and criminal records from the date of the last activity can stay on for up to seven years. Accounts sent for collection, accounts charged off or any other similar action may be reported from the date of the last activity on the account up to seven years. The date of last activity is 180 days from the delinquency itself. Creditors are obligated to include the date of the delinquency when they report past due accounts to credit bureaus.

o Bankruptcies, lawsuits, paid tax liens, accounts sent out for collection, criminal records and any other adverse information may be reported indefinitely if you apply for a large amount of money over one hundred thousand dollars of credit or insurance, or if you apply for a job with an annual income amount of at least $75,000. However, credit bureaus usually delete all items after seven or ten years.
Now that you have read through this info and you know how to read your credit report and
understand it, you should be able to analyze your report and make a list of everything that you see that is inaccurate or out of date, misleading, or not authorized to be in your file.

Fact: Over 150 million Americans have credit report with the three major credit reporting agencies. Approximately 50 million of these credit reports contain errors, many of which are inaccurate. Do you know what’s on your credit report?

If you’ve ever applied for a charge account, a personal loan, insurance or a job, there’s a credit report about you. This credit report contains information on where you work and live, how you pay your bills, and whether you’ve been sued, or filed for bankruptcy.

About The Fair Credit Reporting Act? (FCRA)

The Fair Credit Reporting Act was the first federal law to regulate the use of personal information by private business. It was all the way back in 1899 that the first major credit reporting agency was started. Over time, credit reporting grew into a huge industry and, by the late 1960′s, became surrounded by controversy.

Credit reports from the Credit Reporting Agencies were being used to deny services and opportunities. At that time, you would have had no right to see what was in your credit report. The FCRA was passed in 1970 and fortunately now you have that right.

On December 4, 2000 President George Bush signed into law the first phase of the Fair And Accurate Credit Transactions Act (FACT Act), which amends the FCRA. The FACT Act establishes the Financial Literacy and Education Commission and calls for a national financial literacy campaign.

The act addresses consumer’s rights to understand and protect the information in their credit report and to get help when their financial information has been stolen. It also restricts the use of medical information in determining a consumer’s eligibility for credit, and also limits the sharing of medical information with affiliated companies under certain circumstances.

Here are some questions consumers commonly ask about credit reports, Consumer Reporting Agencies and the answers. Note that you may have additional rights under state laws. You can contact your state Attorney General or local consumer protection agency for more information. You also have information and resources at your disposal 24/7 at: http://www.creditandyou.com.

Q. What can I do about inaccurate or incomplete information?

A. Under the new law, both the Consumer Reporting Agencies and the information provider have responsibilities for correcting inaccurate or incomplete information in your credit report. To protect all your rights under this law, contact both the Consumer Reporting Agencies and the information provider. See credit repair article by credit and you.com

Q. Can my employer get my credit report?

A. Only if you say it’s okay. A consumer reporting agencies may not supply information about you to your employer, or to a prospective employer without your consent.

Q. Can creditors, employers or insurers get a report that contains medical information about me?

A. Not without your approval.

Q. How can I stop a consumer reporting agencies from including me on lists for unsolicited credit and insurance offers?

A. Creditors and Insurers may use consumer reporting agencies file information as a basis for sending you unsolicited offers. These offers must include a toll free number for you to call if you want to remove your name and address from lists for two years, completing a form that the consumer reporting agencies provides for this purpose will keep your name off lists permanently.

Q. Do I have the right to sue for damages?

A. You may sue a consumer reporting agency, a user or in some cases a provider of consumer reporting agency data in state or federal court for most violations of the FCRA. If you win, the defendant will have to pay damages to reimburse you for attorney fees to the extent ordered by the court.

Q. Are there other laws I should know about?

A. Yes. If your credit application was denied, the Equal Credit Opportunity Act (ECOA) requires creditors to specify why if you ask. For example, the creditor must tell you whether you were denied because you have no credit report with a consumer reporting agency or because the consumer reporting agency says you have delinquent obligations. The ECOA also requires creditors to consider additional information you might supply about your credit history. You may want to find out why the creditor denied your application before you contact the consumer reporting agencies. See Equal Credit Opportunity Act article by credit and you.com

Stay On Top Of Your Credit

Before financing anything, car, furniture, or a home, it’s a god idea to make sure your credit report is clean. Errors can often be quickly removed. And no sales person should ever know more about your credit report than you.

Copyright © Credit and You | All Rights Reserved |

Obtaining a credit report is an excellent way to begin taking control of your financial future. It’s recommended that you review your credit report once a year, not only to be aware of your standing with creditors but to also keep abreast of errors and fraud. However, once your report arrives you may have trouble making sense of it. How are you to read and understand a credit report?

There are three major credit reporting agencies that issue credit bureau reports; Experian, TransUnion and Equifax. It is recommended that you obtain reports from all 3 credit report agencies as they most likely contain varying information since creditors subscribe to agencies on a purely voluntary basis. The credit reports provided by each of the different bureaus may present somewhat differently but generally speaking the information will be broken down in much the same way.

There are four main parts to the credit report: personal profile, credit history, public records and inquires. Check each section carefully for any errors. Note any errors you may discover on a separate piece of paper as you read over your report.

Personal Profile

At the top of the credit report you will find all your basic information such as your full name, current and previous addresses and employers, social security number, and date of birth. Your spouse’s name may also appear if applicable. In addition, you may notice several variations of your name listed. This can occur when creditors record the information incorrectly. These discrepancies are usually left on your credit report. It is important however, to ensure that your address is correct. An incorrect address could alert you to a possible identity theft.

Credit History

The next section is your credit history. This provides you with an itemized list of your current active, past closed accounts and their balances or arrears. Listed first is the name of the creditor and your account number for each bill–sometimes the account numbers may appear partially obscured for security purposes. These debts could include real estate mortgages, credit cards, car loans, or medical bills.

There will be a column for identifying the nature of the account; Joint, Individual, Undesignated, Authorized User, Terminated, Maker, Co-signer or Shared. There will also be a notation of the date when the account was opened, number of months the account payment history has been reported and date of last activity. The report will show your high credit limit or the maximum you are allowed to borrow, if applicable. There is a column for Terms which indicates the number of instalments or monthly payments remaining on the account.

The next few columns will show the balance remaining on the account, any past due amounts and the status of the accounts. There are two types of accounts; installment and revolving. An Installment account means that there are fixed payments and a specific ending date, such as with a car loan. A revolving account is one with no fixed ending date as with credit card debts. Creditors like to see few revolving debts.

The credit report will indicate the different types of accounts and also may assign it a numerical ratings system. You may see such symbols as R1, R2, R3 or I1, I2, I3.The R or I indicates Revolving or Installment and the numbers indicate the payment history of the account as follows;

• 0- account hasn’t been used yet
• 1- paid as agreed
• 2- 30 plus days past due
• 3- 60 plus days past due
• 4- 90 plus days past due
• 5- 120 plus days past due
• 7- Collection account or bankruptcy
• 8- Repossession or foreclosure
• 9- Charged off or bad debt

The credit report will also show a record of any debts that have been turned over to a collection agency. It will show the date the collection was reported, the name of the company handling the collections and the company or lender that the loan was originally issued with and the balance remaining on the account.

Public Records

These are reports obtained from local, state and federal courts. They will indicate records of bankruptcies, tax liens and monetary judgments. Overdue child support records may also be shown. These public records will remain part of your credit history for seven to ten years and reflect negatively on your total credit score.

Inquiry Section

This section reveals any parties that have obtained a copy of your credit report over the last two years. There are generally two types of inquires, hard and soft. A hard inquiry is one initiated by you, whenever you apply for a loan or fill out a credit application. A soft inquiry comes in three forms; companies that wish to offer you promotional applications for credit, current creditors that are monitoring your account or credit bureau inquires requested by you, the consumer. These soft inquires do not show up on credit reports that businesses receive, only on copies provided to you. Although many lenders will view too many inquiries on your report as negative, it is important to note that two or more ‘hard’ inquires within a 14 day period count as just one inquiry.

Credit Score

The credit report can also reveal your credit score. A credit rating scores is a means of calculating an individual’s credit risk to determine how likely they would be to make good on a loan. The score is a three digit number ranging between 300 and 850. The higher your score, the better it reflects on you as a borrower. A good credit rating score will enable you to negotiate for better interest rates.

Disputes

What if you should find an error on your credit report? Once you have discovered an error, contact the credit bureau that issued the credit report and state in writing what you found to be inaccurate. You will find the contact information listed at the top of your credit report.

The credit reporting companies must re-investigate the claim within 30 days. They will then contact the party that submitted the item and attempt to resolve the dispute as quickly as possible. Remember, you have the right under the Fair Credit Reporting Act to dispute any inaccurate or fraudulent information that may appear on your credit report, and should do so in a timely fashion.

Once you learn to read and understand a credit report, you are moving towards a more secure financial future. Obtain your report today!

Your credit report contains information about where you work, live and how you pay your bills (On time or not). It also may show whether you’ve been sued, arrested or have filed for bankruptcy with in the last 10 years. Companies called consumer reporting agencies (cra) or credit bureaus compile and sell your credit report to businesses all over the world.

Many financial advisors suggest that you periodically review your credit report for inaccuracies or omissions. This could be especially important if you’re considering making a major purchase, such as buying a home. Checking in advance on the accuracy of information in your credit file could speed the credit-granting process, clean credit is a must.

Because businesses use this information to evaluate your applications for credit, insurance, employment, and other purposes allowed by the Fair Credit Reporting Act (FCRA), it’s important that the information in your report is complete and accurate.

Whenever you apply for any type of credit or financing, a credit report is pulled from at least one of the three major credit bureaus. You want a clean credit report to be pulled. While there are hundreds of smaller credit bureaus around the country, virtually every credit bureau is affiliated with either Experian, Trans Union, or Equifax.

Getting Your Clean Credit Report

If you’ve been denied credit, insurance, or employment because of information supplied by a credit reporting agency, the FCRA says the company you applied to must give you the agency`s name, address, and telephone number. If you contact the agency for a copy of your report within 60 days of receiving a denial notice, the report is free. In addition, you’re entitled to one free copy of your report a year.

If you simply want a copy of your report, call each credit bureau listed since more than one agency may have a file on you, some with different information.

The three major national credit bureaus are:

Equifax, P.O. Box 740241, Atlanta, GA 30374-0241; (800) 685-1111.

Experian (formerly TRW), P.O. Box 2002, Allen, TX 75013; (888) EXPERIAN (397-3742).

Trans Union, P.O. Box 1000, Chester, PA 19022; (800) 916-8800.

Correcting Errors For Clean Credit.

To protect all your rights under the law and to keep your credit clean contact both the CRA and the information provider.

First to get clean credit reports, tell the credit reporting agency in writing what information you believe is inaccurate. Include copies (please keep your originals) of documents that support your position. In addition to providing your complete name and address, your letter should clearly identify each item in your report you dispute, state the facts and explain why you dispute the information, and request deletion or correction. Always keep copies of your dispute letter.

They must reinvestigate the items in question, usually within 30 days, unless they consider your dispute frivolous. They also must forward all relevant data you provide about the dispute to the information provider. After the information provider receives notice of a dispute from the CRA, it must investigate, review all relevant information provided by the CRA, and report the results to the CRA. If the information provider finds the disputed information to be inaccurate, it must notify all nationwide CRAs so they can correct this information in your file. Disputed information that cannot be verified must be deleted from your file, then you will recieve a clean credit report, with that item removed.

If your report contains erroneous information, the CRA must correct it(clean credit).

If an item is incomplete, the CRA must complete it. For example, if your file showed that you were late making payments ( 30 days or more), but failed to show that you were no longer delinquent, the CRA must show that you’re current.

If your file shows an account that belongs only to another person, the CRA must delete it.

When the reinvestigation is complete, they must give you the written results and a free copy of your clean credit report, if the dispute results in a change. If an item is changed or removed, they cannot put the disputed information back in your file unless the information provider verifies its accuracy and completeness.

Also, if you request, they must send notices of clean credit report corrections to anyone who received your report in the past six months. Job applicants can have a corrected copy of their clean credit report sent to anyone who received a copy during the past two years for employment purposes. If a reinvestigation does not resolve your dispute, ask the CRA to include your statement of the dispute in your file and in future reports.

Second, in addition to writing to the credit agency, tell the creditor or other information provider in writing that you dispute an item. Again, include copies (please not originals) of documents that support your position. Many providers specify an address for disputes. If the provider then reports the item to any credit reporting angency, it must include a notice of your dispute. In addition, if you are correct that is, if the disputed information is not accurate the information provider may not use it again, thus you will have a clean credit report.

When negative information in your report is accurate, only the passage of time can assure its removal. Accurate negative information can generally stay on your report for 7 years.

Clean Credit: There are certain exceptions:

Bankruptcy information may be reported for 10 years.

Information about criminal convictions may be reported without any time limitation.

Credit information reported in response to an application for a job with a salary of more than $75,000 has no time limit.

Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer. Criminal convictions can be reported without any time limit.

Credit information reported because of an application for more than $150,000 worth of credit or life insurance has no time limit.

Adding clean credit accounts to your file:

Your credit file may not reflect all your clean credit accounts. Although most national department stores and all-purpose bank credit card accounts will be included in your file, not all creditors supply information: Some travel, entertainment, gasoline card companies, local retailers, and credit unions are among those creditors that don’t report clean credit.

If you’ve been told you were denied clean credit because of an insufficient credit file or no credit file and you have accounts with creditors that don’t appear in your credit file, ask the CRA to add this information to future reports. This will help get you on the road to a clean credit report. Although they are not required to do so, many CRAs will add verifiable accounts for a fee. You should, however, understand that if these creditors do not report to the CRA on a regular basis, these added items will not be updated in your file.

You may know that federal law entitles you to receive one free credit report each year from the three major credit bureaus: Equifax, Experian, and TransUnion. But do you know the best way to do so, and how to stay on top of your credit all year long?

To get your credit reports at no charge from the credit bureaus, simply log onto Annualcreditreport.com, the website maintained by the three credit reporting agencies. When you request your credit files, you have the option of getting those reports in one of two ways: all at once, or over a period of several months, perhaps even up to a year.

Some experts recommend that you get a single credit report at a time, staggering them every four months or so, to see your credit files throughout the year. Under this scenario, you might retrieve your Equifax report in January, your Experian report four months later in May, and then your TransUnion report in another four months, in September. The following year you’d repeat the cycle, picking up those respective credit reports again in January, May and September. Advocates of this method suggest that, to execute this strategy, you should set up email notifications, text alerts or other calendar reminders to help you keep tabs on your credit – and when to next request a credit file – throughout the year.

While this process can work, I strongly suggest a different method. Namely, I think you’ll be far better off getting all three credit reports at once, and signing up for a worthwhile credit monitoring service. (FreeCreditReport.com has a good credit monitoring service, because it tracks all three credit bureaus, and will alert you to any activity in your credit files, such as inquiries, newly-opened credit accounts, or late payments reported by creditors).

So why it is most advantageous to get all your credit reports simultaneously – as opposed to waiting and getting those credit files in a staggered fashion over the course of many months? It boils down to these four primary benefits:

1. Speedier Resolution of Errors

If something is wrong in any one of your credit files, you want to know about it and get it corrected, pronto. When you pull all three of your credit reports, you’re able to instantly tell if one, two or all of your credit files have inaccuracies about your credit past. If so, you can begin disputing those mistakes immediately. If you waited to get your credit reports, months could go by with damaging, erroneous information on your credit files without you even knowing it. And don’t forget, if you’re seeking any loans, mistakes in your credit files could cause your application to be rejected, or could force you to pay higher interest rates than you should.

2. Clarity About Differences and Discrepancies in Your Credit Files

By looking at all three credit reports in concert, you will gain clarity and insight into a host of potential differences and discrepancies contained in your various credit files. For instance, does one of your reports show that that student loan you paid off, but the other two lack that information? If so, you’ll want to have that positive payment history (i.e. a record of your successful loan payoff) added to those two other credit files. And what about other discrepancies? Are you listed as an authorized user or a certain credit card account on your TransUnion report, but as a co-signer of that same credit account on your Equifax file? The difference may seem subtle, but it can impact your credit rating. Also, have you ever pulled your credit scores and not understood why the scores linked to the Experian report came in at 700, while the score based on your Equifax file was a 675, and the TransUnion-linked score was just 658? These score discrepancies can frequently be explained by the disparities in your credit files; disparities such as inquiries listed, amount of debts shown, or the payment track record reported in each of your credit files.

3. Better Credit Education

Perhaps the chief benefit of viewing all your credit reports together is the amazing amount of financial education you will assuredly get about your credit profile just by looking at the highlights of each credit file, and the way that similar information is presented differently in each credit report. Every one of us learns differently, and you’ll find that you understand some aspect of your credit better (or not as well) from the reports generated by Equifax, Experian and TransUnion. For example, after pulling my most recent TransUnion report, my first thought, in all candor, was: Yuck. Not because I had bad credit; my credit is actually excellent. But I simply didn’t like the way the information was presented in my TransUnion file. The tiny print on the file was hard to read. There were confusing images.

All my accounts were listed alphabetically, making it difficult to determine or see which accounts were closed versus which ones were open. It reminded me of an engineering report with little boxes and things I had to somehow decipher. All in all, the delivery of information from TransUnion wasn’t attractive or particularly enlightening to me. In contrast to the TransUnion credit report, I really liked the visual presentation on my Equifax and Experian reports. My Experian report was easy to read, presented in a clean summary-style format, and clued me in to salient points right ways, such as the number of open and closed accounts in my file, and the fact that all my accounts were in good standing with no delinquencies. With my Equifax report, I appreciated that Equifax did a lot of analysis work for me. It too told me the number of Open Accounts I had, gave me balances, available credit and credit limits on each, and then calculated my debt to credit ratio. My Equifax report also tallied my monthly payment amounts in each category (mortgage, installment and revolving debt), and informed me of how many accounts hade a balance. So my point is simply this: each credit report had something valuable to offer; had I only looked at one report, I wouldn’t have learned as much. To conclude, just because the TransUnion report didn’t wow me, doesn’t mean it won’t be discernible or valuable to you. Some of us like to see information presented in a text-heavy manner, with lots of words and explanations. Others prefer charts and graphs to explain things to you. And still others like pictures or snapshot summaries.

No matter what your preference, you’ll be all the more educated about your credit if you take the time to look at the information contained in each of the three reports together. As proof of this, I should note that despite my previous comments about my TransUnion report, I nevertheless did learn several valuable takeaways courtesy of that report – information I wouldn’t have immediately grasped had I only pulled my Equifax or Experian reports. For example, TransUnion was the only bureau to give me a summary of the length of my credit history. At the top of my TransUnion report was a statement that said: “You have been on our files since 02/1987.” This was good to know, especially since the length of credit history counts in computing one’s credit score. The TransUnion report furthermore explained a few mysterious codes that are sometimes contained in credit reports, but not always explained. To be precise, my TransUnion report stated: “If any item on your credit report begins with ‘MED1′, it includes medical information and the data following ‘MED1′ is not displayed to anyone but you except where permitted by law.” Although I had no medical debt, this would be good info for those trying to interpret that MED1 code.

4. More Comprehensive View of Your Overall Credit Standing

When you get all three of your credit reports at once, you’re giving yourself the same comprehensive, birds-eye view of your credit profile that many lenders use. Especially when banks are evaluating you for a major loan, such as a mortgage, many of them will pull a so-called tri-merged report, or a 3-in-1 credit file containing information from TransUnion, Equifax and Experian. There’s a reason that lenders want to look at all three of your reports: and it’s to have all the facts about you, and the broadest possible look at your credit rating. If lenders and creditors take that full scale approach to examining your credit, then so should you. Some of you might ask: But what if I’m not seeking a mortgage? Do I really need to know what’s in all three reports? The answer is a resounding yes. Even though you may not be in the market for a mortgage, is it possible in the near future you will apply for any form of credit whatsoever – say a credit card, a car loan or some kind of a line of credit? If so, you obviously know that a bank is going to pull your credit. But the problem is: you don’t know exactly which credit file they’ll examine. That’s why you should already know what’s in all three of those reports. Don’t take the risk of being ignorant about something missing or erroneous being in your credit file, and having that information hurt your chances of getting the credit you want or need.

As you can see, there are a host of reasons to get all your credit reports at once, especially during the global credit crunch we are experiencing. A simultaneous examination of all three files – from Equifax, Experian, and TransUnion – is one of the most sure-fire ways to get a true picture of your credit status. Given these facts, it’s almost unthinkable that many people either consciously or unconsciously choose not to pull their credit files – even though they can get them quickly, free of charge, and even conveniently online.