Finding Report Errors
In Credit Score of CreditGuru (October 11, 2008 11:59 pm)
Keeping track of your financial situation is essential for maintaining your financial health. You should be aware of your income and expenditures. To this end, keeping detailed records of where all your money comes from, is saved and spent is a project worthwhile undertaking. In the current financial economy, not staying on top of one’s finances has led millions of Americans to file for personal bankruptcy.
In addition to keeping your own records, a critical piece of your financial picture lies in your financial credit score. Credit scores are called FICO scores because the majority of credit bureau scores used in the United States are produced by Fair Isaac and Company, or FICO. FICO scores are provided to lenders by the three major credit reporting agencies - Equifax, TransUnion, and Experian.
A FICO score measures your creditworthiness. Your score will fall between 300 and 500. Borrowers with higher FICO scores are less risky borrowers than those with low scores. They are more likely to pay off their debt and not default on a loan. The score is based on many factors, including payment history, outstanding debt, duration of credit history, negative credit information such as bankruptcies and collections and the amount of credit used vs. the amount of credit available.
Be aware that the 3 credit reporting agencies may report different FICO scores for you. The agency only considers the data in your credit report at that agency. If your current scores from the three credit reporting agencies are different, it’s probably because the information those agencies have on you is different.
If you request it, each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — is required to provide you with a free copy of your credit report once every 12 months. Be sure to review your credit report from all 3 reporting agencies. If you find credit report errors, it is important to remedy the matter as quickly as possible. First, dispute those credit records on your credit report with the credit bureaus. A formal letter written to the agencies with all the details of the item in dispute should be accompanied by a copy of your report which identifies the item in question. Disputed credit report records are removed or corrected. Credit report records that are not confirmed are removed. Discuss negative credit report items with creditors and collection companies. After you discuss and make payment, creditors delete the negative accounts or change them to a positive credit rating.
Staying on top of your financial circumstances is critical to maintaining your financial stability. Don’t overlook the importance of credit repair with the three reporting agencies. The right information will help present a sound picture of your creditworthiness to all your creditors.
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