Free Credit Report: Fix the Problems before Applying For Credit |
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Your free credit report contains information on where you work and live and how you pay your bills. It also may show whether you've been sued or arrested or have filed for bankruptcy. And, thousands of unsuspecting consumers discover they have errors on their free credit report every day. And they usually discover this when they get turned down for a loan, receive a higher than normal interest rate. It takes time to fix the errors in a free credit report. So, it's best to check and correct these errors before applying for credit, like a new loan, new mortgage, new job, or insurance. This advance check saves time, money, as well as the embarrassment of rejection. Errors on your free credit report may cause a variance of 50 points or more in credit scores, the number used to determine creditworthiness. Errors can be caused by wrong credit reporting, inaccurate listings, missing satisfied loans or mortgages, duplicate mortgage entries and information that have been wrongly entered. With over 75% of all credit reports containing some sort of error, most consumers have been or will be affected by a problem with inaccurate credit history. Most people are aware of the need to find free credit report errors, but they have no idea how to go about it. Even if they find errors on their own they feel overwhelmed, when it comes to getting the errors fixed. But there are some companies called consumer-reporting agencies help people to discover the errors on their free credit report and correct them. The consumer friendly Fair Credit Reporting Act is helpful when it comes to fixing errors in your free credit report. Errors in your free credit report include mistakes but they also include omissions. It's possible that actions you've taken to pay off a debt or clear up a delinquency, for example, have not been recorded in your credit report. There is a procedure to change incorrect information in a free credit report. Since credit bureaus compile the information they receive from merchants, only the credit-granting merchant can make changes, by sending new information directly to the credit bureau. So contact the merchant or lender if you have a dispute. And don't resolve disputes with merchants by not paying your bill; it could wind up ruining your credit! A common thumb rule is to review your free credit report from all the three major credit bureaus, at least once a year. If the creditor or information provider realizes that an error exists, it must correct it and notify all the major credit bureaus of this error. In turn, the credit bureau that reported the error must send you a free credit report to show that it has been corrected. Any disputed information that can't be verified must be deleted by the credit bureau. And, if an investigation isn't resolved in your favor, you can ask the credit bureau to include your version of the dispute in your record. Accurate negative information usually stays on a credit report for seven years and in case of bankruptcies, for ten years. However, if negative information in your free credit report is accurate there is nothing much that you can do. You're also entitled to one free copy of your report in a year, if you can prove that you're unemployed and plan to look for a job within 60 days. You can also get a free copy if you're on welfare, or your credit report is inaccurate because of fraud. Otherwise, a CRA may charge you up to $8, for a copy of your free credit report. The Fair Credit Reporting Act also guarantees the consumer the right to dispute any inaccurate and erroneous or obsolete information in their free credit report. Credit bureaus are often willing to offer consumers the help they need to the correct problems. They do so to earn the additional income, as an affiliate independent marketing representative. So don't ignore your free credit report. Look at it closely and regularly, and if you find any inaccuracy don't sit idle. Instead, dispute the inaccurate information and try to remove it from your free credit report. |
