Why Lenders Want To Check Your Credit Report Before Approving A Loan? |
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Did you check your credit report recently? Are you thinking about applying for a loan? If so, your lenders will check your credit report before they approve you for the loan you want. Every time you apply for credit, you give lenders permission to check your credit report. Before you let your lenders check your credit report, you should check it yourself. You can apply for a copy of your credit report from any of the three major credit bureaus: Equifax, Experian and TransUnion. These agencies charge a small fee for reports. However, you are entitled to one free credit report from each bureau once a year. You can check your credit report for free under other circumstances too. You are entitled to a free report if you certify in writing that you are unemployed and plan to look for a job within 60 days, you are on welfare, or your report is inaccurate because of fraud. To apply for your free credit report, you need to provide personal information, such as your name, address, social security number, date of birth, spouse's name, and so on. If you have moved in the last two years, you may have to provide your previous addresses also. If you check your credit report and find any kind of error, you should fill out the dispute form provided by the credit bureaus. You can fill out the dispute form personally by contacting the officials or online. When the credit bureaus have received your dispute form, they must investigate and respond to you within 30 days. Before you are approved for a loan, lenders check your credit report to confirm your creditworthiness and to assess your risk-taking capacity. If you have very good credit score, lenders assume you are a responsible borrower. As a result, you can get the loan you desire. But things may be just the opposite if your credit score is not up to the mark. With a low credit score, you may be denied the many benefits given to people with good credit. For this reason, you should always be very careful regarding your credit report. Errors, even trivial ones, should not be taken lightly. An erroneous social security number or address can cause serious problems to your credit standing. Moreover, cases of identity theft and fraud are on the rise, and these can cause severe damage to your credit report. And with identity theft, many times you down even know if it's happening to you. But with your free credit report, you can verify the information and report any discrepancies to the credit bureaus for investigation. Nowadays, with a social security number and a little bit of work, anyone can steal your identity and obtain credit cards, identification, loans, and more in your name. By obtaining key information from your credit report, criminals build a profile of your identity and enjoy the benefits meant for you. In the most extreme cases, thieves can use personal information to gain access to your bank and investment accounts. And all of these credit charges are recorded in your name. Once the credit charges are reported against you in your credit report, you will face severe problems and headaches. Identity theft not only lowers your credit score drastically but also ruins your financial standing. Until and unless you check your credit report, you won't know what appears in your report. So, if you"re considering a major financial step, it's a good idea to check your credit report to know where you stand so you can take care of any problems before they derail your plans. |
