Repairing your credit report and score
By Melissa Wirkus
Your credit
report and subsequent credit score are
essential factors in buying a house and
taking out a mortgage. A low credit score
can substantially decrease your chances
of getting into a home.
And if you have a bad credit score, you
can pretty much kiss your chances good
bye of getting a mortgage
with low interest rates and payments.
Those with low credit scores have to take
out sub-prime loans, which carry higher
rates and payments.
Achieving a high credit score starts by
looking at and fixing your credit report.
An October 3, 2006 article by Nance Kelly
of About.com, “How to repair your
credit report,” looks at how you
can look to improve the outlook of your
credit history.
“Credit report repair is not something
you can accomplish overnight. It took
time for your credit report to become
damaged, and it’s going to take
time to get your credit report fixed.
Follow these steps to get the credit repair
process started and improve your credit
score.”
Most experts agree that it takes about
30 to 60 days to fix any mistakes on your
credit report, although it varies depending
on your specific situation.
The first thing you must do is request
a copy of your credit report. There are
many companies that will try to scam you,
and there are only three national agencies
that are licensed in the United States.
They are Equifax, Experian and Trans Union.
“Take advantage of your ability
to request a free copy of your credit
report, or if you want to see your credit
score as well, you can purchase a copy
of your report and score.”
Once you have obtained your credit report
and/or score, you need to carefully review
it for any errors it might contain. You
would be surprised to find out how many
errors a credit report contains.
“Negative information can be reported
for up to 7 years. If old collection accounts
are reported, you can request to have
these items removed. You'll also want
to check for inaccurate or incomplete
information; If your credit limit is showing
as $3,000 instead of $5,000, or you have
an older, open account, that is not being
reported, you will want to bring these
errors to the attention of the credit
bureau so your report is as accurate as
possible.”
Next, it will be time to contact the Credit
Reporting Agency, or CRA. Send letters
via certified mail and include any proof
you may have concerning the inaccuracies
such as receipts. The CRA then has 30
days to look into your dispute and if
they cannot verify its accuracy they must
remove it from your report.
If you do not have an extensive credit
report, be sure that you ask credit card
companies to report your other accounts
that are in good standing such as any
miscellaneous department store credit
cards or your bank accounts.
Once you have done these various things,
you should be well on your way to repairing
your credit report. Now you should just
focus on maintaining good
credit.
“Pay
your bills on time, don’t max out
your credit cards and don’t keep
a lot of open accounts, but be careful
about closing older accounts as this can
negatively affect you too.”
