Credit
We all have a credit report-What
does yours say about you?
We all have a credit report and
whether it is good or bad is something that you need to start thinking
about. If you have ever financed a car, or had a loan of any sort, even a
credit card you have a credit report.
And if you have ever paid bills for anything like a cell phone or for
electricity then you have a credit report. It is important that you have a
good credit report for several different reasons. First of all if you have
plans to buy a house someday or a new car then you are going to need good
credit to be approved for financing. Most people do plan to purchase a
home someday and you cannot do that unless you have good credit. Your
credit rating will even affect the interest rates that you will be able to
get your loans at. The lower your interest rate the more money that you
will save.
I am sure that you have heard or
read the offers that promise you that they will erase all of your bad
credit history quickly and efficiently but these promises are false. No
one can get rid of your bad credit history but you. Time is the only thing
that will heal these types of wounds and anyone that promises you
otherwise is lying to you.
A good tool for you to refer to when
you are trying to rebuild your credit is the book written by the Federal
Trade Commission (FTC). This book will teach you the following: your
rights under the Fair Credit Reporting Act and your rights under the Fair
and Accurate Credit Transactions Act. It will also teach you how to
legally improve your credit, knowing how to do this the right way is
important, this book will also teach you about identity theft and how it
can affect your life and most importantly it will teach you how to deal
with your debt once and for all.
The Fair Credit and Reporting Act is
dedicated to making sure that your records are keep accurate, private and
safe. It is the FTC that enforces the rules and laws as they pertain to
the credit reporting companies. You have many rights that you probably do
not have any idea what these rights are. One of your most important rights
is the right to see your credit report. You have the right to a free copy
once a year but you will have to request it, it will not be automatically
sent to you. When you get your report you will also get a list of the
companies and people who have also requested a copy of the
report.
Most people wonder what exactly is
on their credit report. Your credit report contains your name and address,
birth date and Social Security Number as well as your employment history
and your spouse's name. You will also find your home ownership, income,
and previous address information. Some of these things may only be given
to those who specifically ask for this information.
Your credit report will also have
exact record of all your past history as far as the amount of credit that
has been extended to you as well as how you dealt with this credit. If you
have not paid your debts off according to schedule then this will be noted
on the report. Every company, person or business that has ever requested a
copy of your credit report over the last year, regardless of their
purposes will be noted on your report as well. And if you have ever been
the subject of a foreclosure or you have filed for bankruptcy or even if
you have tax liens this information will be on this credit
report.
You are permitted to receive one
copy from each of the credit reporting agencies at no charge each and
every year. It is a good idea to get your report from each company because
they may have different information on them. All you have to do is ask for
a copy and they will send it to you right away. In order to get your free
credit report all you need to do is visit www.annualcreditreport.com and
there you will be directed to the different credit reporting companies.
The information that you will want to have ready to provide is your name,
address, Social Security number, and date of birth. Keep in mind that
www.annualcreditreport.com is the only place that is authorized online to provide you with
your credit report. By getting your report from this site you know that
you are not taking part in a scam that will end up costing you money in
the long run. There is only one other time that you are eligible to
receive a free credit report and that is when a company takes action
against you. If some company denies you credit you have a right to see
your credit report in order to figure out what the problem was and fix
it.
Your credit report has a credit
score on it and this score is what will determine whether or not you get
approved for a loan or more credit. This score is also what will determine
what your interest rate will be when and if you do get approved for any
kind of credit.
It is the responsibility by law of
the credit reporting agency to correct and false or inaccurate information
on your credit report. If you ever see anything that you are unsure about
on your report be sure to report it immediately. You should first give
your credit card company a telephone call and then follow up with a letter
explaining the problem. If you have any documentation pertaining to your
claim be sire to attach copies to send along as well. Never send the
originals, those you need to hold on to. Ask the company to correct these
errors as soon as possible. When they respond to you be sure to file these
responses away someplace where you will be bale to find them again with
ease if you need to. They should respond to your claim within 30 days of
the receipt of the letter that you sent so mark down this day.
Once the error has been corrected
you have the right to ask that your corrected credit report be sent to all
those who have requested it in the last 6 months.
If you credit report is in terrible
condition not because of any errors on your report but because of your
unreliability with credit then you need to take some steps to deal with
your credit. One of the easiest ways that you can take control of
your credit trouble is by budgeting. You can plan your budget any way that
you want although it is a good idea to not make your budget too strict
right off the bat. This could lead to you abandoning it altogether. A good
way to plan your budget is to first keep track of all your expenditures.
Write everything down and then at the end of the month take stock. This
list will give you a good idea of where you can cut down and what you can
cut out.
If your biggest problem is coming up
with enough money to pay your credit card bills then you should consider
giving your creditors a call. It is far better to let them know about the
problem than it is to simply not pay them at all. They may be willing to
work out a better payment schedule for you. This might even keep them from
raising your interest rate.
If you are past the point where your
creditors want to deal with you and you have already been passed off to
debt collectors you need to know your rights. Legally debt collectors
cannot call you before 8 am or after 9 pm, nor can they call you at work
unless you have previously given them permission. And if you feel you are
being harassed by debt collectors all you have to do is send them a
written request to stop contacting you and they must honor this
request.
One of the options that you have is
debt consolidation. Debt consolidation is a good option for those who are
looking for lower monthly payments. This not too bad of an idea because at
least this way you will be able to make your payments without further
damaging your credit. The one thing to keep in mind is that when you
consolidate your debt it will be taking you longer to pay them off. The
longer it takes you to pay off the loan the more you will end up paying in
interest. You can use lines of credit to consolidate your loan but if you
do this you will most likely be asked to put up your home as collateral.
If you default on these payments then you will lose your house.
One of the most important things for
you to learn is that you are in a prime position to be taken advantage of.
Millions of people just like you get fleeced each year by falling for
scams that promise to fix your bad credit or erase it entirely. None of
these promises are worth as much as the paper they are printed on because
there is nothing that can be done to simply erase bad credit. All you can
do is work to improve your credit and depending on how bad your credit is
this could take some time. Make sure that you look into any company that
you are considering working with. A good place to find information is your
local better business bureau.
Many of the credit scams that are
out there can actually land you in hot water with the law. Some of these
companies will charge you money up front and then they will proceed to
teach you how to erase your debt history. In fact you are not erasing
anything, only creating a new credit identity, which is illegal and
punishable by jail time.
Your credit report can be damaged by
others besides you and knowing this and how to prevent it is important to
your financial welfare. Identity theft is getting to be more anymore
prevalent all of the time. It does not take much for someone to be able to
steal your entire identity. All they need to do is get a hold of some of
your personal information. Some of the most common ways that others steal
your identity are by stealing information about you that they come across
on the job or by talking someone else on the job to give them your
information. This can happen by them paying off an employee or perhaps
they already have a previous relationship with an employee that they can
use to get such personal information. Hacking into computer records in
order to steal personal information is also very common. In this day of
computers and technology anyone can learn how to hack into just about any
company or network.
Going through others trash is
another one of the more common techniques that identity thieves use to
gain access to your personal information. We are always getting offers in
the mail, many of them pre approved and all it takes is for someone to get
a hold of one of these little pieces of paper and they can take over your
life. They can then go on to destroy your credit rating and history. You
should always shred any and all of these offers that you receive in the
mail to avoid identity theft.
Another way to avoid identity theft
is for you to keep your credit cards in a separate place from your wallet.
This way if a thieve steals you wallet all they are getting is your cash.
While it is never fun to have your cash stole at least this will not
destroy your entire life. Losing your credit cards to an identity thief
can destroy your life. Your credit report is accessed by employers and
even landlords these days and if your credit report is in really bad shape
you could find yourself without a place to work or a place to live. This
is why you should never write down your credit card numbers or your bank
account numbers where someone could find them and why you should get a
copy of your credit report each year.
If you think that your identity may
have been stolen there are some things that you can do. Putting a fraud
alert on your credit cards is a good idea and it can save your credit
rating. All you have to do is call the credit reporting companies and let
them know that you would like to get a fraud alert on your credit report.
Getting copies of your credit report from all of the major credit
reporting companies will help you to see if there has been any fraudulent
activity. The next step is for you to contact your local police station.
Let them know what has happened to you including all detail about how it
could have happened. You will then want to contact the FTC and fill tem in
on what has happened to you as well.
