Did you know that if you are refused credit, you can find out exactly why under the Fair Credit Reporting Act (FCRA) and even if you do business or work overseas there is similar legislation to allow you to do the same, like the UK’s Data Protection Act and the EU Data Protection Directive. I ordered and received a review of my application to see just what they had on my report when they reviewed my credit.
Errors in Credit Reports
Poor credit ratings are repairable but it takes time – and mistakes on your credit ratings make it all the more difficult. Five percent of people report mistakes in their credit report but if you have minor problems on your credit report, mistakes or not, it shouldn’t take more than a year to get your rating to where you can use it to your benefit again – as long as you continue proper credit habits.
Many times, if the information is incorrect on your rating, it can help to contact the company or agency that claims you missed a payment. This can often rectify a mistake.
However, it could also be that your debts in question may be registered under someone else’s name and address. It could be that someone stole your identity, or a spouse used your credit card information to obtain their own card. In either case, it helps to find the source of the mistake first and then contact the credit agency with proof that the mistake is not yours. These kinds of services can be tremendously useful.
To make sure you are aware of all transgressions in your rating, complete this basic checklist below:
- Clarify that all your debts are registered under your own name and address.
- Make sure your debts and payments are not made under another person’s name.
- Space your applications over time and apply only for credit you know you have a good chance of receiving. Otherwise, it looks as if you are acting in haste and irresponsibly applying for as much credit as you can.
- Show you are a responsible borrower by spending very small amounts on your credit card and then paying it all back. This keeps you from paying interest costs as well as showing that you are responsible.
- Make sure you cut in half and shut down any and all credit cards you don’t use.
- Keep away from jointly financing with someone who has a bad credit rating, which may affect your own rating adversely in the long-run.
- Look for outdated information on your credit report and update it.
- Keep a detailed record of what you do when you’re rectifying issues on your report so that you can have all the evidence at your fingertips. Make sure you keep originals in your files and send only copies of documents and correspondences.
- When contacting a credit agency to dispute an item, make sure you have all the proof you need. Creditors are required to resolve issues within 28 days and update your record.
I can tell you it will make a world of difference on your credit if you complete this checklist. More information can be found at this site and others like it.
Scott Bryan is a financial blogger who gained his experience of the world of finance through thirty years as a high street bank manager. This instilled in him the understanding that everyone has unique requirements and gave him the knowledge to help find the right solution for each person. He now works as a freelance financial writer when not consulting