repair credit

How To Report An Error On Your Credit Report
By John Simpson, Thu Dec 8th

Have you been turned down for a loan recently? Have you appliedfor store credit and been refused? Did you really want that carand find out that because of your 'credit score' that they wouldhave to require an unreasonable down payment?

Credit reports are designed to help businesses evaluate the riskfactor in giving you money or valuable products on a line ofcredit.

The Fair Credit Reporting Act promotes the accuracy, fairnessand privacy of information in the files of the nation's creditreporting agencies. The act is enforced with regard to theconsumer's rights and requiring new responsibilities for thecredit reporting agencies.

For example, a reporting agency must give you a copy of yourreport and they must provide a list of every inquiry about yourcredit report within the last year.

The agencies collect data on personal identification (name,address, social security number, current employer, etc), paymenthistories with all current and closed lines of credit thatdetails how much you owe, when you've paid on time and what, ifany have been reported to a collection agency.

The final two items are all inquiries that have been made onyour credit report as well as anything that is considered amatter of public record such as bankruptcies, foreclosures andtax liens.

To repair or report errors on your credit report, you mustobtain a copy of your personal report and score. The reportsthemselves are not uniform from company to company.

Experian may not list all the data of Equifax and vice versa.So, be sure to obtain credit history reports from the samecompany as the creditor who turned down your application. Insome states, that may require a small fee, but after September1, 2005 all states will have to be in compliance with providinga free credit report.

Once you have the report, verify the information. Every reportis also scored. Scoring is the system that creditors use todetermine your credit experience. These scores are valid for allthree companies and are uniform in value.

Credit scores range from 375 to 900 points, but those numbersmean little on their own. A score of 650 or better usuallyindicates a very good credit history. Scores between 620 and 650are considered average, while scores below 620 may prevent aperson from getting a loan. If they do receive one, it is likelyone with prohibitive interest attached.

If you look at all the information on your credit report andit's correct, then you are faced with having to improve eitheryour payment history, lower the number of debts.

If the score is low because you possess very little credithistory, investing in a secured credit card can help generategood feedback to your credit report or a co-signer who canprovide the creditor with a good credit history as security foryour lack of one.

Inaccurate information, however, such as reported late paymentsthat you disagree with or a listing for a debt that is not yoursis repairable. Some companies offer debt consolidation or

creditrepair. Before getting involved with either type, be sure youthoroughly check out the company to avoid scams.

Doing the credit repair on your own is simple enough. Write aletter, detailing the inaccuracy to the reporting company. Sendthe letter and copies (copies only) of any documents supportingyour claim to the credit-reporting agency. Some agencies allowyou to do this online through their websites; however, if youneed to send them hard data it's better to use regular postalmail.

The credit agencies are then required by law to investigate theitem in question, usually within 30 days. They must forward allinformation to the reporting creditor and if they cannot verifythe veracity of their report or the creditor does not respond,the report will then be changed and updated to reflect the dataprovided.

The company must then notify you in writing of the change aswell as provide you with an updated credit report.

It's important to note, that if there is an inaccuracy onExperian that there is likely a similar one on Trans Union andEquifax. Each company must be notified, separately for eachitem.

Also, if you have more than one item you are disputing on yourcredit report, then you may have to send a separate letter foreach instance, to be certain that each item is addressed.

While this can be a time-consuming task at first glance, it isthe best way to remove inaccuracies from your credit history andrepair misinformation damage to your credit report. If yourequest it, the reporting agency must also send notices of anycorrections to anyone who received your report in the previoussix months.

If the negative information reported to your credit history isaccurate, then only time can repair the damage of the negativescore. Most information rolls off after 7 to 10 years, butfelony convictions, information on jobs paying you over $75,000a year or credit of more than $150,000 has no time limit.

If you had a car repossessed, you'll have to wait about 8 yearsto see the repossession removed from your credit history. Opencredit lines, whether the information is negative or positive,will remain active on your credit history whether you activelyuse the credit or not.

Applying for credit is never a fun, even for people who areconsidered to have good credit. There is always an inherent fearof rejection by the creditor you are applying for. If you areconcerned about your credit history, keep an eye on it.

It's recommended that you check your credit history once a yearat least, because in an age of identity theft, negative credithistory can be part of the collateral damage.

About the author:John Simpson works in software development. A few years ago, hegot in trouble with credit card debts. Now he's written a seriesof articles explaining how he recovered, and repaired hiscredit. Find out how to repair your credit. Discover why a goodcredit report is vital to your financial future, and how to makeit the best http://www.credit-repair-101.com/

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