Money | Debts | Financial Freedom

When a bank or other creditor is deciding whether to approve a loan they look very closely at the applicants credit score; it is one of the most important parts of the application. Your credit score is created through an analysis of how you have previously handled the credit extended to you. Unfortunately, more and more people are finding incorrect or incomplete information on their credit reports. This false information can lower your overall credit score and make it much more difficult to obtain a loan with acceptable terms.

The first step is to obtain a free copy of the credit reports from each of three primary credit reporting agencies: Equifax, Experian, and TransUnion. It is necessary to get all three reports because each of them are based on different databases and a mistake on one report may not be recorded on another. The lender is likely to look at all three scores; therefore, the savvy borrower should as well.

Once you receive the free credit report copies the next step is to look at each part very closely, even line by line. This report will show every creditor, the amount owing, and whether your payments are on time or late, or if the loan is in default. Make sure that everything on the report is actually your loan or credit card account, also making sure that all of your loans are indeed reported and that the available credit is listed. Each bit of this information is a part of your overall credit score.

The credit reporting agencies have taken on an enormous task in collecting, sorting and entering all the raw data into their databases. It is no wonder that mistakes happen with all the common and similar names that people have and with the rarity that people review their credit files.

If you find mistakes and false information you can appeal the information by contacting the reporting agency. The main credit reporting agencies have websites that will have a claim form available on them that will make resolution of the problem easier. To make your claim move forward smoothly it is a good idea to include any documentation that will substantiate what you are saying and why you think it is incorrect. It is important to frequently look at your credit reports; getting old information removed is much easier than having new data removed or corrected.

Once the claim is initiated, it usually takes 30 days for the agency to investigate the matter. Depending on the results of the investigation, the item may or may not be removed. It is not uncommon for lenders to fail to respond after a claim has been initiated. If this happens, the bureaus are required to remove the information from your credit file.

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Tags: Credit, Credit Info, credit repair, credit report disputing, credit tips, Finance, mortgage, Personal Finance

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