Fix Your Credit Now!

2007-03-08 10:33:40

( Financial )



Who says the only time to care about your credit history is when you’re applying for a loan? Why wait the last minute to fix your credit problems when you can fix it now? Before you even think about getting any major loan, consider where you stand with your credit history; doing so will save you the hassle and horrors of dealing with bad credit.

Reviewing Your Credit Report

To fix your credit, you have to start someplace. The logical step of course is to ask the three major credit bureaus to give you a copy of your credit history. Review the report for errors and inaccuracies. Usual credit report errors involve payment records to your creditors, debts of an ex-spouse still linked to you and you might even be a victim of identity theft and liked with bad debt that you have nothing to do about. So check and keep tab of everything. After this, gather proof (receipts, bills, and letters) that will back up your disputes.


Disputing Errors

Contact your creditors first. Argue your case and provide evidence. If they yield and correct the errors, be sure to ask for a letter of acknowledgment regarding the errors. If not, move on to the credit bureau. Request for an investigation through a letter; include explanation for each dispute and supporting paperwork. Follow up after 30 days to check on their progress. If changes were made to your report, you will receive a free copy from the credit bureau.

What Credit Bureaus Don’t Want You To Know

What they may not be telling you is that all items that cannot be verified as correct when investigated must be removed from your file. This means that you can try to challenge all the negative items in your credit report and if credit bureaus can’t verify them within a reasonable amount of time (defined by law as 30 days) they can be deleted from your file. However, some items are easier to dispute than others. Items older than 2 years, late payments that are now paid off as well as repossessions are easier to dispute than recent bankruptcies, judgments and tax liens. So with a bit of patience, you can drastically improve your credit history and fix your credit woes!

Negative Entries

As you fix your credit report, you will come across negative entries that are accurate. These may in fact be the biggest hurdles in improving your credit score. If you have bad credit, pay loan balances if you can. Avoid unnecessary loan applications since they may have adverse effects on your credit score. Refrain from making late payments for a minimum of two years. If you are looking to consolidate your debt, weigh the risks carefully. This should be the last option, along with filing for bankruptcy


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