| If
you are applying for a loan or credit, records of your
previous dealings
with someone else's money are vital. Whether
you get that
mortgage or credit card, or not, may depend on a network
of credit reporting
agencies that either share information with, or are
owned by, three major
credit bureaus. This report is often a critical factor
in
credit
scoring systems
that lenders use to issue credit cards as well as
mortgages or other loans. So,
if you're considering
making a major financial move it's a good idea to check
your credit report
to know where you stand. That way you can be aware
of, and/or take care
of, problems before they jump up and derail your plans. If
you find problems,
or if potential creditors discover them, you can take steps to rebuild
damaged credit and clean up that record. If
you've made mistakes
in paying previous loans, bounced checks, made late
payments or had other
problems, you may still be able to reduce the amount
of damage they will
do to your credit with explanations or some basic repair. Getting
your hands
on your credit report
There
are
basically three ways to get a copy of your credit report. - You
can simply
request a copy from one of the three major national
credit bureaus:
Equifax,
Experian
and Trans Union.
Checking your credit report can cost you as much
as $8 per report, although it differs from
state
to state.
- If
you applied
for a loan and were turned down, you are entitled to
a free copy of
your credit report, but you must request a copy by
writing the correct
credit bureau within 30 days of the rejection. With
your request,
you should include a copy of the declined loan application.
- You
can also
get a free report if you are unemployed, planning to
apply for jobs
in the next 60 days, receiving public welfare assistance
or believe
the credit file contains mistakes resulting from fraud.
To
obtain a copy
of your credit report: - Call
the number
of the proper credit bureau and follow their directions.
- Make
certain you
request the copy in writing, and send it certified
mail, return receipt.
- Include
your full
name, date of birth, current and former address, Social
Security number,
your spouse's name and your phone number.
- Each
person requesting
the report should sign the request.
Time
it, then
check the details
If
you
are about to apply for a major loan, like a house or
car, it's important
to give yourself time to correct mistakes or make good
on delinquent accounts.
Depending on the type of loan, you should give your
self enough time.
Here's a guideline: - For
a home, you
should check your credit at least three to six months
before you apply
for a mortgage.
- For
an auto loan,
check your credit (and arrange financing with your
bank or credit union)
before you start shopping.
- For
credit cards,
check your report before you apply. The last thing
you need is for a
credit report problem to slow down your application
-- particularly
if it's not your fault.
Once
you get the
report, you should make sure the following information is correct: - Your
name, or
names if you are or were married
- Social
security
number
- Date
of birth
- Addresses
of places
you've lived
- Names
of places
you've worked
- Pending
accounts
and accounts that have been closed
- Nothing
has been
on the report longer
than is allowed by law:
--
Bankruptcies must be taken off your credit history after 10 years.--
Suits and judgments, tax liens, arrest records, and
most other
kinds of unfavorable information must be dropped after 7 years.Records
of delinquent payments or other problems (i.e. make
sure they aren't
mistakes)Correcting
errors
Any
error
that you find must be investigated by the credit bureau
with the creditor
who supplied the data. The bureau will remove from
your credit report
any errors a creditor admits are there. If you disagree
with the findings,
you can file a short statement in your record giving
your side of the
story. Future reports to creditors must include this
statement or a summary
of it. The
Fair
Credit Billing Act requires creditors to correct errors promptly and
without damage to your credit rating. The law defines
a billing error
as any charge: --
for something
you didn't buy or for a purchase made by someone not
authorized to
use your account; --
for something
that is not properly identified on your bill or is
for an amount different
from the actual purchase price or was entered on a
date different
from the purchase date; --
for something
that you did not accept on delivery or that was not
delivered according
to agreement.
Billing
errors also
include: --
errors in
arithmetic;
--
failure
to show a payment or other credit to your account;
--
failure
to mail the bill to your current address, if you told
the creditor
about an address change at least 20 days before the
end of the billing
period;
--
questionable items, or any item for which you need more information.
Once
you have written
about a possible error, a creditor must not give out
information to other
creditors or credit bureaus that would hurt your credit
reputation until
the matter is resolved. And, until your complaint is
answered, the creditor
also may not take any action to collect the disputed amount. The
law is on
your side
Keep
in mind, the law is on your side if information on
your credit
report is proven to be false but is not removed, according to the Fair
Credit Reporting Act.
Under the law, you are entitled to actual damages,
plus punitive damages that the court may allow if the
violation is proved
to have been intentional. In any successful lawsuit,
you will also be
awarded court costs and attorney's fees. You
may also sue
any credit-reporting agency or creditor for breaking
the rules about who
may see your credit records or for not correcting errors in your file. A
person who obtains
a credit report without proper authorization -- or
an employee of a credit
reporting agency who gives a credit report to unauthorized
persons --
may be fined up to $5,000 or imprisoned for one year, or both. But
a lot of people
can see that report - including everyone to whom
you have applied
for a loan or credit. So be careful when applying for credit. When
the companies
you apply to check your report they can find out who
else has been checking
your report and determine what, when and how you have
been applying for
credit. That means if you have been getting turned
down and are desperately
applying for credit all over town your potential creditors will know. Thinking
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