Credit Reports

Credit files are windows into your private life, they are your financial fingerprints, your payment history, your available credit and your address records, all recorded with or without your consent. Lenders look at your credit history to assess your creditworthiness. It’s to your advantage to know what your credit report says before you apply for credit so you can correct any inaccurate data. It can take up to six months for credit reporting agencies to investigate and make a change in your credit report - give yourself at least 12 months to correct your data before you start shopping for a mortgage, car or any other large purchase.

With the increasing importance of credit in our society today comes the growing importance of knowing your own credit history. Free credit reports can now be obtained from many different agencies and can be used to benefit those requesting them in several ways.

A good credit history opens financial doors that may be closed to those with a less than perfect credit history. Past mistakes don’t mean that you’re forever doomed, though. There is hope for individuals of all types of credit histories. Requesting a free credit report can let you know where you stand and may give you tips on how to improve your credit.

Did You Know?
Do you know how long information stays on your credit report? Reporting times vary from state to state, but here are some averages for you to gauge the length of time information will stay on your credit report:

• Good credit behavior: indefinitely
• Delinquencies (late payments): seven years
• Bankruptcies: 7 to 10 years
• Collections and charge-offs: seven years
• Closed accounts: seven years from date closed (if zero balance), or seven years from final payment (if closed with balance)
• Tax liens – seven years if paid, up to fifteen years if unpaid
  

You are eligible to get a free copy of your own credit report:

If you have been denied credit, employment, or insurance within the last 60 days, you can take the written proof of your denial and mail it to the credit bureaus, requesting a free report.

If you have been charged higher rates and fees based on a credit report issued by a credit bureau, you have the right to get a free copy from that bureau.

If you are unemployed and aim to seek employment within the next 60 days, you can certify this in writing for the credit bureau.

If you are on welfare.

If you write to say you were a victim of fraud.

When you get the report, review your credit file to verify the following:

Name
Address
Social Security Number
Date of Birth
All accounts listed are your own
Credit/charge accounts
Outstanding balances/limits on the accounts
Payment histories
Derogatory credit information
Inquiries

Some states have laws requiring the bureaus (Equifax®, Experian® and TransUnion) to provide one free credit report per year. You can also order your own credit report online at any time.

You may benefit from requesting a credit report by knowing and understanding your financial security to a greater degree. It also may help you protect yourself from identity fraud, one of the fastest growing crimes in the US. It can also help you verify that you have been given honest rates of interest on loans, and that there are no errors on your credit report.

Avoid overspending, establish a budget, correct your credit report, add positive information to your credit file and maintain good credit.