Building a Better Credit Report
Everyone has a credit card report, and should be checked, once a year. In 2002, nearly 200 million Americans have credit files. A high credit rating, provides the consumer with a lower interest rates for a variety of loans, including lower cost for a mortgage, and more available credit Often, landlords use credit card ratings, accepting or denying new tenants. Unfortunately or advantageous, many businesses evaluate credit card ratings, when hiring employees, and evaluating to underwrite insurance policies. Some states, don’t allow insurers to use credit scores, and more states are considering new legislation, prohibiting the use of credit score information.
The three top credit agencies are Experian (1 – 888 – EXPERIAN), Equifax (1 – 800 – 685 – 1111) and TransUnion. Each (1 – 800 – 888 – 4213) tracks consumer credit ratings. These agencies monitor, amount owed and paid on credit cards, payment history, any time someone has been sued, debt load, and types of debts owed. According to Fair Credit Reporting Act, anyone can get free access credit history, from any agency, once a year. A copy of the credit report should be obtained, from each agency, since each one, reports independently. Information, believed to be false, must be proven by documentation to the credit agency, update their records. This will enhance your credit rating. Credit Agencies have thirty days to investigate your complaint. Statistically seen, thirty percent error rate, on credit reporting. If your credit card information cannot be resolved, contact Federal Trade Commission: 1 – 877 – FTC – HELP). Credit agencies measure a person’s credit rating by FICO score (credit score) from 375 – 900. About eleven percent, surveyed population ranks above a score of 800, and twenty-nine percent between:
750 – 799.
Increasing Credit Card Score:
Paying your bills on time. Thirty-five percent of the credit card score, evaluated by history of payment schedule, and timely payment amount. Missing one payment, could reduce credit score by 50 – 100 points, and worse, missing a month of payments, could reduce your credit score substantially. At least, make minimum payment, avoiding lowering credit score. In January 2006, minimum credit card payments will mostly double. Enhancing, your credit card score by reducing or eliminating debt owed, compared to amount total credit limits. The more wider or difference amount, reflects a better credit rating or score. Owning a credit card increases your credit availability. A credit agency, will total amount of credit availability, by adding all credit cards owned. If a credit card is canceled, reduces amount of credit available and reduces credit score. Consolidated to fewer credit cards, actually more harmful, than helpful. However, having many credit cards is risky, if anyone is stolen or lost. Besides temptation using, credit cards. Having many years, perfectly paying on time, credit card payments or bills, accounts for fifteen percent, of the credit card score. Inquiry history, for new credit reduces credit card score. Opposite is favorable, pursuing fewer or no credit, provides a better score. Credit agencies interpret, actively seeking credit inquires, maybe incur financial difficulties, and accounts for ten percent, credit card score.
Avoid, sharing a credit card or cosign any loan. Your credit rating may go down, if the other person defaults on the loan or unable to pay on time, credit card payment. During a marriage, husband and wife, should have their own credit card. Unfortunately, event of a divorce or death, a joint credit card, could render the other credit card holder, responsible for the debt and may lower their credit rating, if payment is not paid, on time.
Avoid filing for bankruptcy, when possible. Bankruptcy reduces credit score rating by 200 or more points, and stays on the record up to ten years. Contact a consumer credit counseling service. Foremost, provide advise helping to consolidate credit card payments, and likely reduce interest rate. In the long term, building a higher credit score.
