Get Free Credit Report – Quick Consumer Credit Guide

Every US citizen is entitled to free copy of their annual credit report from each of the three credit bureaus. This can be done in three ways:

1.      ONLINE: Visit the website www.AnnualCreditReport.com. Please be aware that this is the only authorized website through which consumers can access their credit report for free and others are likely to be “free” credit report scams.

2.      PHONE: You can call the hotline at 1-877-322-8228. However please bear in mind that free annual credit report requests over the phone take about 15 days to process.

3.      MAIL : If you wish to order your credit ratings history by mail, complete the Annual Credit Report request brochure and mail it to Annual Credit Report Request Service, PO BOX 105281, Atlanta GA 30348-5281

Please remember that consumers are entitled to only one free credit report each year and each additional request incurs a charge of about $10.00. In addition to this, please also keep in mind that approaching a consumer credit agency directly will also incur a charge.

Order Free Consumer Credit Report – Advantages

Even though it is free, many consumers do not order their free consumer credit report because they believe it is pointless. However, regularly checking one’s credit rating history has several advantages, some of which are:

• Credit Report Errors: Viewing your free annual credit report regularly will allow you to pick up on any discrepancies and credit report errors that might have crept in to your credit report such as:- Payments not being credited to your accounts
  - Incorrect defaults shown on your account
  - Credit applications or enquires not applied for
  - Incorrect bank judgments and defaults, etc

• Viewing your own Credit Ratings Score: Obtaining your own credit ratings history enables you to view your own credit score and thereby see your credit standing

• Identity Theft : Viewing your annual credit report frequently could protect you against identity theft. Identity theft has been growing at an alarming rate in the country and it might be a good idea to ensure that you are not a victim. In fact, identity theft victims legally qualify for free credit reports at any time of the year.

Adverse Circumstances – Obtain Free Consumer Credit Ratings History

Apart from identity theft, certain other adverse circumstances qualify a consumer for a free credit report which can help them view and if necessary, improve their consumer credit history.

• Negative Outcomes: If you have been denied credit or employment based on adverse comments in your credit ratings report, you can obtain a free credit report within 60 days of receiving notice of the action.

• Unemployment: In case of unemployment, consumers are entitled to a free credit report within 60 days from the date that they lose their job. Under these circumstances you are only allowed one per year.

It is recommended that consumers review their credit reports quarterly or half-yearly as it has been found almost a quarter of all consumer credit ratings reports contain errors. By regularly obtaining and viewing your free annual credit report, you can prevent and rectify errors in your credit ratings history to improve your personal credit ratings history and maintain a healthy credit standing.

Alison had a credit card with a credit institution. Although Alison had been very regular with her payments, owing to a system error, her payments were not recorded and were being credited to another account. Her account showed defaults for over two and half months. Alison was completely unaware of this, till she applied for a mortgage. Her application was rejected owing to her repayment history.

She eventually took this up with her credit card company and had the issue resolved, but was unaware that the credit card company had not informed the credit bureau and these listings stay on your report for a five year period.

Credit Report Error Examples

Alison’s credit report error story is not an isolated one. Some common examples of credit errors are:

• Payments not credited to your accounts.
• Default interest wrongly charged to your accounts.
• Incorrect account set-ups there by causing payments to come out early and placing your account in arrears.
• You do not have any dealings with the lender listed.
• The listing on your credit report was over 5 years ago.
• The same credit default has been recorded multiple times.
• The debt default listed had nothing to do with you and you have not acquired the debt.

These are just some examples of the kind of credit errors that may creep into your credit report.

Improve Your Score with Correct Information

In addition to the five elements such as payment history, balances owed, new credit applied for, types of credit and length of credit history, your credit report also records the following:

1.       Your name (including previously used names)

2.       Your address (including previous addresses)

3.       Court judgments.

4.       Dishonored cheques.

5.       Bankruptcy orders etc.

To improve your score the first thing you must do is ensure all the information on your credit report is absolutely accurate. Also it is important to know what is included in your score and which companies report to credit bureaus before you wage a battle with creditors and credit bureaus because sometimes what might seem like a credit error to you might actually be a rent default you had forgotten about.

Credit Report Repair – Get Rid of a Credit Error

The next issue is to solve any credit report errors that might have occurred on your score. Follow some of the steps below to improve your score and repair your credit report.

• Obtain a copy of your credit report regularly (as often as six months if need be) to ensure that no unwanted listings and credit errors have occurred.
• In the event that there is a listing that has wrongly appeared on your credit report, get in touch with your credit provider disputing the credit error and question the credit report error immediately.
• In certain cases the credit provider might have an external resolution system and in that case you might to file a credit error complaint with them to improve your score.
• Finally if none of the other avenues work, talk to the appropriate credit bureau and raise the issue with them by lodging a formal complaint about credit report errors and how it is affecting your score.
• The Federal Trade Commission regularly handles complaints about credit errors so you could complain to them to restore your score.
• Be prepared to fight a legal battle if necessary. This is your credit report and you should not take credit errors lying down. If a creditor will not fix a credit report error, inform them you are willing to hand over the matter for your solicitors to manage.
• If you are unable to repair your credit report alone, seek advice from a credit repair company but be careful as there are several scams out there.

For poor credit rating customers, getting a good credit interest rate is becoming a bigger problem during the recession. One fact to remember is that your individual FICO credit score has a directly proportional relation to the credit interest rate that will be offered to you (i.e. the better your FICO score the better the credit interest rate).

Getting the Best Interest Rate For Poor Credit Rating Consumers

Every consumer wants to get the best interest rate but for poor credit rating consumers, sometimes this becomes hard. It is therefore important to understand how much your FICO credit score affects your credit interest rates.

Every credit contract contains a certain element of risk within it. There is the risk that the customer will not repay the contract. In order to compensate this risk, lenders/financial institutions charge a higher credit interest rate to customers with a low FICO score. The philosophy behind this is that, clients with bad credit and lower FICO credit scores tend to carry a default risk.

FICO scores usually range from about 500-850, needless to say 850 being the best and 500 the worst. The chart below shows the relative credit interest rates you might be charged on a basic mortgage corresponding to your FICO credit score.

Bad FICO Credit Scores, High Credit Interest Rates

In the wake of the global financial crisis financial institutions are tightening credit policies like never before. They are lending less money even to those consumers who have good FICO credit scores making it harder for poor credit rating consumers to get the best interest rates. Financial institutions are now looking at things like default percentages corresponding to your FICO credit score. For example an accepted industry statistic is that consumers with a credit score of 750-760 usually have a default / arrears rate of 0.18%-0.20%. On the other hand for poor credit rating consumers with a FICO score of 540 or below the chances of a default are significantly higher as they stack up at nearly 20% or in other words nearly one out of five consumers with bad credit are likely to default on their payments. This is known as the risk rate and since consumers with bad credit are likely to have a higher risk rate, they usually end up paying higher credit interest rates as well.

Best Interest For Poor Credit Rating Consumers

Therefore, in order to improve your FICO credit score and become eligible for better credit interest rates you could take some of the following steps:

• Make sure you keep up with your credit contract repayments and make them on time.

• Get credit only if you need it and make sure that you do not accept any and every credit card limit increase that is offered to you.

• Keep you credit card and store card balances low as this can hugely affect you FICO credit score.

• Try and reestablish your credit worthiness if you are a poor credit rating consumer. Catch up on your missed payments and defaulted accounts, should you have any. Reestablishing your FICO credit score can go a long way in getting you the best credit interest rate possible.

A few simple steps can help vastly improve your FICO credit score and translate to getting you a better credit interest rate which in turn will save you a lot of dollars as far as far as repayments are concerned. When you start improving your FICO credit score, you automatically become a less risky customer and this will enable you to get the best interest rates on any credit contract.

What is Your Fico Score Chart Made Up Of?

Primarily your Fico credit score is dependent on the following factors:

• Length of Credit History – This usually contains data like the time since the account has been active and classifies them based on account type (e.g. consumer credit contract, hire purchase, residential mortgage etc). It also contains data regarding the last time there was activity on the account. This usually accounts for about 15% of your personal credit rating.
• Repayments history – This is the most important part of your FICO score chart as this accounts for 35% of a good credit rating. The data contained in this relates to repayment information classed according to account type. It also displays the presence of any adverse public records e.g. bankruptcies, court judgments, writs etc and also amounts due on accounts in arrears and the time since these amounts were due. This section of your FICO credit score also shows delinquent accounts which have been paid as agreed.
• New credit contracts entered into – This accounts for only 10% of your personal credit rating and contains information such as new credit enquiries classed on the basis of type of account. It also shows the time since the last credit enquiry was made and if good credit history has been reestablished since the last time the account encountered problems.
• Balances owed on each credit contract – As it would suggest this part of your fico score chart deals singularly with balances outstanding on credit contracts classed on the basis of account type. This also displays the proportion of balances owed to the total credit limit available with regard to revolving credit contracts (e.g. Lines of Credit). This accounts for about 30% of your score
• Types of credit- This displays the types of credit used by the consumer e.g. retail accounts, mortgages, credit cards etc. This accounts for another 10% of your Fico credit score.

Your FICO score chart takes into consideration all the factors mentioned above and FICO scores consider not only the negative factors but also the positives.  In addition it would help to know that while banks and finance institutions may consider a lot of outside factors while making decisions, your FICO score only considers the information available on your personal credit rating.

How To Improve Credit Ratings?

Good Fico credit scores are important and if you would like to restore your credit score it is important that you know how to improve credit rating.

• Your repayment history is extremely important and it is essential that you ensure that you keep on top of your repayments for a good credit rating. If you have missed any repayments in the recent past catch up with them.
• Remember that accounts which have been in collections, even after being paid still remain on your personal credit rating for a period of 7 years. Hence paying them off will not make them disappear immediately.
• If you feel like you are going to struggle with your finance obligations, then it may be time to see your bank or financial institution. Talk to them and seek independent financial advice about the best way to resolve your financial stress without letting it adversely affect a good credit rating.
• Having a brand new credit card is tempting but do not accept credit unless needed . This not only creates unwanted credit but also hampers your personal credit rating as it causes an additional enquiry and adds to your list of balances owed/ credit limit available.
• If you have not had a credit file for very long, just to show enquiries on your credit report, do not open up a lot of credit enquiries on your account at the same time. This reflects badly on your Fico credit score as this will show too many enquiries in too short a time.
• If you have had a bad personal credit ratings history, to restore credit scores only get the credit that you need and start paying them off in a timely manner. This will improve your FICO personal credit rating in the long run.
• Check your credit report as often you think fit to check whether you have a good credit rating. Ordering your own credit report does not affect your personal credit rating in any way.

Knowing how to improve credit ratings is not hard. By following these simple steps and managing your credit better you can vastly improve your Fico credit score and achieve a good personal credit rating.

Here are a few tips on how to manage your car loan efficiently without letting it affect your credit report:

1. Determine your Financial Situation:

• Make a budget and consider all your expenses.
• Any surplus funds should be redirected into your loan account.

2. Look at your Credit Report:

• Get a copy of your credit report from an online agency and gauge your credit worthiness.
• You may be able to negotiate a more competitive interest rate on a good credit score.

3. Shop Around:

• Shopping around may be time consuming but can result in significant savings for the smart shopper.
• Do not be afraid to inform a sales agent of the deal you are being offered at another dealership. It is better than haggling over price and the competition in the car industry may mean you land a better deal.

4. Target Mainstream Finance Options:

• Mainstream car finance options (mainstream finance option is finance obtained through a bank or a major credit institution) usually have the best deals.
• In case of a bad credit score, you might have to get finance from a non-conforming lending channel. This is usually at a higher interest rate.

5. Prompt and Timely Repayments:

• Your car loan repayments should be scheduled in line with your wage or salary.
• Pay your car loan immediately after getting your salary or if you have a direct debit system with the finance provider, ensure you account is debited a day or two after payday.

6. Beware of Interest Rate Rises

Example : If your repayments are $370 per month on a car loan of $40,000 at 11% p.a. for a period 5 years. If the interest goes up to 13%, your new repayments will be $433. This means that you will have to budget an additional $63 per month to meet your repayments or risk damaging your credit report.

7.      Leasing versus Buying: Car loans can either be leasesor purchase contracts and a lease should only be considered if the vehicle is for income generating purposes.

Leasing may offer lower monthly repayments than a purchase option but costs you more in the long run. Typically a lease agreement is structured such that you have to contribute a single balloon payment at the end of the contract. This balloon amount cushions you from higher monthly repayments but may be unaffordable at the end of the lease agreement. More importantly, if you calculate the total costs with a lease and purchase option, you may be surprised to find that you save more with a purchase agreement.

8. Debt Consolidation: Debt consolidation could be a good way to ease financial stress. If you have sufficient equity in your property, talk to your bank and use part of that equity to pay off your vehicle finance. The bank will absorb your car loan into your mortgage facility and you will be making repayments on the one finance facility. So now have only one credit facility to deal with and also have a greater amount of time to repay the loan (home loans are usually 15-30 years) and at a lower interest rate than your car loan.

The above mentioned tips are a few simple and easy steps that can ensure that your car loan is well managed. This will ensure that you do not fall behind on repayments and will also guide you towards improving your credit report.

Mortgage loans are one of the most important credit contracts consumers can get. It is mandatory that you manage this credit contract the best you can, so that it does not negatively impact your credit report or impair it any further. Below are a few points that would help you manage your mortgage loan better.

1.    Timely Payments

The first and probably most important step towards managing your mortgage loan efficiently is making timely mortgage repayments. Analyze your individual pay cycle and depending on whether you get paid weekly, fortnightly or monthly, talk to your bank to arrange your mortgage repayments accordingly. These can be arranged either via a direct debit or via self credit (this is where you pay the nominated mortgage loan account yourself). Try to ensure that the payments fall a day after the money from your salary or wages have come into your bank account. This will ensure that you never miss a payment.

2.    Contact Your Funder

If you think that you are going to struggle with your mortgage loan repayments for a specified period, contact your mortgage lender immediately and inform them of the situation. They may be able to defer your mortgage interest payments or allow the interest payments to be capitalized Capitalizing means that the interest payments get added to your loan amount for the duration that you are unable to make the repayments. The last thing you want is for a missed repayment to appear on your credit report.

3.    Increased Contributions

If you have received a pay rise, have worked overtime or find that that at the end of the month you have surplus monies left over, put these extra funds towards your mortgage loan. This will help you build up a buffer (surplus of cash in your mortgage account which can be drawn down later at the mortgage holder’s discretion) for future contingencies and unexpected commitments.

4.    Use an Offset Account

An offset account could be a very handy tool in helping you combat the rise in your mortgage loan repayments. An offset account, in most cases offers you the same interest rate as that of your mortgage loan. Hence it is wise to have surplus funds in your mortgage loan offset account as this will help reduce the interest payments on your mortgage loan.

5.    Don’t draw out equity unnecessarily from your home

This is a very common mistake which mortgage clients make. Most mortgage clients do this in order to combat their spending habits. Drawing out the unused equity from your home is not a good idea.

Let us assume that your home is worth $350,000 and you have taken out a mortgage loan on it worth $280,000.00 (80% of the property value to avoid Loan Mortgage Insurance Implications, also known as LMI). In about 2 years time your home is worth $385,000 assuming a 10% increase over 2 years and your mortgage loan is down to about $250,000. In this situation the available equity in your property is 80% of $385,000 = $308,000 less your mortgage loan balance of 250,000 which is equal to $58,000. This means that you can increase your mortgage loan by getting an additional $58,000 from the mortgage lender without having any LMI implications.

Doing this is a bad idea because the progress you had made towards repaying your home off sooner will have been undone. This not only leverages mortgage clients further but also adds another credit enquiry to your credit report.

6.    Understand the Mortgage Product You Are In

It is very essential that you understand the type of mortgage loan product you have. Mortgage loans can be of various types. Most mortgage clients use the standard variable options in which the bank provides you with a product that uses the bank’s standard variable rate. In most cases these products have user and management fees, which can be charged to your mortgage loan account.

It is essential that you are aware of the fees and charges related to your mortgage loan account. These fees and charges can sometimes make your mortgage loan appear to be in arrears, which looks detrimental on your home loan statements and if ignored can trickle down to your credit report. Another situation is where in certain cases banks might charge you a penalty for excessive mortgage contributions. Banks can set a ceiling on the amount a client can contribute over and above the minimum repayments in a year. Mortgage clients should be aware that they do not exceed this limit or else they are running the risk of being penalized by the bank.

Another very powerful mortgage loan product is a Line of Credit, also known as an LOC. A line of credit allows the mortgage loan client to make the minimum repayments while allowing the mortgage interest to  capitalize as long as the loan amount stays below the master or the global limit (Master/Global limit is the maximum loan amount that is allowed under the particular facility for the mortgage loan client). This can be a very useful mortgage loan management tool.

7.    If Interest Rates Fall Do Not Reduce Your Contributions

A common mistake mortgage holders make is to reduce their repayments as interest rates fall. Keep your mortgage loan repayments constant as this will allow you to pay off you mortgage faster and this helps reduce the overall debt levels on your mortgage loan. Clients must remember that if interest rates are falling owing to troubled economic conditions, they will rise once the economy starts to stabilize. Hence it is better to get used to higher repayments rather than have to adjust with a sudden increase in mortgage repayments.

8.    Fixing of Interest Rates

In certain cases if you feel that you are comfortable with the current interest rates and mortgage loan repayments and you are anticipating future mortgage interest rate rises, it might be a good idea to lock in your interest rates for a fixed period depending on your mortgage lending facility. This will help you get on top of all your mortgage repayments and prepare for when you come out of the fixed rate period.

9.    Budgeting

It is always a good ploy to create a budget around your mortgage loan repayments. Once you have factored in your monthly mortgage loan repayments you can work out how much of a surplus of funds you have to meet all your other expenses. Once you have worked this out and have estimated your total monthly expenditure you can work out if you are in a situation to make extra contributions towards you mortgage loan or offset account.

10.    Refinancing

In certain cases it might be better for clients to refinance out of their existing mortgage facility. This is more common in cases where existing mortgage loan clients are in a product which has an excessively high interest rate or the mortgage loan product they are in does not provide them with the flexibility and ease of management when compared to some of the other mortgage loan products available in the market.

These tips provide you with a guideline to better manage your mortgage loan. Do not forget that mortgages are very important consumer credit facilities and it is advisable that mortgage loans should be managed efficiently. Missed mortgage repayments, mortgage arrears or mortgage defaults and court judgments can irreparably damage your credit report and your ability to get a consumer loan.

Take these few simple and easy steps towards better managing your mortgage loan facility and improving your credit report.

Equifax

Equifax has been conducting this business for more than one hundred years. The headquarters of the company are in Georgia, Atlanta and it also has several offices in many other countries of the world. Equifax caters large as well as small businesses and provide assistance to individual consumers to get right credit reporting. However, one shouldn’t reckon that their every report is error free, but they provide good assistance to instantly correct your credit report.

Experian

Experian is the other major credit bureau that focuses on to offer different business services to companies. Experian is paid by these companies as to get creditworthy leads for preapproved offers and direct mailing. ContractorCheck is another service of this credit bureau that can be very helpful for people who look for related information prior to employ some contractor to know about its licensing status and other such details.

TransUnion

TransUnion started its operations in 1968; the company has been headquartered in Chicago, Illinois. This credit reporting agency keeps the record of those millions of those consumers who live somewhere outside the United States. People who want to get a lot of information and educational materials can get a lot of educational material related to credit management and many other financial issues. Their Credit Learning Centre can give you necessary details about your frequently asked questions.

There are many lenders that get the copies of credit reports from all three major credit bureaus while there are some who request for credit report to one particular credit bureau. Consumers can also get free copy of their credit report from all these three major credit bureaus and can manage their financial affairs in a better way.

If you want to boost your credit score, you definitely need to make it sure that you are paying debts on time and they have been properly listed in your credit report. These different accounts are referred as trade lines and it is possible that some company may forget to report it to credit reporting agencies no matter how well you have been dealing with it and you must thoroughly check that good information making their way into your credit report canceling out bad information.

Mortgages, credit cards, auto loans and other accounts likes of furniture stores, gym memberships, jewelry stores and furniture stores are reckoned as trade lines on a credit report. When these accounts are posted for a specific period of time, they are known as seasoned trade lines.

Authorized and primary user trade lines are two basic types of trade lines. You can be added in the credit file of your friend, boss, father or anyone with good credit file. Normally, this is done through credit cards, as the authorized users can ask their credit card company to issue an additional card for the person you authorized for it. This added authorized user will have the same payment and history record that are found on the credit file of the primary user. However, you must keep this fact in mind that if primary user is late to its payment will also show you as late to this payment.

While primary user accounts are those kinds of accounts that appear only in your name. If you get some loan from a bank or auto dealer, you are reported for the account as the primary user. There are many programs that claim that they can quickly add thirty to seventy points in your credit file for every added trade line.

Nothing can be a better substitute than to pay your debt on time every month, however, you must also keep this fact in mind that there are many other ways to improve credit report and the key is to know what exists in your credit report and what you can do to keep it accurate.

To get a good credit report, earning more credit scores is a must. More credit scores can be earned by on-time payments. Credit scores or FICO scores depend upon various factors other than timely payments, though it is the base of earning credit scores. Credit scores earning can depend on amount owed, an opened account’s time span, and credit history. Credit scores vary from bureau to bureau because their evaluation comes as a result of a lengthy and complicated accounting procedure, but generally fall between 350 to 900 points.

A bad credit or a negative mark sits on a credit report for 7 years. It is necessary to keep an update of your credit report regularly. To keep a track record of your credit report through the year, it is handy to keep in touch with all the three credit bureaus and ask one of them for your credit report after every 4 months turn by turn. In that way you will be able to see whether there is any lingering on account that can be troublesome or not.

Credit reports should hold up to date information to portray exact picture of your financial standing and responsible nature. Ensure that the bureaus close the long unused accounts that are appearing as active accounts onto your credit report. Many times it also happens that your credit report has ‘missing accounts’; items do not appear onto your credit report and are missed. The reason being, not all the creditors report your credits to the bureaus as the Fair Credit Reporting Act (FCRA) do not force any creditor to report its accounts.

It is wholly solely the businesses choice to report your credit to the bureaus or not. Mostly people misunderstand the credit process and start sending their credit track records to the credit bureaus straight away. The credit bureaus however do not add any information provided by the debtor himself. An account is added only when the creditor provides the credit record to the bureau.

Also, the bureau cannot ask on its own to the creditor to provide their accounts to update an individual’s credit history. The credit bureau can only ask a bank for updated account history, and that is also, if the debtor is using an American Express or Visa Card.

The way to report your credit is to ask the creditor to do you a favor by sending your credit information to the credit bureau. In many cases, it works, but in many, it doesn’t, as many businesses do not opt to provide account details to the bureaus; many small retailers are not into account update practices. In such a case, you can shift yourself to a creditor who regularly updates its account information at the credit bureaus and can update your credit report avoiding missing accounts. In a way you are reporting your own credit to the credit bureaus to get updated accounts history.

Unfavorable card use, late payments, account collection, account closure and absence of credit references are aspects that damage a credit report. To get a good credit report you should have more credit scores, which range from 300 to 900. Credit scores up to 720 or higher are best to gain favorable interest rates.

You can get as good a credit report as serious you would be. To get an excellent credit report, make it a point not to miss the minutest economical issue as a cell phone and cable bills. These are items that are treated with less care and bills piling up are not given much importance. But you get to know the bad consequences when you pay for the missed payments records.

Getting an on time payment record onto your credit report is really important to achieve certain economical benefits with a positive impression and less trouble. Make it a priority to get your bills paid on time so to avoid a black mark appearance on your credit report.

Take extra care for prompt payments of cell phone bill and cable bills, because they help the lender to determine your payment schedules. First of all try to avoid late payments, second and most important, don’t let your bills go unpaid. Keep the receipts of the payments you make for an efficient update of records in your credit report. Do not ignore any payment notices and reminders, immediately call the billing authority ensuring a prompt payment.

Make sure that when you pay your cell phone bills and cable bills, they must appear onto your credit report. It would make more credit points if you pay your bills through credit cards. You can also earn more credit points by making daily routine purchases through credit cards. Set aside the cash for each purchasing you do through credit card, this will help you to an ensured payment.

The benefit of getting your cell phone bill and cable bill onto credit report is that it will be an evidence of your promptness and keen nature of maintaining your economical status. As, both of these are amongst the basics of a routine life style, they are used by almost every person earning a reasonable income.

You must be aware of the fact that your credit report can be viewed online. Credit inquiries are done when you apply for a loan or sometimes in job application too. There are also online services that allow up to four companies to examine your credit report, when loan is applied for. It is really important to get positive credit scores on your credit report to help you run your finances the way you want them to.