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Credit Report Repair – How to Fix a Credit Error

Editor — Sun, 14 Jun 2009 09:21:06 +0000

Numerous credit consumers have to face rejection from financial institutions owing to credit errors which were not caused by them. It is therefore important to repair your credit report and improve your score as soon as possible.

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.

10 great tips for improving your credit rating

Sat, 26 Apr 2008 19:59:27 +0000

Having a low credit rating and credit score can have a devastating effect on your chances of being successful when you apply for credit. Your credit rating is what a lender will take into account whenever you apply for credit and if you don’t score high enough then your application will simply be rejected. However luckily there are ways that you can repair a bad credit rating and build your credit rating back up, which in turn puts you back into the good books with the lenders.

Tip number one is to take your credit cards and hide them or better yet take a big pair of scissors and cut them up to avoid being tempted. One of the very worst things that you can possibly do if you have a low credit score is to keep adding to the debt that you have already accumulated, if you have very little self-control then don’t keep temptation around you destroy them or hide them.

Tips two is to make yourself aware of your own credit report, if you have a bad credit rating then it could be through no fault of your own but rather an error in the system. If this is the case then it can be rectified providing of course that you know about it, you can apply for a copy of your credit report from any of the three main credit bureaus.

Tip three is to take the bull by the horns and do everything in your power to clean up your credit report. Follow step three and obtain a copy of your report and check this for errors. If there are errors then these should be rectified immediately and will help to get you back in good favor.

Tip number four is to ensure that you bring your payment history up to date, your payment history accounts for around 35% of your total credit rating, so it is essential that you bring any outstanding or missed payments up to date.

Tip number five is to never make any more credit applications then you really need too, when repairing your credit rating this is essential. The chances are that if you apply for more credit whilst having a bad credit rating you will turned down anyway.

Tip six is to think twice before you close down accounts that don’t have an outstanding balance, always check before you do close them to ensure that this won’t have an adverse effect on your credit rating.

Tips seven is to talk with those that you owe money too, if you are seen to be making an effort after having got into difficulty, then this will go in your favor.

Tip eight is to make sure that you pay off all your debts that you currently owe, this can improve your credit rating drastically.

Tip nine is to make sure that you realize there is professional help available for those who are in serious debt and to make sure that you get the help if it is needed. Again if you are seen to be doing everything you can to make matters better then this will be in your favor.

Tip ten is to have patience when it comes to repairing your credit score and rating, it is easier to get a bad rating than it is to repair your rating but with patience and perseverance it can be done.

Credit ratings and recovery

Sat, 26 Apr 2008 19:09:12 +0000

Damaging your credit rating is far easier to do than it is to repair and recover from a poor rating. Your credit rating can be affected by several factors some of which might not even be your fault such as theft of your wallet or identity theft, identity theft is on the increase as many have found and have also found that even despite their rating being poor through no fault of their own, it can take months if not years to re-establish a credit rating.

Your credit rating can be compared to taking a test, before the lender will give you a loan, credit card, mortgage or any other form of credit you have to pass this test. This is to ensure that you will be able to pay back the loan and thus reduces the risk that the lender is taking on you, the higher your rating is then the less risk you will be seen as and as such are more likely to get approved for a loan. If your credit score is low then your chances of getting approved will be very slim if any.

While identity theft and crime are two of the reasons why your credit rating goes down there are also many other reasons. Factors that can affect your credit rating for the bad include such as making late payments on your bills or missing payment altogether, applying for and taking out more than 80% of the total amount of credit that is available to you and requesting too many lines of credit.

If you want to keep your credit rating on a good level then it is essential that you always ensure that you pay your bills on time, don’t use more than 25% of the credit that is available to you and make sure that you remain in steady employment.

Repairing a bad credit score is hard and does take time and patience but it can be done. To begin with you should request a copy of your credit score and check it for any errors or glitches that shouldn’t be there to start with, mistakes have been known to happen and these are the easiest to correct and improve your score. Never take out credit or request it unless you absolutely need to, for example don’t ask for a store card just to get the discount as this is still regarded as a form of credit. Make sure that you use your credit card less and if possible ensure that you pay off the outstanding every month on the card, always try to keep the balance on your credit cards less than 25% of that which is available to you. Perhaps the most important thing to remember is to avoid declaring bankruptcy although this might seem to be the best solution in the short term it is the worst thing you can do to affect your credit rating. When taking out any form of credit it is essential that you understand the consequences of credit and if not then seek the advice of a financial advisor before making a huge mistake.

Scams to avoid when it comes to fixing your credit

Sat, 26 Apr 2008 17:36:42 +0000

Some people when faced with desperation can make themselves easy targets to those with very few principles, who prey on the problems of others in order to make personal gain for themselves. When it comes to credit then almost all of us have to rely on it at some time or another. However if for some reasons our credit rating falls short then being able to get credit is impossible or you are charged expensive rates of interest for the luxury of being giving credit which leads to even more debt. This is where the “scammers” begin to rear their ugly heads with promises of fixing your bad credit rating and they have an arsenal of scams in their supply all of which you should avoid. Here are some of the main ones to watch out for and to be aware of.

Beware of anyone who claims that they are “in” with the credit bureau and that for hundreds of dollars of your hard earned cash can wipe the slate clean for you and bring your credit rating up to scratch in the blink of an eye. Your credit rating can be repaired but it cannot be done this way, it takes time to repair your credit rating and score and the bureau will not take a “back hander” from anyone.

Another scam that is widely used is the promise that if you part with your hard earned cash then the company can convince the creditor that you really don’t owe them the money at all. While it would be nice if we could wave a magic wand and make the debt go away in reality we know that this simply isn’t true, however it can tempting but you should avoid the temptation of this scam.

“Not only can we clean your credit record but we can also get you a loan quickly and easily by using our contacts”. This unfortunately one of the newest and also the more costly of the many scams that is travelling around at the moment, as the unsuspecting person is so desperate to get a loan they will often fall for the promise that not only will they be able to get the loan after being turned down elsewhere but also that their credit rating will be cleaned and they can start from fresh. The majority of these are nothing but conmen who will take your money upfront not only for the promise of repairing your credit but also take part of the money for the promise of a deposit on a loan.

Beware of those companies that if you call their special 900- number you will be able to get your credit rating fixed by taking their essential information that no one else but them knows. The truth of the matter is that this number is often a huge amount of dollars per minute and the person on the other end will offer you information is nothing more than you would be able to find yourself quickly and easily online while racking up a huge amount of money on the phone call.

Your credit rating can be repaired but you can do it yourself and the only thing that costs you will be the fee for your own credit report.

The difference between credit ratings and credit scores

Sat, 26 Apr 2008 17:17:28 +0000

Although the two terms are often thought to be related they are in fact two entirely different parts of a person’s credit history. However they are both very similar in their ways when it comes to the fact of your financial future and how likely you are to be approved for a loan. When it comes to dealing with matters relating to your credit rating and repairing a bad credit rating, then it is essential that you understand the differences between the two.

Your credit report is your financial history, on this such things are included as your payment history including whether you were late making payments or missed them and the total amount of debt that you currently have outstanding. There are different types of credit reports, a single credit report provides information that is given out by one of the three main credit bureaus and a three in one credit report which is the most complete type of report and which takes into account information from all three credit report companies. The majority of the information which exists on your credit report comes from those companies which you have done business with in the past. When you apply for credit again, by law the lender can check this report and either grant you permission by giving you a loan or by turning you down for credit. Depending on how low your rating is some lenders will allow you a loan but then you will have to contend with paying an interest rate that are well above the standard and this means that you cannot take advantage of low rates of interest or interest free loans. With the information being so essential to you being accepted or declined, you should do everything in your power to ensure your rating remains in the high bracket. Once you have got a bad credit rating it can be improved but it does take time to repair a bad credit rating.

On the other hand your credit score is a number which is assigned to you that shows a lender how big a risk you are determined to be when applying for such as a loan, mortgage or credit card. The higher the number then the less of a risk you will be seen and you stand a better chance of being approved and the lower the number the chances of you getting credit are very slim until you take steps to repair your credit score. Your credit score is just as essential when it comes to the difference between you being granted or rejected for credit as this is a quick and easy method for the lender to assess how big a risk you are. Credit scores are generated by a computer based on the factors of your credit report and is based on the fact that your past can predict your future. If you are going to be applying for credit then it is essential that you have a high credit score so it is essential that you are familiar with both your credit score and your credit rating to improve your chances and not have the uphill struggle of repairing your credit rating.

What is a credit score and how is it determined?

Sat, 26 Apr 2008 17:05:21 +0000

Your credit score is an essential number when it comes down to the fact of you applying for and being accepted for credit, it is classed as being as important as your social security number and it is essential that you understand it and what it does.
Your credit score will consist of a three digit number which shows a lender a quick and accurate guide as to how big a risk you are seen to be. This of course determines from the onset how likely you are to be turned down or accepted for any form of credit, it is always the first factor that is taken into account by a lender and in the majority of cases it is the only factor and especially so if you have a low credit score.

Your credit score is based on a mathematical formula which says that your past credit history will predict your future, for example if you have made late payments or have missed payments in the past then the probability is high that you will do so again in the future. A computer will predict your credit score and it will do so from the information which is listed in your credit report. Your credit report holds such important information as your payment history, the total amount of credit that you have outstanding at the moment, the amount of credit that is available to you and how many times you have applied for credit in the past.

Points are then awarded on certain aspects of your credit report with some parts of your credit rating being taken into account more than others. As a general rule of thumb your payment history goes towards 35% on your score, the amount of credit that you owe out covers around 30%, 15% accounts for the length of your credit history and 10% for the types of credit that you haven taken. There are many different types of scoring but they are all based on this same principle.

While it is essential that you keep your credit rating in good stead to ensure that you are given a good credit score if for some reason you do have a poor score then all is not lost, you can repair your credit rating. The score that you do have fluctuates depending on circumstances, it doesn’t remain the same and you are able to do many things to bring it back up to an acceptable level. Your credit score can even change on a daily basis and it can also vary between the three national credit bureaus, when checking out your credit rating you should have a 3 in 1 report as this ensures that you have the most accurate information regarding both your credit rating on the whole and the score which is derived from the credit rating. There are many online sites where you can obtain your credit rating and also obtain your credit score and it is essential that you do obtain a report every now and again to make sure that a mistake hasn’t been made in the system which could affect your score.