Sunday May 22, 2022

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Only You Know If Your Credit Report is Accurate
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You might be surprised to learn that noone checks your credit for accuracy except you! Credit reporting services are providing by credit bureaus, or credit reporting agencies (or CRAs). The three largest credit bureaus are Equifax, TransUnion, and Experian (formerly TRW).

How do credit reporting services work? Basically, credit reporting services are organizations with massive amounts of consumer data in their files. This data, based primarily on personal information, credit account information, payment histories, and public records of consumers is information that credit bureaus have received from creditors and other public and private organizations.

It is important for you to understand that credit reporting services do not verify in advance the information they receive from your creditors. They just take in the information as reported and enter it into your files. Creditors who report information to the credit bureaus are responsible for transmitting true and correct information to the bureaus, but there are many occasions when this information, will contain inadvertent errors. With mountains of data, a certain amount of errors is virtually impossible to avoid.

The important thing for consumers to understand is this: The only one who knows if the information in your credit report is accurate is you. Since the information in your credit report determines your credit score, and your credit score can cost you, or save you a lot of money, it is very important for you to check your current credit information to make sure you get treated fairly.

Take control of your credit yourself. Check your credit report and score regularly. If you want to get the credit you deserve, there's only one person who can help you: You! Don't count on a loan officer, or a finance person at the dealership, or a representative at one of the credit bureaus, or certainly not a credit card company customer rep to look out for your best interests. Noone else checks your credit for accuracy. It is solely up to YOU to take responsiblity for checking and managing your own credit, and there can be a lot of money at stake. Fortunately, today, it is easy and covenient to get your credit score and credit report online, and it only takes a few minutes upon verification of your identity. You can see your information online, and you can even print out your credit report and score if you choose to! If you see any information on your credit report that is not correct, you can take immediate steps to file a dispute with the appropriate credit bureau. We cover this process in detail here at

You should check your credit report and credit score on a regular basis. The plain facts are these: You should check your credit, file an online dispute form if you discover information on your credit reports that you believe to be incorrect. Mistakes on your credit report can lower your credit score, so you are smart to check your credit regularly and make sure everything is accurate. There are other key steps you can take to achieve the highest credit score possible: Maintain an excellent payment history, pay down your debts, and avoid over-applying for credit. All of these measures can help improve your credit score, and help you save a lot of money in the long run.

Many people feel that there is a certain magic formula for a higher credit score, and they try to engineer the best score possible. The plain fact are these: Practice these solid credit habits and you are virtually guaranteed a higher credit score: Keep a healthy balance of credit: retail, credit cards, installment, real estate, etc; don't have too many credit cards; with the credit cards you have, try to keep your balances down to about 25-35% of your available credit; do not close old accounts so you can demonstrate a good length of credit history to lenders, and make all of your payments on time.

It is important for you to understand that recent payment history counts most of all when it comes to a strong credit score: A single late payment over the past few months can hurt your credit score more than a 90 day late four years ago. That is just the way the credit scoring system works. Lenders want to know that your current habits and paying patterns are solid. Anything that happens more recently can be a red flag to lenders, whether this is justified or not. It is all about managing risk and lenders, via your recent credit history, are intent on following any of a number of trails in an attempt to identity a person who may be a poor credit risk.

If you have less than perfect credit, take heart because there is some good news: Credit scores are constantly changing as new info is added to your credit reports. If you've had a rough go of it in recent months, you can turn things around quickly just by showing a perfect payment record over the next 3-6 months. Pay down those debts to improve your debt-to-available credit ratio and before you know it, you're credit score will be trending up!

The Editors at CLC hope this rundown on credit has been helpful to you. If you've got some credit experiences or maybe even tips you'd like to share with the CLC community, share your story with the rest of us. Good luck to you and your credit!

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