Real Estate and Beyond Blog

HOW IS YOUR CREDIT TODAY?

It is a new day in America. The credit report is your scorecard in the finance world. We are being judged on a three digit number. One must have decent credit to obtain lines of credit and conventional mortgages. You will be instantly denied if you do not have an acceptable credit score. It seems that people need at least a 680 or better when applying for credit. The credit score tells how reliable you are when paying money back. Can you make the payments? History does tell the future when it comes to credit scores.

Yes, one will need to prove one is worthy when applying for credit and/or mortgage. One must do everything as possible to maintain an acceptable credit score.

Where do you obtain information on how to maintain a decent credit score? This information is not taught in school or college. Many people are clueless when it comes to establishing and maintaining credit. Here are some questions that people have when it comes to credit:

• How do they come up with the credit score? What are the factors?
• Why do I need to establish credit?
• How do I remove information that is not correct?
• Why is my insurance so high?
• Will employers check my credit score?

Your credit report includes the last 10 years with borrowing and repaying habits. Again, it is your report card on how you handle your finances. Creditors report your account activity to the three major Credit Reporting Agencies. These agencies receive and maintain information on each person. The credit business is huge because it does touch every person in America who holds a mortgage and/or credit card.

My parents instilled in me to pay my bills on time each and every month. They informed me that I will have no difficulties down the road. However, they did not teach me the importance of credit and the power of it.

Many people are walking around with incorrect information on their credit report. This will include negative or wrongful information. This will lower one's credit score if it remains on the credit report. This is not a true reflection of one's credit history. Now, everyone will experience something in life such as death, job loss, divorce, health issues and so on. Things will happen in one's life that is beyond control. It is not the end of the world.

Here are some things creditors look for on the credit report to deny credit

• Charged off accounts
• Collection accounts
• Settled at a lower amount
• Bankruptcy
• Judgments unsettled

The following statements are considered negative on the credit report. Yes, it does lower the credit score. Furthermore, these statements give reason to deny credit.

Please do not let this get you down. It will require patience, understanding and money to rebuild the credit score. I would advise to seek professional assistance when it comes to credit restoration. We have obtained a strong relationship with Praxis Credit Consulting. Their main business is credit consulting and teaching people how to develop and maintain a budget. They become an advocate for you and your credit score. They know the rules of engagement better than you. Mistakes happen when processing your report or creditors report wrong information by mistake.

How to obtain your credit report? Please review the information below.

TRANS UNION, Customer Disclosure Center, P.O. Box 390, Springfield, PA 19064-0390
http://www.transunion.com/ 1-800-888-4213

EQUIFAX, P.O. Box 740241, Atlanta, GA 30374-0241
http://www.equifax.com/ 1-800-685-1111

EXPERIAN, P.O. Box 2104, Allen, TX 75013-2104
http://www.experian.com/ 1-888-397-3742

The scariest situation is when someone has stolen your credit identity. This can be a nightmare when handling on your own. You will need to file a police report with local police. Then, send that report to all major credit bureaus along with all of your creditors to alert them of the situation. This will create a fraud alert. Timing is critical at this point in time.  

Finally, I would encourage everyone to check their credit report at least every six months to ensure its accuracy. Being informed and maintaining one's credit score is vital in today's financial business.

START NEW YEAR OFF WITH REPAIRING ONES CREDIT SCORE

When considering purchasing your first home, whether you get the mortgage or not, may depend on your credit score.  Your score is determined by a network of credit reporting agencies, that either share information with, or are owned by, three major credit bureaus. The credit bureaus take the information reported by the agencies and turn it into one report.  This is your credit report and is what lenders use to determine whether or not to issue mortgages or other loans.

It's a good idea to  inorder to know where you stand before you get too far in the home buying process, that way you can be aware of problems before they jump up and derail your plans.

Getting copies of your credit reports is easy. You can request a copy from each of the three major national credit bureaus: Equifax, Experian and TransUnion. Checking your credit can cost you as much as $9 per report, although it differs from state to state.

If you applied for a loan and were turned down, you are entitled to a FREE COPY of your credit report, but you must request a copy by writing the correct credit bureau within 30 days of the rejection. With your request, you should include a copy of the declined loan application.

You can also get a free report if you are unemployed, planning to apply for jobs in the next 60 days, receiving public welfare assistance or believe the credit file contains mistakes resulting from fraud.

To obtain a copy of your credit report, call the number of the proper credit bureau and follow their directions, or order it online. If you write, you will need to include your full name, date of birth, current and former address, Social Security number, your spouse's name and your phone number. Each person requesting the report should sign the request.

When planning to buy a home, you should check your credit at least three to six months before you apply for a mortgage.

Once you get the report, you should make sure the following information is correct:

• Your name, or names if you are or were married
• Social Security number
• Date of birth
• Addresses of places you've lived
• Names of places you've worked
• Pending accounts and accounts that have been closed

Nothing has been on the report longer than is allowed by law:

-- Bankruptcies must be taken off your credit history after 10 years.
-- Suits and judgments, arrest records, and most other kinds of unfavorable information must be dropped after seven years. Tax liens must be dropped seven years after the lien is paid in full.

· Records of delinquent payments or other problems (i.e., make sure they aren't mistakes)

Any error that you find must be investigated by the credit bureau and with the creditor who supplied the data. The bureau will remove any errors a creditor admits are there. If you disagree with the findings, you can file a short statement in your record giving your side of the story. Future reports to creditors must include this statement or a summary of it.

Be certain to be careful about applying for additional credit when you're about to apply for a mortgage. When the mortgage company checks your report they can find out who else has been checking your report and determine what, when and how you have been applying for credit. That means if you have been getting turned down and are desperately applying for credit all over town your potential mortgage company will know, and might turn your loan down because of it.