You all know how important a credit report is. It is the basis on which your financial standing is determined, subsequently the way you lead your life depends on a healthy credit rating. Just as a neat and tidy house gives you a sense of satisfaction and good living, a clean credit report allows you to live a tension free life. Here are a few tips that you need to follow to maintain your credit report the way it should be:
Cleaning up your credit report involves deleting incorrect information and having it updated periodically. You also need to get rid of all outdated information. You need to first get copies of credit reports from the major credit reporting companies like Experian, Equifax and Trans Union. Credit report copies can be obtained free of charge once a year, as you are entitled to it. Some companies do provide copies without charges even more than once a year; however, even if you need to pay, the fee would not be too high. Having a copy of the updated credit report is what is important.
Once you get the copy of your credit report, go through it with a fine tooth comb. You will need to look out for information that is updated incorrectly or some vital bit of information that has not been updated. The credit report reflects how you have been managing your finances over a period of time. Most of the lenders decide on whether to lend you money or not based on what they find in your credit report. The credit rating companies rate your credit and sell the information to prospective lenders and employers. Hence, there is nothing personal in a report that is generated by them.
What you need to look out for in your credit report:
- Whether contact details and your first and last name are updated correctly
- In case you have moved recently, the prior address needs to be mentioned
- Birth date and social security number need to be correct
- Current and previous employment details (not very outdated information)
- Marital status, including correct information about spouse
- Criminal records or lawsuits older than 7 years can be removed
- Details of tax paid, and removal of details of unpaid taxes after they were paid
- If you have never been a cosigner but listed as one, the information can be removed
- Discharged debt that still shows as owing can also be deleted
- Accounts that were closed by you, yet showing up as closed by the creditors need to be updated
Once you have all the information corrected you can list out the same in detail. If possible, you need to collect supporting documents for accounts that were closed by you and a letter to that effect from the creditors. This information needs to be forwarded to the credit rating agency with copies of supporting documents enclosed. The dispute letter should clearly list out the inaccuracies and a request to have the information updated in your forthcoming credit reports. The letter needs to be typewritten with a copy for your record. The letter can be in Nolo’s format which is the legally prescribed letter to request reinvestigation.
Though an option to send the letter online exists, it is better to send a hard copy by mail as you need to send copies of the supporting documents as well. You may send the letter directly to the address of the credit rating agency that is available in the website.
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