Get a Better Credit Rating by Managing Your Finances

Over thirty-five percent of American consumers impaired with a low credit score -- due to expensive hospital and medical bills. In the world of finances it is all about managing debt to maximize one’s buying power. Managing one’s personal finances for a better credit rating is critical.

In the world of finances it is all about managing debt to maximize one’s buying power. Since a consumer’s credit score has a direct correlation on any financing or loan authorization, managing one’s personal finances for a better credit rating is critical.

Did you know that when financial institutions consider authorizing loan approval, they review your payment history? Even if you were unemployed when you were inundated with medical bills, the balance will appear on the credit report.

FACT: Over thirty-five percent of American consumers impaired with a low credit score -- due to expensive hospital and medical bills.

About Your Credit Report Card

A credit report is a factual record of your credit payment history and it details personal information such as:

Where a consumer works
Where the individual resides
Have you ever been convicted of a crime
Has the individual ever been involved in a lawsuit or claim
How you pay your bills

Credit reports or your report card are kept by organizations referred to as consumer reporting agencies (CRAs). These credit bureaus collect, compile and sell consumers credit documents to individuals and companies, for purposes permitted by law, usually to grant you credit. The main purpose of a credit report is to help a credit grantor decide whether to grant you credit based upon your credit payment history. Certain employers and insurance companies evaluate one’s credit before extending employment or writing a policy.

One should always review their credit score at least once or even twice per year to make sure that the information in it is accurate. Financial advisors recommend that all consumers should report any updated, omissions or inaccuracies immediately. Specifically, for the person planning to apply for a mortgage, auto loan or other personal loans (secured or non-secured) an exact truthful credit report is important.

Another aspect of managing one’s finances with a better credit score is by checking the accuracy of information detailed on the credit file. Nonetheless, it may drastically accelerate the credit-granting process.

On the other side of the spectrum, consumers who are denied credit have the right to acquire the following information:

The credit bureau’s name (CRA)
The CRAs address and all contact information
A copy of a free report within 60 days of a denial
In lieu of fraud, being on welfare or unemployment, consumers a allowed one complimentary copy of their credit report

Generally, the cost of a credit report starts at nine dollars.

Credit Reporting Agencies and Credit Bureaus

There are three major credit bureaus in the United States: Experian, TransUnion, and Equifax. All agencies may have different information about a consumer. To compare and check all your credit files from all the top agencies, here is their address:

Experian
P.O. Box 2002,
Allen, TX 75013
(888) EXPERIAN (397-3742)

Trans Union
P.O. Box 1000
Chester, PA 19022
(800) 916-8800

Equifax
P.O. Box 740241
Atlanta, GA 30374-0241
(800) 685-1111

After obtaining a copy of your credit report, the first step to managing your finances begins with noting any discrepancies. Then, protect your rights under the FCRA Act by contacting the source of the erroneous information and the credit reporting agency by writing a letter.

Sample Dispute Letter

Date

(Your Information)

Name
Address
City, State, Zip Code

Complaint/Dispute Department
Name of Credit Reporting Bureau
Address
City, State, Postal Code

To Whom It May Concern:

Attached you will find a copy of a report I received. The items of dispute are circled on the attached copy of the report I received.

1.) (Detail the disputed items in a list with the credit account, name of the creditor the type of item, such as credit account or judgment etcetera)

This above item is (inaccurate) because (detail what item is inaccurate or incomplete and why). I am requesting that the above named item be removed or corrected (or state the specific change).

Attached you will find copies (describe any enclosures that depict a record of payments or any court documents) which demonstrate my position. Please research this issue and (remove or amend) the disputed item(s) as soon as possible.

Regards,
Your name

Enclosures: (List what you are enclosing)

Remember to include duplicates (only) of the documents that corroborate the correction.

Facts about Accurate but Negative Credit Report Information

Certain accurate negative information remain on the credit report for a period of time. Usually, the time limit is seven months; however the following list details the exceptions:

Any information regarding criminal convictions may be reported for an unlimited time span.
Any credit information provided as a response to an application for a salary position worth over $75,000 does not have a time limit.
Bankruptcy information can remain on a report up to ten years or more.
All credit information reported as a result of an application worth over $150,000 of credit or life insurance does not have a limit.
Any unpaid judgments or lawsuits have a credit report life of seven years or more -- until the statute of limitations has expired (whichever is longer).

In summation, despite negative accurate information, paying your bills on time and regularly monitoring your credit report is a good way to a better credit rating.

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3 Truths That Can Keep You Entangled in Your Current Financial Chaos

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