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Five easy steps to repair your credit
A good credit report is of utmost importance in this day and age. Everything from acquiring credit at low interest rates to getting a good job is in a way dependent on your credit report. Your future credit worthiness is defined by the contents of your credit report. This all-important document is reviewed by future lenders, potential employers and even insurance companies before accepting your loan, job or insurance application.
So your credit is in a bad shape and you are wondering how to repair it? Unfortunately most people are not aware of the simple steps they can follow to spruce up the condition of their credit. With some effort and interest from your end, you can actually witness the changes in your credit report. This article lists five easy steps to repair your credit and revive your creditworthiness.
- Get your hands on your credit report. Most people are unaware of the fact that as consumers they have the right to order their credit report from three main agencies - Trans Union, Equifax, and Experian. Do not make the mistake of jumping to conclusions after going through one credit report. It is very much possible that all three agencies will provide you with contradicting information.
- After getting the credit reports from the agencies, the next step is to study all of them in detail. The report will list the details of all entities that have recently gone through your report. It is vital to go through this list to ensure that no unknown party has gone through your report. Know that scrutiny by collection agencies and creditors and insurance underwriters is legal. Also, some credit card companies may go through your report before offering you their new facilities like extended cash limit or increased credit limit. Make sure to study your payment history is utmost detail and detect any inaccurate or misleading information. Make a list of all the incorrect information.
- After detecting the errors, the next step is to notify the agencies of the specific mistakes on the credit report. According to the Fair Credit Reporting Act (FCRA) you have the right to ask the Credit Reporting Agency (CRA) to rectify any misleading, incorrect or incomplete information on your credit report. But remember that you must have proof to back up your claim. Send the details of the mistakes along with proofs to the agencies.
- The credit reporting agencies have up to 30 days to investigate and correct the inaccurate details mentioned in your credit report. Unless the reporting agency can prove that your claims are false, by all means they have to make the changes notified by you.
- In case the agency does not respond to your request within 30 days, you have every right to take legal action against them. Also, it is the responsibility of the agency to inform the creditors who have reviewed your report in the last six months about the misleading information and provide them with the updated, accurate information.
A recent survey demonstrated that up to 75% of the reports created by the credit reporting agencies had errors, which could have a terrible impact on the creditworthiness of the consumers. Remember that your active interest and effort is extremely important in order to repair your credit.
Don’t expect any correct derogatory remarks to magically disappear from your credit report. A lot of companies in Canada promise to erase any negative remarks from your credit report. Remember, only false importation can be rectified; in order to do away with the other negative markings, it is your responsibility to improve your financial health. Pay your bills on time and repay your debts as soon as possible with the help of a genuine company.
