Friday, July 4, 2008
Maintain Your Credit
Check Your Credit Report Regularly
If you have studied this document carefully, you know know that, much like a resume summarizes your work experience for a prospective employer, a credit report summarizes your credit history for prospective creditors (and in some cases employers and insurers). And like a resume, your credit report can influence whether you will receive what you are applying for.
Ideally, your credit report is an accurate, up-to-date reflection of your credit history. However, in this less-than-ideal world, there are many reasons why your credit report could contain inaccuracies that might prevent you from receiving the credit you deserve. Here, you have learned how to take action to keep your report accurate. Here are some important reasons why you should make a practice of regularly reviewing your credit report:
1. Inaccuracies & Mixed Credit Files
Many inaccuracies on a credit report can be the result of simple human error, and are therefore are not difficult to dispute. Whether the inaccuracies relate to payments not credited, late payments, or data mixed in from the credit file of someone else with a name similar to yours, you will want to contact the credit bureau to dispute inaccurate information promptly.
2. Tracking Payments
One of the most important elements of credit is a demonstrated history of on time payments. Once you send the check though, anything can happen--a delay in the payment being received can kick you over to a 30-day delinquency. If you call your creditor and explain the situation, they might adjust the information.
3. Identity Theft
Identity theft is an insidious crime, involving a thief who assumes your name to open new accounts, divert your card statements to another address, and run up all sorts of bad debt without you ever knowing about it until collectors come calling. Over time, identity theft could jeopardize your ability to obtain further credit. The best way to catch a thief who is using your name is by getting a copy of your credit report, which will show you if there are accounts listed you know you haven't opened. For example, if a thief has intercepted a pre-approved credit card offer in your name and sent it in with a change of address, your credit report will include the account.
4. Inquiries
If you're shopping around for a loan or more credit, you should know that when creditors check your credit, it places an inquiry on your credit report. Inquiries can add up, which is often interpreted as a negative by creditors. For this reason, too many inquiries can actually make getting credit more difficult. Moreover, if you didn't authorize someone to look at your credit report and they did, they may have broken the law.
5. Credit Fraud--Unauthorized Charges
Credit fraud involves the theft of your credit card or account number to make unauthorized charges to your account. Though consumers are protected financially from this abuse, other creditors may take note of all this activity and decide to raise your interest rates or refuse to grant you a loan. Reviewing your credit report will help you catch new activity on accounts that you haven't been using, or may have closed.
For these and other reasons, you should check your credit report regularly, or you might never know about any problems until it is too late. When it comes to managing your credit worthiness, your credit report is your best resource.
