4. Watch out for phantom money
Lohrenz says consumers with a history of collections can have their outstanding balances appear larger than they actually are because of the booming secondary market for collections. Here's how it happens: If a consumer has a credit card balance that becomes delinquent, the issuer will attempt to collect for a while, then give up and sell the account to a collection agency.
The card balance should then drop to zero, and a new account, this time with the collection agency, should appear on the report. Sometimes, though, the issuer won't strike that balance from its records, and it will appear as if the consumer has two outstanding debts. If the debt is bought and sold numerous times, which is common, the problem can multiply.
Another instance of "phantom money" can occur when a consumer has a closed bank account that had an overdraft protection line of credit. In some instances, that line of credit will remain on a person's report even after the account is closed, says Bucci.
5. Dispute any mistakes
If you find a major mistake, order your credit report from all three bureaus. Doing so can help you figure out if the problem is limited to just one report. The next thing to determine is if you need to take your dispute up with the credit-reporting bureau or the lender.
If there's a case of mistaken identity, such as someone else's information on your report, or accounts listed that aren't familiar to you, contact the bureau. All three bureaus have online dispute forms, which Sweet says are faster than snail mail for resolving problems.
"Taking things up with the bureau is easier because they have one set process," says Bucci. "There's a dispute process in place, so you can dispute any account with the same process, whereas when you contact the creditor, every one's a little different. It's not as neat and simple."
In the case of negative information more than seven years old or a report of an outstanding balance that has actually been paid off, try contacting the lender directly.
6. Follow up
It would be great if you could just file a dispute and forget about it, but you may have to follow up. Especially if an item is very old, the creditor in question may have been bought, merged or gone out of business entirely, which makes documenting everything important.
Keep notes of the people you speak with at the bureau or lender, when you contacted them and the date by which any corrective action is to be taken. Check your credit report again after that date to make sure they followed through. The three credit bureaus communicate with each other electronically, so a correction made on one report should be reflected on the other versions, too.
7. What not to sweat
There are a couple of items pertaining to your credit report that might seem alarming but really aren't a big deal. Closed accounts in good standing don't need to be taken off your report. In fact, leaving them on your report can help.
Credit inquiries also aren't as damaging as many people believe, says Sweet. "Honestly, a hard inquiry is very small impact on your credit score, and it's short term. It stays on for two years, but it has the most impact only within six months." A "hard" inquiry will appear if you applied for a loan or credit card. It can also crop up if you enter into a service contract such as a cellphone or cable-TV plan.
Lohrenz says not to worry about the actual credit scores, the three-digit numbers lenders use to gauge your level of risk. It's what the report contains that dictates your score, so concentrate on making sure it's accurate and up to date.
This article was reported by Martha White for Bankrate.com.
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I agree that the credit reporting industry and the banks are in cahoots. And the government does not do anything about it. Because negative "reports" allows the credit industry to force you to order their reports with the SCORE ($15 a pop). And, of course, banks (and other financial institutions) can charge higher interest for your loans, credit card, et al.
Take my experience. Bank of America, who issued me my MasterCard, "upgraded" my card. Of course, they cancelled my old card and issued me a new M/C. Good thing I routinely check my credit reports. The card, which was cancelled by the Bank of America -- to give me an upgraded, enhanced benefit card -- was reported as "lost or stolen." That description negatively impacts my credit rating. I contacted the Bank and they refused to change the
description -- they could have simply reported it as "cancelled by the issuer." Worse, when I contacted the FTC, they agreed with the bank that "lost or stolen" description for cancelling a card is a common industry practice and the government refused to do anything about it.
The person who wrote this artcle if very much misinformed. What the article is not saying, is when a person tries to use the "free" credit report that a mark goes aganist them and their score. It is much better to write the Credit Reporting Agencies or call them to get your credit report. Every few months the "Credit Reporting Agencies" actually tell you how to fix your credit the right way. Banks do the same thing. Banks give you what they are looking for when a person gets a negative score and why they got a negative score.
This is the best way to make sure that you are not getting a low score on your credit report.
One: Make sure that you pay your bills on time no matter if the bill is from a major credit card company or a small store that gives out credit cards. It's the small stores that will hurt the most. Make sure that you pay all your utility bills on time this is what the "Credit Card Companies look for.
Two: If you do not pay your doctor bills on time or the doctor bill goes into collections and the bill is paid off it stays on your credit report for the next 7 years. The only way the late doctor bill can be removed is that you have to call the doctor's biling office, have them write a letter to the collections agency make sure that you get a copy of the letter so it can be used to send to the "Credit Reporting Agencies" this is the ony way it can come off before 7 year limit expires.
Three: If you do run into problems paying your credit card bills this is what you should do.
The "Credit Card Companies" actually said this, if you call them and make arrangements with and explain you situation to them they will work with you they don't want to lose you as a customer. But make sure you hold true to your word and do what is necessary to pay the "Credit Card Company" back.
This is a lot of hard work it will pay off in the long run, and it you stay true to your deal with the "Credit Card Company" and pay them back you'll be suprised on the good score they will give you.
So in the end find out what the "Banks, Car Loan, Credit Card Companies, want and work with them you'll be suprised that their not out to hurt you. The only one who gets hurt is you.
In the process of reviewing and cleaning up my credit record I found that there is more than one scale being used. The three credit bureaus have my score at 900+ then I receive another score and it was 780+. When I questioned the difference I was told I assume as an example, TransUnion has two scores, A TransRisk Score with a range up to 850 And a VantageScore with a range up to 990. I know in reviewing my credit score I have yet to run across The TransRisk Score.
So I guess like a lot of folks are saying your credit score can be manipulated depending on the circumstances.
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