What Do Credit Reports Mean To You?

Some people find themselves with a messy financial situation and therefore credit reports are not a pleasant topic. However, credit reports provide you with the facts. And even if the information is undesirable it can be like a helpful guide on your road to financial recovery. Being well informed is important and necessary information can be found in your credit report.

Those reports are maintained – at least in the U.S. – chiefly by the three major credit reporting agencies: Equifax (PO Box 740241, Atlanta, GA 30374; www.equifax.com), Experian (PO Box 2002, Allen TX 75013, www.experian.com) and TransUnion (PO Box 2000, Chester, PA 19022; www.transunion.com).

The reports contain a multi-year history of your credit cards, home loans and other debt. They also record any late payments that occurred and how late they were, 30-day past due, 60-day past due, etc. The reports will list any current and old address, and often your phone number and social security number.

Your credit report can be requested by almost all lending institutions, banks, mortgage lenders and credit card companies. Other entities and individuals can request your report in connection with legal proceedings. The credit agencies are committed to giving an accurate report. However, despite their best efforts errors do occur.

Errors are sometimes made in recording payments made to bring a past due balance current. At times your credit report will list loans as active or credit cards as open that you have closed out or paid off some time ago. There are many different computer systems operating out there that may not always transmit information one to another accurately or in a timely manner. That leads to reporting errors.

To be sure that your credit report has accurate information you must regularly review copies of the reports produced by the three reporting agencies. If you notice an error in your report send a letter to the agency explaining the error and include proof that it is in fact an error and ask the agency to make a correction in their database.

Everyone can receive one free copy of their credit report each year. You can request your credit report on line or by phone. If requesting your credit report via the internet you can visit annualcreditreport.com

On a more positive note, having the information at your fingertips allows you to develop a debt-free plan for your future. Understanding your past credit history is the first step in creating that plan.

When you receive your credit report review it carefully for any past due balances. Resolve these quickly paying off the smaller balances first and then move along to the larger balances until all past due balances have been cleared. In time you will be on your way to a cleaner credit report.



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