Reviewing Your Credit Report
After you receive a copy for your credit report, what do you need to look for?
Well, the first thing you should do is check over each opened account listed, making sure that you were, in fact, the one who opened the account. Identity theft is becoming a huge problem in America and many people do not realize they are a victim of it until they see their credit report.
After you check that over, make sure all of the other details on your report are accurate. Is the outstanding balance that they report for that student loan the same as that listed on your last statement? Credit reports are created through a basic grapevine of people passing along information, making it is easy for errors to appear. In fact, one study reported that four of five credit reports contain some sort of mistake. Since all of the information on your credit report could affect your next loan or credit card approval, it is important to make sure it is correct.
Finally, look over your report and see if you are doing anything that is damaging your credit score. For instance, are there a lot of missed or late payments listed? These wave a red flag in front of a potential lender, making them more likely to turn you down.
Not to many people are aware that credit inquiries can also damage your credit score. Whenever you fill out an application for credit, that lender makes a credit inquiry on your report. Their name then gets added to a cumulative list that stays on your report. Each time a credit inquiry is made, up to five points could be deducted from your credit score. The basic theory is that, if you are applying for a lot of credit, you must be financially unstable. And, what lender wants to give credit to someone who is financially unstable? Therefore, it is important to avoid credit inquiries unless 1) you really need the credit and 2) you are almost positive you will be approved. There is no reason to take a hit on your credit score if you are going to get turned down anyway.
Comments
Got something to say?