An Overview of what Credit Report is

Learning the basics of the credit report process, and keeping your credit report free of errors, is essential to good financial health. The 3 major credit bureaus - TransUnion, Equifax, and Experian - collect, maintain, and provide your report to landlords, businesses, and employers who need to check your financial responsibility.

Why Do I Need To Check My Credit Report?
It's wise to check your credit report frequently for signs of fraud. If someone obtains your social security number, only a few additional pieces of information are necessary to commit fraud in your name. Common types of identity theft include fraudulent bank accounts, credit cards, utilities, and loans. Early detection is the key to avoid suffering long-term financial consequences.

What's In Your Free Credit Report?
Your credit report from TransUnion, Equifax, and Experian, the 3 major credit reporting agencies will contain 4 important sections. Each contains one piece of your total credit picture. Carefully check each report for common errors such as misspellings, name confusions, and incorrect information.

* Account report summary (current and past credit status, number of open and closed accounts, balances of accounts, historic high balances, payment history, if accounts are current or delinquent)
* Public records (bankruptcy records, government court records, liens, judgments and child support records)
* Credit Inquires (a list of everyone who has requested your report in the last 2 years)
* Detailed credit history (information about your loan payments, credit card debt and payment history)

Why Do I Need To Check My Credit Score?
A good credit score is your passport to competitive interest rates for mortgages, cars, credit card offers, job offers, insurance premuims and more. A strong score is worth money because it saves you excess costs, so don't ignore it.

For example, see how a fixed 30-year mortgage payment varies according to credit score and the interest rates it dictates. A difference of two hundred points in score can offer a savings of $448 a month for the same $200,000 house loan.
Credit Scores: ------ Monthly Payments: ------- Savings:
550 ------------------------ $1,643.00 ----------------------- $ -
650 ------------------------ $1,339.00 ----------------------- $ 304.00
750 ------------------------ $1,195.00 ----------------------- $ 448.00

If your score is below 650, your future finances may be significantly affected.

Did You Know?
* Victims of identity theft spend an average of 175 hours and $800 to clear their names.
* Only 2% of Americans know their credit score or what it measures.
* 79% of credit reports may contain errors that you are unaware of - usually an indication that you have been a victim of identity theft or fraud.

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1 comment:

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