Good credit ratings are essential for prospective homebuyers and people who want to borrow money to start or expand a business. But loan applicants are often surprised when their requests are denied because of bad credit ratings. According to "The Consumer Reports Money Book," 48 percent of credit reports reviewed by Consumers Union "were inaccurate in some way," and almost 20 percent of the reports had inaccurate information that was important enough to keep people from getting loans. Checking and correcting an unfair credit rating can prevent denials of credit.
Contact the Bureaus
Step 1
Write to the three large national credit bureaus to get your score. You should write them a letter requesting your credit report.
Equifax
P.O. Box 740241
Atlanta, GA 30374-0241
(800) 685-1111
www.equifax.com/home/en_us
Experian
P.O. Box 2104
Allen, TX 75103-2104
(800) 493-1058
www.experian.com
TransUnion
P.O. Box 1000
Chester, PA 19022
(800) 888-4213
www.transunion.com/corporate/personal/consumerSupport/contactUs.page
Step 2
Ask the bureaus if you can receive a free report and what is offered in it. They offer free reports online but offer more comprehensive reports for money. Ask them what information you need to provide them before making a formal request to see your report.
Step 3
Write the formal request. Include the date, the bureau's name and address and your name as listed on your credit cards and credit card bills. In the letter, write that the Fair Credit Reporting Act entitles you to receive a report. If you are married, ask for a copy of your spouse's report.
Step 4
Sign the letters. Your signature is the best proof that you requested a report.
Review report
Step 1
Make sure the following information is included because it positively affects your credit rating--home ownership, a checking and/or a savings account, a phone number in your name and a bank credit card.
Step 2
Make sure your employment information is accurately reported. According to "The Consumer Reports Money Book," professionals who have been working a long time are awarded more points on their report than people with less stable occupations and shorter careers. Income is also important.
Step 3
Make sure your history of paying bills is accurately reported. Delinquencies and omissions of prompt payments can be harmful.
Fix Information
Step 1
If there are omissions, write a letter to the credit bureaus concerning the missing accounts. Provide the bureau your account numbers. Information about credit card accounts and loan repayments for home and automobile purchases is particularly important.
Step 2
If there are errors, provide the bureaus with the correct information, including copies of checks and bills.
Step 3
Ask that the bureaus make any necessary corrections or additions. "The Consumer Reports Money Book" says that federal law requires that errors be corrected "within 30 days after you notify the bureau of the mistake."
Step 4
Make sure the errors or omissions have been corrected by requesting another report 90 days after you asked for the corrections.
Step 5
Notify the other credit bureaus in writing that you fixed errors in one credit report and request that similar corrections be made to their reports. Ask them for proof that they fixed any errors.
Tips and Warnings
- You can get online reports, but "The Consumer Reports Money Book" advises that you have better proof that you requested a report if you submit a letter with your signature and a report in the mail is better proof that you have received a report than an e-mail.
References
- "The Consumer Reports Money Book;" Editors of "Consumer Reports;" 1997
- Equifax
- TransUnion
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