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Why you Need a Clean Credit Report and High Credit Scores
Some of the main problems caused by bad credit include the difficulty in getting a business loans, higher interest rates, and the huge down payment that you are expected to pay. So the better your credit score, the lesser you will have to spend on the loan. Hence it is important that you maintain an impressive credit score and also a clean credit record. These are times when the financial situation is miserable and house market predictions are worsening all the time. No wonders the banks are cautious than ever.
Coming to house market predictions, these do have some impact on getting a loan, even though it doesn’t directly affect your credit report. For example, if you have your own home, and if the house market predictions are very good, you will get loads of exciting deals for loans. On the other hand, if the house market predictions are poor, it will also have a negative effect on the loan offers and its terms and conditions.
Considering the credit report, it is something that is very much different from your credit score. Your credit report is actually a catalog of stuffs like your payment history, bank and credit card accounts, outstanding loans etc; while your credit score is an evaluation of your overall credit based on the credit report. Information found on your credit report may also affect your credit score. This includes details on Bankruptcy, Liens, outstanding amounts, late payments, Credit card balances etc.
If you want a good credit score, you need a clean credit report. There are three credit reporting agencies (CRAs): Equifax, Trans Union and Experian. So if you want to clean up your credit record, you may have to clean up three different credit reports. For this, you should first apply for copies of the credit report from all the three credit reporting agencies. If you think that certain info on the credit report is inaccurate, you should send a letter to the credit bureau that supplied the report. You should also have a proper proof.
Once your letter is received, the credit bureau goes to the credit company for getting the proof of their claim. And if they are not able to provide the asked information in thirty days, the item should be erased from your report. Nevertheless, the item will stay on your credit report if the creditors can prove their claims, not considering whether this is done within the allotted time or not. You can also remove negative information on the credit report, even when they are actually correct. This can be done by writing a requisition letter to the creditor who has reported the facts. You can also clean up the credit report by hiring companies that offer report clean-up services.
Taking into account the importance of your credit, there is nothing wrong in spending some time for getting your credit report cleaned up. So hurry, it is time for the cleaning job.
Continue to: Common Credit Misconceptions
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