Sunday, November 18, 2012

3 Reasons You Should Check Your Credit Score Often

Your credit score says a lot about your financial health. In the same way that you monitor your weight during a weight loss/gain program, you need to constantly check this figure to make sure your finances are in good shape.

There are many reasons why your credit score should be monitored and that is what we will be discussing in this article.

A lot of people find themselves in deep financial trouble nowadays. Though most of them can blame the bad state of the economy, a deeper probe will reveal that things would not be so dire if they only took time to monitor their credit score.

Most people think that they should only look at their credit score when they want to borrow money. While it is true that your credit score will play an important role in a loan approval, that is not the only reason to look at your credit.

One of the rising reasons to monitor your credit score is to prevent identity theft. This crime is done so people can steal from you by borrowing under your name. If you do not keep tabs on your credit report, it may take years before you realize that your credit history had been damaged by a loan that you did not make.

Another reason to keep tabs on your credit score is the fact that it will take quite some time to repair it. Sometimes, we think that paying the minimum of your credit card bill and missing out on a couple of loan payments will not harm us. On the contrary, your credit score may have been slipping lower and lower every time. In case you have to borrow money or you decide to buy a home, you need a healthy score to get an approval. If you find that your score is low because of your negligence, then you can start repairing it as soon as possible.

The last reason why you should constantly monitor your credit score is to check it for any errors. Incorrect information can drive your credit down and you need to see if there are erroneous late payments being inputted in your report. This will be reflected in your history unless you dispute that particular information. Filing a dispute to correct an error is one of your rights as a consumer. Do not be afraid to utilize it.

Remember that lenders are not the only ones interested in your credit history. Some employers take a peek as well and even landlords access this before getting a tenant. If you do want the inconvenience of being turned down by any of them, you should make sure your credit will not negate your ability to pay your dues or manage your finances wisely.

Monitoring your credit score will not cost you a lot. The government mandates the 3 major credit bureaus (TransUnion, Experian and Equifax) to provide consumers with a free copy of their report once a year. This can be accessed through the Annual Credit Report website.

The technique is to download one report from a chosen bureau every 4 months. This will provide you with a free report all throughout the year. You can use one of the many free online credit score calculator based on the information written on your report. Compute and monitor the details and make sure that any additions are based on your own actions.

Your credit score is also one of the factors that will be checked to see if you qualify for a debt relief program. If you have some debts to settle, make sure your score can allow you to pursue the debt relief option that you choose to take.

Aggressive Credit Repair Made Easy With These Great Tips

Whether you have only a few small things to change, or an entire overhaul to accomplish, know that many people also endure problems with their credit rating. Following the advice from this article will help to guide you on your way to better credit.

Get a copy of your credit report first when trying to fix your credit. Check your credit score, and look over the report for any problems or discrepancies. Dispute inaccurate items on your credit report so you can get them removed. Before you can get to the task of repairing your credit, you have to know its current state.

Work with your creditors to work out a payment plan for your debts. If you are unable to make payments ask for a postponement. Where there is a good plan in place for repayment of the debts you owe, there is less risk of interest and late payments accruing. Once you have set up a plan with your creditors about the accounts that will be paid and those that will be postponed, you can then focus your attention on the bills that need immediate action.

Make sure to make a record of any negatives on your credit report. If you go over the document carefully, you might find missing factors or the wrong information. You will be better able to start boosting your credit score once you know what negative factors are influencing it.

Make sure you research the laws when it comes to debt collection in your state and know what your rights are. Keep in mind that collection agencies cannot send you to jail. In fact, it is against the law for them to threaten you this way. State laws regarding collections vary, but almost all states have some law that protects debtors from verbal abuse. Know your rights, and the laws that protect them, to avoid collection agency abuses.

Make every effort to keep your credit card balances under 30 percent of the credit limit. This figure is important for both improving your credit and making your payments easy to keep up with.

You can try to see if you can set up a payment plan for the bills that are already in collections. You can even do this before your outstanding debts are turned over to collections. The worst thing you can do is to avoid the collection agency. By talking to the agency, you can set a mutual plan for repayment. Be honest about your financial situation; let them know that you are sincere about paying off your bills, even though you are having a difficult time with it. Creditors may reduce the amount you owe them and get you set up on a payment plan. If you are upfront with them, many creditors will help improve your situation.

If you follow these tips, you can be sure that you are going to fix your credit. These tips can help you increase your credit score.