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66 Credit Reports and Scores Questions and Answers

As an active duty member of the military, can I get a truly free credit score for me or my spouse?

Yes, servicemembers and military spouses can get free credit scores and helpful credit information from the financial counselors at the Personal Financial Management Program (PFMP) office of your installation. To find your nearest PFMP office (select "Personal Financial Management Services" in the "Program or Service" menu).

Where there is not a Personal Financial Manager nearby, you might access your credit score by emailing the Financial Industry Regulatory Authority (FINRA) at creditscore@finra.org.

Are credit scores used in employment screening?

The nationwide credit reporting companies say they do not currently provide credit scores for employment purposes. When employers review a job applicant’s credit background, which requires an individual’s written consent, they look at credit reports including the credit accounts and other information in your credit file.

Are there any kinds of disputes that creditors or other institutions would not have to investigate if I were to file a dispute directly with them?

Yes. There are certain types of disputes that creditors or furnishing institutions do not have to investigate if a dispute is directly filed with them. These include disputes about the following:

  • Information that identifies you (generally at the beginning of the credit report) such as your name, date of birth, Social Security number, telephone number, or address
  • The identity of past or present employers
  • Inquiries or requests for a consumer report
  • Information derived from public records, such as judgments, bankruptcies, liens, and other legal matters (unless provided by a furnisher with an account or other relationship with you)
  • Information related to fraud alerts or active duty alerts
  • Information some other creditor or furnishing institution gave to the credit reporting company

Generally, the types of disputes creditors and furnishing institutions investigate when you file disputes with them directly relate to:

  1. Your liability for a credit account or debt with that entity furnisher (for example, whether it is your account)
  2. The terms of your credit account or debt with that entity (for example, how much you owe)
  3. Your performance or other conduct on an account or relationship with that entity (for example, whether you are paying on time)
  4. Any other information about your account or relationship with that entity relevant to a credit report (for example, your creditworthiness)

TIP: Other limits on disputes filed directly with creditors or furnishing institutions.

A creditor or furnishing institution does not have to investigate a dispute about your credit report that you file directly with it if:

  • You use a form a credit repair organization supplies to you or a credit repair organization prepares or submits the dispute for you
  • The dispute is substantially the same as one you previously submitted to it or to a credit reporting company, if the creditor or furnisher has already met its legal responsibilities for that dispute

Can a card issuer consider my age when deciding whether to issue a credit card to me?

Generally, age cannot be used to make credit decisions; however, it may be considered in certain circumstances. For example, a creditor may use an applicant’s age as part of a valid credit scoring system (so long as it does not disfavor applicants 62 years old and older).

In addition, if you are under 21 years old, the card issuer cannot issue a credit card to you unless you can show an independent ability to make the minimum periodic payment on the account or someone at least 21 years old guarantees or otherwise agrees to be liable on the account. The guarantee may come from anyone at least 21 years old with the financial ability to make the payments and does not have to come from your parents.

If you have friends under 21 who ask you to help them get a loan, consider that if they do not pay, you would be obligated to do so, and if you do not, it will likely hurt your credit history. If they do not make timely payments, this also may appear on your credit report.

Can I make issuers stop sending me credit card offers in the mail?

You can reduce the credit card offers you receive in the mail by calling 1-888-5-OPTOUT (1-888-567-8688) or by visiting OptOutPrescreen.com.

This service allows you to remove your name from the lists supplied to credit card companies and insurers by the three nationwide credit reporting companies (Equifax, Experian, and TransUnion) and another credit company, Innovis. The credit reporting companies supply these lists for preapproved offers for credit cards, other types of credit, and insurance.

The companies will implement this opt-out request within five business days, though for a period of time you still may continue to see credit offers because your name may already have been provided to companies who have not yet mailed their offers to you.

In addition, “opting out” will not affect credit card offers from companies that don’t use lists compiled by the nationwide credit bureaus. To target these other sources, you can contact the Direct Marketing Association (DMA) which creates an opt-out list for consumers who generally prefer not to receive mail or phone offers. You can sign up for this service on DMA's website or download a form to submit by mail. You can also call 212-768-7277 to have the form mailed to you.

If you opt out by phone or by the DMA website, the request is good for five years. To opt out permanently, you must download and mail a signed Permanent Opt-Out Election form, available by calling 1-888-5-OPTOUT (1-888-567-8688).

If you opt out, your name will no longer appear on lists provided by credit bureaus. However, card issuers can still solicit you if they have done business with you before or they get your name from other sources and send you invitations to apply for a card.

Can I review my credit report?

Yes. You are entitled to one free credit report every 12 months from each of the three major consumer reporting agencies – Equifax, Experian, and TransUnion. You can request your free report through the website AnnualCreditReport.com, by calling 1-877-322-8228, or by filling out the Annual Credit Report Request form (available at AnnualCreditReport.com) and mailing it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. No matter how you request your report, you have the option to request all three reports at once or to order one report at a time. By requesting the reports separately, you can monitor your credit more frequently throughout the year.  

AnnualCreditReport.com is the ONLY authorized website for the free annual credit report that's yours by law.

You also have the right to obtain a free credit report in certain other circumstances – for example, if you are denied credit or, in some cases, if you receive credit at a higher interest rate than the lowest rate that was stated in the original offer to you. The card issuer is required to tell you the name and address of the credit reporting agency from which the card issuer obtained your credit report.

If you find that information in your credit report is wrong, you can dispute the inaccurate information.

Can the card issuer request information about my income, my age, and my Social Security Number when I apply for a credit card?

Yes. Before granting credit to you the card issuer may ask about your income so they know whether you can pay the required minimum periodic payment. The card issuer may also ask about your age so they know you are old enough to have the legal ability to enter into a contract. Also, the card issuer may ask for your social security number to get your credit report.

Could I be turned down for a job because of something in my credit report?

Employers are permitted to obtain your credit report under the FCRA with your written permission.  However, employers may be governed by other federal or state laws that may affect how they use this information.

Employers must also give you a copy of the credit report they looked at, and give you “A Summary of Your Rights Under the Fair Credit Reporting Act” before turning you down based on information in your credit report. This allows you to correct errors in your credit report and prevent employers from taking adverse action against you based on incorrect information.

TIP: Check your credit before starting a job search. Review the reports closely for mistakes or missing items and dispute any problems with the credit reporting company and the creditor that provided the information. If you provide written consent, employers may use your credit report when deciding to hire you.

Do I have to pay for my credit score?

Usually you have to pay for your credit score. The Fair Credit Reporting Act lets credit reporting companies charge a fee for credit scores.

You can get a free score in some circumstances:

Mortgage scoring notice: If you apply for a residential mortgage loan and the lender uses your credit score, the lender will send you a notice with that credit score.

Adverse action notice: You may receive a disclosure from a lender with your credit score if your application for credit gets turned down, if you have to pay a higher initial deposit fee (like for a cell phone plan), or if you do not get credit with substantially the terms you requested based on information in your credit report.

Risk-based pricing notice: You may receive a notice of your credit score from your lender if you received credit on terms less favorable than the terms available to most consumers who got credit from that lender.

You can also review your credit reports free every 12 months at the nationwide credit reporting companies. Most or all of the information that goes into a credit score comes from your credit reports.

Do joint credit card accounts with my spouse affect my credit score?

Yes. Joint accounts, like a joint credit card, will affect both your credit scores.

Does a credit inquiry have a different impact on my score if I'm approved or denied?

Credit models generally do not give positive or negative weight to the outcome of the credit inquiry.

Credit scoring models typically evaluate credit inquiries based on:

  • How recently the inquiry occurred
  • How frequently inquiries are made
  • How many inquiries are made

Being approved for credit could impact other variables in credit scoring models, such as your credit utilization rate – the amount of credit you’ve been given compared to the amount you’ve used.

How can I contact the nationwide credit reporting companies with general inquiries?

Equifax
P.O. Box 740241
Atlanta, Georgia 30374
www.equifax.com
1-800-685-1111

Experian
P.O. Box 9554
Allen, Texas 75013
www.experian.com
1-888-397-3742

TransUnion P.O. Box 6790
Fullerton, CA 92834
www.transunion.com
1-800-888-4213

How can I find out who has accessed my credit report?

When you request a copy of your credit report, you will see a list of anyone who has requested your credit report within the past year, including any employers or prospective employers who have requested your report within the past two years for employment purposes.

How can I recognize a credit repair scam?

If you see ads or receive offers to repair your credit, look for these warning signs:

  • The company wants you to pay before it provides any services. Under the Credit Repair Organizations Act, credit repair companies cannot require you to pay until they have completed the services they have promised.
  • The company doesn’t tell you your rights and what you can do for yourself for free.
  • The company recommends that you do not contact any of the nationwide credit reporting companies directly.
  • The company tells you it can get rid of most or all the negative credit information in your credit report, even if that information is accurate and current. No one can do this.
  • The company suggests that you try to invent a “new” credit identity – and then, a new credit report – by applying for an Employer Identification Number to use instead of your Social Security number. It is a federal crime to misrepresent your Social Security number or to obtain an Employer Identification Number from the Internal Revenue Service under false pretenses.
  • The company advises you to dispute all the information in your credit report, regardless of its accuracy or timeliness.

If you have just signed up for these services, you have the right to cancel your contract with any credit repair organization for any reason within three business days.

Credit repair companies must abide by the Credit Repair Organizations Act, a federal law enforced by the Federal Trade Commission (FTC). This law prohibits deceptive practices by credit repair organizations. You have a right to sue a credit repair organization that violates the Credit Repair Organization Act.

If you have complaints or concerns about a credit repair scam, contact the FTC at 1-877-FTC-HELP (1-877-382-4357).

How can I spot identity theft?

The best way to keep an eye out for identity theft is to read your statements from credit card companies, banks and credit unions, and to routinely check your credit reports for suspicious activity.

Financial accounts and billing statements. Look closely for charges you did not make. Even a small charge can be a danger sign. Thieves sometimes will make a small debit against your checking account and then return to take much more if the small debit goes unnoticed.

Credit reports. Review your free credit reports from each of the three major credit bureaus. If an identity thief is opening financial accounts in your name, these accounts may show up on your credit report. Look for inquiries from companies you’ve never contacted, accounts you didn’t open, and wrong amounts on your accounts. Also be sure your personal information – like your Social Security number, address, name or initials, and employers – is correct.

Tip: Don’t ignore bills from people you don’t know. A bill on a debt you never borrowed may be an indication that someone else has opened an account in your name. Contact the creditor to find out.

How do credit reporting companies get my information?

Banks, credit unions, retail credit card issuers, auto lenders, mortgage lenders, debt collectors and others voluntarily send information to credit reporting companies. Shared information includes:

  • When you apply for an account
  • When an account is opened
  • The amount loaned or the credit limit
  • The account balance
  • The status of your payments
  • If your account is in collection

Credit reporting companies also purchase public records like liens, bankruptcy filings, and court judgments from public records providers.

How do I choose which credit counselor is right for me?

A reputable credit counseling agency should be willing to send you free information about itself and the services it provides without requiring you to provide any details about your situation. If a service doesn’t do that, consider it a red flag and go elsewhere for help.

Here are some questions to ask to help you find the best counseling service for you:

What services do you offer?
Look for an organization that offers a range of services, including budget counseling, and savings and debt management classes. Avoid organizations that push a debt management plan (DMP) as your only option before they have spent a significant amount of time analyzing your financial situation.

In a debt management plan, you deposit money each month with a credit counseling organization. The organization pays your credit card bills and other debts according to a payment schedule they’ve worked out with you and your creditors. The Federal Trade Commission has found that some organizations that offer debt management plans have defrauded clients. If you do choose a debt management plan, contact your creditors and confirm that they have accepted the proposed plan before you send any payments to the organization handling your debt management plan.

Do you offer in-person counseling? Consider finding an organization that does offer in-person counseling.

Do you offer free educational materials? Avoid organizations that charge for information.

What are your fees? Are there set-up or monthly fees? Get a specific price quote in writing.

What if I can’t afford to pay your fees or make contributions? If an organization won’t help you because you can’t afford to pay, look elsewhere for help.

Will I have a formal written agreement or contract with you? Don’t sign anything without reading it first. Make sure all verbal promises are also in writing. As with any financial product or service, don’t sign anything that you don’t understand.

Are you licensed? Is the organization or counselor licensed to offer services in your state? Find out about what training or professional certifications the counselor has received.

How are your employees paid? Are they paid more if I sign up for certain services, if I pay a fee, or if I make a contribution to your organization? If the answer is yes, consider it a red flag and go elsewhere for help.

How do I dispute an error on my credit report?

If you find something wrong in your credit report, you should dispute it.  You may contact both the credit reporting company and the company that provided the information.  You should explain what you think is wrong and why.

TIP:  To correct mistakes, it helps to contact both the credit reporting company and the source of the mistake.  If you find a mistake in a report from a credit reporting company, you may submit a dispute not only to the credit reporting company, but also directly to the company that is the source of the information and can include the same supporting documentation.  However, there are certain types of disputes that companies are not required to investigate.  If the company corrects your information as a result of your dispute, it must notify all of the credit reporting companies to which it provided the wrong information, so they can update their reports with the correct information.

If you submit a dispute by mail, your dispute letter should include your complete name, address, telephone number, report confirmation number, and account number for any account you may be disputing.  You should clearly identify each mistake, state the facts, explain why you are disputing the information, and request that it be removed or corrected.

In your letter, you may want to enclose a copy of the portion of your credit report that contains the disputed items and circle or highlight the disputed items.  You should include copies (not originals) of documents that support your position.
Send your letter of dispute to credit reporting companies by certified mail, return receipt requested, so that you will have a record that your letter was received.

You can contact the nationwide credit reporting companies online, by mail, or by phone:

 

Equifax
Onlinewww.ai.equifax.com/CreditInvestigation
By mail: Click here to download the dispute form
Mail the dispute form with your letter to:
Equifax Information Services LLC
P.O. Box 740256
Atlanta, GA 30374
By phone: Phone number provided on credit report or (800) 864-2978

Experian
Online: www.experian.com/disputes/main.html
By mail: Use the address provided on your credit report or mail your letter to:
Experian
P.O. Box 4000
Allen, TX 75013
By phone: Phone number provided on credit report or (888) 397-3742

TransUnion
Online: www.transunion.com/personal-credit/credit-disputes-alerts-freezes.page
By mail: Click here to download the dispute form
Mail the dispute form with your letter to:
TransUnion Consumer Solutions
P.O. Box 2000,
Chester, PA 19022-2000
By phone: 800-916-8800

Keep copies of your dispute letter and enclosures.

After you submit a dispute to the credit reporting company, if you are dissatisfied with the resolution you have the option of submitting a complaint to the Consumer Financial Protection Bureau.

If you suspect that the error on your report is a result of identity theft, visit the Federal Trade Commission’s Fighting Back Against Identity Theft website for information about identity theft and steps to take if you have been victimized. This will include filing a fraud alert and possibly filing a security freeze.

How do I find a credit counselor?

Most credit counselors offer services through local offices, online, or on the telephone. You can find a list of approved credit counselors online.

Once you've developed a list of potential counseling agencies, check them out with your State Attorney General’s office, and local consumer protection agency. Finally, ask the counselors for free information about their services and what they provide.

Learn more about how to choose the right credit counselor for you.

How do I get a copy of my credit report?

Visit AnnualCreditReport.com to get a free copy of your credit report, technically known as a “file disclosure” from the nationwide credit reporting companies. You can receive a free credit report once every 12 months. You can also order your free credit report:

  • By phone: Call 877-322-8228
  • By mail: Download and complete the Annual Credit Report Request Form and mail it to:
    Annual Credit Report Request Service
    P.O. Box 105281
    Atlanta, GA 30348-5281

No matter which method you choose, you have the option to request reports from the nationwide credit reporting companies at once or one report at a time. By requesting the reports at the same time, you can determine whether any of your files have errors. By requesting the reports separately, you can monitor your credit file more frequently throughout the year.

Your free credit report does not include a credit score. 

You are also eligible for free reports from nationwide specialty consumer reporting companies

TIP: Be aware that there are many websites that claim to offer free credit reports. A number of these sites will only give you a free report if you buy other products or services. Still others give you a free report and then bill you for services you have to cancel. To get the free credit report authorized by law, go to AnnualCreditReport.com.


TIP: To protect against imposters, the Federal Trade Commission now requires print advertisements, telephone requests, and websites that offer “free” credit reports to make the following disclosure: “You have the right to a free credit report from AnnualCreditReport.com or 877-322-8228, the ONLY authorized source under Federal law.” Radio and television advertisements that offer “free” credit reports must have a similar disclosure: “This is not the free credit report provided for by Federal law.”

How do I get and keep a good credit score?

There are no secrets or shortcuts to building a strong credit score. Following these guidelines should help:

Pay your bills on time, every time. One way to make sure your payments are on time is to set up automatic payments, or set up electronic reminders. Also try to pay more than the minimum payment if you can. If you have missed payments, get current and stay current.

Don’t get close to your credit limit Credit scoring models look at how close you are to being “maxed out,” so try to keep your balances low in proportion to your overall credit limit. Experts advise keeping your use of credit at no more than 30 percent of your total credit limit.

A long credit history will help your score. Credit scores are based on experience over time. The more experience you have with getting credit and paying your bills on time, the more information there is to determine whether you are a good credit risk.

TIP: If you close some credit card accounts and put most or all of your credit card balances onto one card, it may hurt your credit score if this means that you are using a high percentage of your total credit limit.

Only apply for credit that you need. Credit scores look at your recent credit activity as an indicator of your need for credit. If you apply for a lot of credit over a short period of time, it may appear to lenders that your economic circumstances have changed negatively.

How do I put a freeze on my credit report?

You can place a “freeze” on your credit file at any time, but you must contact each credit reporting company. For more information, visit the nationwide credit reporting companies’ websites or call the numbers below: 

How does a bankruptcy affect my credit score?

A bankruptcy will have a very negative effect on your credit score.

Credit scores measure the likelihood that you’ll pay back a lender if the lender gives you credit. In many bankruptcies, consumers do not pay back certain debts, or pay them only partially, which is why credit scoring models consider bankruptcies unfavorably.

Bankruptcies can stay on your credit report for up to 10 years. As long as a bankruptcy appears on your credit report, it will negatively impact your score.

How long after getting my first credit account will a credit score be created?

While the amount of time it takes and the amount of information needed may vary depending upon the credit scoring model being used, for at least one of the three nationwide credit reporting companies, you must have at least one account open six months or more and at least one undisputed account reported by a creditor to the credit bureau in the last six months.

How long does it take to get my free credit report after I order it?

It depends on how you ordered your report:

Online: If you request your report at AnnualCreditReport.com, you should be able to access it immediately.

Phone: If you order your report by calling 877-322-8228, your report will be processed and mailed to you within 15 days.

Mail: If you use the Annual Credit Report Request Form or write a letter, your request will be processed and mailed to you within 15 days of receipt. Please allow two to three weeks for delivery.

Whether you order your report online, by phone, or by mail, it may take longer to receive your report if the nationwide credit reporting company needs more information to verify your identity.

How long does negative information remain on my credit report?

A credit reporting company generally can report most negative information for seven years. Information about a lawsuit or an unpaid judgment against you can be reported for seven years or until the statute of limitations runs out, whichever is longer. Bankruptcies can stay on your report for up to 10 years.

Even though the credit reporting company usually won’t report this negative information after the seven year limit, they still may keep your information on file, and there are certain instances where they will report it. These time limits on reporting negative information do not apply if the credit report will be used in connection with:

  • Your application for a job that pays more than $75,000 a year.
  • Your application for more than $150,000 worth of credit or life insurance.

Tip: Don’t pay fees to “repair” your credit history.

Many companies promise to “repair” or “fix” your credit for an upfront fee. However, no one can remove negative information, such as late payments, from a credit report if it is accurate. You can only get your credit report fixed if it contains errors, and you can do that on your own at no cost.

How much does it cost to get a copy of my credit report if I’ve already received all of my free credit reports?

By law, a credit reporting company can charge no more than $11.50 for a credit report.

How often can I request a free credit report?

You can request a free credit report from a nationwide credit reporting company once every 12 months. You can choose to request reports from the nationwide credit reporting companies all at once or one report at a time.

By requesting the reports at the same time, you can determine whether any of your bureau files have errors. By requesting the reports separately, you can monitor your credit file at no cost more frequently throughout the year.

You can get additional free reports if any of the following apply to you: 

  • If you received a notice that you were denied credit, insurance, or employment or experienced another so-called “adverse action” based on a credit report, you have a right to a free report from the credit reporting company identified in the notice. To get the free report you must request it within 60 days after you receive the notice.
  • Other types of “adverse action” notices you might receive include notice of an unfavorable change in the terms or amount of your credit or insurance coverage, or unfavorable changes in the terms of your employment or of a license or other government benefit.
  • You are a recipient of welfare.
  • You believe your file is inaccurate due to fraud.
  • You have requested a credit report from a nationwide credit reporting company in connection with the placing of an initial fraud alert (you may request two free copies for an extended fraud alert).
  • You are unemployed and intend to apply for employment within 60 days from the date of your request.
  • Your state offers a free credit report. Residents of Colorado, Maine, Maryland, Massachusetts, New Jersey, and Vermont may be able to obtain an additional free credit report each year. Residents of Georgia may be able to obtain two free credit reports each year.

Note that each of the nationwide credit reporting companies has a different way for you to get your free or reduced price credit report if you qualify for one. You can learn more on their websites or by calling the numbers below:

I am in the military and I am concerned that someone may try to use my personal information to obtain credit while I am deployed overseas. How can I prevent this?

If you are a member of the military on active duty, you may place an “active duty alert” on your credit report to reduce the risk of identity theft while you are deployed. 

This alert lets a business know that you are probably out of the country, so the business is required to take reasonable steps to verify your identity before issuing credit in your name. If you have provided your telephone number, the business must either contact you at the telephone number you provided or take other reasonable steps to verify your identity and confirm that the application is not attempted identity theft. Since it may be very difficult to contact you directly if you are deployed, you can assign a personal representative to answer for you, or to place or remove an active duty alert.  
 
Contact one of the nationwide credit reporting companies (that company will then contact the other nationwide credit reporting companies):

Active duty alerts on your credit report last for 12 months, unless you request that the alert be removed sooner. Your name also will be removed for two years from the nationwide consumer reporting companies marketing lists for credit and insurance offers. If your deployment lasts longer than 12 months, you may place another alert on your credit file.

The active duty alert requires the creditor to take reasonable steps to confirm your identity before opening a new credit account. If you want a stronger step to protect you from identity theft during your deployment, consider placing a security freeze.

I applied for a credit card and was turned down. What can I do?

The card issuer is required to give you a list of the principal reasons for its decision, or a notice telling you how to get the principal reasons. If the card issuer based its decision on information contained in your credit report, the card issuer also is required to give you a notice that includes the name and address of the credit reporting agency that provided the report. You have a right to get a free copy of your credit report from the credit reporting agency within 60 days after you receive the notice. In addition, beginning July 21, 2011, the card issuer generally is required to tell you about your credit score and information related to your credit score.

If you find information in your credit report that you believe is inaccurate, you can dispute what is in the report with the credit reporting agency. The credit reporting agency is required to conduct an investigation and correct any errors it finds. If after the investigation you still believe the report to be in error, you generally have the right to have a statement added to the report stating that you dispute the information. Contact the credit reporting agency for instructions about how to add the statement to your report. You can also dispute inaccurate information in your credit report with the company that furnished the information.

I applied for a credit card, but I was told that I had to get my parents to guarantee the account. Can they do that?

If you are under 21 years old and cannot show an independent ability to make the minimum periodic payment on the account, the card issuer cannot approve your application unless someone at least 21 years old who is able to make the minimum periodic payment guarantees, co-signs, or otherwise agrees to be liable on the account. The guarantee may come from anyone at least 21 years old with the financial ability to make the payments, and does not have to come from your parents.

If you have friends under 21 who ask you to help them get a loan, consider that if they do not pay, you would be obligated to do so, and if you do not, it will likely hurt your credit history. If they do not make timely payments, this also may appear on your credit report.

I do not want creditors to report my accounts to credit reporting companies. What can I do?

You have no right to opt out of having creditors report your accounts to the credit reporting companies.

I don't recognize the name of a creditor listed on my credit report. Should I dispute this listing?

If you don’t recognize a creditor, you should contact the creditor to identify the account. The unfamiliar creditors may be entirely legitimate.

Creditors and lenders may sell your accounts or use a third-party collection company, which can result in an unfamiliar name showing up on your credit report. Also, if you have a retail store credit card, it is quite common for such cards to be listed on your credit report under the name of the bank issuing the card, not the retailer.

If the unfamiliar creditor you see is listed only as making an inquiry, the listing may reflect a prescreened offer of credit to you. The Fair Credit Reporting Act permits prospective creditors or insurers to have the credit reporting company search your credit file to see if you meet criteria set by the creditor, in a process called prescreening, in order to make you a firm offer of credit or insurance.  You can opt out of prescreening.

However, if you believe the information is incorrect, you should dispute it.

I filed for bankruptcy. How long will that appear on credit reports?

If you filed for bankruptcy protection under Chapters 7, 11, 12, or 13 of the Bankruptcy Code, that information will remain in your credit report up to 10 years from the date of entry of the order for relief or the date of adjudication. In certain instances, it can be reported beyond 10 years.

I got my credit score from two different credit bureaus and have two different numbers. Why is that?

You could have many different credit scores because there are a variety of scores in the marketplace, often with different score ranges. Even if you buy a credit score it will likely be different than the one a lender sees.

To learn more about the different scores in the marketplace, you can review the CFPB’s report detailing the difference between the scores consumers can purchase and those that lenders use.

Even where credit scoring models have the same range, a consumer’s credit score can vary among credit reporting companies because of different underlying data.

Sometimes, lenders do not furnish information to all three nationwide credit reporting companies. Lenders may also furnish information to each of the bureaus at different times, causing differences in scores. And each bureau has distinct proprietary data sources such as rental data or court records which can lead to different score results.

Comparing your scores between different models is less important than understanding your overall level of creditworthiness and confirming that the underlying information in your credit report is accurate.

I got my free credit reports, but they do not include my credit scores. Can I get my credit score for free too?

Free credit reports provided by credit reporting agencies do not include credit scores. These agencies charge a fee for providing this information. You can request your credit report and your credit score through AnnualCreditReport.com.

There are other third parties that claim to offer “free” credit scores. However, you should consider the following:

  • You may need to enroll in a program with a fee or purchase a product to get this “free” credit score. That means it is not really free. Sometimes there is period of time during which you can cancel without paying a fee. These programs are not free unless you remember to cancel within the allowed period of time.
  • The credit score they provide may not be the same as the credit score your lender uses.
  • Take care when sharing personal information with companies that do not already have access to it.

Note: Effective July 21, 2011, creditors (including card issuers) generally will have to disclose your credit score (and related information) if they use the score and, based in whole or in part on your credit report:

  • deny your application,
  • increase the cost of your credit, or
  • offer you a higher rate than other consumers get from that creditor (when the offer has more than one interest rate).

I may have been the victim of fraud or identity theft. How can I put a fraud alert on my credit report?

Contact one of the nationwide credit reporting companies and place a fraud alert in your credit report:

  • Equifax, 800-525-6285
  • Experian, 800-397-3742
  • TransUnion, 800-680-7289

When you place a fraud alert on your credit report at one of the nationwide credit reporting companies, it must notify the others. A fraud alert requires creditors who check your credit report to take steps to verify your identity before opening a new account, issuing an additional card, or increasing the credit limit on an existing account based on a consumer’s request.

There are two main types of fraud alerts: initial fraud alerts and extended alerts.

Initial fraud alerts
You can place an initial fraud alert on your credit report if you believe you might become a victim of fraud or identity theft. Credit reporting companies will keep that alert on your file for 90 days. An initial fraud alert requires that the creditor take reasonable steps to form a reasonable belief that they know the identity of the person making a new credit request in your name. If you provide a telephone number, the lender must call you to verify whether you are the person making the credit request.

When you place an initial fraud alert in your file, you’re entitled to order one free copy of your credit report from each of the nationwide credit reporting companies. When you place an extended fraud alert in your file, you’re entitled to order two free copies of your credit report from each nationwide credit reporting company over a 12 month period. These free reports do not count as your free annual report from each agency.

Once you get your credit reports, review them carefully. Look for:

  • Accounts you did not open.
  • Information about the status of the accounts and whether the account balances appear correct.
  • Outstanding balances on your reports that you cannot explain.
  • Incorrect personal information, such as your Social Security number, address, name or initials, and employers.

If you find fraudulent or inaccurate information, contact the credit bureau to have it removed by filing a dispute.

Extended alerts
You can place an extended alert on your credit report after your identity has been stolen. You must file either a police report or a report with a government agency such as the Federal Trade Commission, known as an “identity theft report.” An extended alert is good for seven years. An extended alert requires that the creditor contact you in person or through the telephone number or other contact method you designate to verify whether you are the person making the credit request.

Special help for servicemembers
Members of the military have an additional option available to them – active duty alerts, which give servicemembers protection while they are deployed overseas. Active duty alerts last for 12 months.

When you place an active duty alert on your credit report, creditors must take reasonable steps to form a reasonable belief that they know the identity of the person making the request before opening an account or issuing an additional card or increasing the credit limit on an existing account. Your name also will be removed for two years from the nationwide credit reporting companies’ marketing lists for credit offers and insurance.

Credit freezes
You can also place a “freeze” on your credit report. A security freeze means that new creditors cannot access your credit report. Because most businesses will not open credit accounts without checking your credit report, a freeze can deter identity thieves from opening new accounts in your name. Be mindful that a freeze does not prevent identity thieves taking over existing accounts. Learn more about security freezes.

Continue to check your credit reports periodically, especially for the first year after you discover the identity theft, to make sure no new fraudulent activity has occurred.

I tried to check my credit report online, but the site wanted to charge me a fee or get me to sign up for other services. Aren't credit reports free?

AnnualCreditReport.com is the only authorized website for the free annual credit reports that you are guaranteed by law. As a rule of thumb, if the website domain name has the word “free” in its address, it is not actually required by the federal government to provide credit reports for free.

AnnualCreditReport.com is the only place where you can obtain the free credit report guaranteed by federal law.

I was denied credit because of an "insufficient credit file" or "no credit file." What should I do?

Millions of adults in the United States have no credit history or credit files that don’t have enough information to have a credit score. Without a credit score, many lenders are unwilling to offer credit, or they will charge higher interest rates and give you less favorable terms.

For the most common credit scoring models, you may have difficulty getting a credit score if you:

  • Do not  have at least one credit account open for six months or more
  • Do not have at least one update in the past six months to at least one credit account for which you have not filed a dispute

This requirement can be met by having one account that has been updated in the last six months, opened for at least six months, and for which there has not been a dispute in the last six months.

Even if you can get a credit score, some lenders will consider your credit history insufficient for loan approval if you have three or fewer credit accounts (this is known in the industry as a thin file).

Here are some actions you can take to overcome these hurdles:

  • If you have a credit card open, use it carefully and pay the bill in full each month
  • If you have other lines of credit, make your payments on time

If a credit reporting error is corrected, how long will it take before I find out the results?

The credit reporting company has five business days after completing the investigation to notify you of the results.  You will also receive a copy of your updated credit report.  This free report does not count as your annual free report.  Please note that if a company provides the wrong information to a credit reporting company and then corrects your credit report as a result of your dispute, it has a duty to forward the correction to every credit reporting company to which it has provided the incorrect information. 

If I ask my credit card company to reduce the interest rate on my balance while I am on active duty, can that hurt my credit rating?

No. Under the law a lender cannot make an adverse credit report based on a servicemember’s exercising his or her right to get a reduced interest rate under the Servicemembers Civil Relief Act.

If I dispute a debt, does that mean it will stay on my credit report longer?

No. If you contact a credit bureau to challenge the accuracy of any debt in your file, it will not extend the period of time the debt can be reported by the bureau, which is fixed by law.

If I dispute a debt, how does that show up on my credit report?

If you contact a credit bureau and dispute the validity of a debt, the credit reporting company will put a note on the account that it is in dispute and then investigate your dispute. If the credit reporting company’s investigation doesn’t resolve your dispute, you can send the credit reporting company a brief statement of the dispute and ask that it be included in your file and included or summarized in future reports about you.

If I have a bad credit score, will it affect my fiancé’s score if we get married?

Credit scores are calculated on a specific individual’s credit history. By getting married, you will not affect your fiancé’s score.

However, if you and your fiancé open a joint credit card or obtain a joint auto loan or mortgage, or if you are an authorized user on your fiancé’s credit account, that could affect your fiancé’s credit score.

But the bottom line is that any account your fiancé opens solely in his or her name will not be affected by your credit status.

If my spouse has a bad credit score, does it affect my credit score?

Credit scores are calculated on a specific individual’s credit history. If your spouse has a bad credit score, it will not affect your credit score.

However, when you apply for loans together, like mortgages, lenders will look at both your scores. If one of you has a poor credit score, it counts against you both. You may not qualify for the best interest rates or the loan could be denied.

For the time being, until your spouse’s credit score improves, you may be able to get good terms on loans as long as you apply individually.

I'm blind or visually challenged. How can I review my credit report?

The nationwide credit reporting companies provide their free annual credit report in accessible formats for people who are blind or visually challenged. You may call 1-877-322-8228 and request a copy of your free annual credit report in an audio format, Braille, or large print. The report will be mailed within 15 days.

Is it possible to remove accurate, negative information from my credit report?

You generally cannot remove negative information from your credit report if it is accurate. You can, however, dispute accurate information if it appears multiple times or if the negative information arose from fraud or identity theft. Most negative information will remain in your report for seven years. Some types of information remain longer.

You can dispute inaccurate information. Credit reporting agencies must fix mistakes, usually within 30 days, at no cost to you.


 

My application for a loan was denied because of my credit report. What can I do?

First, find out what caused the lender to turn you down. If a lender or other institution denied your loan or took other adverse actions, like increasing your interest rate based on your credit report, the Fair Credit Reporting Act (FCRA) requires it to:

  • Tell you it denied your application(or took other adverse actions);
  • Provide you the numerical credit score it used in taking adverse action;
  • Give you the name, address, and telephone number of the credit reporting company that provided the report;
  • Tell you about your right to get a free copy of your credit report from the credit reporting company that furnished it within 60 days of your adverse action notice; and
  • Explain the process for fixing mistakes or adding missing items to your report.

If a lender rejects your loan application, the Equal Credit Opportunity Act (ECOA), requires it to tell you the specific reasons your application was rejected or tell you that you have the right to learn the reasons if you ask within 60 days.

Indefinite and vague reasons for denial are illegal. Acceptable reasons might include “too many recently opened accounts with balances” or “delinquent past or present credit obligations.” Unacceptable reasons include “you didn’t meet our minimum standards” or “you didn’t receive enough points on our credit scoring system.” Learn more about your rights under ECOA.

Credit discrimination is illegal. Under the Equal Credit Opportunity Act a creditor cannot discriminate in any credit transaction, including mortgages, against any applicant because of these factors:

  • Race
  • Color
  • Religion
  • National origin
  • Sex (gender)
  • Marital status
  • Age, unless the applicant is not legally able to enter into a contract
  • Receipt of income from any public assistance program
  • Exercising in good faith a right under the Consumer Credit Protection Act

This means that a creditor may not use any of the above grounds as a reason to:

  • Refuse you credit if you qualify for it
  • Discourage you from applying for credit
  • Provide you credit on terms that are different from the terms given to someone else who is similarly situated to you, such as having similar creditworthiness
  • Close your existing account

TIP: Don’t ignore mistakes in your credit record. If you are denied credit or not offered the best interest rate available because of inaccuracies in your credit report, be sure to dispute the inaccurate information. You may contact the credit reporting company and the creditor or other furnisher.

My insurance company increased my car insurance rates because of my credit report. Is that legal?

Under federal law, insurance companies may obtain the information in your credit history to do things such as:

  • Decide how much to charge you for insurance
  • Raise your premiums
  • Deny coverage for new customers
  • Deny renewals of existing customers
  • Decide on other terms or coverage 

Some states, however, place restrictions on using credit reports for this purpose. Contact your state attorney general’s Office for more information.

As a servicemember, if I invoke my rights under the SCRA could it hurt my credit score?

Exercising your rights under the Servicemembers Civil Relief Act (SCRA) cannot trigger a bad report on your creditworthiness. 

But, if the creditor has complied with the SCRA and you are late sending in your payments, then they can report you to the credit bureaus.

If you believe your rights were violated, you should contact the nearest Armed Forces Legal Assistance Program office. Dependents of servicemembers can also contact or visit local military legal assistance offices where they live. Find an office within the United States or worldwide. You can also contact the American Bar Association for help.

Should I buy a credit score?

You do not need to buy a credit score to get insight into how lenders will view your credit record. Your credit report tells you much of the key information about your credit record. Plus, the score you buy may not be the one your lender uses to decide whether to give you credit or how much to charge you for credit.

You are entitled to get a free credit report annually from the nationwide credit reporting companies. It is important to get and review these free credit reports. The information that goes into a credit score generally comes from your credit reports.

Should I request credit reports for my children?

Credit reports are not established at a certain age. Children may have a credit report because they are listed as authorized users or joint account holders on an adult’s account, or any time a credit account is reported by a lender for that individual. Or your child may have a report because he or she is a victim of identity theft.

Usually, minors may request a copy of their credit report once they reach age 13. Adults may request their children’s credit reports upon providing documentation demonstrating they are the child’s legal guardian.

Child identity theft is a growing problem. Identity thieves target children’s Social Security numbers because they have no credit blemishes and because their fraudulent activity may go unchecked for years. Possible red flags that your child is a victim of identity theft are when you receive bills, credit card offers, or debt collection calls in your child’s name.

If you believe your child is a victim of identity theft, you can contact the nationwide credit reporting companies at the following addresses:

Equifax Minor Child Department
P.O. Box 105139
Atlanta, GA 30348
Or by phone: 800-525-6285


Experian: Download this form and mail it to:
P.O. Box 9554,
Allen, TX 75013
Or by phone: 800-397-3742

TransUnion: Download this form and mail it to:
P.O. Box 6790,
Fullerton, CA 92834
Or by phone: 800-680-7289

Should I use a credit monitoring service to protect myself from identity theft?

Some consumers elect to purchase credit or identity monitoring services to protect themselves against identity theft. You should be aware, however, that free and low cost services are also available to protect consumers including:

A security freeze. Putting a security freeze on your credit report will generally prevent new credit being opened in your name. In most states, you can file a security freeze for less than $10, and if you are an identity theft victim, you typically can place a freeze for free.

A fraud alert. If you believe that you have been the victim of identity theft or fraud (or might become one), you can place a fraud alert on your credit report. Note that a fraud alert does not prevent a lender from opening credit in your name, but it does require a lender to take certain measures to verify your identity first.

If you have complaints or concerns about a credit monitoring service, contact the Federal Trade Commission at 877-FTC-HELP.

Some of my debts are listed multiple times on my credit report. What should I do?

If the same debt is listed multiple times (possibly with different names) you should dispute it. A multiple listing is not a harmless error. It will likely lower your credit score and lead lenders to give you loan offers with higher interest rates and less favorable terms.

What are errors that show up in credit reports?

Errors in credit reports may occur. Some common errors are:

Identity errors:

  • Errors made to your identity information (wrong name, phone number, address)
  • Accounts belonging to another consumer with the same or similar name as yours (this mixing of two consumers’ information in a single file is called a mixed file)
  • Incorrect accounts resulting from identity theft

Incorrect reporting of account status

  • Closed accounts reported as open
  • Reported as the owner of the account, when you are actually just an authorized user
  • Accounts that are incorrectly reported as late or delinquent
  • Incorrect date of last payment, date opened, or date of first delinquency

Data management /processing errors

  • Reinsertion of incorrect information after it was corrected
  • Accounts that appear multiple times with different creditors listed (especially in the case of delinquent accounts or accounts in collections)
  • Information appears that should no longer be on your credit report, such as a debt that is more than seven years old
  • Credit accounts in your file that don’t belong to you

Balance Errors

  • Accounts with an incorrect current balance
  • Accounts with an incorrect credit limit

What can I do if I disagree with the results of a credit report dispute?

If an investigation doesn’t resolve your dispute with the credit reporting company, you can ask that a brief statement of the dispute be included in your file and included or summarized in future reports. Also, if you are dissatisfied with the resolution, you have the option of submitting a complaint to the Consumer Financial Protection Bureau.

Please note that your right to include a statement in your file only applies to disputes you’ve submitted to a credit reporting company, not to disputes that you’ve submitted directly to companies that provided the wrong information to the credit reporting company.

What is a credit reporting company?

Credit reporting companies (also known as credit bureaus or consumer reporting agencies) are companies that compile and sell credit reports.

Among other information, credit reporting companies collect credit account information including the original amount of a loan, the credit limit on a credit card, the balance on a credit card or other loan, and the payment status of the account; items sent for collection; and public records, such as judgments and bankruptcies.

Credit reporting companies can gather information from many sources including:

  • Thousands of lenders across the country
  • Public records, such as bankruptcies, garnishments, liens, and other judgments
  • Collections agencies, which provide information on delinquent accounts

The Fair Credit Reporting Act (FCRA) is a federal law that provides directions and limits on how credit reporting companies disclose credit report information. For example, the FCRA permits credit reporting companies to provide credit reports only to those users who have a permissible purpose listed in the law to see the information.

 

What do I do if I think I have been a victim of identity theft?

If you believe you are a victim of identity theft, you should contact one of the consumer reporting agencies listed below to place a fraud alert on your credit report. You only need to contact one of the three credit reporting companies to place an alert.

  • TransUnion: 1-800-680-7289; www.transunion.com; Fraud Victim Assistance Division, P.O. Box 6790, Fullerton, CA 92834-6790
  • Equifax: 1-800-525-6285; www.equifax.com; P.O. Box 740241, Atlanta, GA 30374-0241
  • Experian: 1-888-EXPERIAN (397-3742); www.experian.com; P.O. Box 9554, Allen, TX 75013

For more details on the steps to take if you are a victim of identity theft, visit the Federal Trade Commission’s Identity Theft website.

What does the credit reporting company do after I notify it of an error on my credit report?

The credit reporting company generally must investigate the dispute within 30 days of receiving it, or 45 days if you dispute, after receiving your free annual credit report.  It is possible that the credit reporting company will resolve the dispute in your favor if it determines it has sufficient information to do so.  More commonly, the credit reporting company will notify the company that provided the information and ask them to investigate your dispute.

TIP:  Also go directly to the source of the error.  When submitting a dispute with a credit reporting company to fix an error in your credit report, it’s a good idea to also directly contact the company that provided the information.

When a company receives a dispute from a credit reporting company, it must investigate and report the results back to the credit reporting company.  If the disputed information is wrong or cannot be verified, the company is required by law to delete or change the information and notify all of the credit reporting companies to which it provided the wrong information, so the credit reporting companies can update their files with the correct information.

The credit reporting company must send you the results of the investigation within five business days of the completion of the investigation. If your credit report was corrected, you will receive an updated credit report for free. This free report does not count as your annual free credit report.

If you ask, the credit reporting company must send notices of any deleted information to anyone you specifically designate who received your report for employment purposes during the past two years or for any other purpose during the past six months.

What goes into a credit report?

Credit reports often contain the following information:

  • Personal information: The report lists your name and any name you may have used in the past in connection with a credit account, including nicknames; current and former addresses; birth date; Social Security number; and phone numbers. Carefully check your report to be certain these are accurate.
  • Credit accounts: The report lists current and historical credit accounts, including the type of account (mortgage, installment, revolving, etc.), the credit limit or amount, account balance, account payment history, the date the account was opened and closed, and the name of the creditor and other information. Review this information carefully to be sure nothing is incorrect.
  • Collection items: The report lists unpaid debts that have gone into collection.
  • Public records: The report lists liens, foreclosures, bankruptcies, civil suits and judgments, and criminal arrest and conviction records.  The reports may also include information on overdue child support provided by a state or local child support agency or verified by any local, state, or federal government agency.
  • Inquiries: The report lists companies that have accessed your credit report.

What happens when I tell a company it sent inaccurate information to a credit reporting company?

The company that provides your data to credit reporting companies generally must investigate your dispute within 30 days.  It must also notify the credit reporting companies of your dispute.  If the investigation shows the company provided wrong information about you, or the information cannot be verified, the company must notify all of the credit reporting companies to which it provided the wrong information, so the credit reporting companies can update their files with the correct information.

TIP:  Also send your dispute to the credit reporting company.  When submitting a dispute with a company that provided inaccurate information to a credit reporting company, it’s a good idea to also submit a dispute with the credit reporting company.

What is identity monitoring or "identity theft protection" service?

Identity monitors typically scan identity information in credit applications for unusual activity.

Some services may help consumers correct problems if identity theft occurs, as well as offer identity theft insurance, monthly credit scores, chat room monitoring, public record searches, monitoring of black market websites and virus protection software.

Prices and services offered by identity monitors vary widely. The cost of identity monitoring services vary from as little as a few dollars a month to over $15 per month. Before signing up for a service, make sure you understand what you’re getting. This is particularly important when you are offered a “free” service. Before accepting a “free” offer, check for any hidden fees or cancellation requirements. Also check with your local consumer protection agency and State Attorney General’s office to see if complaints have been filed against the company.

TIP: Freeze identity thieves. You can place a security freeze on your credit report to prevent identity thieves from opening credit in your name. Just remember that if you put a security freeze on your credit file, you will need to unfreeze your file (it can take as little as 15 minutes in some states) before you can open new accounts in your name.

If you have complaints or concerns about a credit monitoring service, contact the CFPB at (855) 411-CFPB (2372). If your credit card issuer has charged you for credit monitoring or another type of “add on” product you didn’t want, submit a complaint to the CFPB online or by calling 1-855-411-CFPB (2372).

What is identity theft?

Identity theft occurs when someone steals your financial identity to commit fraud. Stealing your identity could mean using your name, Social Security number, credit card number, or other personal information without your permission.

Identity thieves may rent apartments, get credit cards, or start other accounts in your name. You may not find out about the theft until you review your credit report or a credit card statement and notice accounts you didn’t open, charges you didn’t make, or until you’re contacted by a debt collector.

Visit the Federal Trade Commission's Fighting Back Against Identity Theft website for more information.

What information do I need to provide to get my free credit report?

You will need to provide your name, address, Social Security number, and date of birth. To verify your identity in on-line and phone requests, the nationwide credit reporting companies will require you to provide some additional information that is not generally known by others, such as the amount of your monthly mortgage payment. 

What information goes into my credit score?

For the most common credit scores, the information that goes into your score comes from your file at the credit reporting companies, which is why it is so important to review these files to ensure they are accurate.

Here are some of the common factors that make up a typical credit score:

  • Your bill-paying history
  • The number of accounts you have and what kind
  • How much of your available credit you are using
  • How long you have had your accounts open
  • Your recent credit activity
  • Whether you have had a debt collection, foreclosure, or bankruptcy, and how old these are

By law, the calculation of your credit score cannot use or take into account factors such as race or color, religion, gender, national origin, or marital status.

TIP: You don’t have to buy your credit score to get insight into how lenders will view your credit record. Your credit report tells you much of the key information about your credit record. Plus, the score you buy may not be the one your lender uses to decide whether to give you credit or how much to charge you for credit.

What is a credit monitoring service?

A credit monitoring service is a commercial service that will charge you a fee to watch your credit reports and alert you to changes to the accounts listed on your credit report. Services usually alert you by email, text message, or phone of changes to your accounts.

Prices and services vary widely. Some services cost over $15 a month.

Before signing up for a service, make sure you understand what you’re getting. This is particularly important if you are offered “free” credit monitoring. Before accepting a “free” offer, check for any hidden fees or cancellation requirements. Also check with your local consumer protection agency and State Attorney General’s office to see if complaints have been filed against the company.

What is a credit report?

A credit report contains information about your credit history and the status of your credit accounts. This information includes how often you make your payments on time, how much credit you have, how much credit you have available, how much credit you are using, and whether a debt collector is collecting on any debt you owe. Credit reports also can contain public records such as liens, judgments, and bankruptcies that provide insight into your financial status and obligations.

Lenders use these reports to help them decide if they will loan you money, what interest rates they will offer you, or to check the status of an existing loan. Companies can purchase these consumer credit reports to help inform them while making  a wide range of business decisions such as providing  or pricing insurance;  renting you an apartment;  and (if you agree to let them look at your consumer report) making employment decisions about you.

Credit reporting companies (also known as credit bureaus or consumer reporting agencies) compile these reports.

What is my credit score?

A credit score is a number that is used to predict how likely you are to pay back a loan. Your credit score starts with the information about you from your credit report. A mathematical formula – called a scoring model – is then used to create your credit score. There is no “one” credit score; there are many credit scoring formulas available to you as a consumer as well as to lenders. The CFPB recently published a report on the differences between the credit scores available to consumers and those to lenders.

Credit scores are used by companies to make decisions such as whether to approve a mortgage at a certain rate or issue a credit card. Different lenders use different scoring formulas, so your score can vary from lender to lender. Usually a higher score makes it easier to qualify for a loan and means a better rate of interest. Most scores range from 300-850, although there is one scoring method that uses a range from 501-990.

TIP: To get and keep a good credit score:

  • Pay all your bills on time
  • Make sure the information in your credit reports is correct
  • Only apply for the credit that you need
  • Don’t use too much of the credit that is available to you

What is a “security freeze” on my credit report?

A security freeze prevents prospective creditors from accessing your credit file. Most states have laws that govern the procedures and requirements for security freezes. Security freezes can be useful in preventing an identity thief from opening a new credit account in your name.

Creditors typically won’t offer you credit if they can’t access your credit reporting file, so a freeze prevents you or others from opening accounts in your name. 

Only a limited number of entities can see your file while a freeze is in place, including existing creditors, certain government entities like child support agencies, and companies that monitor your credit file at your direction to prevent fraud.  

Tip: To prevent new credit accounts from being opened in your name, you can place a security freeze on your account, which you can temporarily or permanently lift at any time.

Forty-seven states and the District of Columbia have security freeze laws. For the remaining states (Alabama, Michigan, and Missouri), the nationwide credit reporting companies have voluntarily given residents the opportunity to place freezes. Freezes are generally free for victims of identity theft, but in some states others may be charged a fee. Check the Experian, Equifax, and TransUnion websites to see how much they charge. To place a freeze, you must contact each of the nationwide credit reporting companies individually.

What should I look for in my credit report? What are a few of the common credit report errors?

Make sure your credit report contains only items about you. Look for information that is inaccurate or incomplete, such as accounts that do not belong to you, addresses of places where you did not live, names of employers you did not work for, or information that should no longer be on your credit report, such a bankruptcy that is more than ten years old.

Look for multiple “copies” of an account. Credit reports should only show one instance of an account. Multiple “copies” of the same derogatory account on your credit report may hurt your credit score because they look like multiple delinquencies.

If you find errors, you should contact the credit reporting agency from whom you obtained the report, and the creditor or whomever provided the information (called the “furnisher” of the information). The copy of your credit report will include information about how to dispute inaccurate or incomplete information. For more information, please visit the Federal Trade Commission’s website or call 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261.

What should my dispute letter to a credit reporting company look like?

You can find an example of a dispute letter on the Federal Trade Commission’s website – you may send a dispute letter to both the credit reporting company and the creditor or other entity that provided the information.

To help clarify the dispute, enclose the portion of your credit report that contains the disputed item, and circle or highlight the disputed item. Include copies (not originals) of documents that support your position.

Tip: Provide additional identifying information in your complaint letter. To help the credit reporting company locate the correct file or credit information about you, provide additional identification information in your letter. Such information can include your date of birth, your Social Security number, your spouse (if married), and current employment information. If you send your Social Security number and other sensitive information by email, please take appropriate security measures including encrypting the email.

What should my dispute letter to a creditor or other institution that gives information to a credit reporting company look like?

Here is an example dispute letter. You may send a dispute letter to both the creditor or other institution that provided the information as well as the credit reporting company.

TIP: Make sure you contact the creditor or other institution at the right address. A creditor or other institution is required to investigate your direct dispute only if you send a dispute to (1) the furnisher’s address listed on the credit report, or (2) an address the furnisher has provided to you electronically or in writing to submit direct disputes.  If the furnisher hasn’t specified a direct dispute address, you can submit a dispute to the furnisher at any of its business addresses.

To help clarify the dispute, enclose the portion of your credit report that contains the disputed item, and circle/highlight the disputed item.  Include copies (not originals) of documents that support your position.

TIP: Provide additional identifying information in your complaint letter. To help the furnisher locate the correct file or credit information about you, provide additional identification information in your letter. Such information can include your date of birth, your Social Security number, your spouse (if married), and current employment information.

TIP: If you send any sensitive personally information like your Social Security number by email, please take appropriate security measures including encrypting the email.

What's a credit inquiry?

An inquiry refers to a request to look at your credit file, and it generally falls into one of two types:

Hard inquiries. These are typically inquiries by lenders after you apply for credit. These inquiries will impact your credit score because most credit scoring models look at how recently and how frequently you apply for credit.

Soft inquiries. These are reviews of your credit file, including reviews of existing accounts by lenders, prescreening inquiries by prospective lenders, and your requests for your annual credit report. These will not change your credit score.

When can a card issuer look at my credit report?

A card issuer can look at your full credit report when you apply for a credit card. If you are a customer of the card issuer, it can look at your credit report at any time.

Where can I get my credit score?

Unlike your credit report, which you can get at no cost to you, you usually have to pay for your credit score. There are certain instances in which you are entitled to your credit score for free, for example if you are denied a loan on the basis of your credit score.

The CFPB recently published a report on the differences between the credit scores available to consumers and those to lenders.  If the information about you in the credit reports of the three large consumer reporting agencies is different, your credit score from each of the agencies will be different.

It is more important to get and review your credit report, which you can do at no cost to you at www.AnnualCreditReport.com, than to buy your credit score. The information in your credit report influences your credit score. Even if you do buy your credit score, it is likely that the score the lender buys will be different from the score that you buy. If you decide to purchase your credit score, you are not required to purchase credit protection, identity theft monitoring or other services that may be offered at the same time.

Who has a credit report?

Most adult consumers who have credit accounts have a credit report. There are also specialty reporting companies that compile and sell information about payday lending, check writing history, and other consumer credit activity. Whether you personally have a credit report depends on whether information about your transactions has been sent to a credit reporting company.
 
Tip: Checking your credit report is a good way to spot identity theft. For example, you might find accounts on your credit report that you did not open.

You are entitled to get a free credit report annually from the nationwide credit reporting companies. It is important to get and review these free credit reports every year, even if you don’t believe you have a credit history. In the event you are a victim of identity theft, visit the Federal Trade Commission's website for additional information and to file a complaint.

Who may request my credit report?

The Fair Credit Reporting Act (FCRA) permits a credit reporting company to send your credit report to creditors, government authorities, landlords, employers, and others it has reason to believe intend to use the report for:

  • A credit transaction, such as offering credit, reviewing an account, or collecting on an account.
  • Offering insurance coverage or setting insurance premium charges
  • Employment purposes, which includes prospective employment or promotion, reassignment or retention in your current job. You must provide written consent before a prospective or current employer can get a copy of your credit report
  • Determining eligibility for government benefits or licenses
  • A legitimate business need in connection with a transaction that you initiated, such as a rental application

FCRA also permits a credit reporting company to send your credit report in response to:

  • Court orders, subpoenas, or for certain child support awards and enforcement purposes
  • Potential investors or servicers, or current insurers of credit portfolios

In a process called prescreening, the FCRA also permits prospective creditors or insurers to access certain information in your credit file in order to make you a firm offer of credit or insurance.  You can opt out of prescreening.

No one should request your credit report without a valid purpose allowed by the law. Anyone who obtains a copy of your credit report under false pretenses may be subject to civil and criminal penalties.

Why are some of my debts not showing up on my credit report?

Your creditor may not have reported the information. Creditors are not required to report information to the credit reporting companies. In addition, most negative information is not reported after seven years.

Why do I receive so many offers for new credit cards in the mail?

Credit card issuers, auto finance companies, other lenders, and insurers ask credit bureaus for lists of names and addresses of individuals who meet certain criteria (such as a minimum credit score). They then use this information to contact you. You can opt out of receiving these offers.

Why is it important for me to review my credit report?

You should check your credit report at least once a year to make sure there are no errors that could keep you from getting credit or best available terms on a loan.  You should also check your report before making a major purchase that would involve a loan, such as a house or a car. Be sure the information in the report is accurate and up-to-date.

It is also a good idea to review your credit information regularly to guard against identity theft.  Identity theft occurs when someone uses your personal or financial information to commit fraud. For example, an identity thief may use your information to open a new credit card account in your name. When they do not pay the bills, the delinquent account is reported on your credit report, damaging your ability to get credit in the future and subjecting you to calls from bill collectors. For more information, visit the Federal Trade Commission's Fighting Back against Identity Theft website.

Besides checking your credit report, you should also review at least once a year the reports that specialty reporting companies have you relating to your: medical records or payments, residential or tenant history, check writing history, employment history, or insurance claims.

Tip: Fix errors in your credit report. The information in your credit report affects whether you can get a loan – and how much you will have to pay to borrow money. So if you find something wrong with your credit report, dispute it. Be on the lookout for loans or credit cards listed that you never opened, misspelled names, or collection items that were not updated after a settlement was reached and satisfied.

Also, be on the lookout for duplicates of the same debt appearing on your report. There should only be one listing of each debt you owe. The information in your credit report affects whether you can get a loan — and how much you will have to pay to borrow money.

Will closing credit cards I already have increase my credit score?

Closing a credit card you already have may be an appropriate financial step based on your own personal circumstances, but don’t assume it will improve your credit score. It is quite possible that closing an existing credit card could actually hurt your score, rather than help it.

Part of your score is based on the amount of credit you have and the amount you’ve used – this is known as the credit utilization ratio. So closing an existing card can increase your credit utilization ratio and lower your score.

Tip: Keep an eye on your statements. If you decide to keep an unused account open, be sure to watch your statements to protect against identity theft and to check for unexpected fees.

Will I automatically get good interest rates if I have a good credit score?

A good credit score is only one factor lenders look at when deciding to lend you money. Just because you have a good credit score does not mean the lender will give you the lowest cost loan available.

Other things lenders consider are your credit report, debt, assets, income and savings. Also, rates vary among lenders. You should always shop around to make sure you’re getting the best deal possible, no matter what your credit score.

Will I damage my credit score if I do not pay a portion of my bill that I am disputing?

While a card issuer is investigating a dispute, the issuer cannot report your account as delinquent if you have paid the undisputed portion or the minimum amount due. The card issuer can report to the credit reporting agency that there is a disputed amount on your bill.

Will it hurt my score if employers or landlords request my credit report?

No. As long as the employers and landlords are not requesting your credit report to determine whether to extend you credit, those inquiries do not affect your score.

Will my credit score be damaged by card issuers getting my name from a credit reporting agency and sending me an offer?

No. Your credit score is not affected by card issuers obtaining your name in this way. If you apply for a credit card, the card issuer will generally obtain your credit report or your credit score and the credit reporting agency file will then reflect that you applied for a credit card. Your credit score can be affected by the number of cards or other loans for which you apply.

Will requesting my credit report hurt my credit score?

No. Checking your own credit report is not an inquiry about new credit, so it has no effect on your score.




Copyright © 2013 by Mark McCracken , All Rights Reserved