Most people are surprised to learn how much information about them is included in a credit report. This is a big collection of all the financial transaction related to credit and loans done by the individual with different businesses, institutions and organizations. The report also contains information on the current and past addresses together of any criminal or legal action or convictions and even information on bankruptcies if there were any of course. This information is a key factor in determining the credit worthiness of a person, something very useful for businesses, institutions or employers considering extending credit to a person. This is why credit agencies invest in gathering this information than charging the businesses for this information.
One of the key factors of getting credit and obtaining easy approvals for loans and credit is to have a good credit report. A good credit report also result in lower payments on any desired loan or credit. Recently and currently as you are reading this information the media is full with advertisements of credit repair scams that promise to remove any negative item on the credit report even if it’s true. You are promised to increase your credit score from a clean credit report regardless of the real situation and history. Watch out so you don’t loose additional money on such services. The truth of the matter is that no one can remove negative items from your credit report unless it’s there by mistake. True negative items can be only removed over time with serious efforts to pay the outstanding bills and loans and start paying new bills on time.
The Fair Credit Reporting Act (FCRA) was designed to assure that the data in each personal file of each consumer is accurate, kept private and it is used in a fair way by the official reporting agencies in the country. The FTC from its part is a key factor in imposing the FCRA on these agencies. The FCRA was recently expanded to further protect the consumers with new demands from the reporting agencies. These new additions are also imposed by law on the businesses that provide the information to the reporting agencies.
According to the FCRA both sides that create the report, the reporting party (Businesses, organizations and individuals) and the reporting agencies are responsible to correct erroneous information and complete missing portion to make the information in each file accurate and complete. They are required by law to take any necessary action to assure that this is the case. In order to increase your credit score, you as a consumer can take advantage of this FCRA law and contact the reporting agency or financial entities involved in the wrong information demanding to correct it.
When you find information on your report that is wrong, in order to correct it and increase your credit score you should contact the reporting agency directly. The best is to do it in writing, give in the letter all the information necessary to identify you and the specific case you are referring to. In simple terms explain why you think the information is not correct and why you demand to change it. Attach copies of any relevant documents that can support your claim. Do not forget to state that you demand the information removed or corrected.
If you identify that the source of the error or incorrect information is from the creditor, contact them directly in writing. Most creditors have an address to send complains to and it is located on their statements and documents. Write in this letter what are the reasons you dispute the information they provided and demand it to be corrected or removed and attach copies of supporting documentation. According to the new law the creditor has to inform the reporting agencies of your complaint and if they find out that your complaint is justified, they need to ask the reporting agencies to correct or remove the item from your credit report, something that for sure will increase your credit score? .
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