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Neighborhood Legal Services, Inc. |
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Neighborhood Legal Services, Inc. |
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WHAT IS A CREDIT REPORT?
© 2003 by Neighborhood Legal Services, Inc.
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What is a credit report?
A credit report is a record of your loans, credit cards, payments and outstanding debts. Your credit report has your current and past payment information, your outstanding balances, information about child support payments, information from public records like judgments and bankruptcies and a list of everyone who has recently requested a copy of your credit report.
A credit report does not have information about your race , medical history, criminal record or religion. A credit report tells lenders if you have good credit or bad credit.
Who has good credit?
You may have good credit if you have credit cards or loans and have made all of the payments on time. People with good credit have borrowed money and paid on time by making at least the minimum payments by the due date and have stayed within their credit limit.
Who has bad credit?
You may have bad credit if you don't pay your bills on time or at all. Your credit can be bad if you make late payments, you pay less than the minimum amount, you have accounts that are with collection agencies, you have a garnishment, you declare bankruptcy or you have too much credit.
What if I have bad credit, but I want to fix it. Is that possible?
Yes. You can try to establish good credit - but it will take time. Beware: Usually organizations that advertise that they can help you and also charge you a fee to help you repair your credit are usually not worth the money. Anything that they can do to fix your credit, you can too! There is nothing that they can do to speed up the process. It simply takes time.
You can establish good credit if you keep up with your payments for a year or two. If you can do that you will begin to build a good credit history! Also try any or all of these three ideas:
(1) In order to get credit to begin with, you might want to ask local companies for credit, like a bank or department store instead of a regular Visa or MasterCard which can be harder to get if you have bad or no credit.
(2) You could look for someone who will cosign a loan. If you don't pay the loan, the cosigner will have to. But if you keep up with the payments, your credit will get repaired even though your cosigner co-signed the loan for you.
(3) Try to get a secured credit card. A secured credit card is backed by money that you deposit in a bank account, so it is easier to get. If you don't pay your bill, the money in your account can be used to cover what you owe. But if you make payments, this can go a long way toward establishing good credit.
How do I know what my credit report says? Who has my credit report?
Lenders give reports about your credit to companies called credit reporting bureaus. The three main bureaus are: TransUnion, Experian and Equifax. These three companies have a copy of your credit report.
How can I get a copy of my credit report?
You can get a copy of your credit report by calling or writing to the three major credit reporting agencies listed below:
Experian: 1-888-experian (1-888-397-3742)
Experian
P.O. Box 9556
Allen, TX 75013-2104
Equifax: 1-800-685-1111
Equifax
P.O. Box 105496
Atlanta, GA 30348-5496
Trans Union Corporation: 1-800-888-4213
Trans Union LLC
Consumer Disclosure Center
P.O. Box 1000
|Chester, PA 19022
Does it cost anything to get a copy of my credit report?
It depends. If you have been denied credit in the past 60 days, you have the right to a free copy of your credit report. You are also entitled to one free copy every year if you are unemployed, if you are receiving Public Assistance, or if you think your credit file contains inaccurate information due to fraud.
If you do not fall into one of these categories, the companies can usually charge up to $8.66 for a copy of your credit report.
What should I say in my letter to request a copy of my credit report?
Please use this sample letter as a guideline when you request a copy of your credit report.
Date: __________________, 2003
Joe Consumer
123 Park Ave.
Buffalo, NY 00000
Equifax Customer Information Service Center (or Experian or Trans Union)
P.O. Box 105496
Atlanta, GA 30348-5496
Dear Sir or Madam:
I am writing to request a copy of my credit report. My full name is Joseph John Consumer. My date of birth is 1/1/50. My social security number is 123-45-6789. My home phone number is (716) 555-1234. I have worked at Snow, Inc. and Rain, Ltd. in the past five years. My current address is 123 Park Ave., Buffalo NY 00000. I have also lived at the following addresses in the past five years:
1. 5 Main Street, Apt. 3
Buffalo, NY 00000
2. 10 25th Street, Apt. D
Atlanta, GA 11111
Under the Fair Credit Reporting Act, I should be entitled to a free copy of my credit report because I am currently unemployed. (Or because you are on Public Assistance, were denied credit within the past sixty days, or if your report is inaccurate due to fraud - otherwise, enclose a check or money order for $8.66).
Very Truly Yours,
(MAKE SURE TO SIGN IT HERE!)
What are my rights under the law?
You have a right to get a copy of your credit report and you have a right to correct errors in your credit report.
How do I dispute errors that are on my credit report?
In order to dispute information on your credit report, you should write a letter to the credit bureau (see example letter below). Enclose a copy of your credit report and circle any items that you dispute. Also include a copy of any proof that you might have that the item is incorrect. The address for filing complaints should be listed on the bottom of your credit report. You should mail it certified mail and keep a copy of the letter. This way, you have proof of what you wrote and when you sent it.
What kind of things can be wrong on a credit report?
Often credit reports contain incorrect information. For example, if you have an account that you used to be delinquent on, but now are current in your payments, the credit report must show that you are now making the payments on time. Otherwise, the information is incomplete.
Or maybe your credit report lists an account that was held in someone else's name but it is on your credit report. If your name was never on the account, it should not be listed on your credit report. You should dispute that credit entry.
Maybe you have old debt that should no longer be on your report. If the credit bureau fails to delete old information from your report you should write them and tell them to take it off of your report. Debts can be reported for 7 years. Bankruptcies can be reported for 10 years. Anything older is considered outdated and should be deleted from your file.
What will the credit bureau do after I send my letter disputing my credit report?
The credit bureau must investigate your claim within 30 days (unless it is frivolous). If the charge is incorrect or cannot be verified in that time, the credit bureau must delete it or change it as you requested. If they make changes to your report, the credit bureau must send you a new copy. You can also request that a new copy be sent to anyone who has gotten your credit report in the past 12 months. The credit bureau cannot re-insert the item without giving you written notice.
If the credit bureau can verify that the information that you disputed is correct, it has no duty to change or take it off your report. However, it must give you a written report of the results, and if you request it, a report of how it conducted its investigation. If you feel that the dispute still has not been resolved, you can submit a brief statement (less than 100 words) explaining your side of the story. If you call the credit bureau, they will usually help you prepare this statement. Your statement will then be included as part of your file.
What should I say in the letter to dispute items in my credit report?
Please use the following sample letter as a guideline when you dispute a portion of your credit report.
Date: ____________, 2003
Joe Consumer
1 Park Avenue
Buffalo, NY 00000
Complaint Department
Name of Credit Bureau
Address
City, State, Zip
Dear Sir or Madam:
I am writing to dispute information on my credit report. I have circled the disputed items on the enclosed copy of my report.
Account #12345 from U.S. Bank is listed as 30 days late in May and June of 1999. However, this account was held solely in my ex-wife's name and should not appear on my credit report. Please delete this information.
Account #6789 from Shopper's Credit Cared is also inaccurate. There has been no activity on the account in the past 7 years. I closed it and paid it off in 1992. Therefore, the information is outdated and should be deleted.
Finally, account #10123 from Buffalo Bank is incomplete. It states that I did not make payments in July or August 1999. However, it does not say that I have since paid the money and am now current in my payments. Please complete this information.
I expect to hear from you within 30 days. I understand that you will send me the results of the investigation and if any changes are made, an updated credit report. I would also like a report on how the investigation was conducted.
Thank you for your attention in this matter.
Sincerely,
(Make sure you sign it here!)
Joe Consumer
Enclosures: Copy of credit report
(Also list any proof you have and enclose a copy)
What if an item is correct, but I disagree with it being reported because it wasn't my fault?
Even if an item is correctly reported, you have the right to explain the situation. For example, if you were late on payments because of an illness or you lost your job, you can include this information as part of your file. Sometimes lenders will consider these letters when they decide whether to give you credit or not. You can send the credit bureau a short statement (less than 100 words) and it will be added to your credit report.
This information letter was prepared with a grant from The Community Foundation for Greater Buffalo
