Some questions regarding your credit score

John R. Ulzheimer, the author of “You’re Nothing But a Number" and an expert on credit scores, answered reader questions on credit and the importance of creditworthiness.

Q. I deliberately keep my credit limit lower than what the credit card company will give me on the grounds that should I be hit by fraud, it won't rack up huge charges. Interestingly (no pun intended), a few Saturdays ago I went online to check my balance and discovered what turned out to be the first of several fraudulent charges that, coupled with my usual monthly balance, overshot the credit limit by 79 bucks or so. I do not know when the credit card company planned to notify me but a representative admitted that they should have caught the problem. And yes, I understand that I am not responsible for the fraudulent charges.

Is it a good idea to lower one's credit limit to a more reasonable amount? After reading your column on Oct 10., it sounds like it's not.

A. Ann, it is actually better to have as high a credit limit as possible on credit cards. As you learned through your own experience, you have basically no liability for fraudulent charges if you notify your lender as soon as possible. And the upside to the higher limit is twofold. First, you have access to capital should you need it, which is certainly a good thing these days. The second reason is that you will help to maintain a low "balance to limit" ratio on your credit cards, which is extremely important when maintaining strong credit scores. So if your credit card companies offer you higher limits then gladly take them. Just don't increase your balance or you'll negate any benefit to your scores.

Q. Can you give us guidelines for whether we can cancel a credit card without harming our credit score? I have four credit cards and one of them, my second oldest (since 2001), I don't use anymore. My combined balance is always under 10 percent of my total credit (usually on just one of the cards) and I always pay my balance in full during the grace period. Can I safely cancel the card I'm no longer using? Should I do so, and how?

A. It's almost never a good idea to cancel credit cards. In your case, the reason that your balance to limit ratio is 10 percent is because of that fourth card that you're thinking of canceling. Unless you pay down your balances even more, that 10 percent will increase and your scores will go down. Here's my personal credit card strategy: I have six credit cards with a combined credit limit of $121,000. This gives me enormous flexibility if any of my credit card issuers choose to do something nasty like lower my limits or close an account. It also ensures that my balance to limit ratios never get about a few percentage points because I use my cards modestly and pay them off at the end of the month. I use each of these cards at least once per quarter so none of my lenders close them due to inactivity. My lowest score FICO score is 809.

Q. Please address credit reports and scores for a married couple. Our primary credit card is in both of our names, but we might have other credit data in one name only. If we were to make a major purchase, such as a mortgage, it would be a joint purchase. I'm thinking along the lines of a joint tax return, if there is such a thing as a joint credit score? Is this an issue? Any specific advice for married couples?

A. Good one John. When two people get married at least one typically changes how they use credit. The problem is that credit reports and scores are maintained and generated at the individual level, not the joint or married level. You will always maintain your own credit reports and your own scores, as will your wife. When you apply for joint credit the lender can and normally pulls both your report and the joint borrower's report. Same with scores. And if the account is approved then it likely will show up on both of your reports and will affect both of your scores. This commingling of credit is a necessity especially when you need two incomes to qualify for a loan. But it becomes problematic if or when a couple divorces because the court can't override the original contract with the lender — even though it can assign payment responsibility to one ex-spouse or the other. Frankly, divorce attorneys would better serve their clients if they focused on not only dividing assets but also dividing liabilities at the contractual level.

Some chuck credit cards to avoid late fees

Here's one way to dodge credit card debt and late fees: Don't carry any plastic.

"People look at me like I'm an anomaly. But guess what? It's a whole lot easier when you're not juggling debt," said Paige LeFevre, a 41-year-old Atlanta resident.

The idea of living without credit cards is being given more consideration at a time when Americans hold more than $850 billion in credit card debt, four times as much as in 1990. Of course there are significant benefits that come with credit cards -- convenience being just one of many -- so be sure to weigh them carefully before rushing to close your accounts.

A key concern is the role credit cards play in building your credit and maintaining a credit history. Remember that building good credit is important if you're in the market for a mortgage or other type of loan. Prospective landlords or employers often run credit checks, too. So holding on to your credit cards may be in your best interest.

Credit cards also offer certain consumer protections; for instance, issuers will often refund charges for faulty products. Cards are also necessary to rent a car, and, if managed properly, can reap financial perks through rewards programs.

LeFevre says her vow of plastic abstinence came after she ran up $40,000 in debt while remodeling her home two years ago. But as a homeowner with a steady job for six years, LeFevre wasn't overly concerned about her credit score. She says she hasn't checked
her credit score in recent years, but figures it's better when she's not buried in debt.

"It's just too easy to use," said LeFevre, who works for a retirement investment advising company. She has paid off her debt with a number of drastic measures, including trading in her a car for a cheaper model, getting a roommate and selling many of her belongings. She also axed her cable package, manicures and eating out. She keeps her spending in check by taking out $200 in cash every week for groceries and gas.

For LeFevre and others, keeping plastic around simply leaves the door open for temptation. The reasons for credit card debt no doubt vary, however, and in many cases is the result of financial hardship.

According to the Consumer Federation of America, a nonprofit advocacy group, 58 percent of people with credit cards don't pay their balance in full every month. Those that carry a debt have an average balance of $17,103, according to the group.

It's no wonder Americans are easing up on credit card use. Last month, Mastercard Inc. and Visa Inc. reported credit card spending was growing at its most anemic pace ever.

So how can you cut back? One option is to simply leave your plastic at home for a few months at a time. A credit card only needs to be used about once every six months or so for the credit line on the account to count toward your FICO score, said Barry Paperno, a spokesman for Fair Isaac Corp., the company that created the FICO credit score.

Making small charges on your card once every few months may improve your score more than frequently running up big charges, said Paperno. That's because your credit utilization -- the percentage of your credit line that's in use -- makes up 30 percent of your score. So the smaller your outstanding balance in relation to your credit line, the better.

For the same reason, closing your credit cards could lower your score if you have outstanding debt. If you're still determined to rid yourself of plastic, try to whittle down your balance before doing so. Cancel one card at a time, and wait a few months in between each cancellation to lessen the impact on your score.

For New York City resident Kira Limer, 25, not using credit cards makes it easier to stick to her guiding financial principle: Don't spend money you don't have. It also makes it easier to keep a running tally in her head of how much she's got in the bank. She relies on a debit card for day-to-day expenses. "I just like to know for sure I'm not spending beyond my means," said Limer, a resource librarian at an architecture firm.

How to remove charges from your credit score?

Charge offs stay on your credit report for 7 years from the date of last activity on the account all the while damaging your credit scores. That is such a long time for one mistake to affect your entire financial being. Just one charge off can prevent you from getting credit including; a decent car loan, credit cards, personal loans or can even stop you from qualifying for a mortgage! If you do qualify your interest rate will most likely be much higher costing you tens of thousands on the loan.

Understand that the reporting of items on your credit reports is completely voluntary. No law demands that all your accounts be reported to the credit bureaus. Creditors report at their will.

If you have the ability to pay the charged account do so. The credit might accept less than what is owed as a payoff "in full" meaning that the account is satisfied and closed. What I advise is to have the creditor either update the account to "paid as agreed" "never late" or remove the account in its entirety. Get it in writing if they agree to do so before you send any money as things tend to be forgotten once the creditor gets what they want (your money).

Some creditors will lie and tell you that once a trade line is reported as "charged off" then it must remain that way. This is simply not the case as creditors use software to update the credit bureaus. They can update their reporting at anytime and at their discretion. The simple fact is creditors remove charge offs from credit reports using this method all the time!

If your charge off is already in a paid status then perhaps the only effective way to remove it is to dispute the accuracy of the trade line with the credit bureaus. This is can get a little complicated. There are definite right ways and wrong ways to dispute. If you mess up you can almost guarantee that the charge off account will stay with you for the entire seven years. That is why I recommend hiring out the help. Credit repair is most certainly something you can do yourself...if you have plenty of time to research the dos and don'ts.

Free Credit Report Once a Year - The Best Way to Obtain Your Credit Standing

It is a given fact that when you are credit card holder greater possibilities of more credit debts coming in rather than being settled will usually take place. People from all over the world where credit card served as a major source of trade are facing with a lot of debts from credit cards. There are higher cases of foreclosures and even identity theft, these issues have become rampant at present, and still a lot of people are opting for an instant relief of having credit cards.

With all these factors, the need to obtain your credit report from time to time in keeping yourself updated is deemed necessary. A lot of options can be preferred as a means of getting it. You can easily have access to a free report once you have been declined of your credit card application. You will then be given all the right to obtain a free copy within 60 days duration of time. However, if you haven't taken any application, then obtaining a copy with a small fee is needed in order to get a good view of your credit information.

There are also a lot of ways in obtaining your personal copy and this can be in the form of free credit report once a year. You can call for your personal copy by means of writing to one of the three major credit reporting agencies. Also, to get a free report you will also need to put your information and personal data. This will entail in providing your full name, your address, social security number, date of birth, phone number among many others.

Another option that you can take is by getting your free report online. All you have to do is sign up for online affiliates catering to this kind of services. These services will enable you to acquire your online access and you can get directly to your own information on the net. Queries and access to information can be done at any time. This kind of option is ideal for those credit card holders who are considered as main targets of identity theft. This is also a very convenient way of logging into your personal information online that are easy to navigate and faster to operate. Remember that your account password is needed in this kind of service and this password should be something that is complicated yet easy for you to commit to memory.

Free credit report once a year can be your way of checking your credit standing and doing something to either maintain or make it better that will play a big role in your being credit worthy. There are a lot of ways on how you can obtain your credit information and checking it with careful and keen details is important in avoiding other problems that may occur in the future.

Obtaining your free credit report once a year is also a good way of managing your finances well and keeping up with the standards of the major credit bureause.

Now no need to run after credit score!

Do you really know the purpose of your credit score? Most people know they have a credit score and have some vague idea that it some kind of indicator about their credit but unfortunately that is where the knowledge stops with the vast majority of folks. For as important as your credit score is for a wide variety of things in your daily life, which extends far beyond just your ability to get credit, it is truly beyond comprehension that more people do not pay intense attention to it.

Do you even know what your credit score is right now, or even what it was last month or the month before? Surprisingly, most Americans do not, and even more surprisingly, neither do they care. But the reason they don't care is because they figure as long as they are not getting nasty letters from creditors or phone calls from bill collectors, their credit score must be just fine.

Nothing could be further from the truth.

First let's back up a step. Your credit score is a number which is calculated by the credit bureaus that indicate how much of a credit risk you are. When you go to apply for credit, the lender will pull copies of your credit report and look at that score, which tells him how much RISK he is taking on by approving your loan, and if that risk is uncomfortable for him, he will compensate by offering you financing at higher interest rates.

But simply paying your bills on time is not the only factor that goes into calculating your credit score figure. True, it accounts for about 35% of the score, but where does the other 65% come from?

How close you are to your credit limit on your credit cards plays a significant role. The ideal place to be is about 25% to 30% of your credit limit in terms of your outstanding balance. If you have less than that, then you are not using credit enough to get a clear picture. If you have more than that, then the thought is that you are not using credit responsibly enough. And if you go over your credit limit, that is definite negative credit score points, in addition to the overlimit fees that the card issuer will assess. Talk about adding insult to injury!

As mentioned earlier, your credit score is used in many more places than just when you go to apply for new credit. Various companies use your credit score to determine whether or not they should send you flyers and notices about super special sales, and if your credit score is not up to par, you'll never know about those special sales. Many car insurance companies are now using your credit score to determine what rates to charge you for your car insurance, since they allegedly have statistics which prove that people with lower credit scores make more claims than those with good and higher credit scores. If you are looking for a new job and there are several job candidates that are all pretty much equal, the credit scores of the applicants will play a major role in determining which applicant gets the job, sometimes having more weight than even lesser skills or capabilities.

You need to check your credit report multiple times per year and see what it says about you. There is a better than fair chance that your credit reports contain errors, like some charged off account that does not belong to you but is on your report anyway. This and other similar things will cause your credit score to be calculated much lower than it really should be.

Take your credit score seriously and begin enjoying all the things that a good credit score can provide for you. As credit scores become more and more commonly used in a wide variety of industries and applications, the time you take to improve your credit score will definitely be time well spent.

Save a Buck: Boost your credit score

Want to save $105 a year?

A new study by Washington Mutual estimates that credit card users can do just that if they boost their credit scores by 30 points.

Credit scores are essentially an estimate from the credit companies of the risk that you won't pay off your loan. Credit scores typically range from 200 to 800 and they are used by banks and insurance companies to determine rates for mortgage loans, credit cards, auto loans and other financing.

Some quick tips to boost your score:

Try not to use your credit card to the max. You should have a "usage limit" below 50 percent, meaning if you have a $10,000 limit, try to use $5,000 or less of that amount.

Avoid opening multiple new accounts quickly.

Pay off your debt rather than moving it around. Paying off a large balance improves credit scores.

The scores are compiled by three credit bureaus: Equifax Inc., TransUnion LLC and Experian Group. Consumers can obtain a free copy of their report from all three once a year, but you have to pay about $15 to see the actual scores.

Review your credit report annually

Reviewing your credit report is important to make sure that your information is accurate when applying for a loan. It can also help minimize the damage from possible identity theft. You are entitled to a receive a free credit report every 12 months, so why not request it each year on your birthday?

Your report starts with your personal information — name, address, social security number, telephone number, and employment data. Following that is your account information. Review all the details and make corrections if needed by following the instructions provided.

For each credit account, you will find the lender's name, account number, type of account, and loan information, including your payment history. The credit bureaus also collect information from court records, so don't be surprised to find notes about bankruptcies, tax liens, and/or criminal proceedings that may have occurred. At the end of the report will be a list of any parties who have requested your information.

Potential lenders review your report to determine your creditworthiness. They consider your track record in making timely payments, as well as the total amount of credit you are carrying. They want to determine if you are able to handle monthly payments on any new loans you may apply for.

When you review your report, make sure you agree with all the items listed. If you notice anything unusual it may be an indication that a thief is using your accounts without your knowledge, so review the report carefully and make a list of any incorrect or misleading information. You have a right to dispute incorrect information on your report.

Typically you will receive a form to complete if you wish to file a dispute. When the credit bureau receives your request, it is obligated to investigate within 30 days and to correct any errors. You will receive a report on the conclusion of the investigation, and if your credit report is changed as a result, you should also get an updated copy.

You also have the right to add a statement of 100 words or less to your report, explaining your side of the story with respect to any disputed information.

Credit report hidden errors

Most people are aware that they can obtain a copy of their credit report for free - or for a minimal charge - from credit-reporting agencies like Experian and Equifax. However, many have no idea what’s on their credit report, how to read it, or how to correct erroneous information. This article reviews six items that appear on your credit report, and shows you how to fix any errors you may find.

Personal Information

Are your name, social security number, address and other personal information accurate? If not, contact your credit-reporting agency to correct the error. A lending company would hesitate before lending money to someone whose name or address is different on their loan application than on their credit report.

Information on Open Accounts

Your credit report details all of your current credit card accounts. It spells out your credit limits, whether you have been paying your bills on time, and if you hold any balances.

Pay particular attention to the accuracy of this information. Lenders use it to gauge whether they’ll lend you money.

Mortgage Information

Credit reports also detail information on outstanding mortgages; your account number, the date you signed your mortgage and whether you have been late with payments. The same information is available for any other outstanding loans or lines of credit from your financial institution.

It is vital that this information is correct. If a lender perceives you as having too much debt they are unlikely to approve you for another loan.

Collections/Negative Account Histories

Your credit report identifies whether you have any accounts that are in collection, and the status of those cases. Because this information can adversely impact your credit score and determine whether you are able to obtain a loan, it is important that it is correct.

Some credit-reporting agencies offer services to help you resolve these issues or advice on how to improve your credit score.

Judgments & Liens

Any judgment or award against you in a court of law will be included on your credit report. It will specify the case number, identify the plaintiff and the defendant, verify whether the case is open or closed and detail its resolution (i.e. the amount that has been awarded).

Should there be a lien on your property, your credit report details the case number, the court where the lien was established, the amount of the lien and whether the lien has been released. Make sure your credit report reflects if your lien has been satisfied or the judgement has been reduced or rescinded. Bankruptcies

Bankruptcy information is also available on your credit report and should be monitored carefully. The report will outline whether it is an individual or a joint bankruptcy and include the amount of assets and liabilities you have incurred.

Incorrect bankruptcy information (especially the date bankruptcy was declared) is a frequent source of problems for consumers looking to obtain loans.

Correct Erroneous Information

There is a space for comments under each section of your credit report. You might say that a lien was established due to a misunderstanding with a vendor, and that it was promptly satisfied. You could note that you have paid off outstanding balances listed on the report. You may even choose to briefly explain why you are in arrears on a certain debt payment.

When making credit report fixing and correcting factual inaccuracies such as your address or the spelling of your name, provide your credit agency with written proof as soon as possible. With appropriate documentation, your credit agency should make the necessary changes fairly quickly.

Bottom Line

Try to obtain your credit report at least once a year and review it for inaccuracies. If you spot errors have them fixed as soon as possible. You’ll be glad you did.

No Cost Credit Report - How To Get It

Is it possible to get a no cost credit report? Yes, definitely. This is a good news to people who have serious credit score issues. Perhaps, you're wondering what your credit score is. Perhaps, you're considering taking out a loan for a new business or a new car, but you don't know if you would qualify. You really don't want to go through the hassle of applying for a loan just so you'd get rejected. You could avoid it by knowing your credit score before you even enter the doors of the credit agencies.

Getting it for free can be overwhelming when you don't know where to go and how to get it.

It is very important for consumers to check on their credit every year. They do not remain constant. You cannot expect to have the same credit score five years after you last checked. This could cost you your job or your house. Knowing your credit score is crucial. Luckily, it is now available to you at no cost at all. Indeed, you can get your totally free credit report online.

Every citizen is entitled to their no cost credit report every year. You can get them from the country's three major credit agencies. Before you can get it for $9.50, but these days, Equifax, Experian and TransUnion are required to provide Americans their free reports once a year.

No, you will not get them automatically. You still have to file a request in order to get your copy. You can do this in three ways:

1. You can go directly to any trusted website, the only authorized consumer source online in order to access your no cost credit report.

2. You can get your free report via phone by calling (877) 322-8228

3. You can request via mail by sending in your request and mailing it to Annual Report Request Service.

Your report is the basis of your credit score. Once you have sent in your request, you can expect to receive it within a reasonable time. You'd get a summary of your payment history, balances, payment behavior and accounts listing. What you get is not automatically your credit score. However, credit agencies would base your credit score from your it. The better it is, the higher is your credit score. If it reflects bad accounts or worse, bankruptcy, you'd likely have bad credit score as well.

When you receive your free report, it is very important that you check for disputable accounts and items. Make sure that it is accurate. Otherwise, you would be saddled by these accounts. You will not be able to easily secure a loan. You could lose your home over an inaccurate reporting.

Nowadays, no cost credit report is available to everyone. It is your right to avail of them so you'd know how you stand financially. Your report could mean a huge difference between having a difficult or easy financial life.

10 incredible facts about your credit report

1. I can pay credit repair companies to delete bad information on your credit report. A lot of credit repair companies use this false information to attempt to attract customers for their credit repair services. The truth is that if you have not paid your credit card bills on time, there is no credit repair company that has the ability to legally delete the negative information on your credit report. Bringing your payments in good standing is the only thing that will reduce the impact of your late payments, on your credit score.

2. My personal information on my credit report is accurate. Nothing is farther from the truth than this. Over 75% of credit reports have inaccurate information. The credit reporting agencies have human beings working for them, and they can make mistakes that can impact your credit score. Not only do they routinely make mistakes on your personal information, they can accidentally place derogatory information that does not belong to you on your credit report.

3. My bankruptcy filing will not be reported on my credit report after 7 years. It depends on what type of bankruptcy you filed. If you file a chapter 13 -- reorganization of debt -- then this kind of bankruptcy will not be reported on your credit report after 7 years. However if you filed a Chapter 7 bankruptcy -- forgiveness of all debt -- your bankruptcy filing will stay on your record for 10 years.

4. I need special skills to repair my credit. This is not true. According to the Federal Trade Commission, whatever the credit repair companies can do for you, you can do for yourself. So there is no need to make monthly payments to credit repair companies who end up charging you hundreds of dollars just to do the same thing that you can do yourself.

5. My divorce decree will exonerate me from all the debt that my ex and I jointly owed. This is not true. Just because you got a divorce, and your ex kept the house, and they agreed to make the mortgage payments, does not mean that if they miss payments that your credit will not be affected. Your credit will be affected. A divorce decree does not mean you are no longer obligated to pay your mortgage. Your mortgage company may work out something with you if your ex spouse agrees to sign a document that states that they will be solely responsible for making the mortgage payments. Now if their credit score is weak and yours is stronger, the mortgage company may not honor your request to have your name removed from the mortgage documents.

6. I will reduce my credit score if I check my credit report. Not true again. You can check your credit report without affecting your credit score negatively.

7. If a bunch of car dealers or mortgage companies pull my credit report, my credit score will go down. This is not true. Credit reporting agencies understand that smart consumers will shop for the best deals and will not penalize you by taking points off your score, as long as these pulls occur within a 30 day period.

8. I can boost my credit score simply by canceling my credit cards. Creditors prefer to see two to three open credit cards that are active than credit cards that have been closed out. You are even better off having a credit card that you do not use than canceling the one you do have.

9. I have to pay a fee to obtain a copy of my credit report. Not true. Credit reporting agencies by law are required to provide you with a copy of your credit report once a year. So you can contact any of the credit reporting agencies and obtain a copy of your credit report free of charge.

10. My credit score is so low that there is no way I can repair it. This is not true. You can repair your credit and boost your credit score if you know how to go about it.

So if your credit is bad and you want to repair it you must first make sure that you are clear on what you can and cannot do with your credit report. Once you understand what you can and cannot do, it becomes much easier for you to start the process of repairing your credit.

TransUnion offers free credit reports in wake of data suit

As part of the preliminary settlement of a class-action lawsuit, credit data agency TransUnion is offering free credit monitoring to anyone who had a credit card, loan or credit account between January 1987 and May 28, 2008.

The suit alleges that TransUnion sliced and diced consumer credit information and sold it in the form of marketing lists. TransUnion, which discontinued the accused arm, Performance Data, in 2001, has denied any wrongdoing. The company agreed to the settlement to avoid a protracted litigation process.

“We feel that this is the right thing to do, and it offers consumers the opportunity to monitor their credit and look at their scores,” said Clif O'Neal, a spokesperson for TransUnion. “We feel this is an educational offering. We realize that the privacy issue is more heightened in today's environment, so we feel these services are a benefit.”

In a bid to generate some positive publicity, TransUnion is advertising the offer in a nationwide campaign that starts in mid-June.

Consumers have two options in filing for the settlement: basic relief and enhanced relief. Basic relief provides free credit monitoring for six months, which includes daily credit report and credit score access. The service is worth $59.75, and consumers may also receive a cash payment if the $75 million settlement fund lasts. Enhanced relief offers nine months of credit monitoring, insurance scores and a mortgage simulator service —valued at $115.50.

To participate, consumers must register at www.listclassaction.com.

The nation's other major credit unions, Equifax and Experian, were tight-lipped on whether the settlement may affect their businesses or consumer marketing strategies. Equifax refused to comment.

Donald Girard, VP public affairs for Experian Americas, noted, “Experian's policy is to refrain from comment on legal matters involving other companies.”

He added, however, "Today's consumers understand more than ever the need to frequently interact with their credit reports to make certain they have a good understanding of the data contained in their file. As the data contained in their credit files changes often, consumers will always need to periodically check the file to keep themselves current on the status of the entries and to ensure that they will be able to achieve their credit objectives now and in the future."

Link-Via-Dmnews

5 steps to analyze your credit score

Credit history plays a vital role in building credit score. The exact way that your FICO score is calculated is a secret--it's proprietary knowledge of the Fair Isaac Corporation. Never mind but if you analyze your credit history you can get a good idea of why your credit score is in a particular range. So here’s are important tips to make it done:

Step1
Always remember to analyze the potential problems section on your credit report. These are the issues that can pull down 30 percent of your FICO score very easily. Potential problems can include bankruptcies, debts that have been given over to collection agencies and other delinquent accounts.

Step2
Keep a track of your accounts in good standing. If the companies holding these accounts have reported your current balances, this section is about 30 percent of your FICO score--the 30 percent based on your outstanding debt. Outstanding debt isn't necessarily bad. Debt is considered in terms of your ability to pay it back and how much credit you still have available.

Step3
Make a check over your history of account balances. This section combined with the potential problem section makes up as much as 35 percent of your FICO score because it tells lenders about your payment history.

Step4
Read carefully the listed requests for your credit history. This information can affect up to 10 percent of your FICO score, because your applications for new credit can drive down your score. However, only inquiries that you requested by asking for credit should be provided as part of your credit report for new creditors.

Step5
Try to know how your credit history contributes to your credit score. If you have a history of paying off your credit on time, limiting your problems and not abusing your credit, you will have a very strong credit score.

All these steps are followed by me first and then are recommended to you as there is a huge benefit after using them in real life.

All about credit score happenings

How strange it looks like if your loan application gets disapproved, or maybe you were approved, but the interest rate charged is pretty much higher than your expectation. How do you feel? My credit score is good, I know I checked. Maybe its not as good as you think. It all depends on there you got it and what kind of credit scores it is.

Only facts behind all this is there’s several different credit scoring methods. Credit scores calculated from the same credit reports can differ substantially from credit scoring method to credit scoring method. So how can you ever know what your credit score really is? Well, luckily, 75% percent of lenders use FICO scores exclusively and you can purchase FICO scores of your own.

FICO credit scoring is a numeric method of scoring your credit worthiness developed by Fair Isaac and Company. Your credit score is a number between 300 and 850 that tells creditors how likely you are to pay your bills. The higher the number, the better it looks to potential lenders and creditors.

The three major credit bureaus each have their own version of the FICO score: Equifax uses the Beacon system, TransUnion uses the Empirica system, and Experian uses the Experian/Fair Isaac system. Despite each credit bureaus' use of their own versions, all systems are based the original Fair Isaac FICO scoring method, so each credit score calculated with these systems are generally called FICO scores. However, although most lenders do use FICO scoring, some lenders may have their own scoring methods.

There are many places where you can get your FICO score from all three bureaus. If you order your credit score from anywhere else, again be aware that these scores are "FAKOs" (or "fake") and can differ considerably from your FICO credit scores.

Adding to the confusion is the credit bureaus themselves. Recently, Experian revealed that the national average credit score of its consumers is 678. This is very misleading to the average consumer. When you buy your credit report and score directly from Experians website, you are getting what they call the "PLUS Score," which is NOT a FICO score, and is NOT used by lenders anywhere. (Equifax is the exception--you can buy your FICO score directly from them at their website. The 678 PLUS Score reported by Experian is actually the average of consumers' PLUS Scores, not their FICO Scores.

Clearly, the PLUS Score (and all Non-FICO scores) are useless. Not only that, but such hype misleads consumers into purchasing their PLUS Score thinking that they are getting the same credit score that their lender will use. Non-FICO scores are worthless not matter what the credit bureaus or any website selling non-FICO scores claim. Even a few points difference in your credit score can mean confronting the reality of the loss of thousands of dollars out of you’re pocket--a loss that you probably didn't plan for. The next time you want the most accurate credit score available, do yourself a favor and get the industry standard: the FICO credit score.

Facts about credit reporting agencies

You may never see one, or visit one, but the credit reporting agency is always there in the background. These are the companies that assign credit ratings for both corporations and individuals. The credit rating is a way of measuring credit worthiness-or in other terms, the ability to pay back a loan.

You may envision a remote room in an unknown place where individuals in lab coats collect and collate personal data on people. Actually, in the earliest days of credit reporting, this was exactly the case. The ratings were compiled by hand and banks could call and check on anyone they wanted verbally. In modern times, the data is sent in via magnetic tape reporting or secure data transfer and the only times humans really involved is when there is an inaccuracy on your credit report that needs to be investigated.

There are hundreds of extensions of the "Big Three" Experian (formerly TRW), Equifax and TransUnion that are located all across the country. Because the credit bureaus competitors and do not share information with one another, it is a good idea to check the Big Three regularly to ensure there are no errors or omissions on your personal credit report.

Thus, it becomes the responsibility of the individual to check up on the people that are checking up on everyone else. Changes in the statutes for credit reports now make it possible for everyone to get one free report from each of the three major credit bureaus per year.

Looking at your own credit report will give you valuable insight on how your history is being rated. It would also help to understand the laws that govern how these agencies are able to do business. Know your rights! As the old saying goes, "If you don't know your rights, you don't have any." There may be times that require you to challenge something inaccurate on your report. Since your credit report is the way many firms will "know" you, you want every item in it to be absolutely accurate.

You may think that you have a good credit report but a credit report that has something questionable contained within it may be the difference between getting that new credit card or auto loan and being denied. And if you're in the process of applying for credit without this knowledge, you can be turned down. This is why checking up on your personal credit report and going through the complaint or correction process if necessary is so important.

Since the credit reporting agency is the standard of how the world determines credit worthiness, make sure that any lenders or retailers you want to do business with are reporting to one of the major agencies and that information gives a one-hundred percent correct picture of how you handle your personal finances.

Credit report fraud: Freeze It

Recent federal laws and Minnesota state laws help citizens protect themselves from new account fraud by allowing “freezing.” The laws empower any consumer to freeze their credit report by contacting any of the three major credit reporting agencies and requesting a credit report freeze. This action will deny potential thieves access to the credit history and prevent them from opening new credit cards or loans in the consumer’s name.

Victims of identity theft can have their reports frozen without a charge, but they will need the theft documented by a copy of the police report or case number. People who have not been victims of identity theft can choose to freeze their report for a $5 fee to each of the credit reporting agencies. When an agency receives a freeze request, it must place the freeze within 3 days of the request. In addition, the agency must provide a unique Personal Identification Number to the consumer within ten days.

The PIN can then be used by the consumer to temporarily lift or “thaw” their report for a specific period of time or for a specific creditor. For example, you are car shopping and want to allow a dealership, credit union or bank to look at your credit history to obtain a car loan. Or you may request your information be openly available for a specific period of time, like 30 days, in order to shop at several locations. After this period is over the report will automatically refreeze.

The thawing process is free to those who have been identity theft victims. Those who have not been victims will be charged the $5 fee for thawing.

Check your credit online freely ‘n safely

No future plans to apply for a loan or credit card then there’s no need to keep an eye on your credit report and score. But failing to regularly check your credit report leaves you open to victimization - by the actions of criminals and the errors of creditors.

The credit crunch is squeezing consumers across the country, and not just those looking for loans. With credit increasingly costly and hard to come by, it's more important than ever to protect the credit you already have. That means closely monitoring your credit score, the single most important tool you have for obtaining favorable credit terms now and in the future.

"Identity theft, credit fraud and erroneous credit reporting can happen to even the most conscientious consumers," says Jeff Bartlett, president of GoFreeCredit.com. "Knowing what's on your credit report can help protect you from these increasingly common credit crises."

Now online services make it easy to keep an eye on your credit score. Remember, there are also scammers online posing as credit-help companies, so keep a few things in mind when obtaining your credit report from a site:

* Is it safe? Sensitive information, like your social security number, should be encrypted for security.

* Is it reputable? The company hosting the site should demonstrate credentials or associations with organizations that recognize reputable businesses. GoFreeCredit.com, for example, is a member of the Better Business Bureau.

* Is it free? While some reputable sites may charge for your report and score, why pay if you don't have to? At GoFreeCredit.com, your report and score are both free with a 30 day complimentary trial of credit monitoring.

* Is it offering you more? In addition to your free credit report and score. You'll also receive tips on how to improve your score, such as paying on time if your report shows missed or late payment history, keeping credit card balances lower than your total credit limit and keeping a variety of credit such as auto loans and credit cards to show financial responsibility.

Sign up for a free credit report and score at any website and you will also receive a 30-day free trial of the site's credit monitoring service. Credit monitoring can help prevent identity theft, providing you with automatic notification of changes to your credit report.

Boost your Fico score now!

Most of the lenders uses Fico score as credit score. Since so many borrowers are failing to pay debts, lenders are placing a lot more importance on that number.

The FICO score is calculated based on complicated math which takes into account the behavior of millions of consumers. But, there are ways to take control and boost your score.

It's no longer enough to hit 620. Lenders are requiring scores at 680 and above to be worthy of their money.

Peter Benavides cares about his FICO score because he eventually wants to buy a home in the Bay Area.

He believes he is financially responsible and holds strong credit. But myFICO.com tells a different story. It's an online calculator by Fair Isaac - the firm that invented the primary credit scoring system and it shows his score is lower than he expected at 602.

Benavides is surprised by his subprime status because the program says he pays bills on time and only carries $1,500 in debt. Believe it or not, the problem is with his lack of plastic.

Jen Crawford with myFico.com explained, "His number one factor or biggest problem is he's using 95 percent of his credit cards."

Because Benavides puts purchases on only two credit cards, it gives lenders the idea that he is maxed out and more likely to miss payments. If he opens a third card that debt will spread out.

As long as Peter continues to use 50 percent or less of his available credit his FICO score will rise.

"He can easily reach the low 700s within a couple years," Crawford said.
Peter Benavides looks forward to the challenge.

"As long as I know ways to improve my score I'll feel more confident for the future," He said. "There is a price to pay and you have go to with it. You have to prove you are responsible enough to obtain a good credit score."

I think all these tips would definitely help to grow your FICO score fast.

Tips build a good credit history quickly

Nowadays it has been very essential to hold a good credit history to anyone who expects to make major purchases, rent an apartment or start a business. You could build good credit easily but you need to control useless expenses. Follow these tips to help build your credit history.

Step1
First of all check which accounts are shown on your credit report.

Step2
Try to obtain a copy of your credit report at least once a year.

Step3
Go through the credit report and check whether the information shown is accurate or not.

Step4
Make your entire bill Payments on time. You don't need to pay the entire balance each month, but make at least the minimum payment promptly.

Step5
Avoid going over the credit limit on your credit card account. Some credit card companies allow you to do this as a courtesy, but it can reflect poorly on your ability to handle your account.

Step6
Cancel credit cards you aren't using or don't anticipate using.

I’m not an professional agent but all these tips are self used first as I got great benefits from these I tried to explain here.

Credit report requests on hike

According to the recent figures which indicate that consumers are getting aware of the importance of checking their credit profile and rating before applying for credit, with reports that around 20% of consumers now check their credit report before they apply for any sort of finance.

The global credit crunch has resulted in far tighter credit conditions, and many people have found themselves being turned down for finance as a result of this.
As a result of these tighter credit conditions an increasing number of people are checking their reports either before they apply for finance, in order to see whether there are any problems that could hinder them, or after being turned down to check what the problem was.

Officials from the credit reference agency Experianhttp:www.experian.com/ stated that the number of people requesting their credit reports now compared to six months ago had almost doubled.

The agency said: “Up to 20 per cent of people now check their credit report before applying for credit,” adding: “the vast majority use the internet to do so in order to get immediate access to their score, and also to receive alerts if their credit status changes.”

Another official said: “With lenders reacting to the credit crunch by tightening their lending criteria, you can help stay on top of your borrowing and how well you’re managing your finances by regularly monitoring your credit report.”
Checking credit report is not a bad habit but it’s the only factor which really makes things easier for all consumers around the world.

Credit score protection issues

Are you looking for another credit card? Make your mind properly. You need to consider your credit score as its important aspect for someone need loans and once it goes down, it's hard to recover.

It's surprising how many people don't know their credit score. Many people just assume they know, but that could get you in to trouble.

Debt collector Mike Nowak says, "Right now, we're at the highest debt I've ever seen in my 20 years." With all that debt, collection agencies might be coming after you. Having an account go into collections affects your credit score. Hold on, that's not the only thing you have to be concerned with.

Brian Holiman, owner of Yuma Mortgage Group says, "how you pay your bills, the type of credit you have, your proportion of your balances to your credit limit, and whether you have any public records, collections, bankruptcy, stuff like that."

Always keep in mind to pay off the dues on time because it’s the important component. Your bill is only considered late if you pay thirty days after the due date. Besides looking at your bills, look at your number of credit cards. "If you have a lot of store accounts it does have a negative effect on you because credit card companies see you as a heavy credit user."

If you want to improve your credit, "the first thing they do is pay off their credit card, but then they close that account thinking that helps." It doesn't help, because you want to have low debt to income ratio. Instead, pay the card off, leave it open, but don't use it.

Another idea to help with credit card debt, take a loan out to pay it all off. Cut up the credit cards. Pay off the loan with a lower interest rate. "Once you establish a plan or get into a re-payment structure the weight of the world is off of you. It's just getting started."

All these points are basically made by keeping the user’s beneficial end and also some of them are recorded while going through general conversation with some debt experts.

Grab your free annual credit report fast!

Now consumer credit reporting companies (Equifax, Transunion and Experian) are required to provide you with a free copy of your Free Annual Credit Report according to a recent change to the federal Fair Credit Reporting Act. Consumers could retrieve their free credit report once every 12 months using the governments free credit report site, or more if they use a third party service to make the request for them.

The Fair Credit Reporting Act requires that Equifax, Transunion and Experian all provide accuracy and privacy of consumer information when you use their websites online to obtain your yearly credit report free. Additionally, the Federal Trade Commission, (the US consumer protection agency), oversees and enforces the FCRA with respect to consumer reporting companies.

When you make a request to access your Annual Free Credit Report you are allowed to get the report from either Equifax, Transunion or Experian or any combination of the three. A lot of people choose to request it from only one free credit reporting agency at a time so that they can request additional checks throughout the year. If you are access your free credit report prior to applying for a loan, you should investigate to see which agency the loan office checks and get your credit report from that company. This will ensure that you have the same information that your lenders are seeing.

The Federal Trade Commission (FT), the nation's consumer protection agency, enforces the FCRA with respect to consumer reporting companies. It's your choice that you may order one, two, or all three reports at the same time, or you may stagger requests.

I hope after going through these guidelines one can obtain their annual credit report for free within 5 minutes.

Hospitals keen to get your credit report information

In a development that consumer groups say raises privacy issues, a growing number of hospitals are mining patients' personal financial information to figure out how likely they are to pay their bills.

Some hospitals are peering into patients' credit reports, which contain information on people's lines of credit, debts and payment histories. Other hospitals are contracting with outside services that predict a patient's income and whether he or she is likely to walk away from a medical bill. Hospitals often use these services when patients are uninsured or have big out-of-pocket costs despite having health insurance.

Hospitals say the practice helps them identify which patients to pursue actively for payment because they can afford to pay. They say it also allows them to figure out more quickly which patients are eligible for charity care or assistance programs.

Administrators also argue that these credit checks can help them minimize losses. In 2006, nearly 5,000 community hospitals provided uncompensated care costing $31.2 billion, the vast majority of it charity care or unpaid patient bills, according to the American Hospital Association.
Consumer advocates say the practice creates the potential for hospitals to misuse the information by denying or cutting back on patients' care if they can't pay.

Hospitals say that doesn't happen. Hospitals often ask patients for permission to access their financial records, but such authorization is sometimes buried in the fine print. What's more, hospitals could scour a patient's financial records for credit lines and encourage the patient to tap them, despite high interest rates or other costs.

"It has the potential to put people at risk financially," says Mark Rukavina, executive director of the Access Project, a research and advocacy group that focuses on medical debt. Consumers' credit reports are maintained at the three major credit bureaus, which determine credit-worthiness using criteria such as the well-known FICO score. But while a snapshot of how much credit you have available and your debt-payment history might help predict the likelihood of your repaying, say, a car loan, it's less reliable when it comes to medical-bill payments.

Now credit reports easily accessible to blind

Under an agreement announced on Wednesday the nation's major credit reporting companies will make on-line credit reports accessible to blind people's audio software. The program, scheduled to take effect by the end of the year, was negotiated by the American Council of the Blind, its California affiliate and the three largest credit reporting agencies, Equifax, Experian and TransUnion.

The companies now make credit reports available on a single Web site, www.annualcreditreport.com. Under the agreement, at a blind customer's request, his or her credit report will carry a code that will enable the customer's computer to read the report aloud. Other provisions require the reports to be available in large print or in Braille. Lucy Greco, a specialist in assistive technology for the disabled, was one of three blind individuals taking part in the case, along with the advocacy organizations. She said the agreement would allow her to examine her credit report without sharing the information with others.

"I'm so fed up in my life with having to get someone to read things to me," Greco said, noting that such dependence also makes the blind vulnerable to fraud. "Now I can go online, get my credit report and read it ... and I can do it independently, and other people can do the same thing."

Melanie Brunson, executive director of the American Council of the Blind, said the agreement "will help people with visual impairments fight identity theft by independently monitoring and reviewing their credit reports." In a separate case, a federal judge in San Francisco ruled Wednesday that the Social Security Administration must accommodate the needs of blind recipients of benefits when announcing decisions that affect them.

Under the Social Security Act, the agency sends certified letters, makes follow-up phone calls, or takes other steps to communicate decisions to those who are receiving benefits solely because of their blindness, but does not accommodate visually impaired people who get Social Security because of their age or other reasons.

U.S. District Judge William Alsup ruled that the agency is also covered by an anti-discrimination law that requires the federal government to provide access to disabled people in all federally funded programs, including audio recordings, Braille and other aids for the blind.

Link-Via-Sfgate

Best way to protect Identiy theft, how?

Stealing someone’s personal identification information with motive to make a fraud is serious crime known as Identity theft. It’s often used to obtain a service or credit account of some time. All over the world people and businesses taking Identity theft protection measures and there are several different methods of identity protection that a person can employ, and it all depends on what the risks are. If you make use of computer frequently for business dealings, it is important to protect your computer against the infringement of your personal information. If you use your information to get school loans and things of that nature, identity theft protection can be just as simple as getting identity theft insurance and making sure that the information that you give anybody else is always protected.

Make use of secure and trusted websites: It may be the one of many ways that you can implement identity theft protection for yourself. Trusting every website is wrong but there are many who are protected and encrypted. Those who do have such protection are usually very adamant about letting their customers know, because they will be more likely to use their services in the first place. Secure websites encrypt your personal and financial information so that even the most skilled of hackers won't be able to intercept the information on its way to the merchant it was intended for. If the website you’re using is not securely encrypted you will be begging for keeping personal information private.

Make proper security provisions for your computer: Keeping your computer security up to date is just one more thing that you can do to help make sure that you are exercising good identity theft protection measures. Viruses and spyware programs are known to capture your personal information or leave it susceptible to miscreants, something that nobody should ever be okay with.

Criminals use personal information for a variety of things, from opening new accounts on your credit to getting utilities turned on in your name to opening bank accounts and other things. Identity theft protection software has a way of encoding all of the information on the computer so that nobody else will ever be able to access it.

Identity theft protection is at hike nowadays for so many people. While you may not feel that your computer security is top priority, protection of your identity theft is just one reason to keep your computer security up to date. Identity theft protection is your job; very few other people in the world really care who has access to your personal information except you-and it is your job to take care of it as much as possible. Computer software, virus protection, and smart use are just a few ways of so many that you can help to keep your identity under wraps and keep that unthinkable from happening to you. All these were the simple tips by following which you may have a proper protection against Identity theft.

Credit report bugs: How to fix it?

Major credit report bureaus which are three and we all aware of it may have minor different formats, but all contain similar facts. Mainly your basic identifying information is: name, address, Social Security number. Another section includes "trade lines", a listing of your credit accounts, be they credit cards, car loans or mortgages, along with the credit limit, balance and payment history of each. The reports also show public records and collection, which include any actions taken against you in court and any overdue debts taken over by collection agencies. Check out all these sections carefully for accuracy.

If you find any errors, you might have the right to dispute them, free of cost, by phone, mail or e-mail, with the credit bureaus. If the mistake occurs on all three reports, you must contact all three agencies.

When you point out the problem, the credit reporting agency will open an investigation and contact the credit card company or other lender that provided the statements you dispute. The source must then check its records to verify the information and respond to the credit agency within 30 days about whether they can test item is correct or not.

If you dispute an item and the investigation finds against your claim, there's no appeal, so the information will remain, but you can write out a consumer statement and send it to each of the credit bureaus, which will add it to your credit reports. This will ensure that your side of the story is available to potential lenders. If, on the other hand, the lender agrees with your correction, the Federal Trade Commission requires the lender to amend the error at all the bureaus to which a reports. However, you should check all the reports to make sure all the fixes have been made correctly.

If a credit card you never applied for appears on your report, you may be the victim of identity theft. Contact the fraud department of one of the credit bureaus and request a fraud alert on your credit reports. You have to call only one bureau it will notify the other two. This tells lenders to contact you before issuing new credit or making changes, such as switching mailing addresses, to your current accounts.

How to improve FICO score quickly?

FICO score is a credit score developed by Fair Isaac & Co. Credit scoring is a method of determining the likelihood that credit users will pay their bills. Scoring has become widely accepted by lenders as a reliable means of credit evaluation. A credit score attempts to condense a borrower's credit history into a single number. The score you will receive will always fall between 300 and 850, with the higher the score, the better. Lenders who are looking at FICO scores are determining their lending risk. So, in order to make yourself attractive to financial institutions you hope to borrow money from, you need to raise your FICO score as high as you can. Here
are few steps to follow:

Step 1:
Just check your credit report! Determine how much improvement you need to make your score attractive to prospective lenders.

Step 2:
If you have overdue accounts, get them paid and keep them current. The longer you keep all your debt current, the better it will look on your credit history. This will lead to a better FICO score.

Step 3:
Settle any accounts that have gone to collections. This will help your score in the future, if not immediately.

Step 4:
Keep balances on any kind of credit card or “revolving credit” low. When you have high balances, they can be a huge detriment to your FICO score.

Step 5:
Pay off debt instead of moving it from one place to another. Paying off the debt, or lowering the amount owed, will increase your score.

Step 6:
Open new credit accounts responsibly and pay them off each month. Showing a good payment history over time will raise your FICO score.

Step 7:
Keep open accounts you already have. Closing current accounts will not help your FICO score, but keeping them paid on time will.

Step 8:
Check your credit report at least once a year, to determine how well you are doing at improving your FICO score and to make sure it is not actually getting lower.

Step 9:
Create a budget, including a payment schedule of all your debt, and stick to it.
All these steps are practically done and don’t involve any kind of risk.

How to choose credit counseling company?

All people suffering from financial problems considers credit counseling as an option, they often wonder how to choose best credit counseling company from a vast list that are popping up left and right these days. It’s really hard to answer this dilemma but there are some things that you can look for in a credit counseling company that might make the decision a little easier.

Firstly we consider whether it’s going to cost you anything to aim for credit counseling. If you are having financial difficulties in the first place, then chances are that you don’t really have the expendable cash to pay for the credit counseling you so desperately need. In this instance, rest assured that there are reputable, non-profit, credit counseling companies that will assist you for free. On the other hand, if you are of the philosophy that you get what you pay for, then you may want to consider a fee based credit counseling company.

Your best chance, when deciding which credit counseling company to select at time of need and to find one that will provide you with a custom fit. Every situation, requiring credit counseling, is unique. If you are subjected to a cookie cutter financial plan when your personal situation is much more complex than the average consumer, you may come up short and rule out credit counseling as an option.

Most importantly, you don’t want to end up in the same condition you are in now, after you have gone through credit counseling. You want to make sure that the credit counseling company that you choose is going to provide you best educational services. It isn’t going to do you any good to get out of debt if the credit counseling doesn’t teach you how to manage your money so that you don’t come knocking on debt’s door again.

5 Steps to rebuild your credit report

Usually it takes 7-10 to erase the past credit report issues but making some efforts you can rebuild your credit report before all negative information is set to expire. I have searched five easy steps to rebuild your credit report. Just check them below:

Step 1: Go through the Damage
Firstly get a current coy of your free credit score report to fix past mistakes. Stop scaring, got ahead and take the plunge order all three credit reports with all 3 credit scores. Online ordering of your credit report is actually easy and secure. Contrary to popular belief ordering your own credit report does not affect your credit score.

Step 2: Review the expiration dates
The current law states that negative information will stay on your credit report for 7-10 years from collection date. The expiration date will vary depending on the type of collection. When you pay off a collection that does not mean it will be removed from your report.

Examine your report and determine when each collection is set to expire. Once these collections are set to expire you will see major improvement to your score.

Step 3: Discord errors
If you find inaccurate information such as, fraudulent information, collections that expired still reporting, you have the right to dispute. You will have to dispute each of the 3 credit bureaus separately, Equifax, Experian and TransUnion.Once you the bureaus have received your dispute they have 30 days to determine whether they will update information requested.

Don't dispute good credit on your report, accurate information cannot be removed from your credit report and is a waste of time. Disputing accurate information could harm your credit.

Step 4: Hike up positive credit
Now that you have disputed information that is not correct and have hopefully got it removed or update you can begin to add positive credit to your report. The quickest way to do this is to get an Orchard bank secured credit card. This credit card is designed to rebuild credit even for people that just got out of a bankruptcy. Make sure you use this card responsibly. Also avoid going applying for to lots of credit, you really need a couple of secured credit cards to start establishing good credit.

Step 5: Observe your progress
It is very simple to monitor your progress of increasing your creditworthiness these days with credit report monitoring services. You can sign up for credit reporting monitoring services that will allow you to monitor your credit score, get key changes e-mailed to you, along with access to your credit report. Your credit score will improve over time as you add positive information to your report.

Following all these above mentioned steps one by one may help rebuild credit report easily and safely.

Pros and Cons of seeing your free credit report online

Seeing your free credit report online for the first time may seems to be beneficial. Unfortunately, you have to give out your credit card details in order to get these reports, which may make you feel pretty afraid. Moreover, if you already receive a free report, you might think if that is good enough-if it is really necessary for you to also sign up for a free credit report online. When you really look at these websites, you will feel that there are advantages of seeing your free credit report online. The advantages of seeing your free credit report online include being able to see your credit report whenever you wish. You can view it just before you go to bed and when you wake up to see how your score has improved. One more benefit of seeing your free credit report online is that you don't have to wait for your annual report to come at mailing address. This is important if you are planning to repair your credit rating-and want periodic updates to see if the steps you are taking will work.

Some people are put off by having to enter their credit card details. But with these online companies, you know that your details will be entered and processed through a private server. This lets you know that your details are in the secure hands. There are many advantages of seeing your free credit report online and the above examples are just a few reasons why many people are using the online service of checking their free credit reports online.

Several Disadvantages also seems to occur same like advantages of seeing credit report online. The disadvantages of seeing your free credit report online include the fact that company would charge few dollars if you view credit report. So you are in effect paying to view something that is yours, which often does not seem fair. Other disadvantages of seeing your free credit report online include the simple fact that you get an annual credit report anyway. The annual report is free of cost, too, so why bother filling out forms and surveys and giving out sensitive information to obtain a "free" credit report that essentially gives you the same information as your annual one?

This is a big disadvantage of seeing your free credit report online; of course, the companies will try to trap that by offering you other inducement, but some of them are not worth the price. One more disadvantages of seeing your free credit report online is the use of a credit card to even see your credit report. We all understand that this is the best way to verify yourself and to confirm that you are who you say you are. But there must be other ways to become a member without the use of a credit card. Maybe they can think about these for the future.

When deciding if you want to view your credit report online, you must check out the Pros and Cons of seeing your free credit report online. You have to keep in mind that it is only free for 30 days; after that, you would be charged to use the website. If you are not serious about your credit score, then you won't need this service; and it will probably be a bigger hassle than it is worth. Instead you will be better off with your annual report that you receive from a credit-reporting agency. At least you won’t have to fill out lengthy forms and enter into contracts to obtain it.

Consumers get tips for credit report protection

This week South Carolina became the 40th state to offer consumers some protection for their financial information when Gov. Mark Sanford signed an identity theft bill into law.

State Rep. Kristopher R. Crawford, R-Florence said “We may be one of the last, but we have one of the best laws anywhere”. According to consumer union nineteen people become victims of identity theft every minute in the United States.

The state’s new law allows consumers to place a freeze on their credit reports free of cost, and they can remove or temporarily lift it if needed, so potential thieves don’t have access to that data.

Crawford said “We are one of only two states where citizens don’t have to pay to freeze their credit reports — us and Indiana — and that is the heart of the deal because people need to be able to do it”.

Consumers can start freezing their credit reports from Jan. 1.

The law is a good step forward, especially for vulnerable senior citizens on fixed incomes who frequently fall prey to identity thieves, said Teresa Arnold, legislative director for AARP South Carolina, which fought for the legislation.

“People now have their own tool, and it’s a very strong tool,” she said. “And they don’t have to pay for it.”

Some states require fees as high as $10 for each of the three credit reporting agencies to freeze consumers’ reports and similar fees to remove those freezes, she said.

Among other provisions, the law also gives consumers the power to have inaccurate information removed from their credit reports, and to be notified when their security has been breached. It also provides protection for Social Security numbers by regulating how they can be posted or communicated.

The law also empowers consumers to take legal action in state court against companies that fail to remove erroneous information from their credit reports told by Crawford, a member of the House Judiciary Committee.

Credit report bugs: How to get rid of it?

What you will do in case you get your credit report and there are some negative marks printed on it that you were not involved in or were not part of? This error situation happens in many people’s credit report and can happen with your credit report as well. So what will you do if you find some errors in your credit report?

No doubt, it will not be easy to remove these errors from your credit report. But always there are some ways you can follow to solve a difficult problem even. So here some steps to follow to get the information corrected in your credit report:

When you get some error in your credit report, the first step you have to follow is contacting the credit reporting agency that issued this report in written. In your letter to the credit reporting company, you should attach the relevant documents that show that the information is incorrect. With this you should include information like your name, address, explanation of error situation at hand and why you are reporting the errors in your credit report copy. You should also mention the entries that need to be deleted or edited from your credit report.

Now send this letter to the respective credit reporting company via certified mail and keep a copy of your letter at you in case there are some disputes at their end. When your credit reporting company gets the dispute letter from you, they will start their investigation if they think the dispute can be true or there is some seriousness in it. Normally they start investigation within 30 days of receiving the dispute letter. In their investigation, report providing company will send all the documents and disputes to the company in question in order for the company to do their own investigation and find out why they have placed a particular entry in to that credit report. When that company or organization completes their investigation, they will send their statements about the disputes if they were true or not and support their statements with the evidence of their own.

In case there was some error in credit report, that company will inform all of the credit reporting agencies about this error and get it corrected. Once all this process is completed, your reporting company will send you a new copy of free credit report with all of errors removed from the report.

How to fix your credit score after going bankrupt

Bankruptcy
There is a myth that I’ll just file bankruptcy and start over; it seems so easy. But this is not so. At times situations arise which may cause damage to your credit as claiming bankruptcy. Unfortunately at some point you have to go for bankruptcy option then you must be aware of the many bankruptcy credit repair tips which can help you in gaining back a positive credit rating.

Tips to Bankruptcy Credit Repair
Most of the time there is a feeling that after filing bankruptcy there is no chance left for regaining positive credit. Though, it is a challenge but not an impossible task.

Any strike against you on your credit report (including the claiming of bankruptcy) remains on your credit record for a maximum of seven years. After this time, it is dropped from your record entirely. It IS possible, although you will likely have to wait for seven years, to make positive gains on your score after filing bankruptcy.

How to Get Started
The very first thing you should do is to get a copy of your credit report. In order to get started, you need to know the current position of your credit. The report can be obtained for free or for a very low charge.
Credit report not only helps you in understanding your rating but also help in checking for errors. Review your report check for the errors or negative strikes against you, work for getting them correct, and if there are any errors you will need to contact the credit bureau directly, offering verification that you do not owe what is listed on the report.

In case you owe money somewhere may be it is few dollars showing on your credit report, it is negatively affecting your credit rating. It is essential to pay off debt as it is a crucial step in bankruptcy credit repair. Pay off your highest interest debts first, and keep in mind that the lower debt you owe, the less negative your score will be.

Although there are many other steps you can take towards bankruptcy credit repair. But if you have more debt than you can manage repaying, you must consider filing a formal proposal with your creditors, or think of starting a debt management plan.
Last but not least bankruptcy is the only option for you, and then you should consider negotiating credit card debt yourself. You might get a lower interest rate, lower payments or both.

Steps to obtain free credit report

Normally you have to pay between $5 and $10 to retrieve credit report, but if you meet any of the following criteria, you may be eligible to receive a free copy of your report from any of the three credit report agencies (Equifax, Experian - formerly TRW - and Trans Union). I know it’s hard but take a quick look over these steps:

Step 1:
Determine if you meet any of the following criteria:

Step 2:
You are unemployed and plan to seek employment within 60 days;

Step 3:
You are on welfare;

Step 4:
You believe there is an inaccuracy in your credit file due to fraud;

Step 5:
You can show that you've been denied credit, insurance, employment or rental housing based on information in your credit file;

Step 6:
You can show that you have suffered an "adverse action," such as a reduction in the credit line on a credit card or an unexpected increase in the interest rate on a credit card.

Step 7:
If you meet any one of the above criteria, you qualify for a free credit report.

Step 8:
Contact one or more of the three credit bureaus and request a free report. Each bureau has different guidelines for ordering free reports. If you think your situation is complicated or needs clarification, call the toll-free number provided by the bureau.

Step 9:
If you have any questions about your legal rights, please consult the Fair Credit Reporting Act (ftc.gov/os/statutes/fcra.htm).

I think by following above mentioned steps sequentially one could easily receive free credit report.

Credit reports: why hospitals need it?

Privacy issues are the most vital factor that comes in the mind of consumers frequently but then also number of hospitals are digging patients' personal financial information to evaluate how likely they are to pay their bills.

Few hospitals are poking into patients' credit reports, which contain information on people's lines of credit, debts and payment histories. Some hospitals are also contracting with outside services that predict a patient's income and whether he or she is likely to walk away from a medical bill. Hospitals often use these services when patients are uninsured or have big out-of-pocket costs despite having health insurance.

Hospitals say the practice helps them identify which patients to pursue actively for payment because they can afford to pay. They say it also allows them to figure out more quickly which patients are eligible for charity care or assistance programs.

Administrators also argue that these credit checks can help them minimize losses. In 2006, nearly 5,000 community hospitals provided uncompensated care costing $31.2 billion, the vast majority of it charity care or unpaid patient bills, according to the American Hospital Association.

Karen Godfrey, who runs revenue management at Baptist Health South Florida says Hospitals have "a limited amount of resources that are available to actually execute the collection process,” a Miami system of five nonprofit hospitals that is likely to adopt one of these systems soon. "You want to concentrate on the ones that have the ability to pay."

Consumer advocates say the practice creates the potential for hospitals to misuse the information by denying or cutting back on patients' care if they can't pay. Hospitals say that doesn't happen. Hospitals often ask patients for permission to access their financial records, but such authorization is sometimes buried in the fine print.

Keep focusing on your credit report

You should make it a routine to review consumer credit report because it helps in updating credit score history.

This factual snapshot of your credit payment history contains every major transaction you have made, and it even serves as your voucher with businesses -- a negative report means you won't get the loan or might pay higher rates than those with a more positive report.

Your report can also be evaluated by companies considering hiring you for a job, renting you a residence and selling you insurance.

With identity-theft crimes on the rise and high credit scores needed to secure good interest rates, it's important to know what your report is telling others about your spending habits.

Cindy Tesch, the community outreach director at Consumer Credit Counseling Service of the CSRA, urges consumers to check their credit reports with each of the three reporting bureaus at least once a year.

These agencies, or "collection houses," store your financial data: Equifax, Experian and TransUnion.

Everyone is allowed one free credit report from each of the credit reporting agencies every 12 months under a law signed in 2005 by President Bush.

Texas consumers have the lowest credit score

Report from a Credit research group shows that the Texas consumers have an average credit score that is 26 points lower than the national average credit score. Texas average credit score for six month period that ended in July, 2007 was 666 compared to 692 the national average.

Approximately 27 percent of people find their credit score decreasing during the study period with less than 1 percent finding their credit score down by more than 100 points. 41 percent of consumers were able to maintain their existing credit score and 33 percent of consumers were able to increase their credit score.

3 out of every 10 US customers were able to increase their credit score by 50 points in the six month period as indicated by Experian National Score Index. 33 percent of consumers improve their credit score by 50 points in the States of North Dakota, South Dakota, and Vermont.

What our credit score includes?

Our credit score is a three digit number and its range varies from 300 to 850. Our credit score is a big indicator of how we are paying our bills and whether we will have problems in getting new credit or will get it with ease and with lowest of interest rates. Credit score is calculated using the information available in our credit history.

When we apply for new credit, the creditors and lenders check our credit score to determine our credit history. By viewing your our digit credit score, the creditors just decide whether to give us new credit or not. The creditors and lenders can decide the same thing by viewing our credit report. But checking our credit score make their decision making process quite easy and less subjective.

Although there are many versions of credit score available. But the most commonly used version is Fico score developed by Fair Isaac Company. Today Fico score is used by many creditors and lenders before making decision about providing new line of credit or extending the existing credit to the customers.

There are many parts of your credit history that taken into consideration when calculating your credit score. There are some parts in the credit history that are more important than the other one’s like your payment history. Here is the list of information that is used to calculate credit score with their percentage of use:

• Payment history 35 percent: 35 percent of your credit score is determined by your payment history. Creditors and lenders are more interested in knowing how you have paid your bills in the past. If you are paying your bills late then they look at how late they are. Your late payments, collections and bankruptcy all affects the payment history part of your credit score.


• Your debt level decides 30 percent: How much you are currently in debt deciding the 30 percent of your credit score. The amount of debt you have taken in comparison to your credit limit is known as credit utilization. The higher the credit utilization you have, the closer you are to your credit limit and more lower your credit score will have. And if the case is reverse, you will have higher credit score. The best key will be to keep your credit card balances to 30 percent or less to that of your credit limit.


• Length of credit history determining 15 percent: the length of your credit history determines the 15 percent of your credit score. In general, the longer credit history is in favor of the customers and will help them in increasing their credit score. When you have a long credit history, the creditors and lenders will have better idea about your spending habits and paying habits as well. Thus factor also look at the age of your credit accounts and how long you have been using your credit accounts.


• Credit inquiries 10 percent: approximately 10 percent of your credit score is determined by how many credit accounts you have established. This factor take into consideration the number of accounts you have, their age, your requests for new credit and the length of time since credit report inquiries were made by potential lenders. Every time we apply for a credit, an inquiry is added to our credit report and remained there for the next two years. When we make too many applications for new credit, that indicates that we are in dire need of credit or are in some form of financial problems. Credit score take into consideration the inquiries made within a year.


• Mix of credit is 10 percent: approximately 10 percent of your credit score is based on overall mix of credit cares, loans, installment loans etc. The more balanced this credit mix is, the more credit score you have. In case you have different kind of accounts that’s in your favor as that indicates that you have experience in handling mix of credits.

Credit report freezing benefits and drawbacks

A credit freeze is a tool available to people here in US where they can block their credit report so that it becomes really hard for the identity thefts to get new credit and open new accounts by your identity. When you have set the status freeze on your account, no one even you cannot open an account by your name. Even the creditors, lenders and employers will not have access to your credit files. There are some benefits as well as freezing down your credit report:

After adding the freeze status to your credit files, your identity will have higher level of protection. In fact credit freeze is a good way to protect you against identity thefts. There are many drawbacks to this security freeze but this advantage may be worth enough to go for it.

1. Freezing of credit report is a time consuming and expensive process. You have to provide many certificates and pay $10 to each of the credit reporting bureaus.


2. In case you need credit or open new account, you will have to request the credit reporting bureaus to lift the freeze status on your report and once you have established the credit you will again have to ask them to refreeze your report. All this process will be time consuming and also have to pay more fees.


3. The security freeze will not stop the pre-screened credit card offers.


4. Existing creditors still will have access to your credit files and can send you promotional offer about their products and services


5. Freezing of credit report could also create some inaccuracies in your report when the companies' tries to update account information have problems in accessing your accounts.


6. Credit freeze cannot stop an individual to buy items from a stolen credit card number. Some critics consider credit freeze just a problem fro the consumers where they will not be able to apply for a credit card, or a loan or refinance a mortgage without lifting the freeze on their credit report and lifting the freeze will take time and money both.

Simple tips to follow for getting free credit report via phone

In case you are not willing to get your credit report online, then getting it via phone will be the best option. When you get from credit report via phone, you will be able to escape from hundreds of fraud website on the Internet that claims to be providing you credit report for free. Here is the exact process you have to follow to get it via phone:

1. Make a call to the number 1-877-322-8228 from your phone


2. With this type, you will have to provide some information about you like your name, current address, social security number, birth date


3. Once your identity verification has been completed, you have the option to choose which company credit report you want to get


4. When you chosen the companies/company credit report you are willing to get, will get it via mail within next four to five week time