Credit - 101
 
How do I get my credit report?
                Your credit report is actually up to 3 separate reports combined into one.  The reports come from the 3 credit reporting agencies: Experian, TransUnion and Equifax.  Depending on who is pulling the report, they may receive one or more ‘bureaus’ at once.  Multiple reports are typically combined into a single easy to read report as most of the information is duplicated by each bureau.  Companies like Credit Technologies provide these combined reports to qualified businesses.  The easiest way to get a copy of your current credit report(s) is through AnnualCreditReport.com.  This is the only place where you can obtain at least one copy of each bureau annually completely free of charge.  Once you have a copy of the report(s), you should be provided a way to request changes for inaccurate information (dispute), free of charge.
 
What is my credit score?
                Like the bureaus, there are actually different scores also.  FICO scores are the most popular for business use, and Vantage scores are more popular for consumer use currently.  Each business use has different models depending on when it was created and what purpose it was designed for.  The Mortgage FICO score is typically the hardest score of all.  Automotive FICO scores generally favor current and previous car loans more than anything else in the file, while the same logic applies to credit card scores.  Mortgage FICO scores look at everything in the credit report, paying extra attention to current and previous mortgage, but also using car loans, student loans, revolving account, student loans, public records, etc.  When a business pulls your credit report and score, they will typically provide you with a copy of the score, listing the bureau used and the range of that specific score.  It is important to understand that these are typically not the same score model used if you get a copy of your report and score from any website (including the credit bureaus directly).
 
How do I change my score?
                Your score is actually calculated at the exact moment your report is pulled.  It is based upon all of the information in that specific credit report - at the time it is requested.  The only way to change any score, is to pull a new report, after the information in the report has changed, and get a new score as a result.  Credit Technologies offers mortgage companies an expedited method of updating the credit report for the purpose of providing a new mortgage.  The only other ways to change this information is either to have the creditor who reported the information in the first place to update the report with new information, or what is called a “dispute” process.  The dispute process is simply informing the credit bureau in question of inaccurate information.   The dispute process is provided free of charge to all consumers.
 
How do I “dispute” information on my credit report?
                First, we would highly recommend speaking with your mortgage company prior to starting any new disputes.  Having an item list as “disputed” may have a negative impact on your mortgage process.  The easiest way to dispute any reference on your report is to first obtain the report from the AnnualCreditReport.com site.  This will provide an instant way to start a dispute regarding any information on the report, and will show the report as it lists at that minute (in case the creditor already corrected the issue with the credit bureau).  Once you start the dispute process, you will be provided updates as they credit bureaus attempt to verify the correction.  Documentation can be provided to the credit bureau to assist in this, but the credit bureau will still have to verify the correction with the creditor directly.  As a result, we encourage you to contact the creditor first and insure what will be verified when the credit bureau inquires.  When talking with the creditor, or requesting a dispute, you should be as detailed as possible with each specific item listed that you would like to have changed.  The entire process may take a few attempts in order to get everything correct, but you should get a response within 30 days for each request.  If the dispute is returned, and you disagree with the result, replying with supporting documentation may be helpful.  While there are companies that will process a dispute for you, they almost always require you to pay a fee, for something you can easily do yourself online.  Charging consumers a fee, then attempting to help the consumer improve their credit score is usually deemed as “Credit Repair”, and typically thought to be an illegal practice.
 
How do I improve my credit score?
                First and most important, you need to start with the basics.  Pay any outstanding past due debts, clear old collections or at least start payment arrangements for them.  When possible, start with the original credit grantor for any collection account.  They will often be able to provide greater assistance in setting up payment plans, or possibly working to remove the collection item off your report entirely.  These actions may not help your score immediately, but the sooner these items are addressed, the sooner these items will stop hurting your score.  Second, start the healing.  You need at least one account in good standing that gets regular activity.  This can be a mortgage, car loan, or credit card.  If your credit is currently that bad, consider looking into a secured credit card.  The more accounts that report each month, the longer they continue to report in good standing, generally speaking - the more it will help your score.  Remember that car loans will help indicate how well you qualify for future car loans, and the same for credit cards, etc.
Once you start getting your profile moving in the helpful direction, you may way to think about your accounts before applying for a new loan.  The score only looks at the information in the report, things like interest free periods and low interest rates do not affect your scores.  Ideally, you should try to have at least 1 current mortgage account, 1 current car loan, and 3-5 revolving or open lines of credit (typically credit cards).  The balance of these revolving accounts should stay as low as possible, with regular activity, but try to keep all balances under 50% of their individual limits.  Any revolving account over the credit limit will have a very negative effect on your score.
 
Want more information?
                Here are some sites to help you understand your report, score and rights pertaining to credit reporting: AnnualCreditReport.com, MyFico.com, Experian.com, TransUnion.com, Equifax.com, ConsumerFinance.gov, NCRAinc.org, and FTC.gov.

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