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A credit report is run on a buyer when he or
she needs to buy something that will take a
long-term loan, such as an automobile or a
house. The credit report can come from one of
three agencies &endash; Equifax, Experian, and
Trans Union. Each of these three agencies uses
their own techniques of arriving at a credit
score and receiving credit information, so
attention should be paid to all three. A credit
report score can go up to 800, and an increase
of 50 points is a big one, enabling borrowers to
get loans they previously were denied, and
getting loans at much better interest rates. A
1% drop in an interest rate on a $150,000 house,
for instance, may drop a payment by over $100 a
month, saving the borrower over $35,000 over the
life of the 30-year loan.Each of these credit
agencies have taken all the financial
information they can find about you and
tabulated a credit score from those results.
Information will include your current and
previous home addresses and employers, the
credit cards and loans you have, and any late
payments made over the last ten years. These
agencies' credit reports will be very similar,
but there will be differences, as they all make
mistakes, and the banks and credit card
companies giving them the information make
mistakes, too.Here's where you can improve your
credit score. Any request for a change in
information in a credit report must be answered
and corrected within 30 days because federal law
regulates the credit bureaus. If you write in to
a credit bureau complaining that one of the late
payments on your credit report is wrong, they
must investigate and correct the information
within the 30 days, or delete the information.
Because this deadline is very difficult to make,
often the late payment report is simply deleted
off of the credit report. This procedure is very
slow and time-consuming, and you can either do
it yourself or hire an agency to do it for you.
Each letter should only request one change,
otherwise the credit bureau will usually declare
the request to be frivolous and thus they are
not required to do anything. Each letter should
be written to all three credit reporting
agencies. These agencies, Equifax, Experian, and
Trans Union, all have PO boxes specifically set
up for complaints, but they change the PO Boxes
often to make it difficult for customers to
find. Every month you, or the agency you have
hired, should send out another letter referring
to a different mistake in your credit report.
After many months, your credit report will show
many fewer late payments, perhaps even none, and
your credit score will have improved
dramatically.
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