GULFSIDE MORTGAGE INC, CHRISTOPHER LADD HARKER, BROKER |
BACK page BACK page
FREQUENT CREDIT QUESTIONS Q. What are Credit Bureaus and how do they work?
A. There are three of them: Equifax, Experian, and Trans Union. These three private, for profit, credit bureau businesses, have computers and files and they collect and store all the credit information in this country. Overall 1000 smaller, local credit bureaus that are also private, for profit, credit bureau businesses, that also have computers and files and they collect and store all the credit information in there geographical area. These 1000 companies affiliate with and contribute their information to one of the big three Credit Bureaus. The big three credit bureau companies are competitors and do not share information. Some lenders and creditors report information to one of these systems, and sometimes they report to two or all three. To get all your credit information, you must check all three credit bureaus. (this is changing in couple years or so)
Q. What type of information do Credit Bureaus collect and sell?
A. They collect and sell four basic types of information:
- Identification and employment information: Your name, birth date, Social Security number, employer, and spouse's name are noted routinely. The consumer reporting company also may provide information about your employment history, home ownership, income, and previous address, if a creditor asks.
- Payment history: Your accounts with different creditors are listed, showing how much credit has been extended and whether you've paid on time. Related events, such as the referral of an overdue account to a collection agency, also may be noted.
- Inquiries: Consumer reporting companies must maintain a record of all creditors who have asked for your credit history within the past year, and a record of individuals or businesses that have asked for your credit history for employment purposes for the past two years.
- Public record information: Events that are a matter of public record, such as bankruptcies, foreclosures, or tax liens, may appear in your report.
A. There are three of them: Equifax, Experian, and Trans Union. These three private, for profit, credit bureau businesses, have computers and files and they collect and store all the credit information in this country. Overall 1000 smaller, local credit bureaus that are also private, for profit, credit bureau businesses, that also have computers and files and they collect and store all the credit information in there geographical area. These 1000 companies affiliate with and contribute their information to one of the big three Credit Bureaus. The big three credit bureau companies are competitors and do not share information. Some lenders and creditors report information to one of these systems, and sometimes they report to two or all three. To get all your credit information, you must check all three credit bureaus. (this is changing in couple years or so)
A. They collect and sell four basic types of information:
- Identification and employment information: Your name, birth date, Social Security number, employer, and spouse's name are noted routinely. The consumer reporting company also may provide information about your employment history, home ownership, income, and previous address, if a creditor asks.
- Payment history: Your accounts with different creditors are listed, showing how much credit has been extended and whether you've paid on time. Related events, such as the referral of an overdue account to a collection agency, also may be noted.
- Inquiries: Consumer reporting companies must maintain a record of all creditors who have asked for your credit history within the past year, and a record of individuals or businesses that have asked for your credit history for employment purposes for the past two years.
- Public record information: Events that are a matter of public record, such as bankruptcies, foreclosures, or tax liens, may appear in your report.
Q. What is a Credit Report?
A. A Credit Report ( also called a credit file disclosure), prints out all of the information in your credit file maintained by one of the Credit Bureaus. They are given to you and to third parties, such as a lender or employer or service provider like an insurance company or bank. A credit file disclosure also includes a record of everyone who has received a report about you within a certain time period. There is a screening so that not all third parties receive all information. For example, your medical account data is suppressed for a third party considering you for a home mortgage.
Q. What are the benefits of having a good Credit Rating?
A. Everything you do winds up in a Reporting file. WHY? Businesses and persons find themselves required, if they are prudent, to PAY MONEY for it. It cost much money to hire people, and provide services to people (such as loaning them money). So it is wise to learn somethings about them before you take this financial risk. When the Reporting files have favorable things to say about you, you can get credit cards, loans, cars, furniture, jobs, mortgages, bank accounts, home and health insurance, and all the rest. But while you might not necessarily be denied these things, people just like to know if you been sued, arrested, bankrupt, fired, and in the habit of never paying your bills. As far as a home mortgages go, having good credit means lower interest rates and lower interest rates mean smaller monthly payments.
Q. What is the Fair Credit Reporting Act?
A. The Fair Credit Reporting Act (FCRA) promotes the accuracy, fairness, and privacy of information in the files of the nation's consumer reporting companies. The FTC enforces the FCRA with respect to consumer reporting companies. Recent amendments to the FCRA expand consumer rights and place additional requirements on consumer reporting companies. Businesses that provide information about consumers to consumer reporting companies and businesses that use credit reports also have new responsibilities under the law.
Q. What is a credit score, and how does it affect my ability to get credit?
A. Credit scoring is done by computers in a second. Creditors use this to quickly and reliably determine whether to loan you money and how favorable the terms will be.
Data about your credit experiences, such as the number and type of accounts you have, late payments, how much outstanding debt, and about you such as your pesonal profile, are plugged into a computer's statistical formula, and out pops a number that purportedly predicts how likely it is that you will repay a loan and make the payments on time, or skip town. And now the trick. You can get your report for free which does not tell you if you will get the loan, but you must pay money to get your scores.
Q. How can I figure out which of the 1000 Credit agencies has my data?
A. When an application is denied because of information supplied by a certain Agency, the creditor that denied the application must provide you with the name, address and telephone number of that Agency. When you have moved around the country as is so often the case these days, and you are wanting to just check for possible problems, then you can find the Credit Agencies for different cities in the phone book. The danger in letting possible problems go untended is: you can get an all clear from the big three agengies and then at the last minute, this thing that you did not even know about, becomes uncovered from some city where you lived five years ago and the Lender wants it removed.
Q. How many years can the Credit Agencies report unfavorable information?
A. Seven years usually, but there are exceptions:
- Bankruptcy information for 10 years.
- Information reported when you apply for a job with a salary over $75,000 has no time limitations.
- Information reported when you apply for over $150,000 worth of credit or life insurance has no time limitation.
- Information about any lawsuit or judgment can be kept for over seven years if the statute of limitations goes beyond seven years.
- Information about criminal convictions has no time limit.
Q. How about a report that is inaccurate?
A. Tell the Credit Agency. The agency may have a free phone number, or when you go in person, they are usually very friendly and helpful. They have paper work for you to fill out and please be very specific. And you contact yourself the creditors you are referring to in your complaint. After the agency investigates, they will fix it, and a corrected consumer report will be sent to you, and if you want, to anyone who received your report in the past six months or for job applicants in the past two years. If the agency will not change your information, they must include your version of the disputed information in your file and in future reports. You will fill a form for this and this is very useful and free.
Q. Our Credit reports do not have several creditor accounts that we have, and we are confused about why these accounts are not listed.
A. Your Credit file will not always list every creditor account you have. For example, often accounts for gasoline, travel, entertainment, credit unions, retailers, and bank cards are not included in your file. And it may (not always) be helpful for you to have these listed. If you are having weeker credit due to not enough credit use history, ask the Credit agency to list these accounts in future reports. They are not required to, but they often will.
Q. What right do I have to know what's in my report?
A. You have the right to know what's in your report, but you have to ask for the information. The consumer reporting company must tell you everything in your report, and give you a list of everyone who has requested your report within the past year - or the past two years if the requests were related to employment.
Q. I understand that under Federal Law I get free reports. How do I get them?
A. The three nationwide consumer reporting companies are using one website, one toll-free telephone number, and one mailing address for consumers to order their free annual report. See Chris's section on FREE CREDIT REPORTS.
Comments(0)