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Free Fico Scores
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Getting Your Credit Score - Among others, Equifax as well as Fair, Isaac & Co. (FICO) now offer consumers access to the one time secret credit scores and credit reports.
What is a credit report?
A credit report is a summary of your financial reliability for the most part, your history of paying debts and other bills. Itis prepared by credit bureaus primarily for use by lenders, employers and others who, under the federal Fair Credit Reporting Act, have a legitimate need for the information.
The wealth of information gathered by credit bureaus, coupled with the speed of today's computer systems, explains why consumers can quickly get loans and other services, like free fico scores including approvals of certain credit applications in minutes.
What is in my credit report and free fico scores?
In general, your credit report has four components:
- Identifying information, such as your name, Social Security number, current and previous addresses, telephone number, birthdate, and employer. This information helps ensure that your credit report is accurate and doesn't mistakenly include details about another person (perhaps someone with the same name).
- Public record information, generally gathered from local courthouses, including bankruptcy records, foreclosures, tax liens, court-ordered payments, and late child-support payments. This information is used to determine if you have previous defaults or legal judgments against you. For example, a mortgage lender will want to know if you've had a past foreclosure before granting a home loan.
- Derogatory information can generally remain on your credit report for up to seven years, except for bankruptcy information, which may be reported for 10 years. Other credit history information, such as a list of your credit cards and loans, and whether payments were on time. Here, too, negative information about your credit relationships, such as late payments or defaults, will remain on your report for up to seven years, and bankruptcy information may appear on your report for 10 years.
- Inquiries, a section of your report that lists the creditors, insurance companies or other parties that have requested your credit report, usually when considering an application you submitted. Inquiries typically can remain on your credit report for two years.
What is NOT in my credit reports or in my free fico scores?
Your credit report typically does not contain information about your checking and savings account balances, brokerage accounts, medical history, race, sex, religion, national origin, or your driving record.
How do credit bureaus get their information for free fico reports?
According to David Lafleur, a Policy Analyst at the FDIC, Lenders voluntarily supply the information to credit bureaus on an ongoing basis; no federal laws require companies to submit the data. Why? Because having access to current and reliable information about you helps lenders make informed decisions and offer you financial products and services very quickly. Lenders, landlords and other users of credit reports also may want to know about events such as lawsuits and bankruptcies, so credit bureaus obtain this information from courthouses and public records.
Can anyone get my credit report and free fico scores?
The Fair Credit Reporting Act contains rules about who can get your credit report and free fico scores. Generally, a third party can access your credit report when considering an application you've made, such as for a loan, a job, insurance or an apartment.
The law also allows entities to access your report as part of an ongoing business relationship many also look at your free fico scores. Suppose you already have an auto loan at the bank and you miss a payment or you move and don't provide a forwarding address. In this situation, the bank has the right to obtain a copy of your latest credit report.
But even if you are paying on a loan or credit card as agreed, the institution where you have the account can obtain your credit report as part of its regular maintenance of the account, and that includes looking for warning signs that you may have problems fulfilling your obligations in the future.
For example, it is not uncommon for credit card issuers to review their cardholders credit reports and free fico scores on a regular basis and raise their APR (annual percentage rate) or lower their credit limit if there are signs of trouble, even if someone has been diligently paying the card issuer.
An exception to the ongoing relationship would be for employers who would first need to obtain the employee's permission each time before requesting a credit report.
How can I get a copy of my credit report and free fico scores?
First, be aware that there is no one credit report on you. Most likely, each of the three major credit bureaus that operate nationwide Equifax, Experian and TransUnion has a credit report on you.
And because the credit bureaus can have different information and findings, many experts advise you to obtain your report from each of the three major credit bureaus.
As of Dec. 1 2004 you are entitled to a free copy of your credit report each year.
How often should I get my free fico scores and credit report?
Many financial advisors suggest that you review your credit report for inaccuracies or omissions about once a year. It's especially important to review your credit report before making a major purchase, such as a home or a car, so you can correct an error before it slows down your credit approval or prevents you from getting the best possible loan terms.
What kinds of problems could I encounter?
While federal law requires lenders and other companies providing information to credit bureaus to give accurate information, mistakes do happen. So, when you look at your report:
Make sure it accurately reflects how you have paid your bills. If you always pay your credit card and other loans on time, but your credit report erroneously shows late payments, you'll want to correct that.
Verify that all the accounts listed are yours, especially if you have a common name or you share a name with a relative (such as John Doe, Jr.). You also want to be careful that an identity thief hasn't opened new accounts in your name to commit financial fraud.
Look for accounts you don't use and may have forgotten. You may be able to raise your credit score by closing unnecessary credit card accounts.
How do I correct wrong or incomplete information in my credit report?
The FCRA gives you the right to dispute inaccuracies or omissions, and it requires credit bureaus to investigate your complaint (generally within 30 days), send you a prompt response and correct any errors.
The law also requires the source of inaccurate information (such as a bank) to correct the record at the credit bureaus to which it initially provided the erroneous information.
You can follow the same proven tips and techniques used by debt elimination and credit repair specialist to eliminate your debts and build the credit rating you really deserve! Start Repairing Your Credit, Today!
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