By HILARY JOHNSON
TYPES OF CREDIT MISTAKES TO FIND
While mistakes do happen, that does not mean that they are irreversible. The following are some of the most common mistakes you will find on your credit report that should be reported to the credit bureau. You should report these to have them removed.
Remember, it only takes a few minutes to scan your credit report, but looking at the details is where you will find most mistakes. Take the time to go through your credit report with your spouse, if you have one, to ensure that the information being report is accurate, even with their usage of credit that is potentially in your own name.
Incorrect Account Information
One of the largest problems that individuals have with their credit report is information on it that is simply not accurate or does not seem to be their own. Depending on how long you have had credit, you may not remember all of the credit lines you have.
For example, you may have signed up for a store credit card ten years ago and never used it. As mentioned earlier, older accounts that have no bad information on them (such as late payments, collection activity) should not be removed from your account. This is especially true of open, but not used credit accounts. These establish the length of time you have had credit, which is a good thing for most credit scores.
Look at the accounts closely. Is the following information correct:
Is the account one that you have opened? If not, and it has a balance, report it to the credit agency. Follow up with the company about the account.
Is the account listed providing the right balance information? The account may be on a list up to two months behind the current balance since lenders report only one time per month on the account.
Is the information on the credit limit, credit type, lender, and account holder correct? Your monthly payment may not be accurate, which could stop some lenders from lending to you down the road.
Is the payment history accurate? Without including the last two months, is the past payment history right? Are the payments listed as late that are not? This should be in the report if so.
Is there any other information being reported that is inaccurate?
This could be collection activity, judgments, information about bankruptcies that is incorrect, or other information. These should be in the report.
Missing information is also possible. In most cases, this is not a problem as no information does not necessarily hurt your credit history. Still, there will be times when you want the most accurate representation. If the account has the wrong opening date, consider reporting this.
Go through each of your credit accounts to find out what is incorrect on them. Report problems through the steps outlined in the next blog or CLICK HERE for a FREE copy of my ebook
Old Notations on Accounts
Another potential problem you may notice on your credit report is information that is old. There is a lot of information available about old debts, accounts, and inquiries that are on your credit report. What should be there and when should it just fade into the past?
While many people would say that you should pay all your debts, it is important to note the legalities of paying debt. If you have a debt that goes unpaid for seven years, and the lender has not made any communication with you over that seven year period, you legally are no longer responsible for the debt. In addition to this, debts can remain on your credit report for up to seven years.
After that point, it should fall off your report forgotten, unless the debt is active, such as a credit card account you are still using.
What is important to know about this is that if there is a debt being reported on your credit report where there has been no activity for a full seven years, it should be removed from the report, especially if it is unpaid debt. If you have a credit card that has a good record of accomplishment, but you have paid it off and no longer use it, this can again serve as a good history for your credit usage and should be in place.
Old marks on your credit report should automatically be removed, but this does not always happen. In the cases where it does not, it is up to you to have it taken off. Here are some notes to keep in mind:
Old debt unpaid where there is no communication with you should have removal after two years.
Old credit accounts should disappear after two years, though some with good credit history may remain longer (and that is good!) Bankruptcies and judgments passed against you will remain on your credit report for up to ten years. These cannot have removal until after that time.
You have the right to dispute claims that you find that are older than allowed to be. This can be an important tool for improving your credit report, especially if the older accounts have negative marks on them.