December 26,2008
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Fixing Your Credit Report, Pt.2 –
– Free Credit Reports.To use the on-line method, simply access the ‘www.annualcreditreport.com' site. You get to choose from the three major bureaus and will be routed to that bureau's secure site next. There, you'll be confronted with some security levels (not sure why so extensive). For the credit card category, you'll be given a list of only the names of some credit card accounts you've held. From the list of maybe eight accounts, you'll be challenged to provide full credit card numbers of three from the list. If you pass this first level, you'll probably be confronted for a higher level by a shorter list of accounts you haven't responded to thus far and be asked to provide full credit card numbers from a shorter list. Once you've fulfilled the qualifications of this security technique you'll receive a downloaded copy of your report from the bureau you chose at the beginning. Be sure and save it because you've just used your only annual freebee from this provider.
While skimming through the many pages, it will help to understand what to look for. Basically there are five categories to consider. The overall purpose, of course, is the projected calculation of your credit worthiness for credit card and other loan offers. The points that matter most are:
1) The history that's been compiled about you – not only credit cards, but all major forms of credit usage you've been involved in.
2) How long you've been using these credit accounts.
3) How indebted you were at last reporting.
4) The various types of these accounts (ie. Credit cards, home mortgage, car loans, etc.)
5) How active you've been in pursuing of new credit cards and other forms.Various ‘importance weighting factors' are assigned to each of these categories when deriving your overall score. The most commonly used rating by the credit card industry is your ‘FICO Score'. This score ranges between 300 and 850 with the higher score being the better. Standards have recently tightened to where 700 is considered the minimum and the low 800s is considered good. Not so long ago, the standards were lower, but a good FICO rating is becoming increasingly more important.