June 18,2009
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Fixing Your Credit, Pt.4
After the Investigation.Credit bureaus are required to provide you the investigation results in writing along with a new credit report if there was a change. Once the item has been changed or deleted, for example a credit card account that did not belong to you, the credit bureau cannot put the information back in your file. If the organization that reported the information, such as the credit card company, provides documenta- tion that the item is valid, the credit bureau must send you written notice to that effect. The notice must include the name, address, and phone number of the credit card or loan company. The law also requires that credit reporting bureaus send the corrected information to anyone who requested your report in the past six months. Lastly, if the dispute was not resolved, for a small fee, the credit reporting bureau will include a statement of the dispute in your file.
Now that you have cleaned up your credit report, managing your financial responsibilities is critical. Some things to work on are credit card balances. Keeping your balance less than 30% of the available credit, will increase your score. Of course, to obtain the highest possible score, you should pay off the balance in full each month. If your credit card company has reduced your limit or increased your monthly payment, try negotiating a lower interest rate to help you reduce your debt faster. Be cautious when closing accounts. Closing an account with a balance especially if it is one you have had for a long time, could end up doing more harm than good. Credit bureaus consider the length of time an account is active in determining risk.
Lastly, pay your bills on time! Late payments are very damaging to FICO scores. The best way to protect yourself is to arrange for auto payments on all credit cards and loans. Most financial institutions offer online payment where payments can even be scheduled in advance. Some offer to send email or text messages to remind customers payments are coming due. Additionally, allowing disputed items to go to collections will only lower your credit score. Take care of those medical and phone bills before they go to collections. Repairing your credit takes time and effort. With diligence and patience, it can be done. Take the first step by getting that free credit report today!