12 SATURDAY, MARCH 22, 2014 REAL ESTATE WEEKLY
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Your credit: 5 important things to review By Becky Frost, Experian Consumer Services
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s a prospective home owner, you may find yourself paying closer attention to your credit. And rightfully so. A home can be one of the most important investments you’ll make during your lifetime. Home ownership is still the American dream for many. A home can become a part of your family’s story. Applying for your home loan Your lender will want to know as much about you as possible before approving your loan application. Before lending money, lenders want to make sure that you meet their credit risk guidelines. This is why it’s so important to check your own credit report ahead of time. What are the elements that make it a good report? What are the elements that may have lowered your score? Remember, what you see on your credit report is what potential lenders may consider when deciding to offer you a loan.
credit; it’s a snapshot that anyone with permission can review. You might say it reveals the state of your credit’s health at any point in your life. For your own viewing Your credit is a snapshot Think of your credit report purposes, your credit report as a snapshot of how you is an excellent way to tell if take responsibility for your you’re making good financial decisions that could affect where you work, ĹŒ play and live. There are 70 5 '0 12 certain types of information on your credit report that you should pay close attention to. These are
areas that potential creditors will examine when checking your credit # " " & $ report to determine if & & " & " " " you’re a good credit risk. • Personal Infor " " mation – Credit reports & % & ' $ contain basic information " "
about who you are. This information can include your full name along with variations. Your current address, along with past
addresses, will be included. And additionally, your Social Security number, date of birth, spouse’s name and current or previous employers can be included as well. Verifying your own personal information is critical. • Your Current Accounts – These accounts may include vehicle loans, mortgage loans or credit cards. These accounts will appear on your credit report as either in good standing or delinquent if you’ve made late payments that the creditor reported to the bureaus. Examine your account information to make sure it reflects accurate information about when your accounts were opened and activity that took place. • Your Closed Accounts – Even after you’ve closed an account, information about
it can appear on your credit report. Different information will stay on your credit report for different lengths of time. These past accounts, along with current accounts, are a glimpse into your credit history and demonstrate your reliability to pay back loans. • Negative Information – Negative items may include past due accounts, bankruptcies and court judgments. These items can harm your credit score and give potential lenders an impression that you may not be a good credit risk. • Credit Inquiries – As part of a lending-approval process, potential lenders will check your credit report; this type of inquiry is called a “hard inquiry.â€? A “soft inquiryâ€? is when you review your own credit report to view what’s included on it.
These soft inquiries won’t impact your credit score. Hard inquiries can, especially if there are too many in a short length of time. Your credit report captures your financial behavior. By examining it on a regular basis, you can make better-informed financial decisions. Negative or incorrect information can impact your credit score — which, in turn, can impact your present and future ability to secure future credit at the most favorable rates. Whether you’re just starting out in life, or have been around the block a few times, having good credit is essential to securing the things in life you want at a good rate. Becky Frost is a Senior Manager of Consumer Education for Experian Consumer Services that offers credit monitoring products.