Towards a Better Credit Report Now that you know what kind of damaging information will stay on your credit report and pull down your credit score, it is up to you to make your credit report better. Most of the time, the negative items are the result of your own actions so the only way to avoid these from appearing in your credit record is through sound financial management.
Managing your money is easier if you follow a budget and live within or below your means. It means using your credit card only for important purchases but making sure that the balance is paid off at the end of each month. It’s about cutting off the unnecessary expenses and setting money aside each month for savings, emergencies, the kids’ college education, among other things.
If you are already in hot water and are having a difficult time meeting your obligations, it’s a good thing to talk to your creditors early so they can help you develop a repayment plan that’s more affordable for you until your financial situation gets better. Debt counseling sessions will also give you more ideas on how to solve your present money problems and hopefully avoid bankruptcy which can really pull down your credit score.
But there are other times when the negative item on your credit report is inaccurately reported by your creditor or collection agency. If you are absolutely certain that there has been an error, do not hesitate to dispute it with the credit bureau. Document the dispute process by sending communication through registered mail with return receipt requested. Make sure you have all the documents you need to support your claim and send copies (keep the original) to the credit bureau.
The cases of identity theft have also grown in the last few years. Once your Social Security number, date of birth, and other personal information have been stolen, identity thieves can use it to open a new credit card account under your name, drain your bank account, and do other fraudulent transactions that will not only ruin your credit rating but also get you in trouble with the law.
Always protect yourself from identity theft by seeing to it that your wallet or purse is kept safe at all times, by not carrying your Social Security card around, and shredding statement
of accounts, charge receipts, and other documents which contain your personal information before putting them in the trash. If you feel that you have been a victim of identity theft, be sure to put a fraud alert on all credit reports from the major credit bureaus. This will prevent the thief from operating further. You should also close the accounts that you believe have already been tampered or have been opened under your name. Notify the security or fraud department of the bank or credit card company before you close the account. Finally, be sure to report the incident to your local police and the Federal Trade Commission at http://www.ftc.gov/idtheft. You can also call FTC at their toll-free Identity Theft Hotline at 1-877-IDTHEFT (438-4338); TTY: 1866-653-4261.
Be sure to check your credit report regularly so you can regularly monitor the accounts and activities there. Deal with any suspicious activity right away. Don’t immediately share personal information with people you just know as identity thieves are very good at convincing people that they are from a legitimate company or even from government agencies.
With financial management and proper vigilance on your part, you can go on your way towards building a better credit report.
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