Credit Reports & Credit Scores
Presented by
Consumer Credit Counseling Service
What We Will Cover
Credit Reports and Credit Scores What they are and how they are developed. Understanding the Reports – How to read them and why they are important. Acting On the Information In Them – What do to to maintain, correct, or improve the information.
3 Major Credit Reporting Companies
Equifax – www.equifax.com Transunion – www.transunion.com Experian – www.experian.com
800-685-1111 800-888-4213 888-397-3742
Free if denied within last 60 days 8.00/8.50 if through them for single report from one company Can also purchase trimerge reports that combine info from all three onto one report.
Free Credit Reports
New law : one free copy of credit report from each of three credit bureaus every year.
www.annualcreditreport.com 1-877-322-8228
Annual Credit Report Request Service
P O Box 105281, Atlanta, GA 30348-5281
Credit Score does not come automatically with the free report.
Information on a Report
Identification & employment info Account information & payment history Inquiries from creditors/potential employers Public record
Sample credit report CREDIT BUREAU REPORT ----------------------------------------------IDENTIFYING INFORMATION Public, Joe 15 Any Street 325 Broad St. Someplace, USA 55555 Sam’s plumbing Welder Nice City, America 33333 03/15/52 222-22-2222 -----------------------------------------------------------------------------------------------------------Trade Line information
Industry Bankcard Auto loan Retail Retail Mortgage Date reported 05/03/92 05/03/01 04/24/00 04/05/02 06/05/99 Acct. Number High credit Balance Current rating Historical delinquency $5000 Current 90 – 5 yr ago $15,000 $9750 Current $2500 $1200 30 days $800 $700 Current $125,000 $115,000 Current
-----------------------------------------------------------------------------------------------------------Credit Inquiries Date Industry 12/04 Bank Date 5/04 Industry Auto finance Date 01/04 Industry Retail
-----------------------------------------------------------------------------------------------------------Public Record / Collection Items 7/03 collection $450 8/04 judgment $1500 Paid 12/0402/05 collection $250
Disputing Information
Fair Credit Reporting Act The Dispute Process
Put it in Writing – to CRA and creditor in question CRAs must investigate – within 30 days
Must delete what they can’t verify Must correct inaccuracies Must report back to you
Accurate Negative Info
Negative account information will be reported for 7 years. Bankruptcy info – 7-10 years. Criminal convictions info – no time limit Defaulted student loans, judgments on loans, and lawsuits can be listed longer.
Opting Out
Credit Card Solicitations
call 1-888-5-OPT-OUT (567-8688) Stops credit bureaus from selling your name Takes you off lists for two years
Do Not Call Registry
Stops telemarketing solicitations Register at “www.donotcall.gov” or 1-888-382-1222 Phone number valid on list for 5 years
Credit Scores
A number developed from a calculation using the info from your credit report. Most widely used is the Fico Score, also knows as Beacon Score Ranges from 300-850. The higher the score, the better risk you are determined to be and the better rate you will be eligible for.
Five Ingredients of a Fico Score
Credit Score Ingredients
types of credit 10% payment new credit history 10% 35% amounts ow ed 30% length of credit history 15%
Range of Credit Scores
1% up to 499 5% - 500-549 8% - 550 – 599 12% - 600-649 16% - 650 – 699 19% - 700-749 28% - 750-799 11% - 800+
Improving Your Score
Pay bills on time Keep balances low Pay off debt Apply for & open new lines only when you need them. Check your credit report for accuracy and clear errors as soon as possible.
Putting Your Credit Report to Work For You
Tool to assess and improve credit-worthiness Acts like a report card Helps you create a goal focused plan:
Correct incorrect info Start paying bills on time Reducing debt Preparation for a meeting with a lender
Your goal? Successful loan application at lowest cost to you possible.
More Information
CCCS 1-800-355-2227 www.cccservices.com Federal Trade Commission www.ftc.gov Consumer website for credit scores www.myfico.com