Your Credit Report Affects Your Home Buying Ability
It is no longer just your mortgage lender who looks at your credit report. Any person or company wanting to sell you something may want to look, even potential employer. Now, credit card companies, car dealerships, land lords and perspective employers may all want a glimpse. An issue on your credit report may interest points on your mortgage, or even cost you a job. In order to protect consumers, Congress enacted the Fair Credit Reporting Act (FCRA) in 1996 with updates since then.
FCRA Regulates the Use of Credit Reports
FCRA only give access to your credit reports when you give permission. In fact, the law requires if you are denied a job due to information on the report, you must be informed of the specific reason. If you are denied a loan due to information on the report, you must be told which company produced this negative report. This gives you the opportunity to correct any mistakes that may be on the report.
FCRA Gives Consumers the Right to Dispute Mistakes or Errors
In order to correct the issue you must go to the credit reporting agency and the company or person that put in the negative report. This often takes a long time to get these corrections made. You will want to check with the other reporting agencies at the same time and make sure they begin the process of correction as well. The credit reporting bureau will investigate the issue. Once they concur that there is a mistake or error, make sure that the item is removed from your credit report. Keep copies and dates of every in case something gets lost so that you can reinitiate the process if necessary.
What to Do About Negative Information on Your Report
Negative information can only be left on your credit report for 7 years. If you find a forgotten debt, take the opportunity to pay it off, which will go a long way with lenders. Finally, keep tabs on how long negative information is left on your report, once the seven years are up, you will find getting loans will come much easier. If you have too many credit cards but are not using them, that can give you a negative score. Close accounts of any cards that you don’t use. It may take a while for these changes to be reflected on your credit report.