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Credit Repair Increases Your
Chances Of Getting A Loan
by Blane Russell (c) 2002
Anytime you apply for a loan with any type of lending
institution your credit report comes into the picture.
This report is an overview of your credit history that
contains past and current accounts, payment history, and
balances. The credit report is a primary tool used by
lenders to determine the level of risk they take when
extending you credit.
For many people, the credit report is just a formality.
But for over 65% of the population, it can mean the
decline of their loan application. Why? Because their
report shows negative, misleading or inaccurate entries.
Viewing Your Credit Report
Practically no one reviews their credit report as often
as they should. If you have not read yours within the
last year, it is strongly advised that you do so now.
Simply contact your local credit bureau, and request
that a copy of your credit report be mailed to you. You
can find agencies in the yellow pages of your local
phonebook listed under "credit bureau." There
is normally a small charge for generating and mailing
you the report.
Once you receive the document, review it carefully. Look
for negative, misleading, or inaccurate information. If
you find entries like these, you have the full right to
dispute them and have them corrected or removed.
Repairing Your Credit
The process of changing your credit history is often
referred to as "credit repair." To start,
write a letter to the credit bureau stating one
discrepancy in your report. (Your credit-reporting
agency will correct only ONE item at a time.) Request
that they investigate the entry and provide you with
proof of its accuracy. Do the same with each additional
incorrect or negative item.
Should the bureau not be able to prove that the entry is
accurate, it will be removed from your report. Likewise,
if the agency is unable to prove the entry within a
"reasonable" amount of time, it will be
removed.
Because these agencies are extremely busy, it is always
wise to correspond with credit bureaus via registered
mail, return receipt requested. This service is
available from your local post office.
In addition to repairing actual entries to your report,
you can also improve it by:
* maintaining your employment and residence status for
at least TWO years.
* not carrying your credit card balances near, at, or
over the credit limit.
* paying your minimum payments on time and in full, as
required by your monthly statement.
Each of these actions proves stability - something
lenders specifically look for on all applications.
Often times, your credit report can be greatly improved
simply by disputing items that are misrepresented or
misleading. With a little attention and legwork, you
might be able to significantly increase your chances of
getting a loan.
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