The term “credit monitoring,” taken at its simplest definition, is the act of keeping tabs on your credit report. The major reasons all consumers should monitor their credit on a regular basis are as follows:

• Mistakes: credit monitoring allows consumers to be aware of mistakes made by creditors that impact their credit. It is surprisingly easy for a creditor to make a small mistake that will affect your account with them – and your credit – in a big way. Your payment, made on time, might be accidentally delayed in a bank’s labyrinthine systems, causing it to be applied to your account late. Or the same convoluted system may apply your payment to the wrong account of even lose it altogether. In this situation, late fees are the worst of your worries. One late payment can knock serious points off a credit score. Depending on the loan terms, this might even cause the account to default. Finding out about mistakes early through credit monitoring allows consumers to dispute them early and gives much better odds of winning the dispute.
• Fraud: one lost or stolen credit card that ends up in the wrong hands can mean enormous debts in no time. The only thing worse would be the theft or accidental loss of a card that you forgot about. Without regular credit monitoring, it could be quite a long time and a lot of credit report ruining charges mounting. Regular credit monitoring can catch this type of credit fraud quickly, allowing you to cancel the card and clear up the issue with the credit card company. In the event of credit cards being used by criminals, regular credit report monitoring can mean the difference between a no loss at all and the loss of thousands.
• Identity Theft: this is like credit card fraud, only worse. Instead of filching your credit card or finding a charge plate you have misplaced, identity thieves actually use your personal information to open new lines of credit on the premise that they are you. This isn’t using a pilfered credit card to buy some clothes and television sets. This is using your credit and identity to buy cars, open sizable personal loans, apply for multiple credit cards and much more. Unchecked, identity theft can absolutely destroy your credit rating. The longer it goes on, the worse it gets. Obtaining a copy of your credit report on a regular basis is a sure way to protect yourself from identity theft. If you can check your credit monthly, you’ll see these new, unfamiliar accounts and be able to take action. With today’s technology, subscribers to the major UK credit reporting agencies – Experian, CallCredit and Equifax – can access their credit any time online. Imagine checking your credit report online every day. The crooks wouldn’t stand a chance!
• Overall credit health: even if you haven’t been the victim of banks’ mistakes or criminal fraud there are still great reasons to monitor your credit regularly. With regular credit checks, you can keep a close eye on your existing accounts and how they affect your credit score. A regular credit report can help you track trends. Is your credit score declining? Maybe you’re spending too much on a card or two or not paying enough monthly. Keeping tabs on your credit can assist you in maintaining good credit by giving you an excellent tool to manage existing credit. A regular credit check will also help you make purchasing choices. IS now the time to apply for a home mortgage or new car loan? A quick credit check can help you decide before you fill out that loan application.

The major credit agencies in the UK offer various products for monitoring your credit. They can be do-it-yourself services like a one-off reports whenever you feel like you need one, or advanced subscription products that allow consumers to get reports on demand, in writing or online, any time of day or night. These credit reporting agencies also offer proactive monitoring solutions that monitor your credit for you and notify you of changes made by you – or others. Depending on the service you select, the agency will notify you of suspicious activity like sudden large charges or charges made far from your residence, and other activities possibly related to fraud. Other options include services that actually contact you when accounts are opened, blocking retailers and banks from allowing lines of credit to be opened until you give verbal confirmation. Regardless of whether you choose to monitor your credit yourself or if you subscribe to a service like these, it is crucial that every consumer monitor their credit regularly. It is the key to perfect credit health.

In the past, the best a credit consumer could do was write to their credit reporting agency of choice of give them a call and pay for a copy of their latest credit report. Doing this on a regular basis in order to properly stay on top of credit issues would turn into a time consuming chore rather quickly. That changed when the major credit reporting agencies realized that they could be more profitable if they extended a greater range of services to borrowers and everyday consumers.

Equifax, Experian and CallCredit have expanded the scope of what credit reporting agencies can do, becoming full service providers designed to cover all of a customer’s credit related needs. The big three credit reporting agencies in the UK now offer evolved services such as subscription based products for customers who want a more frequent look at their credit report, credit monitoring services that notify consumers about several degrees of credit-related events, fraud insurance to cover expenses if a customer if a victim of identity fraud of other credit related scams, fraud resolution services, email and SMS alerts and much more.

Services offered by Experian

Experian offers a single product aimed at consumers who want a finer degree of control over their credit activities. It is called “CreditExpert” and it costs £14.99 monthly. This £14.99 will get you a range of valuable services, all aimed at maintaining credit health. These services are:

• CIFAS Registration: in the event your credit cards are stolen of lost, Experian will automatically register your information with the Credit Industry Fraud Avoidance System. This means lost or stolen credit cards are flagged and will alarm retailers if anyone tries to use them to make fraudulent purchases.
• Instant Credit Report: credit reports are sent to your computer via email or even to your phone by SMS message.
• Fraud Resolution: Experian will provide you with your very own fraud resolution specialist who will work with your creditors to mediate disputes and make things right in the event of fraud.
• Fraud insurance: the CreditExpert product provides customers with insurance coverage to help with costs related to credit fraud, such as lost earnings, the cost of replacing important documents and more.

Services offered by Equifax

Unlike Experian’s “one size fits all” approach offered by Experian’s CreditExpert program, Equifax offers a variety of a la carte services so clients can pick and choose which credit assistance solutions are right for them. Some of these services are:

• Credit watch: this is a credit reporting product available in two levels. The silver product includes one credit report per month plus weekly updates reflecting changes. The gold level of the credit watch offering comes with monthly reports and on-demand updates.
• Identity watch: this fraud alerting offering comes in three different levels, with weekly alerts or immediate notifications of suspicious activity, depending on the level of Identity Watch purchased. The Identity Watch product also comes with a monthly credit report and discounts on related products and services from Equifax.
• Credit Report: this basic product, offered by all agencies, contains value-added options when ordered from Equifax. An Equifax credit report contains thorough explanations of your score, hints and tips to improve your rating and more.

Service offered by CallCredit

CallCredit, in a way, combines the all-in-one approach of Experian and the pick what you like approach of Equifax. Callcredit has an all encompassing product called CalCredit Check as well as a few very attractive and helpful offerings that consumers can benefit from. Here’s a summary of CallCredit’s products available to clients:

• Basic credit report: everybody offers a basic, on demand credit report, but CallCredit is by far the most economical. For only £2.00, consumers can order a complete copy of their credit report and their credit score, available either on paper or online through CallCredit’s web portal.
• CallCredit Check: this is CallCredit’s comprehensive product. It features on demand online access to your credit report 24/7, identity fraud services and theft services like alerts whenever suspicious or significant credit activity occurs, and fraud victim services like mediation in the event of fraud.
• Disassociation: when people, old addresses, companies, etc. appear on your credit report, it is a ready hassle getting them removed. For a fee, CallCredit will perform any necessary disassociation services for you. They know the ins and outs and can handle this efficiently.

All three major UK credit reporting agencies have expanded beyond the simple credit reports to offer value to customers, generate repeat customers and make a profit. If you feel you need extra credit protection, it’s up to you to evaluate the offerings from the big three and decide which value-added credit products are right for you.

The UK has three main credit reporting agencies. These companies receive varying degrees of borrower credit data from lenders, information about borrowers from voting rolls, data on court judgments, bankruptcies and the like from courts and various other pieces of data from other sources, and aggregate it all into a credit report. They the supply these reports on demand to borrowers and to prospective lenders who would like to evaluate these borrowers’ credit worthiness.

The three major credit reporting agencies in the UK are Equifax, Experian and CallCredit.

The differences between the three

Seeing three different agencies typically leads borrowers to ask, “shouldn’t I just get a report from one of them? Isn’t all my information the same?” The answer to these questions is definitely no.

Each separate agency has its own unique agreement with lenders that determines the nature of information shared. There are some lenders out there that pick and choose which credit reporting agency they do business with. Some might, for example, choose only to report to CallCredit. Others might report to all three. What this means to borrowers is that obtaining a copy of a credit report from only one of the three agencies will most likely lead to an incomplete view of credit health.

Frequency: how often should I get a copy of my credit report?

A credit report is crucial to consumers for a number of reasons:

• Prevent identity fraud
• Fix credit disputes
• Start working on repairing bad credit
• Plan for large purchases
• Negotiate for the best deal with lenders

Now, some of these reasons, such as “negotiate for the best deal with lenders” and “plan for large purchases” only happen once in a while. Knowing this, you may believe you only need to get a copy of your credit report once in a while, like when shopping for a mortgage. But consider the other factors like “prevent identity fraud” and “fix credit disputes.” The only way to effectively cover these is to et a copy of your credit report frequently, probably monthly.

Consider identity theft. If someone has opened accounts in your name and is running up credit making fraudulent purchases, is it okay to find out about this in 3-4 months? By then, damage has been done that can take a very long time to repair. If you found out about it just a few weeks down the line, it would be so much easier to resolve the issue with the credit card company and possibly even get the crooks arrested.

What if your mortgage company made a mistake and lost your last payment? If you let that sort of large default sit too long, your credit could be ruined and you might even lose your home. By getting a copy of your credit report monthly, you could find out about these issues quickly and resolve them before they destroy your credit and cause foreclosure.

Again, keep in mind how important it is that you receive a copy of your credit report frequently AND from all three agencies. Getting a monthly report from Equifax, for example, doesn’t help if your mortgage broker only reported your errant lack of payment to Experian. Getting a monthly copy of your credit report from all three of the main UK credit reporting agencies is the very best way to know exactly what your credit health looks like at all times and is vital to being at the ready to fix problems quickly.
Other services

The “big three” credit reporting agencies also have other services available to consumers outside of their regular on demand credit report services. For additional fees, these companies offer helpful services like:

• Online access: Instead of waiting, customers can log in and access their credit report online any time.
• Alerting: different services have different levels of this, but it is essentially a service where customers are notified whenever credit is opened in their name.
• Weekly updates: email notifications of status changes and other credit activity, sent on a regular basis.
• Fraud insurance: coverage in case of fraud to help cover costs of resolving issues related to fraud and identity theft. This really helps if accounts are frozen or bank overdrafts occur as a result of fraud.

A lot of loan customers in the UK find themselves wondering, “should I get a copy of my credit report?” Well, considering the fact that lenders will certainly obtain a copy as soon as you apply for a loan, the answer is most definitely “yes.” Why would anyone enter into a business agreement blind? All this does is give the other party an enormous advantage. It is absolutely vital that borrowers obtain a copy of their own credit reports. It must be the very first step before anything else. That’s right. Before even thinking about what car to buy or where your next home should be, you need to get a copy of your credit report first. There are two key reasons.

Timing and budget

The question all prospective loan customers must ask themselves right away is, “is this the right time for me to apply for a loan?” Obtaining a copy of your credit report will help answer this important question.

Many borrowers, starry-eyed by their new home or automobile, are brought back to Earth at the bargaining table when their loan is modified to suit the bank or even outright rejected because they had bad credit they didn’t know about. Understanding what’s in your credit report will combat this and will help you decide if this is the right time to shop for a loan. Why even apply if you know your credit isn’t in good shape? That only leads to rejection or unfavorable loan terms. Instead, a customer armed with a copy of their credit report can decide when the time is right for a loan or, if getting a loan is absolutely necessary, budget ahead of time for the increased interest and fees associated with a loan for borrowers with bad credit. This is only possible when you know ahead of time what your credit looks like.

If you’ve looked at your credit report and determined that now is definitely not the time to apply for a loan because things don’t look great, congratulations on a very smart business decision. But how do you fix your credit now so you’re ready next time? Bad credit can happen for two reasons and both can be fixed. One just takes longer.

Credit repair: lender mistakes

Considering the enormous number of account transactions a lender makes just on an hourly basis alone, it’s no wonder that mistakes are made. A payment you made on time could be applied to the wrong account or missed altogether, dismissed to the electronic dustbin erroneously. Another possibility is, with the number of transactions, that your payment might be applied too late. Both of these actions can result in late payments or even loan default through no fault of your own.

Borrowers who get a copy of their credit reports on a regular basis are in a much better position here, increasing their odds of catching these mistakes quickly before small errors can grow into massive, credit-wrecking loan defaults. If you notice a mistake on your credit report, here’s what you need to do:

1. Contact the credit reporting agency, either Experian, Equifax or CallCredit, who gave you the report. Let them know the specifics of what you believe the error is and tell them that this is in dispute. Tell them you are contacting the lender who reported the problem. Be sure to do all this in writing and record the details of your correspondence.
2. Assemble all paperwork that supports your case, including copies of paid bills, cancelled cheques and electronic transaction records and the serial number of the transaction, if applicable.
3. Contact the lender and notify them of the error. Be sure to support your claim with the facts from your documentation. Again, do all this in writing and keep a very detailed record of all correspondence. Keep fax receipts if you fax them your supporting data and send all mailed backup information by certified post. Keep a log of all phone calls with the full names of representatives and the exact dates and times of all calls.
4. Be sure to end all calls with a courteous thank you and a call to action, asking what the next step is. Follow up diligently until the matter is resolved.
5. Notify the credit reporting agency of the outcome of the dispute and make sure the creditor does it, too. Get a copy of your next credit report to verify that the mistake is no longer listed.

Credit repair: borrower mistakes

If the blemishes on your credit report are correct and you just have bad credit, remediation is more difficult. There is no easy fix for this type of bad credit. The best approach is to wait, pay all bills on time, and be a good credit customer from now on. Eventually, the good will outweigh the bad and your credit will be “repaired.” It’s hard to accept this in our instant gratification world, but correcting bad credit that’s definitely your fault takes time and effort.

Too many borrowers in the UK are in the dark about their credit worthiness. When making a big purchase like a new home or automobile, it’s just human nature to be more concerned about what you’re buying rather than how you’re buying it. The exciting features of that new car or the number of bedrooms that new home has are just much more important to buyers than something as dry and boring as the details of credit scores and how they affect a loan. The problem is, if your credit score is the last thing on your mind, you stand to lose a lot of money.

What does my credit score mean?

Your credit score is a number that reflects your credit history. Lenders look at this number and examine the history reflected in your credit report in order to determine four things:

1. Whether to extend a line of credit to you.
2. How much credit to approve.
3. The interest rate and repayment schedule.
4. Additional fees and, if applicable, insurance.

Of course, if your credit is so bad that the answer to number one is a resounding “no,” two through four are moot. If you do qualify for credit, your credit score determines all the terms of the loan. Stellar credit means you will get a much higher credit line with a lower interest rate and minimal fees, if any. On the flip side of this, borrowers with bad credit are determined to be a credit risk, and lenders will mitigate this risk by grant a lower line of credit, a higher interest rate and increased fees and possible loan insurance, such as mortgage insurance. What your credit score means to you is how much buying power you have and what kind of loan you can get. This directly affects the cost of the loan.

What is in my credit report?

Your entire credit history and any accounts you currently have open are listed in your credit report. This includes mortgages for homes, car loans, credit cards, personal credit agreements from banks and more. These lenders all report your balance information and payment habits. This is a very important part. Future lenders will want to know from past and current lenders whether you can pay loans on time and whether you only pay the minimum or if you can pay more. Your past history is only part of the reason banks want to see your credit report. Lenders also want to know if you are spread too thin with current loans or if you have room for more.

Your credit report also lists several negative issues, including loan defaults, bankruptcy agreements, late payments, voluntary arrangements and more. These blemishes actively harm your credit score, making it very difficult to obtain favorable credit terms, if you’re able to get credit at all.

Finally, your credit report contains personal data that is obtained from lenders and election rolls. This includes your name and other names you’ve possibly used, current and past addresses and other contact information.

Regarding payment details, keep in mind this is entirely voluntary on the part of lenders. Lenders are not required to supply full details. Some might only list defaults or late payments, not full information on payment habits. This aspect of credit reporting is entirely p to the lender.
What is not in my credit report?

Borrowers do have a right to privacy in many matters. As such, there are many things not reflected in credit reports. A borrower’s employment history is not listed in a credit report, though savvy lenders may be able to determine some employment data if past employers made credit inquiries, which ARE listed. Information about salary history and pension is not listed in a credit report, nor is information about child support payments, student loans and property ownership status.

Who are the major credit reporting agencies in the UK and how do I contact them?

The UK has three main credit reporting agencies that receive borrower data from lenders, courts and other sources, then compile this data into credit reports and supply it to future prospective lenders and to borrowers themselves. They are Equifax, Experian and CallCredit. They can be reached by telephone, email or in writing. Disputes can be files and inquiries can now be made right online.

Your credit report is your entire history of credit-related activities. Lenders and others use your credit report to indicate your credit worthiness and to gauge whether you have the responsibility needed to pay your bills.

To understand how important your credit report is, you need to see how a credit report works, how lenders obtain a copy of your report and how they use it to decide whether to extend credit to you and at what terms. All lenders, including mortgage brokers, personal loan banks, automotive financing companies, business lenders and many more consider your credit report when making loan decisions.

Credit card companies, banks and every other lender you do business with record your credit activities. These include payment frequency, amount, the number of times you may have paid late and more. They report this history to credit reporting agencies like Equifax, Experian, and Callcredit. These agencies are a resource to creditors; they provide your credit report to future creditors who are looking to determine your credit worthiness. By analyzing your credit history, lenders decide whether to extend credit, how much to give and what terms to attach to the line of credit.

Keep in mind that your credit report is also available to you, which is extremely important.

Whenever you apply for a line of credit, the prospective lender requests a copy of your credit report. Once the lender has your report, they will look at your current debt and your credit history, including bankruptcy records and court judgments if applicable. With this information, they can determine whether you can handle the burden of additional credit and whether you can pay your bill responsibly. They will also determine, based on your credit score, what terms to assign to the loan. A lower credit score not only decreases your chance of getting a loan; it also increases the rates and fees if you do get the loan.

Credit reports aren’t just used by lenders anymore, either. Now landlords looking to rent out a flat will examine your credit report for indications of your responsibility before making the decision to rent to you. It makes sense, since your ability to pay a credit card bill, for example, could be indicative of your ability to pay your lease. Prospective employers, especially in the financial sector, are increasingly looking to obtain copies of applicants’ credit reports. Employers trying to fill high level management jobs are looking at credit reports as well. Again, these groups are looking to your credit report to get an indication of your level of trustworthiness and responsibility.

Now that you see how bad credit can hurt your ability to get a loan, a job and even a place to live, you can see why getting a copy of your credit report is so important. With a copy of your credit report, you can get a feel for how credit-worthy you are before you apply for a loan. Maybe there are things you need to fix first in order to get the best terms possible. Why apply for a loan when you really should be fixing your credit first. There’s no reason to be in the dark with your credit. You should know what your credit says about you before a lender, landlord or employer does.

The second major reason to get a copy of your credit report is this: credit agencies do make mistakes. There could be errors on your credit report that you don’t know about. These errors could seriously damage your credit and you wouldn’t even know it.

Anyone in the market for a loan, a job or a rental flat should get a copy of their credit report on a regular basis. Not many things are more important than your financial well being, and a regaulr examination of your credit report will help you stay on top of your credit health.

Your credit report is essentially your credit history and a listing of your current accounts. Your contact information is listed, including any name changes and previous addresses. Your past and current credit activities are listed, including home mortgages, auto loans, credit agreements with banks and credit card companies, personal finance loans and so on. Your balances are listed and your payment habits are detailed, including frequency and timeliness of payments.

Negative factors are also listed in your credit report. These include bankruptcies, defaults, voluntary arrangements and late payments. Too many credit inquiries can also negatively impact your credit.

What data is not listed in my credit report?

Due to privacy issues, there are a lot of things that are not included on your credit report. These include your employment history, child support payments, information on your salary or pension, personal property status and student loan information.

In some instances, payment details may not appear on your credit report. While lenders do give this information to the credit reporting agencies, they may only provide it when you have made late payments or defaulted. Others will provide full details. How much information is provided varies by creditor.

Who are the major credit reporting agencies in the UK?

The names and addresses of the three major credit reporting agencies are:

• Equifax
  P.O. Box 1140
  Bradford, BD1 5US




• Experian
  PO Box 8000
  Nottingham, NG80 7WF




• CallCredit
  PO Box 734
  Leeds, LS1 9GX

Don’t all three agencies have the same information?

No. Each agency has its own agreement with each lender when it comes to how data is shared and what information they will receive. Some creditors may have no agreement with one agency at all, meaning your credit report from one agency might be incomplete. The only way to get a complete and comprehensive view of your credit health is to obtain a copy of your report from all three agencies.

Who typically receives a copy of my credit report and what do they do with it?

When you apply for credit from a lender, including mortgage brokers and credit card companies, that lender will obtain a copy of your credit report and evaluate it when deciding whether to extend a line of credit to you. They will also carefully examine your credit report as they work to figure out the terms, rates and fees attached to your line of credit. If your credit score is good and there are no outstanding issues, you will probably qualify for the loan you want with favorable terms. If you have bad credit, bankruptcies, judgments or any other blemish that would cause a lender to see you as a credit risk, they may turn down your application. If they do decide to extend a line of credit to you despite your bad credit history, they will mitigate their risk by either giving you less of a loan, attaching unfavorable terms or fees, assigning a higher interest rate to your loan or all of the above.

Increasingly, other agencies are looking at consumers’ credit reports when making decisions, too. Some employers now routinely request copies of job applicants’ credit reports, believing them to be an indicator of a prospective employee’s trustworthiness. This is becoming the case more often than not in the financial services industry, for example, where responsibility with funds is a must.

Credit reporting is also becoming an issue in the rental space. Landlords, when deciding whether to rent a flat, will check a future occupant’s credit score and history when making the decision. It makes sense, since rental fees are paid monthly just like credit card bills or auto loans. A credit report will give a landlord an indication of whether a renter has the funds and the discipline to pay rent in full and on time.

Why should I obtain a copy of my credit report?

Considering the increasing importance lenders, employers, landlords and other agencies are placing on your credit history, it’s easy to see why you should obtain a copy of your credit report on a regular basis. You need to always be aware of your credit health.

When you’re considering a loan, especially a large line of credit like a mortgage or auto loan, you need to go into the loan application process with your eyes open. This means knowing what your credit looks like and having an idea of the type of loan you qualify for before you apply. Sitting at the mortgage broker’s desk is simply not the place to finally discover that your credit is not as good as you assumed it was. Knowing about your credit ahead of time will prepare you and will put you in a good position to negotiate with lenders in order to get better terms on a loan.

Another reason to be aware of the content of your credit report is that you can repair your credit if you know you have some black marks and other issues. You may be thinking about getting a loan and then, having seen your credit score, decide it would be best to hold off. There are ways to shore up your credit and get into a better position to get a loan with more advantageous terms, but unless you obtain a copy of your credit report regularly, you won’t even know that your credit needs fixing.

The last and perhaps most important reason to get a copy of your credit report is this: you can find out quickly about any errors on your report and get them corrected. Creditors make mistakes. It is very easy for a payment to be missed, applied to the wrong account, applied to your own account but too late and more. Bankruptcies, judgments and voluntary arrangements whose terms have been satisfied may not be accurately reported on your credit report as well. Unchecked, these errors can stay on your credit report for a long time and wreck your credit score. By examining your credit report regularly, you can spot errors quickly and remediate them before they become bigger problems.

How can I repair my credit?

If your credit score isn’t what it needs to be, but there are no errors on your credit report, than repairing your credit is difficult. But it can be done. If you have too many outstanding lines of credit, you need to start working diligently to pay them off. In order to get your spending under control, work out a budget and plan to spend extra on your accounts every month. The best way to repair your credit is to work hard to pay off these accounts. If you have worse black marks, such as bankruptcies and voluntary arrangements, the only way to fix them is to satisfy the terms of these settlements and then verify with the courts, when you have met the terms, that they have notified the credit reporting agencies. Unfortunately, in these situations, credit repair takes a lot of time and discipline.

If your credit report has errors on it that are affecting your score, you need to pursue these issues right away. As soon as you find a mistake, organize all your documentation – including cancelled checks, payment records, receipts and bills – and contact the lender in writing via certified post. Contact the credit reporting agency as well to notify them that your report has an error on it and that you are working to correct it. Keep records of all correspondence with the lender and credit reporting agency until the issue is fully resolved. If the error on your credit report is in the form of a bankruptcy, voluntary judgment or a similar court-related issue, and you know that you have satisfied the terms laid out by the court, then these are serious problems that need to be addressed right away. Again, organizing all relevant paperwork and documentation is the first step. After that, contact your caseworker or the agency in question to pursue the error. It is also vital, once again, to notify the credit reporting agency that you believe there is an error, what that error is, and what you are doing to fix it. Follow through until the end, documenting all interactions with the courts, until the error is fixed.

]]> http://www.creditreport.uk.com/facts-about-credit-reports-in-the-uk/feed 0 http://www.creditreport.uk.com/ways-to-resolve-a-credit-report-dispute http://www.creditreport.uk.com/ways-to-resolve-a-credit-report-dispute#comments Thu, 14 Jul 2011 11:08:47 +0000 CRAdmin http://www.creditreport.uk.com/?p=269

Your credit report is important. Lenders will check it before approving a loan. Landlords check your credit report when deciding whether to rent you a flat. Potential employers my even look it over when deciding whether to offer you a job. It’s vital to maintain a clean credit report and resolve issues your report may have. If items have been misreported or errors have been made, you must to contact the credit reporting agencies, the creditor and, in some instances, case workers and courts.

Contact the credit reporting agency

This is your first step in resolving disputes and fixing errors on your credit report. The credit reporting agencies in the UK are Experian, Equifax and Callcredit. You must contact one or even all three to notify them that you believe an error has been made on your credit report. Organize all your data, including detailed records of payments, copies of checks or printouts of online transactions and contact information of case workers or judges in the event of bankruptcies or voluntary arrangements. Write a detailed letter explaining your case and the specifics of your dispute and have it delivered to the credit agency via certified mail. If the agency contacts you by telephone, be sure to document the date and time of your conversation and the name of the agency representative. Keep on them and stay in constant contact — the credit reporting agency should resolve the issue within 30 days and they will pass on the results of the action to the other agencies.

Contact the creditor

Regardless of whether the dispute is with a credit card company, mortgage broker, auto loan agency or a bank, the next step in resolving a credit dispute is to contact the lender in question. Again, it is very important to organize all pertinent information before contacting the lender. Make sure you have copies of all relevant bills and payment records. If you contact them by telephone in the interest of resolving the issue quicker, be sure to record the name of the lender’s representative, date and time of your conversation and the case number if one is assigned. If you are working on the case by mail, certified post is a must. Be sure to follow up by telephone in this case and pursue the matter to completion. Once the issue has been resolved, the creditor will contact the credit reporting agencies to correct your report.

Contact caseworkers or the bankruptcy court

In the event of a past bankruptcy or voluntary arrangement, you must contact your caseworker or the court that handled the case. When you have satisfied the terms of your bankruptcy or IVA, you need to make sure this fact has been accurately reported to the credit bureaus. If not, the damage of a bankruptcy or IVA could continue. Your caseworker or court representative can work with you and the credit reporting agencies to ensure that the details of your case have been reported accurately and are up to date.

]]> http://www.creditreport.uk.com/ways-to-resolve-a-credit-report-dispute/feed 0 http://www.creditreport.uk.com/why-is-my-credit-report-important-to-me http://www.creditreport.uk.com/why-is-my-credit-report-important-to-me#comments Wed, 06 Jul 2011 08:46:02 +0000 CRAdmin http://www.creditreport.uk.com/?p=265

Understanding the importance of your credit report means knowing how the credit report works, how it ends up in the hands of lenders and how lenders use it when making decisions regarding loans. It also means knowing who else can see your credit report and how that effects you, too.

All your credit activities are tracked and recorded by lenders. These lenders in turn report your payment history and bill paying habits to the major credit reporting agencies. The big credit reporting agencies of the United Kingdom are Experian, Equifax and Callcredit. These three agencies will then make all your credit information available to future creditors on demand. What is important to remember, as you will see, is that this information is also available to you.

When you apply for a home mortgage, automotive financing, a credit card or a personal line of credit, the lender will request a copy of your credit report from one of the three major credit reporting agencies. The lender will then examine your credit history, current debts and payment habits. They will pay close attention to black marks such as bankruptcies and late payments as well. They will judge your credit worthiness – your ability to take on credit and pay on time – based on your current and past credit situations. If your credit is good, you will get the loan and will probably get favorable terms such as a lower interest rate or a fewer fees. Conversely, bad credit could mean your loan application is denied. If the lender does decide to extend credit to you despite a dodgy credit history, you will certainly see increased interest rates and fees. The lender will want to mitigate their risk in situations like this.

Your credit report can also come into play when applying for a rental or even a job. Landlords are just like lenders: they want to know whether you can pay the lease on your flat and they want to ensure these payments will be made on time. Some prospective employers may run a credit check to get an idea of your level of responsibility and trustworthiness. This is especially true for positions of greater responsibility or in the financial services field.

Bad credit can affect your life by making it hard to get a loan, a flat and a job. It’s important to remember that the same credit report that is available to banks, landlords and employers is also available to you. By obtaining a copy of your credit report, you can get a feel for your credit worthiness. Doing this before applying for a loan, rental or job will give you an idea of what to expect. More importantly, it will give to an opportunity to fix any errors or disputes ahead of time. You can contact the credit reporting agency, bank or courts to fix anything you believe is in error right away. Checking your credit report on a regular basis is essential to maintaining your credit health.

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Your credit score is the history of all your credit activities. Details listed in your credit score include credit cards, home mortgages, auto loans, personal line of credit loans, education loans and more. Negative factors such as bankruptcies, court judgments, defaults, late payments, voluntarily arrangements and credit inquiries are also in the report. Your credit report is the key factor that a lender will examine when determining whether to approve a loan and what terms to assign to it. Your credit score also might affect your ability to get a job and it could even have an impact on where you live, since landlords will examine your ability to pay when you are looking to rent.

Considering how much of a factor your credit is when it comes to getting a loan, gaining employment or renting a living space, it’s easy to see how important it is to keep track of your score by obtaining a credit report regularly. Bad credit hurts your ability to get a good loan or credit card and could hinder your job search. Let’s take a more in-depth look at how credit affects your life and how to avoid bad credit.

Your credit score determines whether you qualify for a loan

It doesn’t matter what kind of a line of credit you’re applying for; a lender will definitely look at your credit report when deciding your credit worthiness. This is especially true when buying a home, since a mortgage is the largest loan most consumers will ever obtain. With such a large amount of money on the lines, and considering today’s economy, banks are increasingly wary of taking a risk. If you have black marks on your credit report like bankruptcies, voluntary arrangements or defaults, a mortgage company may turn you down. When shopping for a home loan, it is vital to understand exactly what kind of shape your credit is in.

The same principal holds true for auto loans. Car dealerships do not want to go through the trouble of repossessing a vehicle and trying to resell it. Vehicles lose their value as soon as they are driven from the dealership. As a result, dealers want to sell to buyer they feel confident can pay their bills and will thoroughly examine your credit before determining whether you can afford more credit and whether they feel you can pay on time.

Credit card companies also examine your credit report when deciding whether to allow you to open a new charge account. If you are spread too thin with too many open accounts, like loans and other credit cards, they may not feel you can afford another one. Your credit health, once again, affects your everyday life and your purchasing power.

Your credit score determines your loan terms and conditions

Lenders write credit arrangements in such a way to mitigate risk. They will determine the risk they are taking by examining your credit report. If you have bad credit but you have made it past the approval process, banks, mortgage brokers, auto loan and credit card companies will diminish their risk by changing the terms and conditions of the loan to put themselves in a more favorable position. If you are a credit risk, you will end up with less than favorable terms for your loan, such as higher interest rates, a smaller line of credit or increased fees.

When buying a house, your credit score will determine the interest rate you can get for your home loan. This has a huge effect on the bottom line, considering the size of a home loan and the length of time it takes to pay it. Something as seemingly insignificant as a one per cent increase in the interest rate of a home loan can add up to an enormous hit to your wallet over the life of the loan. Considering this, it’s easy to see how important it is to have an excellent credit score when shopping for a home mortgage.

Applying for an auto loan is a similar situation. How many times have car dealers advertised very low interest rates and other favorable terms “for well qualified buyers?” The truth is very few consumers in the market for a new vehicle actually qualify for these great terms. It’s more likely you will receive a higher interest rate that will only increase with a worse credit score. An auto loan is shorter than a home loan, but it is still a fair amount of money whose interest will compound very quickly over the years of the loan. Once again, consumers with a more respectable credit score will get better terms and save money.

Credit card companies operate in the same fashion. Having blemishes on your credit report like late payments or bankruptcies, or simply having too many open accounts, can mean the difference between a credit card with a 13% interest rate and one with a rate of 20%. Credit card companies will also extend a higher line of credit to consumers with better credit scores and vice versa. It’s easy to see, once again, how your credit score affects the terms a lender will apply to your account.

Your credit score may affect eligibility for employment

More and more often, employers are examining applicants’ credit reports when looking to fill positions at their companies. Some hiring managers and department heads view the credit report as an indicator of a job applicant’s level of personal responsibility. They may not want to hire someone with bad credit for fear that this person might be as careless in the workplace as he has been with his money. Whether it is fair or not, there are definitely companies out there who are judging job applicants by their credit scores. This is especially true in the banking and financial services sector, and with good reason. Consider this: if a candidate for a banking job is negligent with his own funds, how can he be trusted to handle the accounts of customers responsibly?

Your credit score can hurt your ability to rent a flat

Much like a home loan, a flat rental relies on your ability to pay a fixed amount on time every month. Landlords offering flats for rent will look at your credit to help decide whether to rent to you, since your credit report can give them an idea of whether you can afford the monthly payment. Your credit report will also show your payment history and whether you pay your debts on time and in full. This is especially important to landlords, who expect the full rental fee on time and in the correct amount. If you have bad credit, you could be turned away and not allowed to rent the flat you want. Just like you might have to settle for a less attractive loan, you may only qualify for a flat on the wrong side of town.

Avoiding bad credit

Considering the very real affects that your credit score has on your day to day life, the question becomes, “how do I avoid bad credit?” Bad credit happens a number of ways, all of which can be evaded with some care.

Don’t spread yourself too thin. Resist the urge to open new accounts that you can’t afford. Having more credit than you need only leads to late payments, defaults, judgments, voluntary agreements and bankruptcy. All of these things will destroy your credit score. Carefully examine your funds, scrutinize why you truly need credit and choose wisely.

Pay the correct amount on time. Keep a strict budget and stick to it. Knowing exactly how much money is coming in, how much is going out and when it needs to go out is the way to make sure you can always afford to pay your debts. Being a good borrower helps build excellent credit.

Avoid bad loans. There is secured debt and there is unsecured debt. Secured debt is actually backed by collateral, like a home or a car, and is considered “good debt” by credit agencies and banks. Unsecured debt, like a credit card, is backed by nothing at all and can hurt your standing. Build your credit by obtaining an auto loan and by paying the proper amount on time without fail. Mitigate bad credit by having as few credit cards as possible. Also, avoid store cards. Credit cards offered by retailers are the worst kind of cards to get, often carrying an interest rate that is double the rate of a standard credit card.

Your credit history has far-reaching effects on your life. Bad credit can keep you from getting a loan or a line of credit or can cause you to lose money by getting loans and credit cards with bad rates and higher fees. Bad credit can hurt your ability to get a job or rent a flat and much more. It’s important to always be aware of your credit health by regularly checking your credit and by monitoring your credit score often.

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