It is no big secret that your entire financial life depends on your credit score and credit history. If your score is low, you are going to have big problems getting any type of credit. The only way to get back on the right track is to raise your credit score and take the necessary steps to improve your financial affairs. How do you get a low credit score? Well, there are many different ways and reasons that your credit score could be suffering.
The most important thing you can do with credit is paying your bills on time. If you have made a lot of late payments, filed bankruptcy, have judgments against you, or have defaulted on payments, your credit history has blemishes and your credit score is suffering. In other words, you are paying more than you need to for your mistakes and now is the time to get those mistakes corrected.
For the process of increasing your credit score, your first step would be to get copies of your credit reports from each of the three major credit reporting agencies and go over them with a fine tooth comb. Federal law says that you can get a free copy of your report once a year, so feel free to take advantage of this. What you will likely discover is that even though all the information on your report may be correct, chances are very high that you will find one or more errors. If you do not get these errors corrected, they will never be corrected since you are the only one who can get them fixed.
Errors happen due to human error, clerical error, mistyping errors, and could even be the first signs that you are a victim of identity theft. Having these errors on your credit report is very likely causing your credit score to be calculated to be lower than what it should be. The process for getting the errors corrected is not very complicated, but you need to follow the instructions to the letter.
The process of getting the errors fixed is not hard but is tedious. Doing nothing with the errors should not be an option since they are causing your credit score to be lower than it should be. You are the only one who can report the errors and get them corrected and there are also laws in place to help with this.
After you have identified the errors, you now have to find the proof. The proof you need depends on the type of error. For example, if there is an error saying something is not paid off and you know that it is, you will need either cancelled checks or statements. Verification can usually be done via the original creditor.
To dispute an item, you should send a letter to the credit bureau that is reporting the error, a separate letter to each one. Some people even say to send only one dispute per letter, so if you have five disputes, you should send five letters, but I don't think that is necessary or saves any time. Be clear about what is being reported incorrectly and how it should be reported. Retain a copy of what you send them and follow up. They have 30 days to either verify the information or remove it.
Your financial life will be easier when you raise your credit score, which will happen as you get errors corrected. You will have an easier time getting new lines of credit setup and may even find that you are now eligible for lower interest rates. Taking the time to raise your credit score will definitely pay off for you in the long run.