Posts Tagged ‘Consumer’

Dealing with Split Credit Reports

Of course, you can go to Annual Credit Report.com to get your authorized free credit report. Still, there are differences between what you may find provided by the three different bureaus.

A Common Problem

On all three bureau reports the errors are difficult to find and reading them may seem very complicated if you are not used to doing so. Another common problem is this: Sometimes all of the consumer’s information in these said reports might be split because two names were used by the consumer.

Other splits may occur be because of common names. For example, a father and son with the same name may have split credit reports.

Other problems pertain to instant credit reports. Some accounts show up on one instant credit report while other accounts show up on another instant credit report. Sometimes as in the case of TransUnion, additional social security numbers are not shown on someone’s file.

Furthermore, additional names, addresses, and possible accounts that don’t belong appear on the report may also appear. The appropriate bureau should be contacted immediately especially in this case.

Possible Causes

There might be a variety of reasons that splits occur in credit reports. Some of the contributing factors may be one of these:

  • A result of consumers who frequently use and pull their personal instant credit report on a daily basis from monitoring services
  • Compilation of soft hits to the credit report
  • When a credit report file becomes too large

A Solution

In the case of split credit reports, Equifax gives the following advice to consumers: Add both scores and divide by two. The end result is the score to be used. However, it is necessary that you inform Equifax that the file needs to be re-merged.

In the case of mix-ups, the consumer must contact the appropriate with the proper I.D. to correct the situation. For instance, TransUnion may require a copy of his driver’s license to update the instant credit report.

How to Get Rid of Credit Card Debt

One thing that can affect your credit the most is how much debt you are carrying on your cards. Thereofre, it may be time for you to finally get rid of some of your credit card debt.

Another factor is how close to the credit limit you are on each card. Any good credit repair company will tell you that it is best to keep your total balance below one fourth of your credit limit. This is for the total of all your cards.

If you want to continue to get rid of credit card debt here are some additional tips and facts:

Reduce the amount of interest paid while buying things with a credit card. You can do this if you pay back the balance within a 25 to 30 day grace period.

Remember that late payments appear on your credit file. Therefore, try to avoid allowing your balances to become past due.

If you are unfortunately already overwhelmed by the debt you have nationwide debt settlement options are available. This is a great place to go for educational advice on what financial options are best for you.

Seek all re-financing options such as consolidations before considering bankruptcy. You may also want to consider budgeting and debt repayment programs.

Settling Debts

The devastating economic conditions right now have caused 60% of Americans in financial distress not knowing what to do. They also quite often do not know where to go for help.

Debt settlement is one option. This helps you eliminate unpaid balances by reducing the amount you owe, by as high as 50 to 70% (and in rare cases up to 100%).

However, this solution is not without its consequences. Using debt settlement could have a temporary negative impact on your credit file. Therefore, whenever possible it is in your best interest to do what you can to pay that account.

The idea is to do whatever you can possible to avoid charge offs, because this can also hurt your credit file. Apparently according to some sources debt settlements are like a charge off.

However, sometimes you have to do what you have to do. The key to all this is to help reduce chance of bankruptcy proceedings, as this is often thought of as a last resort.

When credit card accounts are settled, the creditor will notify the 3 credit bureaus within 30-45 days. Even though this may not always be the option that works for everyone, it can improve your debt to income ratio.

Purpose of a Free Credit Report

Free credit reports are almost as common as bread and peanut butter. The explosion of offers in this regard does not replace the possible need for paid monitoring services.

However, obtaining your free credit report is your right. This is your right as of an amendment of the Free Credit Reporting Act of 2003.

The main reason this new amendment of the FCRA was added by the government to ensure that all Americans have the right to stay informed. This gives people an opportunity to learn what the three credit reporting bureaus are saying about you.

All this is done without you having to pay for it. This has been done to help combat identity theft, since fraud and errors on credit reports are so common today.

The goal of this new government act is to ensure that Americans have the right to stay informed about what these three credit reporting bureaus say about then. Yet, at the same time it gives them the right to do so without having to pay for the information.

Obtaining your Records

You can request a free copy of your credit report within a 12 month period from one of the major financial bureaus: Experian, Equifax and TransUnion.

If you don’t really plan to subscribe to the service, it is important that you cancel the trial subscription, or else it would automatically be billed to your account. In that case, you should remember the termination date of your trial period.

You can also get your files at Annual Credit Report.com. This is one of the safest and most reliable locations to obtain your free documents. This site is actually regulated by the federal government and it also is monitored by the three credit bureaus.

You also can find these documents via other websites. You should make sure that it has the official saying that indicates you are not at the Annual Credit Report.com site.

Your Rights

You should be able to obtain your free credit report without any hassle. You can report a private monitoring service if they try to make you pay for these documents.

Now, you should beware that you do not get a free credit score, but only a free credit report. Therefore, you still have the chance of experiencing hassles in that way.

At the same time, you should make sure you take advantage of what you are entitled to and do not have to pay for up front. The only time you really have to pay is if you seek out additional credit alert and monitoring services other than the free ones provided by law.

Introduction to Credit Monitoring Services

Too often you hear the complaint that a credit monitoring service is billing whether the customer wants the service or not. This is a shame, and it is ironic that one of the reasons you want the service is to find and remove erroneous debt items on your report.

One common solution to this is to use a debit card rather than a credit card when you purchase a service. If a service continues to bill after you’ve finished with the service, you can always cancel the debit card.

Canceling a credit card can have a negative impact on your credit file though. Using a debit card saves you this headache.

Advantages and Disadvantages

Oftentimes credit monitoring services are considered an expensive waste of time. Oftentimes you can accomplish just as much towards fixing your credit on your own not spending any money.

On average, a credit monitoring service will cost about $10 per month, per report. It is true sometimes that can monitor your own credit report for less than the average cost of these services.

However, sometimes people like the peace of mind of hiring a professional service and/or online software to do this action for them. Besides, you may want to receive reports from all three agencies at once.

With many monitoring services all three reports are included, but you may be required to request all of them at once. At the very most it could cost you about $36 a month or $432 a year to do this, unless of course you receive discounted prices as mentioned above (approximately $10 per month).

Regardless of what you pay, what you would receive for that $432 per year varies. It depends upon the services that you choose. However, in general you can expect that you’ll be alerted if someone applies for new credit.

You also have the luxury of being told if something suspicious turns up on your credit report. Most monitoring services also come with identity theft insurance that will help you recuperate the costs necessary to repair any errors that occur.

You also have the option to use one of a variety of identity theft services. On the other hand, you can monitor your own credit report even for as low as $8 per report.

You may have to do a little bit more work when you monitor your own report. However, you can save some money.

On the other hand, many people find that the expense of a monitoring service is much easier. They would rather pay this extra fee than monitor their own credit reports.

Credit Card Companies Seek Risk Management (2009)

Nowadays, credit card companies are seeking ways to reduce risk. This is so they do not have to pay out as much money as they did in the past. This information was true as of September 2009, but new laws have changed since then.

A revelation of this information can clue you in onto some of the changes made before February 20, 2010. For instance, credit card companies who want to reduce risk have used one of the following three tactics:

  1. Some consumers have been hit with lowered credit lines. The general rule of thumb was that they wanted to lower the lines of credit to below the outstanding balances of the consumer.
  2. Other credit card companies are seeking ways to raise interest rates. This was done as a way to try to push consumers into making payments.
  3. Other consumers who have locked-in interest rates saw rises in minimum payments. This has causes the minimum payments of people to double and triple in some cases.

Options for Consumers

Upon credit card companies starting to take one of the above actions against consumers, these companies did make some offers to consumers. For instance, they were able to opt out of an interest rate increase.

This was done by way of closing the account and continuing to pay off the debt a little at a time-at their own pace. This of course is another action that causes damage to a person’s credit scores.

Upon talking to a credit counselor, some consumers were advised to call and re-negotiate interest rates. Some people were successful and some were not. In any case, many of these consumers (as well as the ones whose minimum balances were hiked) were force to seek funding elsewhere.

Laws have changed in 2010. There are certain actions that credit card companies cannot take that they could not before, and some of these apply to the three actions described above.

In any case, the best action is to pay debt off as quickly as possible. Then, a consumer should try to re-configure the home budget so that temporary credit is no longer needed.

A Free Credit Report Story and Revelation

There is one main advantage of seeking a free credit report. This would be to spot cases of identity theft early. An additional benefit would be to spot errors right away and to have them fixed.

Countless stories have probably been told by now telling the advantages of a free credit report. However, this one seems to stand out the most:

It is the one about Sylvia Gallow-Vazquez that has circulated the web the past few years. It tells how she applied for a Discover card and then was turned down. She wondered through all of this how such a thing could be possible, because her credit rating was considered to be “impeccable.”

Now, learning of all kinds of unauthorized transactions and identity theft is never fun. This could appear on your credit report all too often. This is what happened to Gallow-Vazquez.

She obtained copies of her credit report after being denied a Discover Card. This is when she first learned she was defrauded.

It was no fun to find out that that her name was used against her for utility services as well as for car and home loan applications. It was also no fun for her to find out she had a two years worth of additional unauthorized transactions such as Internet and phone services affecting her credit report.

However, it is probably safe to say that Sylvia Gallow-Vazquez was quite relieved to find this out when she did. If she had never gained access to her credit report she would have never known so she is glad she did.

Finding negative remarks on her bill was the first step towards change. The next step would be to place alerts on the files and the earlier identity theft is detected the better.

In the case of Sylvia Gallow-Vazquez and similar situations it can take quite awhile to have all these negative marks removed. However, it never is too late to fix your situation.

F.A.Q.’s of Free Credit Reports Fraud Alerts

Fraud alerts and free credit reports are requested all the time. Consumers who are in search of them now may have questions about these services offered to people.

What is the purpose of a free credit report?

People request them for a number of reasons. One of the main ones is to make sure they have no unauthorized purchases on their account. Another would be simply to monitor payment histories and to analyze in order to create a debt repayment plan.

How do I get a free credit report?

It can be obtained online at websites such as Annual Credit Report.com. It can also be requested by phone or by mail.

How long does it take to get a copy of my credit report?

You can usually get it almost instantly online. If you request it by phone or mail it takes up to 14 days to receive it.

What is a fraud alert?

It is a notice that is placed on your credit report to alert those to whom you owe money. This lets them as well as credit bureaus know that there may be unauthorized charges or unauthorized usage of your account.

How to I place a fraud alert on my credit report?

You can call one of three credit agencies (Equifax, Experian, or TransUnion) by telephone. You can also go to the websites of each one of these major credit bureaus.

Should I get an initial fraud alert or an extended fraud alert?

It depends upon the seriousness of your situation. The initial fraud alert stays on your file for 90 days and the extended fraud alert stays on your file for seven years.

What are my rights as a consumer seeking a free credit report or a fraud alert?

You are entitled to a free copy of your credit report at least once every 12 months. Information is provided by Experian, TransUnion, and Equifax. More info about this can be found at Annual Credit Report.com, the FTC website, and within Fair Credit Reporting Act documentation.

This of course is only a very small list of the concerns associated with protecting your identity and analyzing your financial history. You can seek answers to further questions if you call the appropriate customer service hotlines.

Furthermore, more detailed instructions are provided by more than one public service or legal service entity. This is to ensure your rights as a consumer are protected in case you notice a problem.

An Overview of Consumer Credit Investigations

The concept of investigating credit reports is quite complex. It is done for many different reasons. Sometimes it is consumer fraud while other times it is because of identity theft.

It also could be a case where a consumer is just careless with money and has run up a “bunch” of credit card bills. It could be for any number of reasons or any combination of these reasons put together.

In any case, there is a variety of different ways that credit investigations are made. For instance, sometimes a credit report is checked. Usually this is done by way of social security number or birth date.

Other times other financial records such as bank accounts or credit cards are accessed. Of course, all of this is only done by the proper authorities who can be trusted to handle these investigations.

Investigative Concerns

Sometimes credit bureaus or other governing agencies investigate overextended consumers. However, they do not always do their own research. They sometimes hire detectives of different sorts who sift through personal records.

All of this is done in order to search for financial judgments, liens, or other “dirt” against a homeowner. If there is any negative action on a person’s record, the detective then reports this to a credit bureau.

This further puts a person in financial trouble in even more jeopardy. New information is placed on a person credit record that would prevent them from getting a mortgage, car loan, or job.

There have been legal battles in recent times as to whether or not it is lawful for credit bureaus and other financial agencies to hire these detectives. Lawsuits were even filed in various geographical locations such as New Jersey and Pennsylvania.

There are a variety of different methods and tools that are used to investigate credit. You can read about these in a future blog entry.

The Effect of Fico Scores on Loan Modification

When trying to clean up your credit-which sometimes seems such an impossible feat-you have a lot to consider. One of the major concerns regarding this is that pertaining to FICO scores and how loan modification can affect it.

People who have outstanding loans are encouraged to be careful about the decisions they make regarding this matter. Part of this is in knowing what a loan modification is in the first place.

A Simple Definition

A loan modification is the alteration of any financial contract. Usually this would be in the form of reducing interest rates or in the forgiveness (or partial forgiveness) of a loan. Sometimes it could be an extension of the loan’s maturity date.

The Consequences

This is a very complex matter-that of loan modification. It depends highly upon what parts of the loan are being modified or how it is recorded.

Some schools of thought suggest that since a loan modification is listed as a “Partial Payment Plan” on your financial records it would be better than perhaps not paying at all. However, this actually does lower your FICO score.

Avocation is being made by consumers to determine whether this is fair or not-the lowering of a credit score even if a payment is not missed after loan modification. If it still will affect you negatively why bother?

Therefore, although it might be a better solution than continuing to be delinquent on your loans it could still cost you. It often is not considered to be anything more than just a temporary solution to solving credit and debt problems.

If you are not sure whether this solution would be better for you than a charge-off or type of debt forgiveness, ask a financial counselor. A budget or credit counseling may be your best source for this type of information.

Brief Word from the FTC about Free Credit Reports

The Federal Trade Commission (FTC) alerts consumers about access to free credit reports. This information pertains to the fact that according to the Fair Credit Reporting Act (FCRA) you are entitled to one free credit report every 12 months.

However, you should also know that you are actually entitled to one report from each of the three agencies, not just one report total every year. Therefore, you can receive a copy of your payment histories and other vital financial records as kept by Equifax, Experian, and TransUninon.

Additional FTC Guidelines

In addition to the above, you are also entitled to the following:

  • Accuracy and privacy of the information kept about you
  • The right to know if someone has stolen your identity
  • Immediate access to your credit report if you file online
  • To receive your requested report within 15 days if you want it mailed to you
  • Right to a free report if you are unemployed and looking for work within 60 days
  • Right to investigation in case of an error
  • Opportunity to dispute your case when necessary
  • The right to know if anyone has obtained an unauthorized copy of your financial records

FTC Function

The Federal Trade Commission works to prevent consumer fraud. They also fight against unfair and deceptive business practices, including false advertising. They also help consumers remain aware of problems and thus teach buyers and sellers to avoid being a victim of fraud.

The FTC also helps people file complaints in the event a company or individual has wronged them in some way. This organization deals with all types of consumer-related scams, including falsified records, fake credit report fraud, and credit card identity theft.

Consumers Beware!

The Internet has given rise to many fraudulent websites claiming to offer you a free credit report instantly. While some of these sites are very helpful, you need to watch out for any sign of a stolen identity.

WARNING: If you seek a credit report instantly online, make sure you know whom you are dealing with. This is especially important if you are signing up for a free trial of a credit monitoring service.

Remember, you should know what you are getting yourself into and who you are dealing with at all times. This is not to make you paranoid but rather to make you aware.

Use the Internet with caution when seeking a free copy of your financial history. Your financial future greatly depends upon taking proper precautions.