The first information you should check is your personal information. This data is critical as you may find your personal information to be incorrect or outdated. Human errors are commonly made and data belonging to someone with a similar name is included in your report. Another tip is to be sure that your current employer is listed as well as your current address.
The second tip is pertaining to your mortgage loans. Loan modifications and short sales are sometimes erroneous classified as foreclosures on credit reports. It is important to get this corrected since foreclosures are harmful to your credit score. Loan modifications and short sales should be indicated as such on your credit report.
Cancelled Credit Cards
The third tip is being sure when you cancel a credit card; it is not reflected on your account as “closed by grantor.” When the notation “closed by grantor” appears on your report, it means the credit card company has closed your account. This is a red flag for potential lenders who may see this as a sign that you did not pay your bills in a timely manner or some other reason which violated the terms and conditions of the card issuer.
Check Your Account Balances and Payments
The fourth tip is to check your account balances. You may find your balances are higher than they should be which could have a negative effect on your credit score. A general rule of thumb is to keep your credit card balances under 40% of your credit limit. Since credit card balances are sent to the credit bureaus on a monthly basis, your account may not reflect a large reduction or payoff made within the current month. If you are applying for a new loan, you would want the lowest balances to reflect on your account.
Be sure your account payments are accurate. Make sure your payments are showing as being paid on time and in good standing. Sometimes human errors occur and can be fixed with little effort.
Tip number five is to check who has requested to see your report and score. These inquires can come from companies who are looking to extend additional credit or services, potential employers or third-party service providers for marketing purposes. You should always be aware of who is viewing your credit history.
Check Your Old Accounts
The next tip is to check your old accounts. You may find that some old accounts that have a negative effect on your credit score should have fallen off your report in seven years. This should be corrected in an effort to improve your score. However, some old accounts that are in good standing can have a positive effect on your credit score and you’d want to keep them.
When repairing your credit, It is important to fix any errors that might affect your history and score. These errors could prevent you from being approved for a potential loan. Disputing errors might take work and time but having a correct credit report is important and will help you in the future.