Know Your Credit History

If you have problematic credit you can and should obtain a copy of your credit history from each of the three national credit-reporting repositories:

Equifax (Columbus affiliate)
CBC Companies - Consumer Relations Department
170 East Town Street
PO Box 1838
Columbus, OH 43216
614-222-5377

Experian (Formerly TRW)
PO Box 2104
Allen, TX 75013
1-800-392-1122

Transunion Credit Report
PO Box 390
Springfield, PA 19064
1-800-888-4213

If incorrect information is reported, or if other information (such as paid accounts showing as open) need to be updated, you should contact all three credir bureaus to ensure that corrections are made in their systems. Typically it takes 30 days for the bureaus to investigate and update a credit file when requested to do so. Another option for clearing up your credit is through such programs as "Bureau Direct" or "Rapid Re-score". There is a cost associated with the service, but credit can be changed in 48 to 72 hours rather than the usual 30 days.

Your Credit Score

Credit scores are predictive indicators of a borrower's likelihood of repaying a credit obligation. They are weighted according to the following criteria (example below, can vary per reporting agency):

35%: Major and minor delinquencies including late payments, collections, judgments, and bankruptcies
30%: Amount of outstanding debt and balance to high-credit ratios
15%: Length of credit history (how long accounts have been open)
10%: Inquires or applications for new credit
10%: Type of credit (revolving versus finance company credit).

Note: Information that is not considered in credit scoring includes race, religion, gender, marital status, borrower's address, wages, height, weight, or birthplace.
* There are four factor codes listed on a credit report, which point out the actions that are impacting your score. These are the areas you need to address to change a score.

How to Improve Your Credit Score

Credit scores reflect your credit payment patterns over time with the most emphasis placed on the most recent information (past 24 months). There are some steps you can take that may have a positive effect on your score.

Pay down the balances on revolving accounts

Credit scores are more negatively affected by delinquencies on revolving than installment credit. In addition, high outstanding balances on revolving accounts can have a major impact on your score. By reducing the balance, but not closing the account, you will improve the balance/high credit ratios and positively impact your score. It will take the bureaus at least 45 to 60 days to reflect a lower balance. The credit bureaus can ONLY change lower credit balances with time, not with ANY repair program.

Pay past due accounts current

Avoid credit surfing. This is the practice of shifting revolving credit balances from one card to another, usually to take advantage of low introductory interest rates. The combination of inquires and newly opened balances, especially since new balances will show on a credit report before old ones are reported as paid, can make you appear to be in search of new credit.

Avoid finance company credit

New credit in the form of cash loans from a finance company have more of a negative impact on your score than other installment or revolving debt. You should also avoid 90-day or 12 months same-as-cash finance company transactions in the months before your loan application.

Have erroneous information corrected or updated

You should pay close attention to the accuracy of your credit history, such as the dates of last activity and/or delinquency, since recent information has the greatest impact on your credit scoring.

Avoid creating numerous inquires

Each inquiry can lower your score. Have your scores corrected as soon as possible. Some useful websites to visit are:

www.creditexpert.com
www.transunion.com
www.experian.com
www.myfico.com
www.equifax.com