Credit Bureau Basics

Brought to you by Vincent Polisi & Wendy Polisi

http://www.financethedream.com

In today’s real estate market, it is more difficult than ever to

qualify for a mortgage.

With foreclosures on the rise, your credit score needs to be good, if not stellar, for lenders

to say “yes”.

Still, most American’s don’t understand even the basics of a credit report or what exactly

a credit bureau is.

Even seasoned investors are confused on many of the

details of how credit works.

This brings us to the most basic credit question of all.

What exactly is a credit bureau?

Quite simply, a credit bureau is a giant record keeper that stores information on almost

every adult in the United States.

Information includes addresses, employment and most importantly, payment

history.

Some people think that when something on their credit

report is inaccurate, the credit bureau is to blame.

Many times, a lender will hear the statement “Equifax isn’t reporting my car correctly”.

This isn’t true! Your lender is the one reporting incorrectly.

The credit bureaus collect information, but they do not

verify anything.

What they report is simply the information that creditors

supply them with.

This means that a creditor can report anything to the

credit bureau and it will appear on your report,

regardless of whether it is accurate.

It is estimated that between 40 and 70% of credit reports

contain errors.

These errors can lead to increased interest rates, credit

denial and even job denial.

Since without your involvement, your credit report is simply a large collection of unverified data, the federal government has numerous consumer protection laws in

place.

The most important of these to understand is that the only time the information in your credit bureau is verified is if

you file a dispute with each of the three credit bureaus.

When this happens, the creditor has 30 days to prove to the credit bureau that the

item is accurate.

If they fail to verify the item as accurate within this time

frame, the item is required by law to be removed from your

credit report.

One of the most important keys to keeping your credit

score up is consistent monitoring of your report.

There are many great services to help make this

easy, but the most important key is consumer knowledge

and involvement.

Credit Bureau Basics

Please visit us at http://www.financethedream.com