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3 Steps to Taking Control of Your Credit Report

Written by Mechel Glass on April 11, 2011 in Credit  |   1 comment

3 Steps to Taking Control of Your Credit Report Mechel Glass, CredAbility.org According to a recent CredAbility consumer distress index, the budget of the average American household is once again under stress. People are having trouble saving money, and consumer sentiment has been stagnant. Instead of letting…

3 Steps to Taking Control of Your Credit Report
Mechel Glass, CredAbility.org

According to a recent CredAbility consumer distress index, the budget of the average American household is once again under stress. People are having trouble saving money, and consumer sentiment has been stagnant.

Instead of letting the economic crisis decimate their finances, though, millions of people have been rebuilding their credit as they pay down their debt. In fact, in May of 2013, the credit category of the index rose to 90—with 100 being the maximum level of consumer confidence—for the first time in 24 years. That’s a sign that consumers continue to pay their credit cards and loans on time.

However, if you aren’t feeling confident in your credit history or credit score, there are a few steps you can take to present a positive credit report.

1. Make sure you pay your bills on time.

If keeping up with your credit card bills is still a problem, call the issuer to explain your situation and attempt to negotiate a payment that you can afford. Ask the issuer how this will be reported to the three major credit reporting agencies: Not paid as agreed? Or now paying as agreed, per the new terms? Make certain you get any agreement in writing.

Assess the damage to your credit by getting a free copy of your credit report from each of the three major credit-reporting bureaus through annualcreditreport.com.

2. Write a personal statement for your credit report.

Since prospective employers may pull a copy of your credit report, consider adding a one-hundred-word statement to each of your reports explaining your hardship, whether it’s a job loss or an overwhelming medical debt. All three major credit reporting agencies allow you to add a brief statement through their websites. Most scoring models don’t consider consumer statements in the scoring formula , however, so don’t expect it to sway lenders.

3. Stay away from bogus credit-repair companies.

You’ve probably seen ads for credit-repair companies who say they’ll clean up your credit in a few short weeks—stay away from these organizations. Some companies manage to clean up your credit for a limited time by disputing all of your accounts and sending letters to the bureaus claiming the accounts aren’t valid. But after the credit bureaus validate the accounts and debts, they’ll reappear on your report, and your score will plummet again.

Legitimate credit-repair companies exist, but there’s nothing they can do that you can’t do for yourself—for free.

For people committed to improving their credit score, CredAbility offers online classes at www.CredAbility.org. However you decide to attack your credit, it starts with you. The best way to improve your credit score is to set a goal, create an action plan with specific steps, and follow through on those steps.

Read More:

How To Dispute Credit Report Errors
Four Things College Kids Need To Know About Credit
Four Myths About Your Credit History
Debt Reduction: Why Paying Down Your Credit Card Debt Helps Your Credit Score

Mechel Glass is the Director of Education for CredAbility. In this position, she is responsible for developing the curriculum and educational materials for online classes including webinars, podcasts, videos and listen-on-demand classes. She is responsible for managing the agency’s community outreach programs and staff, including financial education specialists in a 14-county area throughout metro Atlanta and north Georgia. She also manages the development and reporting of education partnerships online for the agency.

1 comment

  1. John says:

    IT seems credit reporting agencies are more much comfortable placing negative information in credit files than placing positive information into consumers credit files.

    I note how deaths, divorces, tax liens, defaults, foreclosures & bankruptcies are automatically entered in credit files.

    Are marriages & unreported discharges of debts entered automatically ?


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