How to Find Out If I Am a Victim of Fraud

A fraudster can use a number of techniques to misrepresent the truth, earn your trust and extract money from you. New types of fraud are seen all the time but if you know a few tricks to spot these attempts, you can become your first line of defense against fraud. Asking yourself two important questions can help you identify attempts of fraud against you, but your ultimate protection against fraud is diligence in reviewing your expenses and account information.

Instructions

1

Keep a record of times and dates when you opened yourself up to the public. Record when and where you released this information. For example, if you post an advertisement to sell something on an Internet site such as Craigslist or eBay, write down the date and time you created the listing. Review all mail, Internet and physical, for an increase in suspect communications within a month of that posting.

2

Ask yourself the first important question regarding any suspicious mail you receive: "What information are they asking me to give them?" Identify requests for your Social Security number, credit card information and bank account numbers. Avoid supplying this information. Assume suspicious mail may be an attempt to target you for fraud. Respond proactively by contacting your bank and credit card issuers and asking them to place fraud alerts on your accounts.

3

Ask yourself the second important question: "What are they offering?" Be wary of any mail that offers to give you something worth far more than what it asks in return. For instance, if you receive an email offering you $1,000 to take a survey, you should consider the email as a potential attempt to defraud you.

4

Review your personal finances daily and look for deductions from your accounts that do not coincide with your purchases. Pay close attention to the dates and times of each deduction and scrutinize them against your schedule and the businesses that you frequent. If you notice, for example, a number of purchases on your credit card during a time you are usually asleep or at work, consider this strong evidence that you are a victim of fraud.

5

Look for a series of suspiciously small deductions from your accounts. Review the date, time and location of these deductions and report them to your credit card companies and bank immediately. As an example, if you notice a small deduction of less than a dollar from your account, this may represent an attempt, by someone intending to defraud you, to determine if their account information about you is verified. These deductions are followed by larger deductions or a long string of small deductions occurring until your account is empty.

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Credit Score Myths Debunked

Myths about credit scores arise from not understanding what factors are taken into account when the scores are calculated. Credit scores generally range from 300 to 850, and creditors and lenders view higher scores more favorably. Yet maintaining a high score involves more than just paying bills on time.

Balances

People who pay off their credit-card balances each month may assume that's enough to maintain a good credit score. Yet credit scores can be adversely affected by how much available credit a person uses. For example, someone who charges $3,500 to a credit card with a $5,000 limit may see his credit score drop, even if the balance is paid in full when the bill arrives. Some financial publications recommend consumers use less than 25 to 30 percent of their available credit at all times. That's because account balances used to calculate credit scores typically come from a consumer's most recent bill. Scores can drop because recent high balances may make it appear a person is maxing out credit lines even when balances are paid in full.

Employment

A stable job with a high income doesn't guarantee a person will have a good credit score. High bank account balances and investment portfolios also don't affect the score. Credit histories are only affected by how people manage their bills, credit cards, mortgages and other loans.

Debts

Some people avoid accumulating debts to maintain a good credit score. However, the responsible use of credit lines and loans is what helps consumers qualify for mortgages, low interest rates, low insurance premiums and other items. Creditors, insurers and lenders look at credit histories and scores to determine how risky it would be to approve an insurance policy or loan or to extend a credit line. People who haven't accumulated any debts often need cosigners on loans and credit cards because they haven't established a track record of responsible debt management.

Payments

Paying credit-card bills and loans long before the due dates won't necessarily prevent late payments or negative marks on a credit report. It's better to strategically time partial payments if you want to pay bills early or pay them off quickly. Your statement should show a closing date, which is the last date on which charges are calculated. Send one payment near the closing date and another payment just before the due date. The first payment will reduce your balance and may help bolster your credit score. The second payment will prevent you from getting hit with late fees. A CBS News report titled "Biggest Credit Card Myths Debunked" notes that some credit-card companies require payments between the closing date and due date, even if an earlier payment has been sent by a cardholder.

Credit Reports

The U.S. Fair Credit Reporting Act allows consumers to get one free credit report from each of three nationwide credit-reporting companies every year. Those companies are Equifax, Experian and TransUnion. However, that does not mean consumers receive their credit scores with those reports -- credit scores are usually provided by the companies for a fee. Yet the U.S. Federal Trade Commission notes on its website that it's still important to check your credit reports to ensure they don't include inaccurate, negative information that could lower your credit score.

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Why Do Banks Run a Credit Check for Checking Accounts?

Bank accounts do not necessarily involve debt, so the credit reporting bureaus usually leave them off of a report. However, banks sometimes pull credit on a customer. Credit inquiries related to a bank account usually happen because a customer requests services that require a small loan. Alternatively, banks might run a credit check on all applicants because they want to avoid misuse of the account, such as check fraud.

Identification

Handing out a bank account poses risk to a financial institution, even if it is a savings account. A customer can overdraw an account--when an account holder writes a check or uses more money from an account than he has available. Overdraft balances mean lost revenue, and banks sometimes sell overdraft accounts to debt collectors, because collecting on the debt is expensive and involves extra regulation.

Considerations

Some banks require a credit check or sneak a consent to a credit inquiry into a bank account application to sell the customer other services, such as a credit card. The bank may have to perform a credit check because of a service requested by the customer. Overdraft and bounced check protection, for example, usually requires a credit check because the bank issues a small line of credit to buffer against overdrawing the account.

Tip

Ask the bank officer if the account requires a credit check. Not all banks run a report, so you can shop around until you find one that does not. Hard inquiries, which result from the customer asking for a check, damage a credit score by a few points, so it pays to avoid them. Your bank might offer an alternative to services that require a check. You can, for example, link a savings account to a checking account to avoid overdrafts.

ChexSystems

A bad ChexSystems report is more likely to prevent you from opening an bank account than poor credit. Since banks cannot report to the major consumer credit reporting bureaus, they have an analogous company: ChexSystems. A ChexSystems report contains negative data from the past five years. Most banks run a ChexSystems report, so you should review yours before applying for a new account.

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Laws Regulating Credit Reports

Your credit report contains a detailed record of all of your credit accounts, including the amounts you owe, the dates and amounts of your payments and how long you have been managing the accounts. The federal government has several laws that regulate how companies can compile and use your credit reports.

Fair Credit Reporting Act

The major law regulating your credit report is the Fair Credit Reporting Act. This law requires that consumer reporting agencies --- which collect information and compile your credit reports --- allow you to access your reports. If you find anything that you believe is incorrect, you can dispute this information; and if it is found to be in error, the consumer reporting agencies must stop including it on your credit reports. The Fair Credit Reporting Act also requires that the credit bureaus directly provide you a free copy of your credit report upon your request if you are denied credit, are on welfare, have an inaccurate report due to fraud, or are unemployed and looking for work within 60 days.

Fair and Accurate Credit Transactions Act

The Fair and Accurate Credit Transactions Act is an amendment to the Fair Credit Reporting Act that provides consumers with free access to their credit reports. You can get one free credit report per year from each of the consumer reporting agencies, in addition to the free reports authorized by the Fair Credit Reporting Act. Obtain your free credit reports by visiting the Annual Credit Report website, which is the only government-authorized source of your free reports under this law.

Fair Credit Billing Act

The Fair Credit Billing Act is mostly designed to give consumers the right to dispute billing errors on credit cards and other lines of credit. It intersects with credit reports by including a provision that prohibits creditors from reporting an account as delinquent until the dispute has been resolved. This protects your credit rating from being damaged by billing errors.

Equal Credit Opportunity Act

The Equal Credit Opportunity Act requires that lenders evaluate applications fairly, without considering an applicant's age, race, gender or marital status. This affects your credit report because it requires that some information on your report not be included in credit scoring. For example, although your date of birth appears on your credit report, the lender is not allowed to use this in a discriminatory fashion. If your application for credit is denied, the Equal Credit Opportunity Act requires that the lender notify you of the reasons for denial.

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Can a Credit Union Help Improve Credit?

Bankrate reports that as of 2010, there were almost 7,700 credit unions operating in the United States. Credit unions operate as nonprofits, meaning they can offer better terms and rates to their customers. As a customer, you can apply for different credit products, such as credit cards and auto loans, which will help you build a positive credit history and score.

Basics

A credit union works like a traditional bank, except a credit union requires membership. Qualifying for membership depends on the type of credit union. For example, many large corporations operate a credit union for their employees and employees' family members. Credit unions offer checking and savings accounts. Many credit unions also offer credit products that can help raise your credit scores, if managed properly.

Credit Cards

Many credit unions offer credit cards for their members. Since credit unions operate on a smaller scale than large, national credit card companies, they may offer easier approval terms. If you have had past credit problems, you may still qualify for a credit card through your credit union. Opening a credit card through a credit union will increase your available credit limit and help you build a payment history, both of which help your credit rating. Credit union credit cards also typically come with lower fees than major-label credit cards. Bankrate reports that as of 2009, the fees associated with credit union credit cards ran an average of 20 percent lower than larger banks.

Loans

Several credit unions offer auto loans. You can finance both used and new cars through a credit union. The auto loans have similar terms to a loan through a national bank, and often come with similar or lower interest rates. Financing a car can help improve your credit rating. Opening an auto loan will add to your credit mix, which factors into your credit score. Many credit unions also offer perks to their existing members wishing to open a car loan.

Tips

Using the credit products offered through a credit union will only help improve your credit if you manage them well. Pay at least your monthly minimum credit card payment on time each month. Keep the balance on your credit card low, or pay the balance off entirely each month. Make the payment on your auto loan on time each month. If you do not manage your credit card or auto loan responsibly, it will hurt your credit report and score.

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How to Negotiate With a Creditor to Update a Credit Report

If you've just paid off a delinquent credit account or removed your name as a joint account holder from a credit account, it can be frustrating having to wait until a creditor decides to report the information to the three national consumer reporting bureaus: TransUnion, Equifax and Experian. Using a few strategies, you can negotiate with your creditor to update your credit reports as promptly as possible. The process is moderately easy, but does require legwork.

Instructions

1

Obtain a copy of your credit report from one of the three national credit reporting agencies. Circle or notate the incorrect, incomplete or missing information on your credit report(s) and provide your creditor with a copy. Contact your creditor by phone or mail. Either option is effective.

2

Ask your creditor to update your credit report on a rolling basis. Creditors may update consumer reports on a set date after the close of a billing cycle, so ask your creditor to update your report on a rolling basis. Ask if a company representative or manager can provide written notification confirming a promised report date.

3

Explain the importance of having the new information documented on your credit report. For example, explain that in 30 days you will apply for an auto loan and want to receive the lowest interest rate possible.

4

Find out which credit reporting agency will receive the information. Be sure that all three of your credit reports are updated at the same time. Follow up with each credit reporting agency to verify the changes.

5

Quote the law. When dealing with a dispute, remind your creditor that according to the Fair Credit Reporting Act any item in dispute must be investigated and removed, if found to be inaccurate, within 90 days of a dispute letter being sent by a consumer. If you have not already sent a dispute letter, do so now.

6

Threaten to report the creditor to the Federal Trade Commission, Better Business Bureau and your state's attorney's general office. Each has the authority to receive and investigate complaints against creditors.

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What to Write to a Credit Card Company to Remove My Ex-Spouse's Charges From My Report?

You may be disappointed to learn that divorcing a spouse does not necessarily cut all ties with him. In fact, you may find some of your spouse's debts on your credit report. Unfortunately, this probably means you legally owe them. You could write the creditor to fight your liability to pay the debt, but your plea may fall on deaf ears.

Identification

There probably is little you can say in a letter to remove an ex-spouse's charges from your report. If you had a joint account with a spouse, you are liable for payment on the account even if a judge says otherwise. Experian, one of the major credit reporting bureaus, tells consumers to explain to the creditor that you do not owe the spouse's debts. Even this may not stop collection efforts on the part of the creditor, but at least you can show responsible actions in case of a lawsuit over the debt.

Considerations

It is better to pay debt on a joint account rather than ignore and try to fight the charges. You can later ask a judge to enforce an indemnity agreement to get the spouse to repay the debt. If the account was in error or the spouse took an account in your name after a judge signed the official divorce papers, you could send proof that you are not the account holder, such as government identification and proof of the dissolution of marriage. Some states require both spouses to pay any debt incurred during marriage, while others may require you to pay the debt even if you name never appeared on the account.

Considerations

Ideally, you want to work out a plan with your spouse to determine who gets what debts. Once you do this, you can ask the lender to assign the charges to your individual accounts. Even in this case, the creditor might still consider you both liable for the debts. Secured debts, such as a mortgage, usually require both spouses to agree to refinance the debt.

Tip

You should hire a lawyer to help you enforce court orders that require a spouse to pay a certain debt. You also may need to determine what debts you both must pay if you live in a community property state. You and your spouse may want to get individual consolidation loans as a convenient way to keep track of your debts. You should keep any disputed account current so you can protect your credit score and qualify for loans on your own.

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Can My Bad Credit Affect My Spouse?

Although your bad credit does not directly affect your spouse's credit score, it can have several indirect effects as you move forward in managing your finances together. Before getting married, you should discuss your credit scores so you don't run into any surprises when you apply for credit together after the wedding.

Separate Scores

Credit scoring is done on an individual basis, so even after getting married, you and your spouse will maintain separate credit scores. You will each have the credit history from before you got married, which means you will be stuck with your bad credit. The good news is that this bad credit does not transfer onto your spouse's credit report. Only accounts that you hold jointly will appear on both of your credit reports.

Borrowing Together

Your bad credit will affect the terms of the credit you and your spouse are offered when you apply jointly. This is most relevant when you apply for a mortgage because the interest rate offered based on your credit could force you to pay thousands more dollars in interest than you would have if your spouse applied alone. In fact, some couples choose to have only the spouse with good credit apply for a mortgage. However, this can result in a lower approval amount because only the applicant's income is considered.

Other Effects

If your bad credit includes unpaid debts in your name, these can affect your spouse indirectly. This is because some of your income must go toward paying these debts, which reduces your ability to contribute to joint household expenses. Another potential effect of your bad credit is that it can affect the premiums you pay on your joint auto insurance policy. Lastly, your bad credit can cause emotional stress in the marriage by causing your spouse to feel that you are the cause of financial problems you have together.

Tips

Work together with your spouse to help increase your credit score. His good money management skills that have led to a good credit score are teachable, so let him help you to pay bills on time and manage your debt wisely after you are married. Another way to increase your credit score is to have him add you as an authorized user on his credit card. This will cause the account history on that card to be added to your credit score, which should boost it.

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Does Refinancing Change a Credit Score?

A lender will often report credit accounts to the credit bureaus. The bureaus compile this data and keep it within their database. This information is used to create a consumer credit report on you. Refinancing occurs when you take out a larger loan over an extended period of time to pay off a smaller loan, and this may have an impact on your credit score.

Credit Scores

Your FICO credit score represents how you handle credit and ranges from 300 to 850, according to FICO. It has five areas. The largest portion of the score measures how well you pay your bills at 35 percent. Thirty percent is the amount of debt you have, 15 percent is the average length of your credit history, 10 percent is how much new credit you've applied for recently and the final 10 percent is your credit mix of credit types.

Significance

A refinance can change your credit score depending upon the specifics of your new loan. FICO measures how much credit you have in relation to your level of debt. This is called your credit utilization ratio. The more debt you have, the higher this ratio and the lower your score. When you refinance, you take out a new loan and the old loan balance goes to zero. If the new loan you receive is larger, which means you now have more debt, that will increase your credit utilization ratio and this will lower your score. How much your score changes will depend on the other information on your individual report.

Considerations

Refinancing also requires you to apply for the new loan and give lenders permission to access your credit report. Each time you apply for credit, a hard inquiry will appear on your credit report. If you apply to multiple lenders then you will have multiple new inquiries on your report. This can lower your credit score. Inquiries remain on your credit report for up to two years. When calculating your score, FICO only considers the inquiries from the last 12 months. FICO does make an exception for rate shopping. If you apply for multiple auto or mortgage loans within a short period of time, usually 2 weeks, FICO considers that as one inquiry.

Prevention/Solution

Errors on a credit report can lower your credit score. If you notice inquiries on your report that are older than two years, you have the right under the Fair Credit Reporting Act to file a dispute with the bureau to have them removed. Disputes are filed by mail, phone or online at the bureau's website. If you notice inquiries that you did not make, this could indicate identity theft and you should notify the credit bureau and request a fraud alert be placed on your file. The initial alert remains active for 90 days, or up to seven years if you submit an identity theft police report to the bureau.

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Steps to Build Credit

Building credit is a gradual process that requires understanding how credit works and making wise financial decisions. Wrong choices and bad habits lead to a poor credit rating, which can reduce your chances of getting a home or car loan when you need one and make it harder to get a good interest rate.

Personal Loans

Start establishing a credit history by taking out a personal loan using your property as collateral. Visit your bank and talk to a loan officer about applying for a small personal loan using jewelry or other personal property as collateral. Rather than spend the money, deposit this cash into a savings account and then make monthly payments -- on time each month. This will start your credit report off on a positive note and help you establish a good payment history with your bank, which will open the door to other credit opportunities.

Retail Credit Cards

First-time credit applicants may not qualify for major bank cards. They use credit scores to determine eligibility; without a credit score, they can't assess your level of responsibility. Apply instead for a department store credit card. You can submit an application in the store, and these are easier to secure than major credit cards.

Sharing an Account

Piggybacking is the term used to describe adding another person to a credit account. Parents often help their children establish credit by adding them as an authorized user to their credit card. Talk to your parents to see if this is an option. Your spouse or a sibling would be another option.

Credit Patterns

Getting a credit card and applying for loans puts you on the right path. But to achieve a high credit rating, you've got to practice good habits. This includes making bill payments by their due dates to avoid late fees and negative remarks on your credit file. Most creditors and lenders have websites that allow you to manage your accounts online. Paying online and setting up automated monthly payments can help alleviate late payments. It's wise to pay off new credit card charges each month to keep your debt-to-income ratio low. If you can't pay them off each month, stay below 30 percent of your credit limit because the amount of credit used -- not just the number of cards -- affects your credit rating.

Credit Reports

Creditors report your payment history to the credit bureaus. Once you've established credit, you should check your credit report to ensure accuracy. Annual Credit Report (see Resources section) gives consumers one free report a year from each of the bureaus. Monitor your report regularly to catch mistakes early and recognize signs of identity theft. According to CBS News, about 80 percent of credit reports have errors. Some mistakes are minor and may not affect credit scores. But if your report contains mistakes such as unknown collection accounts, liens or judgments, these remarks can reduce your score.

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How to Determine What is a Good Credit Score

What is a good credit score? When it comes time to borrow money for a house, car, or personal loan, people begin thinking about their FICO numbers. In fact, people should think about their credit each and every day. If you don't know where you stand in the eyes of your potential lenders, now is the time to find out. Here you will find out how to determine what is a good credit score.

Instructions

1

Pull your 3 credit reports and FICO scores. Although you are entitled to 3 free reports per year, that does not include your FICO. If you want to know what is a good credit score, however, you need to know where you stand.

2

Throw out the bottom and the top score. The middle is the one most mortgage lender will look at. Perhaps the term, "Throw out", is a bit rash. You must consider the top and bottom numbers to know what is a good credit score for you. Some lenders only pull from 1 financial bureau, so all are important.

3

Understand that FICO can range between 300-850. A score above 700 is considered high. If you want to know what is a good credit score, try to reach even higher. Anyone above 800 is considered fantastic.

4

Break it down even further if you want more explanation about what is a good credit score. Anything above 730 typically gets the best rates. 700-730 is good. 670-699 isn't great, but people can still get loans with decent rates. Anything below 650 is typically considered pretty poor.

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Free Fast Credit Repair Tips

Bad credit records haunt you when you try to get loans or credit cards. You may be tempted by ads online, on television or the radio offering to repair your credit, but the Federal Trade Commission warns that most companies do not follow through with their claims and explains that you can fix your records yourself for free.

Clean Your Credit Report

You may be able to clean up many negative entries on your Experian, Equifax and TransUnion credit reports if you can find any errors in them. There are mistakes in up to 25 percent of reports. The Fair Credit Reporting Act requires the credit bureaus to investigate if you dispute a mistake. Creditors frequently don't bother to respond, and the negative items must be erased under the law if it is not verified. Once they are gone, they no longer hurt your credit score or figure into lenders' decisions. You can check your credit reports for free every year through annualcreditreport.com, the FTC explains. Make disputes on the credit bureau websites or with letters sent through the mail.

Make On-Time Payments

FICO, the largest credit score compiler, recommends getting your payment record back on track if you've been late or completely missed credit card or loan payments. FICO cites paying bills by their due dates as one of the biggest factors in building or repairing credit. Mail payments early to account for possible postal delays or send them electronically so you can specify the date they reach the creditor. Every on-time payment counts towards credit repair because lenders put the most emphasis on recent activity.

Pay Down Debt

Your credit score is harmed by high balances on credit cards and other revolving accounts like those from retailers or gas stations, according to FICO. Channel as much money as possible towards reducing your highest balances every month. Redistribute the money onto your other debts once an account is paid in full.

Keep Using Credit

You get in trouble when you use too much credit, but you can't have a good credit score unless you are actively using accounts. You may need to get a secured credit card if your old issuers charged off the debt or you declared bankruptcy. People with bad credit still qualify for secured cards because they make a bank deposit as collateral. For example, you would deposit $500 with the card issuer and receive a $500 credit line. You use the credit card in the same way as a traditional account, and the bank reports your activity to the credit bureaus. This helps you as long as you manage the account responsibly. The bank seizes your deposit if you stop paying your bill.

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Who to Call for Updating My Credit Report?

The credit bureaus can be notoriously hard to contact -- Experian is famous for constantly changing its mailing address and phone number, according to the BCS Alliance. You usually do not have to call anyone to update your credit report. In some cases, you might have to contact a creditor or credit bureau.

The Creditor

Normally, creditors update their accounts every month, so you do not need to call them as a reminder. The only time you might want to call the creditor to update your report is when you find an error on one of your loan accounts. Since lenders are the source of information for the credit bureaus, they can correct mistakes by sending in new data.

The Credit Agency

Technically, consumers should contact the credit bureaus to correct a mistake or update a report, because they have the power to report to other lenders. Sometimes, however, calling a credit agency takes longer than contacting a lender because the bureaus receive thousands of disputes each day. On the other hand, there are some errors that only the agencies can correct, such as a judgment that does not belong to you or a false employment history.

Considerations

You probably do not even want to call a creditor or credit agency to update your credit report in a dispute case. Sending a certified letter gives you proof that the agency received your claim and you can include evidence to hasten the process. If you do have phone contact with the agencies, log all details of the call, including the name, supervisor and department of the employee and ask for a certified letter summarizing the interaction, suggests Bankrate.

Tip

In a worst case scenario where a creditor nor a credit agency will update your report and you feel you have enough evidence to prove a negative item is erroneous, you may need a lawyer. Some credit experts, such as Holden Lewis of Bankrate, even suggests calling a reporter to publicize your case.

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How to Get a Credit Report From Equifax

Equifax is one of the three major credit reporting agencies in the United States. This agency creates a credit report based on information furnished by your creditors. You'll find credit card, loan, mortgage and other type of credit accounts on your report. Any recent delinquencies, collection accounts or negative reports will also be included. Request a credit report from Equifax to confirm that your report has accurate information. You are legally allowed to request a free credit report from Equifax and two other credit reporting agencies once per year, through the Annual Credit Report site run by the federal government.

Instructions

1

Navigate to the Annual Credit Report website (see Resources).

2

Choose your state in the drop-down list and click "Request Report." Enter the requested personal information in the form. Click "Continue."

3

Check "Equifax" from the list of credit reporting agencies. Click "Next" twice. You will be redirected to the Equifax website.

4

Click "Continue" to view your Equifax credit report.

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How to Improve My Credit Score

In today's economic environment, you may be pondering "how to improve my credit scores". What most people do not realize is that increasing your credit score by 80 points can reduce the interest rate that you pay by 1.5%. This could potentially save you hundreds of thousands of dollars over the course of a 30-year mortgage.

Instructions

1

Pay Your Bills On Time - Everyone knows that you should pay you bills on time each month. What you may not realize is that every late payment shows up as a negative factor on you credit report. As soon as you get your invoice, rip it open, mark it on your calendar, and pay it BEFORE the due date.

2

Pay More than the Minimum Due - Most minimum payments are around 4% of the outstanding balance. Paying this amount really contributes to you having less wealth. Basically you are working hard to earn some money only to send it to the credit card companies at the end of the month. Do whatever you need to do to make some extra money. eBay, even with their ridiculous fees, is an easy way to reduce the clutter around your house and pay off some debt.

3

Do Not Skip A Payment - I think this is worth repeating - DO NOT SKIP PAYMENTS! If my goal is to increase my credit score and to become debt free, allowing the credit card companies to tack on interest and penalties is not the appropriate approach. Pay anything that you can each month, even if it is less than the minimum. Do not allow your accounts to be sold to a collection agency.

4

Do Not Close Old Accounts - One of the major factors in determining your credit score is how long you have had credit with each creditor. If your balance is zero, leave it open (unless there is an annual fee). Simply cut the card up to ensure that you never use it again.

5

Lower Your Outstanding Balances - You credit score is negatively impacted if you carry a balance that is more than 35% of your available credit. For example, if your available credit for Card 1 is $1000, you should not carry a balance greater than $350.

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Does My Credit Score Affect My Spouse's When We Marry?

Your credit score plays a significant role in your ability to be approved for loans and other lines of credit. Each individual has a credit history based on how their have handled your debt obligations in the past, which is used to calculate your credit score, a number between 300 and 850. The higher your score, the more creditworthy you appear so banks will be more likely to offer you a lower interest rate. Your credit score is based on your credit history alone and is not affected by your spouse's credit score.

Misconceptions

Some people mistakenly believe that getting married will result in your credit scores being combined when you tie the knot. However, just getting married has no impact on your credit score. Not only will you still have a separate credit score from your spouse, your prior financial activities will not play any role in calculating your spouse's credit score in the future.

Factors

Your credit score takes into consideration only the accounts with your name on them and does not include account information that applies only to your spouse. When looking at these accounts, the FICO credit score looks at whether you have paid your bills on time, how much you owe and how large your credit lines are, how long you've been using credit, how much credit you've applied for recently and the different types of credit that you've used.

Joint Accounts

You do not automatically become listed as a joint account holder on all of your spouse's accounts when you get married. However, should you choose to, you can open joint accounts that both of you will be legally liable for. These accounts will appear on both of your credit reports, for better or for worse. Even if only one person uses the accounts all on-time payments and missed payments or defaults will appear on both credit reports, which can have a significant affect on both credit scores.

Considerations

Even though your credit scores do not get merged when you get married, lenders will want to look at both your credit score and your spouse's credit score when you apply for a loan. If your new spouse has a lower credit score, you may end up paying a higher interest rate, or even being denied a loan or line of credit. Before applying for a loan, you should check both of your credit scores for errors and to know what to expect from lenders.

Benefits

Your credit score is solely your responsibility. Getting married cannot provide a quick fix for a bad score or a steep drop for a good score. Lenders do not expect a trip to the alter to magically change your fiscal responsibility for better or worse. In addition, if you end up getting divorced, you will still have a separate credit score from your spouse and you will not have to start all over to build credit from scratch.

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How to Understand Your Bad Credit Report

Many things can contribute to a bad credit report. Bad credit can remain on your credit report for seven years. Each item of bad credit has a certain designation for identification purposes. Items of bad credit can include bankruptcy, repossession, foreclosure, 30, 60 and 90 days past due, judgments and tax liens. After seven years, most bad credit items will automatically fall from your credit report. You can dispute any inaccurate or incomplete information.

Instructions

1

Determine which items on your credit report are charge offs. An account is reported as a charge off or loss when there has not been a payment in six months. Charged off accounts are assigned a credit rating of "9" on a credit report. The "9" can be preceded by an "I" for installment loan or an "R" for revolving account such as a credit card.

2

Locate and review your credit ratings. When an account is late by 30 days, it shows up on your credit file. If a payment is not made the next month, it becomes 60 days late. An R-1 or I-1 means that the account is paid on time. An R-2 means the account is 60 days past due; R-3 accounts are past due 60 days; an R-4 account is 90 days past due.

3

Take a look at trade lines. The information reported to credit reporting agencies are called trade lines. The information listed includes the name of the creditor, balance, date last paid, type of account and the credit limit. The credit rating appears at the end of the account to the far right.

4

Find your credit score. Once you establish credit, you are assigned a credit score. Credit scores can range from 300 to 850. The higher your credit score, the better terms and conditions you receive on credit products such as mortgage loans, lines of credit, auto loans and credit cards.

5

Review the effect bad credit has on your credit report. A foreclosure can reduce a credit score of 680 by 85 to 105 points; a score of 780 can be reduced by 140 to 160 points. Bankruptcies can reduce a score of 680 by 130 to 150 points and a score of 780 can be reduced by 220 to 240 points according to the website Credit Cards.

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Will a House Boost Your Credit Score?

Credit scores are calculated using criteria such as the types of credit accounts you have, the balances on the credit accounts, the overall and average length of your credit history, and other factors. When you add a house mortgage to your credit report, several new factors are added to the report that can make your credit go up or down, depending on your situation.

Credit Score Basics

Your credit score is a three-digit number produced based on information found in your credit report. The credit report information comes from your creditors, public records and collections. A credit score is influenced by several different aspects of your credit report, such as your credit balances, the age of your accounts and any negative credit marks such as collections. Lenders use credit scores to determine your credit worthiness when you apply for a loan or credit card. Good credit scores allow you to get promotional rates, low interest rates and other benefits. Bad credit scores can prevent you from qualifying for credit at all, or can result in you getting terms that include higher interest rates.

Diversity

If you have never had a mortgage loan, buying a home will boost your credit report's diversity of credit lines. The diversity of your credit accounts is a positive factor, so once the mortgageis reporting, you will likely receive a score increase. Other types of accounts you can add to your credit report to increase diversity of credit lines include credit cards, installation loans, car loans and store cards.

New Account

Another aspect of credit scoring involves new accounts. A new account may have a positive effect if you do not have many new accounts or a negative effect if you have many accounts and your new account reduces the average length of time that you have had credit accounts.

Inquiries

When you apply for a mortgage through a lender, an inquiry is placed on your credit report. The inquiry reduces your credit score slightly, because it indicates you want to borrow more money, but it may have a larger effect if you have a thin credit file. Thin credit files are credit reports without long histories or many accounts. Inquiries are removed from your credit report after two years, so the negative effect is temporary.

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How to Dispute Identity Theft Items

It's a bit disconcerting to realize that there is something on your credit report that isn't right, but it's a sinking feeling to realize the inaccuracies are the result of identity theft. The financial mess left in the wake of identity theft can take months or even years to completely straighten out. One of the first things you can do to start down the path to reclaiming your identity is to dispute anything on your credit report that isn't yours.

Instructions

Disputing Fraudulent Items

1

Report the identity theft to a law enforcement agency in your area. Be persistent if there is any reluctance by the law agency to take an identity theft report. Ask for a copy of the report.

2

Check reports from all three of the nationwide credit reporting agencies: Experian, TransUnion and Equifax. Mark disputed items on the credit reports. Free copies can be obtained from AnnualCreditReport.com.

3

Fill out an Identity Theft Victim's Complaint and Affidavit from the Federal Trade Commission. For each disputed account, complete a separate Fraudulent Account Statement.

4

Write a dispute letter to each credit reporting agency. Include the file or report number of the disputed report, usually found in the top right corner of the report. If there are disputed accounts, list each credit account, including the creditor's number and the account number. List incorrect addresses, unknown debt, and unsolicited inquiries from creditors.

5

Attach copies of all supporting documents to the letter. Do not send original copies of supporting documents. These documents might include a police report, ID Theft Affidavit, and marked credit reports. Also attach proof of identity and residence, such as a copy of a driver's license and a copy of a utility bill. List all attachments in an Enclosure section at the bottom of the letter. Make a copy of your dispute letter for your records. Keep it with the original documentation you attached to the letter. Send the letter and all the supporting documentation via certified or registered mail. Keep the receipt with your records. Send a copy of the letter to each creditor involved.

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How to List a Past Due Account on a Patient's Credit Report

A successful medical practice is not just about treating patients. You must also manage your practice's accounting processes if you expect to make a living. One such task that a medical practice must complete is collecting money that is past due. Accounts that are more than 90 days old should be reported to credit bureaus. If your patient sees the account on his credit report, he may be more likely to pay it.

Instructions

1

Call your patient about his past due account and explain that you plan to report it to the credit bureaus. In some cases, your patient may be able to make a payment.

2

Enlist a credit reporting service to process past due accounts. The service will charge a small fee, but it will format the information correctly and contact patients' credit bureaus. This is a smart choice if you have a small practice and need to report past due accounts only a few times each year.

3

Contact a collection agency to help you report past due accounts to the credit bureaus. These companies also help you collect fees you are owed by contacting the patient and, if necessary, garnishing wages and freezing bank accounts. However, since collection agencies take a percentage of any money they collect on your behalf, large past due accounts may be expensive to service.

4

Consider getting a membership in one of the credit bureaus. Membership will allow you to report past due accounts directly to the credit bureaus using their electronic interface. Membership can be a hefty investment, so it's not for medical practices that don't have at least 100 credit accounts to report each year.

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How Do Deposits for Cell Phone Companies Work?

Basics

Cell phone companies tend to require deposits to start service when there is the presence of bad credit or no credit history at all. This is a source of protection for the company, in case the bills are not paid as agreed. It is important to understand how cell phone deposits work when one is asked of you to complete a purchase.

No Credit

When a consumer has no credit, she is still a credit risk. A cell phone company will usually ask for a modest deposit, such as $150 to $300, to secure the line. This is not used toward future bills but is held in case the account is closed without notice or bills are not paid. Some deposits can be reconsidered after 6 months to a year of on-time payments, while others will remain on the account for the life of the contract or line.

Bad Credit

Those with bad credit may need to pay deposits closer to $500 to $1,000 to get a cell phone, because their history already shows a high risk of defaulting on loan and bill obligations. Some cell phone companies may also outright deny service, requiring the potential customer to either get a prepaid cell plan or go to another company. If a deposit is accepted, it also cannot be applied toward future bills but secures the account in case of sudden closure or unpaid transactions.

Alternatives

Prepaid cell phone plans are usually the best alternatives to transactions requiring a high deposit. These phones only work when money is loaded to the phone, usually in-store or using a gift card. Most of these phones have monthly plans and text messaging, making these an affordable alternative to extensive deposit requirements that some cell phone companies place onto those with no credit or a bad credit history.

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What Effect Does a Frozen Credit Card Have on My Credit Score?

Credit cards may raise or lower a person's credit score depending on a variety of factors. A frozen credit card account may be one of those factors, but usually it will only affect a person's credit score in a minor way.

Credit Card Freeze

A credit card freeze is different than a credit freeze. You can freeze your credit cards if you contact the card company and tell them to freeze the card. You won't be able to use the card after that.

Credit Freeze

A credit freeze involves a consumer freezing their credit report from being accessed by anyone, including themselves. This prevents creditors from inspecting their report, and therefore prevents any further credit cards from being issued. Freezing a credit score is not the same as freezing a credit card, though, as the card can still be used.

Credit Score Factors

Credit card freezes can affect your credit score for a number of reasons. Credit scores are based on a number of factors: payment habits, amount owed, length of credit history, new credit and types of credit used.

Increases

If the credit card freeze prevents you from using your card and buying more, you may be able to increase your score, if that is accompanied by continued payments. If you freeze credit and pay the balance down to below 30 percent of the limit, you can increase your score.

Decreases

A credit card freeze that is accompanied by late payments or continued spending without repaying will lower a score. Opening more cards or taking out new loans to pay off a card may increase or decrease your credit score, depending on how much credit you owe and how many accounts you already have open.

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Issues Related to Internet Credit Card Identity

Credit card identity theft can occur over the Internet and have lasting consequences. Regrettably, some people don't realize their personal information is compromised until they apply for a loan. Thieves have several tricks for stealing your personal information. Learn the ways they acquire your information and tips to protect your card numbers.

Consequences

Having someone take your credit card number and it to buy items can negatively affect your personal finances. And if someone applies for a credit card in your name, this move can hurt your personal credit file because these charges often go unpaid. Thieves can max out your existing credit cards, which increases the your outstanding balances. If unaware of this crime, and if you do not report theft to your credit card company, these higher balances may show on your report and possibly lower your score.

Acquiring Personal Information

Thieves have several techniques to getting hold of your credit card information. Oftentimes, they employ online methods. They can hack into your computer system, or break into a company's system and access customer credit card numbers. Another method for acquiring credit card numbers involves a technique called phishing where thieves randomly send countless fraudulent emails asking you to update your account information with a specific company. They may ask for your name, credit card number and expiration date.

Online Protection

The best way to protect your credit card numbers online is to ignore any unsolicited emails. Remember, your credit card companies will never request personal information through email, and they will never ask you to enter your credit card numbers online. Emails of this sort are fraudulent and an attempt to steal your card information. Do not click links or respond to these emails. Delete these correspondences and report the email to your credit card company. And if shopping online, only enter your card information on sites that feature a secure logo, such as padlock or Verisign logo.

Credit Report

Because Internet identity theft can go unnoticed for weeks or months, it's imperative to stay on top of your personal credit history. There are ways to keep aware of your credit situation. You could sign up for credit report monitoring and receive alerts whenever a new account is opened in your name. Another method involves ordering your personal report from Annual Credit Report annually. Check your report for unauthorized credit card accounts, and check each entry to ensure correct account balances and accurate information. Report negative findings to your credit card companies.

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Being 30 Days Late & Your Credit Report

When you fail to make a loan or credit card payment within 30 days of the due date your lender can notify the credit reporting agencies. The national credit bureaus, Equifax, Experian and TransUnion, all list 30 day late payments on your credit report, and your credit score suffers every time a creditor reports a late payment.

Late Payments

Technically, you are making a late payment if you miss your payment due date by just one day, but most lenders provide you with a grace period that lasts for up to 10 days before your payments are regarded as late. You incur penalty fees from your creditor for making payments after the grace period ends, but from a credit reporting perspective, you are not "late" until you have fallen more than 30 days behind on your payments.

Credit File

The credit bureaus store information about your current borrowing habits in your credit report. Generally, closed accounts disappear from your report once the lender in question stops making monthly reports about your account activity. However, late payments and other negative events, such as foreclosure, stay on your credit report for seven years. Even thought you made your payment, the fact you were late making it means a late payment occurrence remains on your credit report.

Credit Score Factors

Credit bureaus use a variety of different pieces of information to calculate your credit score, but your payment history accounts for about a third of your overall score. However, if you have multiple accounts that you have paid on time then a single 30 day late payment may not have much of an impact on your credit report. The more good information you have on your report, the less damage a single negative event can do to your score. However, if you have not had credit for a long time or have very few open accounts, a single late payment can have a significant impact on your score.

Lenders

Lenders check your credit score whenever you apply for a new credit product, but the only credit events that normally immediately disqualify you from obtaining credit are events such as a recent bankruptcy. If your score has fallen due to a single late payment, lenders are often prepared to overlook that single negative event, especially if some kind of unusual sequence of events caused you to miss your payment. However, if you missed your payment because you are starting to have financial problems then lenders may view that missed payment as a sign of future problems and refuse to provide you with additional credit.

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How to Get Negativity Off of a Credit Report Instead of Disputing It

It is always a good idea to periodically inspect your credit report to make sure there aren't any mistakes bringing down your score. If there are no mistakes, you may still find a few negative influences that are harming your report, in which case you need to remove them. According to "DestroyDebt.com," you can challenge the accuracy of anything on your credit report at any time to have it removed. Removing the small harmful portions of your credit report can greatly increase your overall credit score.

Instructions

1

Look at your credit report for any bills that are marked as unpaid. There may be cable or phone bills from previous addresses.

2

Send a payment to these companies and ask them to report to the credit bureaus that the bills have been paid.

3

Pay off your larger loans. You do not need to do this at one time, but chipping away at the debt is going to slowly increase your credit score.

4

Stop applying for loans and credit cards. Every time you apply for a loan or line of credit an inquiry is made into your credit score and stays on the report for 2 years. Eventually your score may be affected if too may inquiries are made.

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How to Run Your Credit Score

If you aren't getting the best interest rates, it might be time to run your credit score. Credit scores are numbers that credit bureaus assign to assess borrower risk. Financial institutions use this number to determine which interest rates to offer consumers (or even if they qualify for a loan). In some cases, a low credit score can prevent you from accessing credit, securing insurance or landing employment.

Instructions

1

Gather personal information. Before requesting your credit score, make sure you have personal information handy. Credit bureaus require that you prove your identity. Multiple choice questions will be asked about your finances. For example, you might be asked for the lender of a car loan or the exact amount (to the penny) or your home mortgage.

2

Decide which credit scores you want. Credit scores can be ordered through AnnualCreditReport.com. At this time, you can also print a free credit report from each credit bureau, including Experian, Equifax and TransUnion. Each credit bureau has its own credit score. You can request all three or just one. As of 2010, the cost for each credit score is $6.95. Ordering a credit report is free (once every 12 months).

3

Review your credit score. A credit score of 720 to 849 is excellent. A score of 620 to 719 is average and a score of 349 to 619 is poor. Don't be alarmed if different credit bureaus have different scores. It's normal to have a little variation.

4

Look for inaccuracies. If your credit score isn't what you hoped, review your credit report. Look for inaccurate late payments, credit card limits that aren't correct or other issues. File a dispute with the reporting bureau (see Resources). Requests are typically processed within 45 business days. If approved, your credit score should improve.

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How to Sue a Company for Information on Credit Report

Debtors can sue their creditors for reporting false information to a credit bureau. This is usually only an effective strategy if the debtor can produce documentary evidence demonstrating the inaccuracy of a claim on a credit report and their attempts to resolve it with the offending party. If a creditor or collection agency violates the Fair Credit Reporting Act, they may be vulnerable to a lawsuit for damages.

Instructions

1

Maintain records of all bills and communications with creditors. Only mail out copies. Keep the originals for yourself and make backups. The more documentation that you have supporting your case, the more likely that you are to win a lawsuit against a creditor for credit reporting errors or other improper behavior. Keep records of any communications with credit bureaus as well.

2

Record all telephone conversations that you have with a creditor or collection agency after you have obtained their permission. This may be counted as admissible evidence during a lawsuit or court case.

3

Contact a lawyer to determine how to proceed. Lawsuits relating to inaccurate credit reports are usually filed under defamation, the Fair Credit Reporting Act or the Fair Debt Collection Practices Act. A company that has not updated a credit report despite a written agreement to do so may be vulnerable on multiple violations.

4

Proceed with the lawsuit. Expect the company to settle quickly rather than go through the expense and time of a lawsuit. In many cases, the underlying debt, if it was still valid, will be discharged as a result of the misconduct of the creditor and a penalty will be rewarded to the plaintiff.

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