How Do I File on Someone's Credit Report?

A credit report is designed to show a potential borrower's creditworthiness--that is, the likelihood that he will be able to pay the loan back on time. Many small and personal lenders assume that they do not have the same power as large companies to report debts and delinquencies on a borrower's credit report. However, any business owner can file such reports. After the initial setup, reporting credit data is a fast and simple task.

Instructions

1

Open an account with each of the three major reporting bureaus: Experian, Transunion and Equifax. You can open an account on the website for each bureau. Each agency will charge a fee, typically in the form of a subscription charge that you pay online with a credit or debit card.

2

Draft a disclosure notice that advises the borrower that you will report her payment history to the three credit bureaus. State in the disclosure notice that you have the right to access the borrower's credit report. If a prospective borrower refuses to sign the disclosure, do not do business with her.

3

Complete the credit data reporting form for each agency. On each form, you will include the borrower's identifying information, such as name, address and Social Security number. You will also include the type of debt owed, the amount of the debt, and whether the borrower is current on his loan. Submit the reporting form to each agency online.

4

Report data for your borrowers each month until they pay off or otherwise close the loan. If the borrower does not make timely payments as agreed, this consistent reporting gives other prospective lenders the information they need to deny the borrower a loan or charge higher interest rates. If the borrower does pay as agreed, it helps the borrower to build a solid credit history.

Read More

Does Paying Off a Collection Negatively Affect Your Credit Score?

When you are faced with debt collectors calling you, paying off your accounts may be at the top of your priority list. In this situation, besides just getting rid of the debt, you also have to consider how it can impact your credit score. When paying off your accounts, it should not negatively affect your credit score unless you close them after paying the balances.

Paying Off Old Items

When a debt gets to a certain age, it passes a statute of limitations. This statute of limitations is different for every state and once the time limit has passed, the collector cannot take you to court. However, this does not mean that you should not pay off the debt. Paying off old accounts cannot hurt your credit score, but it may not necessarily help it right away either. Once you pay off the debt, the creditor will report it to the credit bureaus as paid; however, accounts less than 7 years old will remain on your reports. But as MSN Money points out "any potential lender, landlord or employer would much rather see a paid collection account than an unpaid one."

Credit Utilization Ratio

One factor that must be considered in this situation is your credit utilization ratio. This is the ratio of the amount of debt you have in relation to the amount of available credit. If your credit utilization ratio is below a 35 percent, it helps your credit score. This means that paying your collection account balances down can actually boost your score in this regard. When creditors know that you have little debt, it makes you a more attractive borrower.

Closing Accounts

When you pay off your credit accounts, closing them could actually hurt your credit score. If an account is closed, it lessens the amount of available credit that you have. Even though you have less debt also, it can make the credit utilization ratio less attractive. Once your ratio rises above the 35 percent mark, it hurts your credit score and makes lenders think twice about extending credit to you. If the account is delinquent, the creditor may freeze it, which prevents you from accessing the rest of your credit limit. Once this happens, it can actually negatively affect your credit utilization ratio. Paying off the account, could help improve your ratio again. In some cases, the creditor may be willing to reinstate the account once you pay off the delinquent amount. When this happens, it can significantly improve your credit utilization ratio again.

Frequent Use

Once you pay off all of your collection accounts, you may be tempted to avoid using credit completely. While this can help you avoid paying interest and it can keep you out of debt, it can hurt your score. In this situation, using your credit accounts lightly but frequently can help boost your score. Once you make a purchase on your credit cards or other credit accounts, pay it off when the statement comes and your score will increase over time.

Read More

How to Put a Credit Alert

The Federal Trade Commission says you can place fraud alerts on your credit reports to protect your identity. The alerts will make it difficult for crooks to use your name and personal information to open fraudulent credit accounts. The alerts can remain in place for up to seven years, and during that time federal law requires potential creditors to make reasonable efforts to verify your identity or even meet with you before issuing credit in your name.

Instructions

1

Contact the three major credit bureaus--TransUnion, Experian and Equifax--to place the fraud alerts on your credit report. Call the bureaus for the fastest service, or write them. If sending a letter, include your name, Social Security number, address and telephone number. The credit bureau will contact you by standard mail or telephone to confirm your identity and activate your fraud alert. If you call, this can be accomplished during the initial conversation. Contact the credit bureaus at their addresses.

TransUnion Consumer Solutions
P.O. Box 2000
Chester, PA 19022-2000
800-916-8800

Equifax Consumer Services
P.O. Box 740256
Atlanta, GA 30374-0256
800-846-5279

Experian
P.O. Box 2104
Allen, TX, 75013
888-397-3742

2

Ask for one of two types of fraud alerts: an initial alert or an extended alert.

3

Request an initial alert if you need only temporary protection. An initial alert remains on your credit reports for at least 90 days and is a good choice if you've lost your wallet or purse and need time to notify your creditors. You can specify how many days you want the alert to remain in place beyond the minimum of 90. For an emergency situation like this, call the credit bureaus to activate the alert. Once the alert is in place, federal law requires creditors to follow "reasonable polices and procedures" to verify your identity before issuing credit in your name.

4

Select an extended alert if you have become a victim of identity theft and crooks have already used your personal information to open fraudulent accounts. To activate the alert, you must provide the credit bureaus with an Identity Theft Report that describes how you were victimized. Sample reports are available at the FTC website. Or gather information from your police report. The credit bureaus can guide you through the process. The extended fraud alert will remain on your account for seven years. While the alert is in place, creditors must contact you directly or even meet with you before issuing credit.

Read More

What Is the Meaning of Your Credit Score?

Credit reports are detailed dossiers of your credit accounts and financial transactions, compiled by three reporting agencies called Experian, Equifax and TransUnion. Many lenders review your reports, but some prefer to use your credit score, which compacts all your report data into a simple number. Your score changes regularly, based on the information in your reports, so it is always up to date, according to the Board of Governors of the Federal Reserve System.

Definition

A credit score is a three-digit number calculated by original scoring company Fair Issac Corp. or a credit bureau. It summarizes your creditworthiness based on your current and past financial activity. Scores run between 300 and 850, according to Leslie McFadden of the Bankrate website, and a higher score means you are a more trustworthy borrower. Low scores mean you are at higher risk of defaulting on bills or filing for bankruptcy.

Factors

Credit score formulas are based on various factors related to your credit use, with some actions weighed for heavily than others. For example, the timeliness of your payments and signs of financial mismanagement, like charged-off accounts or repossessions, are 35 percent of your score, according to the MyFICO scoring site, while owed balances account for 30 percent. Fifteen percent of the total number is based on how long you have had loans and credit cards, while your newest accounts and your mix of revolving and installment credit makes up the remaining 10 percent.

Range

Lenders grant new accounts and determine interest rates, fees and other terms based on a range of credit scores that marks you as a highly desirable or average customer or high-risk credit user. The best scores fall between 760 and 800, while anything below 620 classifies you as "subprime" and raises your application rejection risk. Creditors may insist on charging higher-than-average interest if they do agree to work with you.

Access

The Fair and Accurate Credit Transactions Act, an amendment to the Fair Credit Reporting Act, entitles you to see your credit score but allows FICO and the credit bureaus to charge you for it. Experian, Equifax and TransUnion must give you free credit reports yearly through AnnualCreditReport.com, but the law lets them impose a "reasonable" fee for your score. The usual charge is around $8, according to the Federal Trade Commission. Two websites, CreditKarma and Quizzle, which is owned by Quicken, give free credit scores with no purchase requirements, according to financial adviser Clark Howard.

Read More

How to Add Years of Positive Payment History to a Credit Score

A credit score is a rating credit agencies place on the level of risk involved with lending to an individual. Higher credit scores indicate a lower level of risk, whereas low credit scores indicate high risk. Several factors go into determining your credit score. The number of credit lines you have, outstanding debt, banking information, judgment and lien filings and payment history all have a significant impact. Adding positive payment history to your credit report will improve your credit score and increase your borrowing ability.

Instructions

1

Contact the information provider or creditor. Creditors provide the details or information regarding payment history to the credit agency. You can report positive payment history related to credit cards, rental agreements, mortgages and other financial obligations by contacting specific creditors. Notify them that you do not see payment information on your credit report. They, in turn, should furnish the information to credit agencies for reporting.

2

Contact the credit agencies. Many consumer credit agencies or bureaus compile credit scores on the reports they sell or furnish. Adding your positive payment history can improve your credit score. Notify credit agencies such as Equifax, TransUnion and Experian of the missing payment information. They will conduct an investigation that includes contacting the creditor for verification.

3

Verify the payment information has been added to your credit report. Any changes made to your credit report require the credit agency to notify you in writing and provide you with a free copy of your credit report. If you do not receive a notification from the credit agency, contact them to see whether any changes were made. After any changes occur, compare the credit score on your new credit report to the old one. You should see an improvement.

Read More

Can Banks Report Credit for Participating in the MHA Program?

Creditors will report a Making Home Affordable, MHA, loan which might seem like a bad item, but it usually helps borrowers keep their home and avoid more serious incidents. When the MHA program first started, the normal credit reporting codes hurt credit scores of participants. As long as you abide by the rules of your MHA program, your credit score will be fine in 2011.

Identification

Banks will report a mortgage in a MHA modification program. In 2011, a MHA account appears as ""modified under federal government plan" on a credit report, according to the Making Home Affordable website. Lenders do not have to report any account to the credit bureaus, but most mortgage providers do this to keep credit bureau files as accurate as possible.

Effect

When the federal government introduced the MHA program in 2009, modification usually hurt scores, because the government told lenders to report accounts taking part in MHA as partially paid. Anything less than "paid as agreed" damages a credit score. In 2010, the government fixed this by authorizing a new reason code for consumers taking part in a federal modification program.

Considerations

The status of your mortgage before entering an MHA program determines how the creditor reports it to the bureaus. If you are in default before the trial period -- a three-month testing time to see if the loan modification helps you meet payments -- the creditor will report the account as delinquent unless the modification lets you catch up on the missed bills. If you are not behind on payments, the creditors reports the account as "paid as agreed."

Tip

Always ask the lender how he will report the modification to the credit bureaus. As of 2010, taking part in an MHA program does not lower your credit score. The Fair Isaac Corporation, designer of the popular FICO score, does not have enough data to determine how the MHA program affects borrowing habits. Since most people requesting help from MHA are having trouble paying a mortgage, there is a good chance that just taking part in the program could lower a person's credit score in the future.

Read More

How to Improve Credit Using the Piggyback Method

The Equal Credit Opportunity Act helped to give homemakers credit scores by adding them as an authorized user on their husbands' accounts. Being added as an authorized user of an account--known as "piggybacking"--can help you increase your credit score through association with someone who has good credit, even if you never use the account. Unfortunately, credit repair companies began using piggybacking to boost the scores of strangers' accounts. The credit bureaus have caught on to this method and are developing ways to catch deceptive use of piggybacking, but it still works in legitimate cases of adding family to credit accounts.

Instructions

1

Ask a family member to help you out. You need to have someone who is willing to add you as an authorized user to her account. Typically, this would only be a parent or a husband or wife.

2

Call the credit card company. The card owner must call the credit card company and ask to add you as an authorized user. You may or may not get your own credit card. Even if you never use the account, you will still benefit from being an authorized user.

3

Wait for your credit score to rise. You may see an initial jump of 20 or 30 points, but you'll have to wait several months to see a significant increase.

Read More