Applying for a Mortgage? Better Check Your Credit Report for Errors!

 

Are you getting ready to apply for a mortgage?  Have you obtained a recent copy of your credit report to check for inaccuracies?  If not, you might be surprised by what you find.

A February 2013 study from the Federal Trade Commission (FTC) found that:

  • five percent of consumers had errors on one of their three major credit reports that could lead to them paying more for products such as auto loans and insurance.
  • one in five consumers had an error on at least one of their three credit reports.

So what exactly is a credit report and how does it differ from my credit score?  A credit report is a person’s documented debtor history. It includes every credit card, student loan, charge card, mortgage or auto loan or lease for which you’ve ever been named as a signer or co-signer. Details include starting amounts owed and current balances; monthly payment history for individual accounts; including any record of delinquency. Credit reports also include information regarding known places of residence and employment; judgments and tax liens assessed by courts; and any public record of bankruptcy.

A credit score is a numerical expression based on a statistical analysis of a person’s credit files, to represent the creditworthiness of that person. A credit score is primarily based on credit report information obtained from credit bureaus.  For purposes of a mortgage application, the three credit scores used by mortgage lenders are the Equifax Beacon; the TransUnion Empirca; and, the Experian FICO.

Under the Fair Credit Reporting Act (FCRA), All consumers are entitled to one free disclosure (i.e. credit report) every 12 months upon request from each nationwide credit bureau and from nationwide specialty consumer reporting agencies. Consumers who have had their application for credit, insurance or employment denied because of “poor credit” may apply for additional free credit reports.

certain persons may request a free credit report anytime, with no limit. This includes unemployed persons; persons looking for work within the next 60 days; and, individuals receiving government welfare assistance.

For further information, please either visit www.ftc.gov/credit or review A Summary of Your Rights Under the Fair Credit Reporting Act.

How to Fight Credit Report Errors and Inaccuracies

All consumers should review their credit reports on a regular basis to identify any inaccuracies and should report any errors as soon as possible to the credit bureau.  It is very important to clearly indicate the error (i.e. highlight the inaccuracy in yellow); make notes in the margins; and to include any supporting documentation that will substantiate your claim.  Finally, you must submit your request to the credit bureau in writing and  should send your correspondence with delivery confirmation (ideally requiring the name and signature of the person who received your letter).

Abraham Lincoln was quoted as saying: “He who represents himself has a fool for a client”.  Sometimes it’s best to let the experts in a particular field such as credit repair and restoration take on the fight with the credit bureaus for you.  Companies such as Better Qualified have been representing consumers for years with amazing results. 

Better Qualified has developed a program that will help you restore your credit and save money. Unlike other competitors, the Company takes a personal approach to the credit restoration process and work with its clients every step of the way. This consultative method ensures that clients receive the best results. The Company’s clients complete the program knowing how to maintain good credit long after their term with Better Qualified ends.

Better Qualified CEO, Paul Oster was recently featured on ‘Varney and Company’ on Fox Business discussing the importance on good credit and the proposed changes in the credit reporting industry. Fox Business is seen in 50-million homes nationwide.

 Better Qualified has been creating quite a stir recently in the credit repair marketplace and has several other videos featured on the website.

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