A Good Credit Score may not be enough

In this economy, having a good credit score may not be enough to obtain a low interest rate or get approved for a loan.

This is the case for many people who at one point or another have had trouble with their credit. Making late payments or no payments at all for a long period of time can affect your credit. Don’t forget about collections, bankruptcies and judgments.

Like a criminal record, your credit rating may now affect your possibilities of obtaining employment, purchasing cell phone plans, apartment/home rentals and loans.

Paul Labonne, vice president and CRA officer with National City Bank (now part of PNC Bank) gave a few tips about how to deal with credit repair and how to spot scams, which end up costing you a lot more and leave your credit rating the same.

To start, Labonne said that people should order their credit report from any of the three major credit report agencies: Equifax, TransUnion and Experian.

“Preferably all three because sometimes the information that appears on one of the reports may not be on the other. Then review the information thoroughly and make sure the name, address and social security number is correct. Often times, that information is not correct and that can be a cause for bad credit,” Labonne said.

He suggests that once the credit report is received, people should go through it and request that any information like past delinquent accounts that have been paid and are more than seven years old, are removed from the credit report.

Credit repair scams
“The best way to avoid being taken advantage of is by not hiring any credit repair agency because there is nothing they can do, that you can’t do yourself,” Labonne said.

He said that most of the time, people hire credit repair agencies because of language barrier or they don’t have the time to do it themselves.

If someone needs to use a credit repair agency, Labonne suggest that they go to a reputable, not-for-profit agency that deals with affordable housing or financial counseling, which can guide them with the credit repair process.

“They’ll work with the client and help them reestablish credit. The best way to reestablish credit is to get on a budget and eliminate all the unnecessary credit cards. Instead of having up to 10 credit cards, just have two that you actually need for every day use or emergencies,” Labonne said.

To conclude, Labonne also suggests that if you dispute an item, it is best that you send it by certified mail so that here is proof that it was received. The credit bureau then has 30 days to investigate each disputed item and verify it or delete it.

“If you are saying something happened and the credit bureau can’t prove that it didn’t happen the way you say it did, they have to remove the item. The law requires that each disputed item must be verified and accurate for in order to stay on a credit report,” Labonne said.

To obtain your credit report you can contact:

Experian: (888) 397-3742

Equifax: (800) 685-1111

TransUnion: (800) 888-4213