Inaccurate details in your credit report can badly affect your score. As a result, your options when applying for new credit applications can become limited and you might not be able to qualify for the best interest rates. Keep in mind that creditors reserve their best deals for customers who have good to excellent credit. If you have less than perfect rating, the interest rate of your loans and credit cards can be much higher.
The start of the year is a good time to start rebuilding credit. How can you clean up errors in your credit report? Consider these tips:
1. Request for your annual free report. All consumers are entitled to receive one copy of credit report for free from each of the three major credit bureaus (Experian, Equifax, TransUnion).
2. Fix errors in your report. Check your credit report and see if there are errors or incorrect charges in your file.
3. Enclose copies that support your claim. In your letter, it helps to enclose copies of documents that support your claim such as receipts or written correspondences from your creditor.
4. Wait for the bureau’s response. Upon receiving your letter, the credit bureau will conduct its own investigation on the matter which can last up to 30 days.
5. Alert the credit bureau. If you think you have been a victim of identity theft, you should place your credit report on alert or on credit freeze.
6. Monitor your credit report. Order a copy of your credit report after six months to make sure that all the information are accurate.
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