A clean credit report can help you get better interest rates on your financing, give potential employers a better opinion of you and even help you to rent a nice apartment or home. There is a great deal of information on your credit report that is collected from many different sources. In some cases, the information may not be correct. It is a good idea to clean up your credit report at least once a year to help keep your credit score as strong as it can be.
Basic Credit Report Information
According to federal law, every United States consumer is entitled to one free copy of their credit report from each of the three major credit reporting agencies every 12 months. Use that opportunity to order your free report and review it for errors. Make a comprehensive examination of all of your credit reports. Be sure to check everything from previous addresses to the balances left on your old credit accounts. If you see a mistake, use the dispute process outlined on each credit report to get the error corrected. You can only include one item per dispute, so be sure to keep copies of all correspondence back and forth between you and the credit agencies.
Check Your Bills
One of the things that may be causing problems with your credit report is credit card scam. You may not even think you have been a victim of credit card scam, but criminals do not always make thousands of dollars in purchases when they steal a credit card number. Sometimes they make purchases as small as $30, but they do so every month. They do it that way because most people never check their credit card bills to see the activity on their account. Check every one of your credit card bills and make sure you recognize all of the activity. If you see something you do not remember charging, contact the credit card company immediately.
Tidy Up Your History
Many people have credit cards with small balances that are spent to their limit. You pay the minimum payment each month, but new interest and service charges put you right back to the maximum. Consolidate these small accounts, pay them off but do not cancel the cards. Old credit accounts are good for your credit rating, but maximized credit cards hurt. You can use a personal loan with a lower interest rate than your cards, or you can get one card with a low balance transfer rate to consolidate all of your cards on. With the balances eliminated on those old accounts, they can then begin to have a positive impact on your credit. You can then turn your focus toward paying off the consolidated balances.
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