The Fair Credit Reporting Act Benefits Credit
The Fair Credit Reporting Act Benefits Credit-Active Consumers The Fair Credit Reporting Act (FCRA) law went into effect in 1971 and was amended considerably in 1997 by Congress. The original FCRA protected your rights as a credit-active consumer by limiting who has access to your credit report. It mandated that, while you yourself may request a copy at any time, no one else may legally review your report unless they intend to: The 1971 FCRA also stated that your credit report may be accessed in response to a court order or federal grand jury subpoena. Fines up to $5,000 and imprisonment for up to one year are consequences of knowingly and willfully obtaining a credit report under false pretenses. The 1997 version of the FCRA further protects credit-active consumers and gives them more control over their credit information. Highlights of the updated version of the FCRA are summarized below: Credit Reports Credit Disputes Credit Accuracy Credit Offers Banks, retailers, and credit card issuers purchase pre-screened lists from credit bureaus and use them to identify qualified and interested consumers to whom they market credit cards and other retail loans. These pre-screened lists have also been affected by the FCRA amendment. Card issuers can deny credit if the consumer does not qualify for the pre-screening criteria. Credit Clinics Credit repair clinics will charge consumers up to thousands of dollars to allegedly “repair” less than perfect credit reports. Although these clinics claim the ability to dispose of negative credit information from a consumer’s file, if the negative information is accurate, it has to stay on the credit report for up to 10 years. This is federally mandated. If the consumer pays the credit repair clinic before the service is performed, the consumer can expect to lose a large amount of money. The new law prohibits credit repair clinics from collecting a fee before a service is performed.
Improve Your Credit Profile To Obtain Better Credit Deals
Improve Your Credit Profile To Obtain Better Credit Deals When you apply for credit, it is understood that the lender will check your credit report. The information contained in your credit report helps lenders decide how much credit and what interest rate you are eligible for. The more stable your credit history, the more likely you will qualify for the best credit deals. What They Look For: Pay Your Bills On Time Creditors always check to see that the prospective borrower is worth the risk. So pay your bills on time! This demonstrates that you are what they are looking for. Good credit does not necessarily mean perfect credit. “Good” credit can include a few minor problems, such as: You should not have any payments more than 60 days late and there should be no outstanding public record debts such as judgments or liens. Keep Your Debt Load Reasonable One factor any creditor must analyze before extending credit is the total debt of the person applying. If a large portion of your income each month is already dedicated to paying off other debt, the lender will have doubts you will be able to pay back an additional loan. Financial experts advise that non-mortgage debt payments should not exceed 10-15% of your take home pay each month. If your debts are currently too high, consider alleviating some before applying for new credit. A note about cosigning: If you cosign somebody else’s loan, the outstanding amount is considered your debt, even if the individual for whom you cosigned pays all the bills. Because cosigning means you have contracted to pay back the loan if the other party does not, it is considered one of your liabilities. Therefore, think carefully about cosigning, even if it is for someone you know will pay the debt; it does affect your credit. Avoid Unnecessary Inquiries When you permit a creditor, employer, or other business to check your credit report, an “inquiry” is added to the report itself. This is a note stating that someone has checked your credit. (Checking your own credit report does not count.) An inquiry usually is visible on the credit report for up to two years. A lender considering you for a loan will look at the number of inquiries recorded there and the time they occurred. A large number of inquiries taking place over a short period of time may mean that you: So, it is always a good idea to minimize inquiries into your credit report. If you are looking for mortgages, do not authorize every lender you consider to run a credit check. You may have to settle for slightly more approximate estimates on what the lenders can offer you, since they cannot verify your credit history. That is still better than shopping around only to find that the lender of your choice now considers you risky and wants to charge you more money. Eliminate Excess Unused Credit Just as a high number of inquiries suggests you may be overextending yourself, a surplus of available credit means that you are capable of overextending yourself in the future, even though you have not done so before. Although some my believe that having many credit cards with high limits is a sign of good credit, too much of this can make them appear as a poor credit risk. The lender needs to be assured that you will continue to be able to repay your debt in the future. But if thousands of dollars of unused credit are available, it is possible that you may spend it all the month after your loan closes and suddenly have more debt than you can pay off. To not concern the lender, it is recommended that you close unused credit accounts before applying for a large loan, and/or consider reducing your credit limits. If you do that, ask the creditors to record that the account was closed or changed at the consumers’ request. This will stop anyone from thinking that the bank closed the account because you had bad payment habits.
Establish Good Credit History Immediately
Establish Good Credit History Immediately If you have not yet built credit, begin now! Start small. Apply for credit with a local business, such as a department store or bank. They are more likely to have lower credit standards than larger lenders. Before you apply for credit, make sure the credit grantor reports credit history information from either Experian, Equifax, or Trans Union, the three bureaus. If you decide not to do that, you can also ask a friend or family member to cosign your loan or credit car application or obtain a secured card, which is guaranteed by a deposit you make with the card issuer. Actively Monitor and Manage Your Credit While building a solid credit history by paying bills on time is important, you can also take steps to protect your credit standing and make sure your credit report is accurate when you apply for credit. Many credit reports contain inaccuracies, usually caused by innocent errors but occasionally by fraud (such as identity fraud). The Fair Credit Reporting Act ensures your right to dispute such inaccuracies in your credit report free of charge. To effectively use this right, familiarize yourself with the information contained on your credit report. You can also create a plan for your credit report, just like you could for a budget, to improve your credit worthiness. Applying for a major credit card if you only have local credit, closing old unused credit accounts, and paying attention to the number of inquiries in your credit report can improve you credit status. Skip “Credit Repair” Clinics Some consumers pay credit clinics hundreds of dollars for “credit repair,” hoping to improve their credit. The Federal Trade Commission has investigated and reported on these often-fraudulent “clinics.” Keep in mind: You can fix your credit report for free simply by maintaining good credit and paying your bills on time! Consumer credit reports contain easy-to-follow instructions for disputing incorrect information for free. Incorrect information will be changed or deleted by the credit reporting agencies. Accurate information that displays negative payment habits will remain on a report for up to 7 years, with bankruptcies up to 10 years. This is mandated by federal law.
Best Tenant Screening Practices
Best Tenant Screening Practices Review the following best practices for safe renting and to ensure you have protected yourself and your asset from unwanted tenants. 1- Rental Application: Give your tenants the proper rental application. The applicant has to give you permission to conduct a background check. Go to: https://hxn.62f.myftpupload.com/forms/rental-application.pdf and use this application which gives you the proper verbiage. 2- Verify Identity: Ask for two months of pay stubs and examine the driver’s license/picture ID and social security card to make sure you have the right person. 3- Background Check: Conduct a background check through a credit reporting agency that specializes in tenant screening so you can see their credit report and examine their criminal and eviction history. 4- Denial Letter: Always use a formal denial letter instead of verbally rejecting your tenants. The denial letter is created to remove the landlord out of the discussion regarding why tenants are rejected. All you have to do is inform a tenant of their rejection and that their denial letter is in the mail. If you choose to use the credit bureau to screen your tenants, we ask you to use our sample denial letter by going to: https://hxn.62f.myftpupload.com/forms/denial.doc 5- Formal Tenant Check: Understanding the credit, eviction and criminal reports are difficult at times. Consult your credit reporting agency for the interpretation of the data they give you. 6- Security: Always keep the background check documentation in a locked cabinet for safe keeping. Based on the Fair Credit Reporting Act, you are obligated to keep the credit reports in a secure location. For more information go to: http://www.ftc.gov/os/statutes/031224fcra.pdf 7- Application Fee: You should charge a non-refundable screening fee to be used for a background check. 8- Employer: Verify the employer by calling them yourself or have your credit reporting agency verify the employment for you for a price. 9- Past Landlords: Verify and speak to the tenant’s current and past landlord. 10- Policies and Procedures: Create guidelines specific to your real estate business. They could simply require obtaining a credit score, bankruptcy, two months of check stubs and etc. Think about what is important to you and add those as guidelines. Policies are very useful as they remove the emotional aspect of dealing with tenants, for both tenant and landlord. When confronted with an aggressive tenant, policies and procedure help you stay focused. 11- Number of people residing in the apartment: Ask the current or past landlord about the number of people living in his place and cross reference that with the application. 12- Takes Notes: Make sure you have a note pad available at all times. Start taking notes from the first phone call and the interview. Ask questions and write them down. The notes become very valuable throughout the screening process. 13- Auto Debit: This is the best way to collect rent but you need an official agreement between you and the tenant. You can ask your bank that receives the auto debit for forms to give to your tenants. Although it can be a tedious process, screening is well worth the effort. Statistically, landlords that screen their tenants properly will have less problems than the landlords that don’t take screening seriously. Good luck! If you have any questions go to: https://hxn.62f.myftpupload.com/tenant-screening.htm or call 800-518-1077 Extension 4
Really Free Credit Report
HOW IT WORKS www.annualcreditreport.com is a website jointly operated by the three major U.S. credit reporting agencies, Equifax, Experian and Trans Union. This site provides free credit reports from three credit reporting agencies once each year. AnnualCreditreport.com is the only federally mandated and authorized source for obtaining a free credit report. FTC cautions consumers to be aware of fraudulent sites that have similar names and will take consumers to unwanted sites with improper intentions. When you go to Annualcreditreport.com, it will ask you for your information and will try and authenticate your identity before it provides you the report.
No Credit Score
Credit Score is created by your credit accounts such as credit cards, bank loans, car loans or appliance purchases from stores. When you don’t have any credit or if you had them but they are old and never been used, then your credit score will not come up and a note will appear on your report that says “insufficient credit”. To build your report and therefore the score follow the advice below: 1- Open a secured credit card. You can use google.com and search for secured credit cards. Be choosey and make sure the fees are not high and the interest rate is reasonable. 2- Become an authorized user of someone else’s credit card but make sure you have the ability to pay the bills. That is the only time the credit card companies report you to the bureaus. The credit card you are going to be the co-signer of should have a balance and should have been around for a while. Also make sure the card owner is not going to default and leave you with the bill. 3- If you have some old credit cards that you have not been used, call the company and ask to get activated again. You may have a chance. 4- Go to www.annualcreditreport.com and get your report and make sure you dispute everything that does not seem correct. Good luck.
Identity Theft- First Step
Identity theft first steps Place a free, one-year credit freeze by contacting the three credit bureaus. Sign up for IDIQ IDIQ provides:
Identity Theft-Credit Freeze
Credit Freeze or Security Freeze Credit freeze is provided by 3 major credit reporting agencies to prevent credits, loans from being approved in your name without your signature. When you put a security freeze on your credit report, you will be provided a personal identification number or password. You will use this password when you try to remove the freeze from your report or give permission to temporarily release your credit report for a specific person or time. If you are applying for new credit, you should organize and lift the freeze, either completely, or specifically for a certain creditor, a few days before actually applying for new credit. But remember that your already existing creditors are exception to this rule and they can run your report. Collection agencies acting on behalf of your existing account can also run your report without permission. When you put a security freeze of your report with one bureau it is not automatically shared with other bureaus. So you need to call the three credit reporting agency separately using the following phone numbers. Equifax 1 800 685 1111 TransUnion 1 800 916 8800 Experian 1 888 397 3742 Bureaus will charge you to freeze your report if you do not have a police report. So if you are a victim of fraud you should report the fraud to your closes police station and make sure you have a copy of the police report. How to Un-freeze: You can use the following links to un-freeze your report or simply call the above numbers for guidance. https://www.freeze.equifax.com https://www.experian.com/freeze/center.html https://freeze.transunion.com/sf/securityFreeze/landingPage.jsp Please post your questions and we will reply as soon as we can.
Credit Agencies Stop Reporting Unpaid Tickets
Local governments and counties will no longer be able to use credit reports as a tool to collect tickets and fines. Cities and counties normally refer traffic tickets and government fines to collection agencies, which in turn report the debt to credit reporting agencies. Beginning in September 2016, credit reporting agencies, Equifax, Trans Union and Experian will no longer report debt that “did not arise from any contract or agreement to pay,” such as traffic tickets and government fines. As of September of 2016, credit reporting agencies will no longer report medical debt unless the medical debt is delinquent by at least 180 days. This will allow time for processing of insurance claims. Also, credit reporting agencies have to remove medical debt if a creditor, collection agency or debt buyer reports it as paid in full, or if an insurance company is paying the debt. Source: National Consumer Assistance Plan Highlights (Xerox, 3/1/2016)
Active Duty Soldiers Now Have Identity Theft Protection
Members of the military (such as members of the Marines, Army, Navy, Air Force, and Coast Guard) have an additional protection available to them – active duty alerts, which give them identity theft protection while they are on active duty. Choose one of the three agencies and ask for active duty alert. The one you call will report it to the other two. Equifax: 800-525-6285 Active Duty Alert Experian: 888-397-3742 Active Duty Alert Trans Union: 800-680-7289, after entering your zip code select option 1, then select option 3 When you place an active duty alert on your credit report, creditors must take reasonable steps to make sure the person making the request is actually you before opening an account, issuing an additional card, or increasing the credit limit on your existing account. Your name also will be removed for two years from the nationwide credit reporting companies’ pre-screening lists for credit offers and insurance. Source: ftc.gov