Tim Gorman asked:




Credit reports can be a bit of a balancing act. On one hand they need you to take out credit so that they (the big three credit reporting agencies) can see that you have a good payment history otherwise they have nothing to base a credit report on. But if you take out too much different credit too quickly then they can see you as being a bad risk for their clients thereby preventing you from obtaining a good credit ranking and possibly favorable credit terms on future purchases.

The trick is if you are looking for credit, whatever it is for, then only apply for the credit that you really want. Don’t apply for many different products so you have a better chance of one of them accepting you. Of course, it can be difficult trying to determine just how long do credit inquiries stay on a credit report and when you can start applying for purchases requiring credit again without it adversely affecting your credit history.

Although you may want to know and may routinely ask yourself “how long do credit inquiries stay on a credit report” for perfectly good reasons it is not always easy to get a straight answer to the question. Credit report companies can be very secretive about exactly how they compile their reports for very good reasons and are unlikely to give you any real help, information or guidance even if you are trying to find out why you have been refused by a merchant for credit.

For a general guideline as to how long do credit inquiries stay on a credit reports, it is usually safe to estimate about 2 years. And if you have been refused credit because of this it is usually a good idea to wait for about 6 additional months before applying again for another loan. Even if you have been applying for credit cards and are now looking for a mortgage the credit card applications will appear on your credit report for the mortgage company.

The best way to make sure that the credit check companies do not see you as having too many applications for loans is to not apply for more than one or two things at a time. That way they may see each application as separate and you will not look like someone who is just applying for a lot of different products or credit at the same time. Of course if you get refused for the loan you are looking for then you are free to always apply to different loan and credit agency or company. Just remember, it is not usually a good idea to apply for too many at the same time. This way your credit is much more likely to be looked at favorably by the credit report company.

Margaret

Pammila Phillis asked:




Credit reports contain errors on a regular basis. So, before applying for new credit or beginning your credit repair journey make sure that all of the information contained in your credit report is yours.

Reasons for such mixes include:

1. Common name. For example, a father and son who live at the same address, or who don’t add “Sr.” or “Jr.” when completing credit applications.

2. Loan officers make clerical mistakes. For example, spelling names wrong, transposing social security numbers when pulling the credit report, or even entering incorrect addresses.

3. When reporting data to the Credit Reporting Agency (CRA) personal information is entered incorrectly. For example, an address at which you never lived.

4. If married, the social security number of the incorrect spouse is entered. This is not good because each credit report should be individual. What can happen is a merged credit report resulting in incorrect scores.

5. Co-signing for children or other people. Sometimes the lender will match the social security number with the wrong person.

6. Individuals with the same name mixed at the CRA’s side. For example, John L Smith and John M Smith all is the same except the middle initial. This is a very common mistake.

It is not easy finding these mistakes, but if you know you see information that does not belong to you, then call the CRA specifically to ask, “Is my file mixed?”

Mortgage lenders pull three bureau credit reports through different systems. Sometimes the system has the capability to pull in mixed reports or split files, which will show the conflicting information. This is something consumer reports don’t always show.

1. Experian: Experian is the best for this because the mix can show two ways.

It will show additional names and addresses and possibly incorrect accounts that are not obvious. If the consumer gets the chance to review the credit report and knows something is not right, then the consumer will have to write directly to Experian and provide a copy of a driver’s license (with DL number marked out) and request to un-mix the file. Sometimes it is obvious showing additional social security number of the other individual mixed on the file. Fix the same way by writing to the CRA with request to un-mix the file.

2. Equifax: On the mortgage side when the files are split, the files are received as Equifax 1 and Equifax 2. What is different is that on the credit report are two credit scores, one for each file. But it is all merged on the mortgage reports. These are very complicated.

It may very well be all of the consumer’s information that just got split because two names were used. For example, a married name verses maiden name. If that is the case, Equifax advises to add both scores and divide by two for the end score to be used. But also follow up informing Equifax that the file needs to be re-merged. Other splits may be by common name, for example father and son, where there are two people making up the files. These need to be unmixed. Consumers using and pulling their personal credit report on a daily basis from monitoring services can cause problems, compiling soft hits to the credit report. If the file gets too large, Equifax cannot handle it and will result in a split file. Some accounts will show on one credit report while other accounts show on another credit report.

3. TransUnion: Like Equifax, TransUnion doesn’t show additional social security numbers, only additional names, addresses, and possible accounts that don’t belong. The consumer must contact TransUnion with a copy of their driver’s license in order to update the file.

So, depending on the vender and software used, besides the type of creditor, different things can result when trying to pull credit reports. Sometimes it just looks like you have no credit history, and other times it mixes other people’s credit reports right in with yours. If creditors don’t know to look for the warning signs, they will flat out decline credit because they think it was all your credit that was bad.

The CRA’s don’t go first and foremost by the social security number. Listed below is how the repositories assign importance to this information (from most important to least important). Notice the SSN is not the most important (Information provided by California Association of Mortgage Brokers, Orange County Chapter, “Shedding Light on Credit Scoring” by the NAMB Credit Scoring Committee Chair, March 12, 2002):

Equifax

1. Last name

2. First initial

3. Address

4. SSN

TransUnion

1. Zip Code

2. Address

3. Last name

4. First name

5. SSN

6. AKA/Alias name

Experian

1. Last name

2. First name

3. SSN

4. Address

With this in mind, understand that it is quite easy for the creditors to mix consumer files. Even if you catch this and fix it completely, it can happen again.

You must take precautions to just use one deviation of spelling your name, especially if you have a father and son with similar names living at the same address.

Finally, be sure to obtain a copy of your credit report at least once a year or 60 days prior to applying for credit so you can catch and fix mistakes in time.

Jacob

Joel Owens asked:


Getting a credit card application is a typical scenario that most Americans have probably experienced at some point in their lives.  The reasons for this are as diverse as the people who use them, although some of the most common reasons why they apply for a credit card include safety (it minimizes the risk of carrying any cash with you while you’re purchasing something), convenience (you don’t need to go to the bank to withdraw cash), easy access of records (so you can easily check for credit mistakes and purchases that you’ve made).

Applying for a credit card is not difficult. All it takes are some documents that are required by the credit card company and a good financial history. However, no matter how simple it is, there are some areas that should be given more emphasis in the application process. Here are some of the common concerns you need to be aware of.

The importance of good credit.

When you say good credit, this means that you regularly pay your bills and debts on time. In addition, you regularly check your credit reports. This is very important, particular for those who are applying for credit card for the very first time. You have to remember that any mistakes on your report will adversely reflect on your rating. So make sure that there are no loose ends or suspicious transactions on your credit report.

Those who belong to the “Applicants With Poor Credit.”

If you are under this category, be very careful. Most credit card groups are easily discouraged when they see that you have a poor credit history, and chances of them approving your request might be difficult and highly unlikely on your part. One thing you can do, though, is to avoid applying to those companies who are strict when it comes to good credit records. Don’t waste your time on them, as they will instantly reject your application once they see that you don’t reach their qualifications. And when this happens, it may even add more damage to your credit, making it much more difficult for you the next time around. By the way, if you are rejected, don’t reapply for another credit card right away. Wait at least three months before you make another attempt.

Remember to always verify the eligibility criteria before you decide to go for a credit card application. This will save you a lot of time, and decrease your chances of getting avoidable rejections. Try targeting those companies who offer cards for those with poor credit.

The importance of honesty

Most people ask if it’s okay to tinker with details when filling out their application form. DON’T. And don’t even be tempted to lie on your application form. These credit card companies mean business, and they hire good people to make sure that deceptions and fallible information are found out. Be truthful, and provide as much accurate information as you can about your income, employment history, current financial status, and the like. Your credit card application has more chances of getting approved if you tell the truth.

Credit card application is easy to understand, once you gain enough information about them and further your knowledge by asking experts in the field.  There is no reason why you can’t enjoy the benefits of owning a credit card for yourself.



Florence