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Credit Check
A credit check is the method in which a prospective lender or renter reviews the history of a person’s finances in order to determine how much risk is involved in lending that person money or leasing them a living space.
A lending institution that wants to check credit will usually look up a personís credit report. The report will show the financial history of the borrower and also their credit score. A credit score is a number, found by statistical analysis, that determines the likelihood of repayment by the borrower.
It is important to keep a credit score in good standing. Any lender who performs credit checks will want to make sure that the person they are lending to has a history of honoring his or her agreements.
Here is a list of things that must be done in order to keep your credit check in check.
Pay Your Bills: Besides for just being a good idea, (We all like light and water.) this suggestion has a lot to do with your credit. Although temporarily flaking on a bill here and there probably won’t affect your credit that much but having a collection agency sent to your door because the phone bill hasn’t been paid in a year will severely damage anyone’s credit score.
Pay Your Credit Card Bills On Time: If you use a credit card, then it is important that you pay your bills on time. Usually, the late-payment fees on these cards are dreadfully high, especially if you carry a balance, but unlike the light bill and the phone bill, missing one credit card payment can lead to a drop in your credit score. It can make you look bad during a credit check. Don’t miss a payment, because they won’t miss you.
Have Credit: It is a good idea to have some borrowing history. Some people will not lend or lease to unproven people. Many credit card companies have “Starter” credit cards. These credit cards have a low balance and extremely high interest rates. Some even have membership fees. The best way to take advantage of these cards is by using it to buy something somewhat substantial, like a TV. Make sure to have enough money in the bank in order to cover the TV. Buy the TV. Repay the loan. Cancel the card. This will give your credit a boost with minimal risk to you.
Keep Your Debts to A Minimum: Even if your credit score is within acceptable limits, and your all your bills are paid on time, it is a good idea to have less debts when undergoing a credit check. A lender may be dubious about lending to someone who owes money all over town. A lender might see this as a chancy situation. They might not believe that you can take on more debt.
Even if you do have some black marks on your credit report, it doesn’t mean that you’ll fail a credit check. After seven years, any credit mistakes are removed from your record. Bankruptcy takes ten years to go away, but even that, the granddaddy of all credit sins, will disappear in time.
You may want to check your credit before your next credit check. Check it here:
Equifax
P.O. Box 105873
Atlanta, GA 30348
(800) 685-1111
Trans Union
Consumer Disclosure Center
P.O. Box 1000
Chester, PA 19022
(800) 916-8800 or (800) 888-4213
Experian
P.O. Box 2104
Allen, TX 75013-2104
(888) 397-3742
Topics: Credit Repair |
