Donald Saunders asked:
You probably know all too well that the information in your personal credit report is used by the finance and credit card companies when deciding whether or not to extend credit to you, but are you aware of exactly what information your personal credit report contains? For instance, did you know that the information contained in your credit report could affect whether or not you can buy that new home or will have to remain in your current ‘shoebox’?
Many people believe that if a credit card company or other lender looks at your credit report they are merely looking at your credit score and, although this is without doubt one thing that they do look at, they are looking at far more. Most especially, they are looking to see how much debt you have in comparison to to your income and even quite small accounts, like those with a mail order company, will be treated as an income deduction when when it comes to considering a loan application.
If a lender calculates that you have got less money coming in than you have going out then your loan request will undoubtedly be turned down. In fact, by law a specified percentage of your income has got to be available to meet loan payments before the lender is permitted to approve it, regardless of the purpose of the loan.
Lenders are also looking back at your credit history over the past seven years to see how well you have managed loans in existence during that period. Specifically, they are looking to see if you have made your payments on time and will take note of any payments that were more than thirty days late. It may not have seemed particularly important to you at the time that you ran into a few problems and were late with your payments for a few months on an account, but any new lender is certainly going to consider this when assessing the risk of lending to you now.
Lenders will also look to see whether any of your accounts have run into debt during the past seven years and whether or not these debts have now been paid off. If you have payments outstanding on an existing loan agreement credit card companies and other lenders will be very wary when it comes to giving you additional credit before these are cleared.
Finally, your personal credit report will also show if you have filed for bankruptcy, usually in the last ten years. A few people believe that a lender is much more likely to advance you credit if you have filed for bankruptcy as they enjoy the protection of knowing that you may not file again for several years. However, this is not the case and filing for personal bankruptcy is viewed as a red flag by the credit card and finance companies showing that you have already demonstrated a tendency for getting yourself in over your head when it comes to managing your finances.
Your personal credit report is a very important document and one which you should not only understand but that you ought to review from time to time for your own protection. Luckily, the law states that you must be sent a copy of your personal credit report once every year if you request it.
Gertrude
You probably know all too well that the information in your personal credit report is used by the finance and credit card companies when deciding whether or not to extend credit to you, but are you aware of exactly what information your personal credit report contains? For instance, did you know that the information contained in your credit report could affect whether or not you can buy that new home or will have to remain in your current ‘shoebox’?
Many people believe that if a credit card company or other lender looks at your credit report they are merely looking at your credit score and, although this is without doubt one thing that they do look at, they are looking at far more. Most especially, they are looking to see how much debt you have in comparison to to your income and even quite small accounts, like those with a mail order company, will be treated as an income deduction when when it comes to considering a loan application.
If a lender calculates that you have got less money coming in than you have going out then your loan request will undoubtedly be turned down. In fact, by law a specified percentage of your income has got to be available to meet loan payments before the lender is permitted to approve it, regardless of the purpose of the loan.
Lenders are also looking back at your credit history over the past seven years to see how well you have managed loans in existence during that period. Specifically, they are looking to see if you have made your payments on time and will take note of any payments that were more than thirty days late. It may not have seemed particularly important to you at the time that you ran into a few problems and were late with your payments for a few months on an account, but any new lender is certainly going to consider this when assessing the risk of lending to you now.
Lenders will also look to see whether any of your accounts have run into debt during the past seven years and whether or not these debts have now been paid off. If you have payments outstanding on an existing loan agreement credit card companies and other lenders will be very wary when it comes to giving you additional credit before these are cleared.
Finally, your personal credit report will also show if you have filed for bankruptcy, usually in the last ten years. A few people believe that a lender is much more likely to advance you credit if you have filed for bankruptcy as they enjoy the protection of knowing that you may not file again for several years. However, this is not the case and filing for personal bankruptcy is viewed as a red flag by the credit card and finance companies showing that you have already demonstrated a tendency for getting yourself in over your head when it comes to managing your finances.
Your personal credit report is a very important document and one which you should not only understand but that you ought to review from time to time for your own protection. Luckily, the law states that you must be sent a copy of your personal credit report once every year if you request it.
Gertrude
