FREQUENTLY ASKED QUESTIONS ABOUT CREDIT REPAIR (PART 2)

What you may not know about bad credit repair

Bad credit is defined as a FICO score of 620 or lower. FICO (Fair, Isaac and Co.) scores range from 300 to 900. A score that is above 680 means that your credit is in good  standing. Credit scores in the 620-680 range are medium and a score lower than 620 puts you in the poor or bad credit range.

How does the credit reporting system work?
Basically, it consists on millions of computer files that contain personal information of each individual such us how much you owe, how you have paid your debts, your social security number, your employer, public records, etc. The three credit reporting companies maintain this information.

What is the name of these companies?
There are 3 major credit bureaus: Equifax, TransUnion, and Experian

Are all 3 important?
Each one of these three major credit bureaus or CRAs will reflect at least one-third of your credit history. When requesting a credit card, you can get lucky if some one look at your Equifax report for instance and fdoesn’t fin any bad credit information that would keep the credit card company from issuing you the card. But, they might also look at your other reports, and find flaws or bad credit history in your credit profile. That’s why it is extremely important to use a credit repair service that repairs your bad credit with all three of the bureaus.

How does information about me get into my credit report?
When you accept credit from a bank, retail stores, etc., or even if you file any application where a credit report is requested as a background check, you are giving the creditor the right to provide information to any credit reporting company.  Other information’s about you might come from public records, such as court records, debt collection companies, and even utility companies.

How do the credit companies work?
Each month the Credit Reporting Agencies receive a report of your payment record from banks, retail stores, utility companies, etc. These companies then give that information to a second tier of regional reporting companies who sell it to anyone who legitimately requests information about you.

Why should I care what is in my credit file?
Because it is your credit report that creditors use to determine if they will grant or extend credit to you.  If you have inaccurate information on your report, you may be declined for the loan you need or pay unnecessary high interest rates.

Who can request information about my credit file?
A credit reporting company may only disclose your credit report if someone is reviewing you for employment purposes, reviewing your application for insurance, reviewing your eligibility for a license or government-related benefits, providing information for a business transaction, a court order, an IRS subpoena and someone to whom you have given written permission.