Three Examples of Why You Should Check Your Credit Report
On Saturday, we held our 6th Annual Financial Resource Event. At the event, people can review their credit reports with credit counselors and create plans for managing the items in the report. Inevitably, there are people who want to see their reports, but are afraid of what is in them. They often haven’t checked their credit in years. Not knowing what is in your credit reports can cause headache and heartache when you need to use your credit and you suddenly learn there are negative items included.
This Saturday’s event was no different. One participant was referred to us by a local credit union. She learned she had negative items in her credit report when she attempted to rent a house and was turned down. When we pulled the report she had various types of negative accounts – medical bills with collection agencies, a broken lease and a credit card that was past due. The medical bills were the biggest surprise.
We worked together to create a plan for taking care of the accounts listed on her report. Of course, nothing is easy or fast, but she has a step-by-step method for repaying, disputing and seeking financial assistance for her negative accounts. It was a tough process that included some tears, but in the end, this woman walked away with hope – she was in control. She has a plan and she knows that she has knowledgeable support throughout this process.
In another case, we asked a woman what she expected to see in her credit reports. She rattled off several negative accounts – things that would have gone to a debt collector. When we pulled the reports there were very few items listed. Most of the accounts she was worried about had come off of the report because they were older than seven years.
This woman’s new plan included methods for reestablishing positive credit information using a secured credit card and a share-secured loan through one of the local credit unions at the event. She was ecstatic when she left. She was avoiding applying for any services or credit because she thought her credit report was riddled with negative information. The reality was that she (now) only had a couple small (under $500 total), very old, negative items left.
Sometimes the not knowing is much worse than the reality; and even if reality and imagination match, you cannot do anything about it if you don’t know. The worst case of errors (or fraud) on a credit report we have seen came from a woman in her 40’s that had never checked her credit report. For a period of three years, someone had established credit in her name, purchased a home which subsequently went into foreclosure, and failed to pay on multiple credit cards.
Good or bad, the message is the same, it is critical to check your credit reports. You can do it on your own or you can contact one of our certified credit counselors for help. The counselor can also help you sort through the accounts on a report, understand what you are reading and develop a real plan for getting out of debt and even reestablishing positive credit.
And remember, most people are happily surprised by what is (or isn’t) in their credit reports. If we had a dollar for every person who said, “It wasn’t as bad as I thought it would be,” we might not be a non-profit agency.
Youre free credit report. from all three credit bureaus is available at: www.annualcreditreport.com
Published Sep 15, 2014.