Your credit score is an important aspect of credit maintenance. Check your credit score free of cost every four months or once annually. Many credit card companies offer free FICO score reports. It is a good idea also to check your credit score at minimum three times per year.
Credit score can be affected by hard inquiries
Although you may not know it, credit scores can be negatively affected by hard inquiries. When a creditor requests your credit report, it can lead to a negative impact on your credit score. These inquiries often occur due to identity theft or error. Routine monitoring of credit reports can help you spot errors. Send a dispute letter to your credit bureau with evidence of any errors. To dispute an inquiry with the lender, you can also send a dispute letter to them. You can also report fraud to Federal Trade Commission.
Hard inquiries can generally reduce your credit score by one to five percentage points. The exact amount will depend largely on your credit score as well as the length of time since you last inquired. It is best to avoid making too many inquiries unless you absolutely need them.
It is crucial to pay your bills on time to improve your credit score
It is crucial that you make your monthly payments on time. This will help determine your credit score. Paying on time is crucial because late payments could make your debt more expensive and compound. Another factor is the proportion of available credit you use versus your total debt. Lenders do not like high credit balances. This is why it is so important to keep credit utilization below 30%. You can also improve your credit score by avoiding new credit cards and paying off those you have.
35% of credit scores are determined by your payment record. This shows whether you have been punctual with your payments and how often you have missed them. Lenders look at this information to determine if you are likely to pay your debts on time. Late payments are bad news because they hurt your score, but if you have a long payment history, your score will be much higher.
You can dispute inaccurate information in your credit report
If you believe there is incorrect information on your credit report, dispute it with the credit bureaus. They must examine the error and provide you with a copy of your credit reports. The bureau may not accept your complaint and it will remain on your credit report. You can take steps to correct the error, such as contacting the creditor for clarification, or you can re-dispute it with more information.
The best way to dispute inaccurate information is to write a dispute letter. It should contain a dispute document and copies supporting documentation. Send your dispute letter to the credit reporting company, using the dispute address on the credit report. It should go via certified mail.
Incorrect information on your credit report can negatively impact your credit score, which can affect your ability to obtain loans or credit cards. While the process is not difficult, it can be frustrating if the result isn't in your favor. If you are able to get a thorough report, it is worth the effort.