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Are You a Financially Savvy College Student?
Common Cost Cutters
Consumer Credit Laws
How Much House Can You Afford?
How to Read Your Credit Report
Identity Theft Myths and Realities
Light at End of Tunnel for Defaulted Student Loan Borrowers
Pay Day Loans Simply Don't Pay
Reverse Mortgages What You Need to Know
Spending Plan Recipe 
Your card has been DECLINED
Your Credit Capacity
Your Guide to Credit Reports
 

Are You a Financially Savvy College Student?

If you are in college, you have invested in your career and long-term personal financial future. You have needs and wants and dreams to fulfill, but where do you begin?  Taking control of your financial situation will increase your “savvy”.

Create a Spending Plan.

Having a written spending plan will help you monitor your expenses. Always be aware of checking and savings account balances. Treat debit purchases like checks by recording the amount in your check register.  Tracking your cash spending habits will make you more conscious of your daily spending. You may be surprised to see what you spend your money on and how quickly it adds up.

Make Savings a Priority.

You may not feel that you can save money while you are in school, but controlling your spending choices helps savings become a reality. Do your research; find a financial institution that will allow you to open a savings account with $5. This small amount can add up, for example: five dollars deposited monthly over a 4-year period at 3.5% generates $263.71. Starting small will help you develop a savings habit, prevent the amount from being a burden, and give you a nest egg to roll over into a more aggressive account after graduation.

Pay Your Bills on Time.

Get in the habit of paying all your bills in a timely manner. Consistently doing this will help you develop good habits and keep your credit score high.

Review Your Credit Report

You are entitled to one free copy a year of your credit report from each of the three major credit reporting bureaus, (Experian, Equifax, TransUnion). We suggest you stagger the reports, obtaining one at the beginning of the year, the next in the middle and the third at the end. Reviewing your credit reports throughout the year will help you catch mistakes and minimize fraud and identity theft problems. You may access your credit report from our web site, www.cccssa.org, by clicking on the link, “Order a Credit Report”. There is no cost for obtaining the copies. If you have questions about your reports, call us for a free credit report review session.

Use Credit Wisely

Before getting involved, learn all you can about credit. How you handle credit today determines your access to it later. Successful consumers have sound credit portfolio’s, they know the terms and conditions of their credit accounts and are aware of their credit scores and debt loads. We suggest you have one credit card, and make small purchases that can easily be paid in full when the bill arrives. Staying below your credit limit has a positive effect on your credit score. To learn more about credit cards, call us request a  College Credit for Life Workshop presented at colleges and universities..

Keep Student Debt Loads to a Minimum

When it comes to student loans, please note that you must repay your loan whether or not you graduate, if you can't find a job related to your program of study, or are unhappy with the education you paid for with your loan.

Defaulting on student loans can have serious consequences.  As mentioned in the May 30, 2009 Express-News article, “Tips on repaying student loans,” your credit profile will be damaged and you will not be eligible for any type of loans in the future.

If you have defaulted on a student loan and need assistance reviewing your options, our agency provides student loan repayment counseling. The initial session is free.

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Common Cost Cutters

For Home

For Vehicles

For Food Expenses

For Clothing Expenses

 

Home

• For a cooler house in summer, use your microwave, range top or outside grill instead of your oven

• Use the "no heat" drying cycle on your dish washer

• Keep your water heater thermostat under 120°
• Take quick showers or fill your tub ¼ full for baths
• Maintain and change your AC & furnace filters often
• Adjust the thermostat when no one is home & close the drapes when possible
• When possible, use florescent rather than incandescent lighting
• Close the damper on your fireplace when not in use

Auto

• Check and maintain fluids, tire pressure and oil often because it saves on repairs
• Avoid fast starts & stops to save on gas & tire wear
• Drive the speed limit to avoid tickets & save gas
• Consolidate trips, share rides or ride the bus when possible
• Take basic auto mechanics & maintenance class
• Take defensive driving class to lower insurance rates
• Compare insurance company rates – be neither over nor under insured

Food

• Study ads & plan weekly menus around specials

• Shop once with a complete list made from menus & household inventory

• Shop once a week & limit your time for shopping

• Shop alone, if possible & NEVER when you are hungry

• Take advantage of the lower cost of generic or store brand goods

• Shop in a familiar store to cut down on impulse purchases & save time

• Use coupons but only for items you would normally buy

• Compare prices of different size products by noting the unit prices

• When buying large quantities, divide & freeze remainder

• Buy fruit & vegetables that are in season

• Shop at day-old bakeries for bread products

• Let one or two all-purpose cleaners take the place of many

• Eat out less often & have cocktails or desserts at home

• When eating out, order water with your meal

• Take "brown bag" to work & use facilities like microwave & refrigerator
  
  

Clothing

• Shop at discount stores or resale shops

• Shop sales but don’t buy just because it’s cheap

• Sew and mend garments

• Buy conservative clothes that will stay in style

• Avoid garments that require dry cleaning or special care

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Consumer Credit Laws
 

Click here for "Secrets of Bill Collectors"' in PDF format

Click here for "Fair Debt Collection Practices Act in PDF format

Truth In Lending Act - requires creditor to provide the consumer with accurate and complete credit costs and terms.

Equal Credit Opportunity Act (ECOA) - Prohibits a creditor from discriminating against a consumer on the basis of age, sex, or marital status, reliance on income from a public assistance program, and race, color, religion, or national origin.

Fair Credit Reporting Act (FCRA) - The purpose of this act is to insure that information contained in a credit report is accurate and that it will be used in a confidential manner. Consumers have a right to dispute information that may be derogatory or erroneous. Inaccurate information must be corrected or deleted, and a consumer explanation statement of 100 words or less can also be included in the report. A credit bureau must also delete adverse information which is more than seven years old and information on bankruptcy which is more than ten years old.  

The Fair and Accurate Credit Transactions Act (FACTA) - The FACT Act was signed into law at the end of 2003.  This Act amends the Fair Credit Reporting Act and gives every consumer the right to a free credit report every year from each of the three major credit bureaus: Equifax, Experian and TransUnion.  To get your free credit report, go to www.annualcreditreport.com or call 877-322-8228.

The Fair Credit Billing Act (FCBA) and Electronic Fund Transfer Act (EFTA) - These Acts can help consumers resolve mistakes on credit billing and electronic transfer account statements.  The Acts outline procedures for correcting several types of errors including unauthorized charges and the failure to properly reflect payments.

Fair Debt Collection Pratices Act (FDCPA) - A third party collector is prohibited from:

• Using abusive language to coerce a consumer into making payment,
• Calling at unreasonable hours (before 8:00 AM and after 9:00 PM) or making excessive calls
• Threatening to notify the employer or friends that the consumer has not paid his/her bills
• Using false pretenses to gain entry to the home with the intent to identify or take something of value
• Attempting to collect more than what is owed
• Sending the consumer misleading letters that may appear to be from a government agency or a court of law

Click here for more details of the Fair Debt Collection Practices Act in PDF format.

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How Much House Can You Afford?

A lender or real estate broker is primarily concerned just with your ability to make that mortgage payment, but YOU must look at the "bigger picture" and carefully consider all your other expenses. Be sure to include your periodic expenses such as clothing, car repairs, medical expenses, school supplies and gifts. Money needs to be set aside monthl for these expenses too.

Also, try to anticipate any changed in your future expenses. Do you foresee purchasing a new car? Will your insurance payments increase? Are more children in your future? Are your children planning to attend college? These circumstances may have a bearing on whether or not you can afford the mortgage payment in the future. Do not commit to payments so large that your home becomes a financial burden instead of a joy.

Compare your current expenses and proposed future expenses to these national averages:

Housing..............................................25% Food....................................................20% Clothing..............................................5% Transportation.....................................5% (maintenance and insurance)   Household...........................................5% (maintenance, utilities, etc.)   Consumer Debt....................................20% (include car payment)   Health..................................................5% (costs not covered by insurance)   Periodic expenses................................10%   Savings.................................................5%

To figure how similar your expenses are to the national average: Add your expenses for each particular category Divide your take home pay into that amount.   The resulting amount will represent the percentage of your income spent on that particular category. Use the same procedure for each category.

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How to Read Your Credit Report

Ever wondered what iur credit report? It contains important information that can impact your life as a consumer. Your credit report influences whether you are able to buy a home or get a job, so it is important to stay up-to-date.

Your credit report contains:

• Identity Information – Including Social Security Number, address and date of birth. This information is used to ensure the credit report information is accurate and matched with the right person.  It also can help detect and prevent identity fraud

• Employment history – Where you’ve worked and for how long.

• Credit history – account records with creditors.

• Inquiries- a list of potential lenders that have requested your credit report and when.

• Public financial records- including collections accounts, bankruptcies and late child support payments.

Your Credit Score

Most lenders use a mathematical formula to generate a “score” to help them determine if you are a good credit risk.  This is called a “credit score” and the most frequently used version is the FICO score created by Fair Isaac and Company.  A FICO score is a snapshot of your credit risk at a particular point in time.  FICO scores range between 300 and 850 with higher values being preferred because it indicates to lenders you are a lower risk. 

Your credit score is determined by five factors: payment history, outstanding debt, length of credit history, recent inquiries and types of credit in use. Each of these factors is weighted differently to determine your score:

• Payment history (35%) – Build up a consistent payment history.  Late payments, judgments, bankruptcy and tax liens can lower your score.

• Outstanding debt or Amounts Owed (30%) – Maxing out your credit cards can lower your score, so keep balances well under your credit limit.

• Length of credit history (15%) –Long relationships with banks or credit unions based on loans have a positive influence on your score.

• Recent inquiries or new credit (10%) – Too many inquiries for credit within a short period of time can lower your score because it suggests you are frantic for credit and/or may soon be overexposed.

• Types of credit in use- (10%)- Too many open lines of credit (i.e. credit cards, retail accounts, installment loans, mortgage accounts) can lower your score. Loans from finance companies generally lower your score, especially when there are no other types of credit reported.

The interest rates you are charged on loans may be determined by your FICO score. Most often, the higher your score the better chance you have of getting a lower rate. FICO scores also can be used to determine your homeowner and auto insurance premiums and whether or not you qualify for a loan.

More information on How to Build a Better Credit Portfolio.  

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Identity Theft: Myths and Realities

One thousand one,
One thousand two,
One thousand three,
One thousand four...

Every four seconds another person's identity is used by someone else without their knowledge. It occurs in Texas more often than in 46 other states according to reports by the Federal Trade Commission.

 

So while you are reading this article, over 200 cases of IdentityTheft (IDT) will occur in the United States. These statistics include both ID Theft and ID Fraud. The difference is basically that theft involves using existing information or accounts while fraud involves opening new accounts or creating a fictitious person. Because stolen personal information can be sold again and again for use by another thief, IDT may happen more than once to thesame person.

 

IDT is probably the only crime that requires the victim to prove they are innocent and even clean up the mess caused by the thief. It’s not a bad idea to get professional help with this.

 

But, ideally you want to prevent yourself from becoming a victim. There are a number of steps we all can take – steps that are not expensive, but that require some diligence. Visit us online at www.identitytheftcounseling.org for 15 steps to help protect you from Identity Theft.

One of the best tools available to stop the unauthorized use of our credit history is a “Freeze”. Texas and many other states now allow anyone to place a “Freeze” on their credit report, a service that was previously limited to only IDT victims. A security freeze is effective because it requires the consumer to make an active consent before the Credit Reporting Agencies can release their information.

However, this “Freeze” also makes obtaining new credit more difficult for the consumer taking advantage of the service. A Personal Identification Number (PIN) is determined by the Credit Reporting agency and then must be used in all subsequent communication with the agency, or any time information is to be accessed or each time an application for credit is made.

Imagine you’re at the store to buy a new HDTV and they have a “no payment” for one year plan. Or, it’s year-end sale time at the car dealer, and you’re planning to use the 3% dealer incentive loan. It won’t happen if your credit can’t be checked. These are some considerations that you should ponder prior to taking this step, as it does last for seven years, and there will be a charge to unfreeze.

Another alternative is to place a “Fraud Alert” on your report. The “Alert” is effective for 90 days but can be renewed. The alert requests but does not require creditors call you before using the information so may not be as effective as the “Freeze.”

Another tool we have is access to a free credit report each year from each of the three Credit Reporting Agencies. To obtain your report go to www.annualcreditreport.com; note: there are other sites claiming to be free, but they require a purchase of a monitoring service.

Another very effective protection is to be very, very stingy with your Social Security (SS) number. Before you provide it, ask why it is needed. Probably the veterinarian does not need this number to care for your pet, etc. If necessary, speak to a supervisor or manager to insist another identifier be used. Often when people ask for your SS number, they are planning to check your credit.

Thieves can use SS numbers to obtain employment, and then the IRS may dun you for the  income taxes due. Sometimes IDT thieves use a SS number to falsely claim a dependent on a tax return or to obtain government benefits. In some cases, a new virtual person can be created using a your Social Security number, with that person obtaining new credit card accounts, a new drivers license, renting an apartment or obtaining utilities. This is also where the credit freeze is effective.

If you or someone you know may be a victim, Consumer Credit Counseling Service of Greater San Antonio and Budget & Credit Solutions offer Identity Theft Counseling services to assist in the resolution process. Their counselors can help you deal with the numerous contacts, the letters and forms that can take hours and hours to research and complete. They can also provide information such as phone numbers and letter templates for the victim to complete on their own, or can assist in the process to reduce the amount of time spent on remediation. You will have peace of mind knowing that you’ve worked with a professional and covered all the bases.

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Light at End of Tunnel for
 Defaulted Student Loan Borrowers

Consumer Credit Counseling Service of Greater San Antonio now provides Student Loan Repayment Counseling.  This service provides a free initial counseling session in which a Certified Consumer Credit Counselor will provide an overview of the situation and point you in the right direction. For a one-time $70.00 fee, a Certified Consumer Credit Counselor will assist the client in sifting through information and resources that will help get the borrower back on track with repaying your student loan while learning to avoid predatory offers and dishonest marketing ploys. 
 

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Pay Day Loans Simply Don’t Pay

A year-end study by the Center for Responsible Lending and other consumer advocacy groups showed that U.S. consumers pay as much as $4.2 billion annually in steep fees charged by payday loans.

An article by Market Watch's Andrea Coombes put it quite simply: "You don't have to know much math to understand that taking out a loan for $325 and then having to repay $793 to clear the books is a losing proposition."

But despite the clear math, some financially distressed consumers continually turn to payday loans. Two-thirds of them are taking 12 or more payday loans out a year (Personal Finance Daily, December 1, 2006). Coombes says that since payday loans are designed to be paid back in two weeks, the lump sum required at the next payday is impossible for some borrowers. In most cases, consumers end up renewing the loan in order to have more time to pay but end up paying hundreds of dollars more on interest than what they originally borrowed.

Although the Personal Finance article advises against payday loans, the fact remains that even for those consumers that get caught up in the payday loan cycle, the terms of the agreement are crystal clear. The issue isn’t hidden fees or poor mathematical skills on the part of the consumer. It’s that often, consumers with less than perfect credit believe that they simply won’t qualify for other lenders. However, the director of consumer protection for the Consumer Federation of America, Jean Ann Fox, says that “only 6% of payday loan customers say they have no other alternative for getting credit”.

Consumers who are turning to payday loans and paying 400% interest may find that other less costly alternatives exist. Fox points to mainstream financial institutions like credit unions and banks to provide better financial alternatives. In addition, pay advances from employers or loans from family members are also avenues that financially distressed consumers may try. While taking these alternatives may be more complicated than taking a “quick and easy” payday loan by writing a check and walking out the door with cash, it may help save you from the cycle of debt.

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Reverse Mortgages: What You Need to Know

Given on-going economic woes, high fuel prices, up and down stock market and rising medical costs, surviving is challenging for Americans on fixed incomes. Some consumers 62 years and older who prefer to remain in their homes are finding relief in a reverse mortgage.

A reverse mortgage does not have to be repaid until you or the last surviving borrower permanently moves out of the house or dies.The money borrowed in a reverse mortgage is tax-free and does not affect your Social Security or Medicare benefits.

How does a Reverse Mortgage differ from a Home Equity Loan?

As stated in AARP Home Made Money, with a forward mortgage, your equity rises while your debt decreases. However, with a reverse mortgage you are withdrawing from your home’s equity, which causes the reverse mortgage to be a “cash generator”. The amount borrowed depends on the age of the youngest borrower, current interest rate, and appraised value of the home and the FHA’s mortgage limits for your area.  Also, the lower the interest rate, the more you can borrow.

One of the drawbacks of a reverse mortgage is the up-front fee total, which can include a 2% lender origination fee, 2% mortgage insurance, appraisal fee, closing costs, and other miscellaneous expenses.  As your equity in the house increases and especially if you’re planning to stay in the home, the reverse mortgage can be an attractive alternative to moving.

It is important to remember that while you do not make house payments, you are responsible for taxes and associated bills like utilities and fees. You should also know that the lender cannot take away your home if you outlive the loan. And you can never owe more than the value of the home.

Does it matter how long you expect to stay in your home?

While you cannot be foreclosed on or forced to vacate your house, the upfront costs of a reverse mortgage make it unattractive for those who plan to move in a few years.  A reverse mortgage works best for older consumers who want to remain in their home, and allows them to pay off high-cost debt, fund medical expenses or purchase long-term care insurance.

Discuss your plans with your family and heirs.

When changing your living arrangements it is important to determing what is best for you and your family. Maybe you would do better to downsize or sell and move to another home. Perhaps you have relatives in another part of the country, or an assisted living arrangement may be more practical. Everyone in your family needs to be informed of your choice.

In Summary.

Reverse mortgages have assisted many individuals by allowing them access to their home equity while paying off the existing mortgage, make needed repairs or increase their monthly income.

“Caution should be used and all options considered to determine if this type of mortgage is right for you before taking out a loan against your home,” says Diana Hamby, Certified Consumer Credit and Housing Counselor.

To learn more about our reverse mortgage counseling services contact our agency at 210.979.4300 or 800.410.2227 or find us on the web at www.cccssa.org.

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Spending Plan Recipe

(How to Make a Budget Work for You) 

What are your financial goals?  To achieve your goals takes time and planning.  Start by organizing your finances.  A fundamental tool of financial organization is the Spending Plan. 

Purpose of a Spending Plan

A Spending Plan helps you control your finances so your finances do not control you.

Servings: One entire family
Preparation: One day
Total:  A lifetime
Rated:  Invaluable

Ingredients:
Income
Living Expenses
Debt Obligations
Savings
Balance & Control
Tracking - Trimming - Fine-tuning 

Instructions:

1. Make it work. Set a date and time to meet, involve the entire family.
2. Do your homework. Bring a list of family expenses to the meeting, including needs and wants.
3. Minimize distractions; turn off electronics (radio, television, cell phones, etc.).
4. List monthly income; include contributing household income (full-time, part-time, and seasonal) and other income (Social Security, trusts, estates, real estate, etc.).
5. Be realistic. You will probably be more successful when you cut back rather than cut out expenses.
6. Identify living expenses. Include basic household costs such as food, mortgage/rent, and medicine. Also list extras like hobbies, extra-curricular activities, dining out and salon services.  
   
7. Divide expenses into three categories:
       a. Fixed (e.g., mortgage/rent, auto loans and insurance)
       b. Variable (e.g., groceries, entertainment, clothes and gasoline) and
       c. Periodic (e.g., property taxes, home repair, car maintenance and
           holidays).
8. Pay yourself first. Treat yourself like any other a bill. Arrange for a portion of each paycheck to be transferred to your savings account. Every budget should include savings, no matter how small. Small savings grow quickly.
9. Prepare for unexpected expenses. Although you cannot predict the exact amount that you will need to cover some expenses, such as repairing your car or replacing an appliance, you can set aside a portion of each paycheck to prepare for life’s little emergencies.
   
10. Control your spending habits. Once you have written down all your household expenses, it is easier to see where you can cut back. One way is to ask yourself if you really “need” everything that you buy. Making the distinction between needs and wants can help you determine why you are spending your money.
11. Banish debt. Your monthly debt expenditures should not exceed 20% of your monthly after tax income (10 to 15% is a much safer figure, CCCSSA Money Principles For Today Guidebook).  An NFCC credit counseling agency can talk to about a debt management plan which will help you combine your debts and restructure more reasonable monthly payments.
12. Adjust as you go. Because the plan is a revisable document, it is important to review it at least monthly and make necessary changes. 

Creating a Spending Plan 
Certified Consumer Credit Counselors are experts in creating Spending Plans. For more great financial success recipes, schedule a confidential appointment with one of our certified credit counselors by calling 210.979.4300 or 1.800.410.2227 toll-free. Or find us on the web at www.cccssa.org.

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Your Card has been Declined...

"I have spent thousands of dollars with your company, and paid in full each month; however, three days ago, while checking my account online, I noticed that you have decreased my credit limit from $8,100 to a mere $400…”

Imagine this happening to you.  Perhaps it already has.  Before you can finish mentally linking the events that will take place after your credit company drastically reduces your credit limit, (this will push me over the limit and I will incur fees; my other creditors will hike my interest rate; this will affect my credit report!) your credit score has plummeted. 

“…this is unacceptable” continued the writer of the above letter as she goes on to list the main reasons for her complaint: “It was automatic, they failed to contact me in any way before or even after” and “they failed to look at my credit history with them and consider the possible circumstances”.  This consumer, who up until a few minutes before that letter held a bank dividend account, posted her experience on a popular online credit forum CardRatings.com.  More postings regarding other creditors appeared over the next few days echoing her experience: “This also happened to me.” 

While it’s typical of creditors to review card member accounts on a regular basis and make changes in interest rates and credit lines due to factors like payment history, out-of-pattern spending or credit report changes, Curtis Arnold, CEO of CardRatings.com says major creditors are “taking steps to protect themselves” in the midst of the subprime lending fallout by lowering credit limits of existing cardholders, “including some prime customers” (CNNMoney, Aug. 23, 2007).

John Ulzheimer, a recognized credit expert agrees with Arnold, explaining the recent credit line decreases as “a reaction to what creditors perceive as increased risk of defaults.” He compares it to the aftermath of Hurricane Katrina, when thousands of people were relying on credit cards for food and necessities; credit-limit decreases were also used to mitigate risks (SmartMoney, July 26, 2007). This practice, called “chasing the balance”, in which creditors not only lower a person’s credit limit to match their current balance, but lower the limit yet again every time the consumer makes a payment, leaves debtors at a high utilization percent. This affects their FICO score drastically, as it has been estimated that consumers lose 1 point for every percent of their credit limit in use (Rex Johnson, 6 Ways to Kill Your Credit Score).  So, if someone’s total credit limit is $10,000 and their outstanding balance is $3,000 (30%), their score would be 30 points lower than if they carried a $0 balance.  Furthermore, if an unexpected decrease puts the consumer above their credit limit, they’ll have to pay over-the-limit fees too. Take for example, an anonymous credit card company customer, who claims that the company decreased his credit line to $150 over his balance, citing ‘Serious Delinquency and Public Record or Collection Files”.  He argues that there are no late payments on his account and that all derogatory information occurred before the account was opened. Nevertheless, this consumer is now faced with his bill for the charged amount, an over-the-limit fee, and a weak credit score for reaching 100% credit utilization. Until now, the ousting of credit line decreases has been quieted by screaming headlines on sub-prime lending and housing market crashes. However, consumers should remain on the lookout for unexpected credit line decreases that can potentially hurt their credit.  Here’s how to keep up on these threats:

1. Read Your Mail

Although creditors can make changes to your credit limits faster than they can notify you about them, they are still required to send you some type of notification. Make sure you’re reading any literature coming from your creditors. Also, monitoring your accounts online can make you aware of credit line decreases or other changes faster, empowering you to do something about it before it’s too late.

2. Know the Rules

Familiarize yourself with the guidelines creditors use in determining “risk”.  Ulzheimer says, “that could be anything from high credit utilization to late payments, to increased credit inquiries.”  Remember, anything that could result in a credit-score decrease puts you at risk for facing a credit-limit decrease as well. So, attend a workshop such as Building a Better Credit Portfolio that teaches you the basics in credit reporting and includes a breakdown of how your credit score is determined.

3. Keep Low Balances

Always try to keep low balances on your credit cards.  This helps with credit utilization percent and decreases the chances of incurring over-the-limit fees in the event that you get hit with an unexpected credit line decrease.

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Your Credit Capacity

Spend no more than 20% of your net income on credit purchases. Example: A person making $12,000 per year (after taxes and other deductions) should spend no more than $2,400 on credit purchases.

• The 20% figure is based on an "average" family with "average" expenses. It does not take into account any major emergencies.

 

Your Guide to Credit Reports

According to a recent study by the Consumer Federation of America, a consumer with an average credit score of 700 would reduce finance charges by $76 each year by increasing his score 30 points. Your credit report reflects the history of your borrowing and payment practices for a seven-to-ten-year period. A credit report contains information about your credit and loan history and is used extensively by potential lenders to evaluate your creditworthiness. When applying for a loan, lenders examine your credit history to assess the likelihood that you will repay the loan.

How you handle credit today will affect your access to credit later. Whether you’re opening a credit card, applying for a loan, purchasing a home or car, renting an apartment or signing up for utilities, providers will pull your credit report.

Know your rights.

Through the federal Fair Credit Reporting Act (FCRA) every consumer is entitled to a free copy of his or her credit report once every 12 months from each of the three major credit bureaus. Read each report carefully as there may be discrepancies between the three credit bureaus. This is because creditors do not necessarily report the information to all three and they don’t always share information.

Order your free credit report at www.annualcreditreport.com or call 877.322.8228.  You can also send a request by mail to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, Georgia 30348-5281.

If errors are found, contact the bureaus immediately so that they can begin to investigate and correct the mistake.

You may dispute the error in writing or online.  Print out the dispute form here.

Take Action to Improve Your Score

Building A Better Credit Portfolio is offered every 4th Saturday of the month for free! To attend a class or a personalized session regarding your credit report and credit score, make an appointment with a Certified Consumer Credit Counselor in your community by calling 1.800.410.2227 or click here to register online.

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