Today I wanted to talk about errors. Specifically, I wanted to talk about the fact that on everyone’s credit report, there are significant numbers of errors, and the impact of these errors on your credit report can impact your numerical score. There are four different types of information found on your credit report.
There’s identifying information, credit account information, credit inquiries, and public records and collections items. Each of these factors plays a significant role in impacting your credit score. In addition, if any of this information is inaccurate, it could affect your credit score. So let me take this time to explain each of these items and the impact they may have on your credit score.
Identifying information includes information like your name, your address, your social security number, your date of birth, and your place of employment. These are essential factors because they identify who you are, as the name implies. So if the information is wrong, it may not be your account.
The next issue is credit account information. This includes mortgage accounts and home equity loans, revolving accounts like credit cards, and installment accounts where the amount in term of payments are fixed, such as a car or a student loan. The payment history for each account will be recorded for 81 months. Satisfactory and negative accounts will be reported separately, with negative accounts usually reported first.
The next issue is credit inquiries. Now, there are hard inquiries, and there are soft inquiries. A complex search occurs when you apply for a loan and authorize the lender to ask for your report. These inquiries negatively impact your credit score if too many of them happen in a short period. A soft inquiry occurs when a creditor orders your report to send you a preapproved offer. Soft inquiries do not impact your credit score.
The next issue is public records and collection items. This includes bankruptcies, foreclosures, lawsuits, wage attachments, liens, judgments, and information on overdue debt from the collection agency.
To address any issue on your credit report, you need to identify each of these items, and we need to address those items accordingly. Use the following tool to address your credit score errors: