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Debt Management through Credit Reports

By Ruth Racey
Published: Sunday, October 30th, 2011

Genuinely managing debt can only come from the most precise source of credit information which is consumer reports or credit reports. These reports are made by reporting agencies which are led by the three major CRAs, Experian, Trans Union and Equifax. Debt management so far is the most effective legal way of repairing financial worthiness ratings. This repairs plan attacks the main source of the different financial problems, debts. Debts also bring out interest rates which can further impair borrowers. Dealing with debts should be the priority of account holders to be able to effectively conduct repairs.

Unfortunately, there are many types of debts which cause financial standing degradations at different levels. Its technicality can even compound the problem by making it too complicated to understand. This is where credit reports come handy. The details and information included in consumer reports make debt management relatively easier for account holders. In using consumer reports as a starting point to manage debts account holders should note the importance of these parts of their reports.

  • Every account holder is entitled to free consumer reports from the three major reporting companies annually. This right is mandated under the Fair Credit Reporting Act or FCRA. Account holders should take advantage of this right to avoid paying extra fees for their consumer reports. Indebted account holders in particular do not need to pay anything to get their debt management basis.
  • Accounted financial information are arranged from the most recent to the oldest. In reading their consumer reports, account holders should carefully check the details of their existing accounts. Everything must be reflected and accounted for including closed, moved and even defaulted accounts. Knowing their accounts will allow account holders to precisely pinpoint the parts of their accounts that they can use to help them manage their debts.
  • In reading their consumer reports, account holders should also double check the name of the issuing company. Discrepancies with the names of their companies are indicators of simple company name change or the devastating identity fraud. Either way, the precision of the information in the consumer report should be flawless.
  • Lastly, account holders should pay close attention to external factors in their consumer reports such as hard inquiries and triggers. While managing debt, account holders should avoid other situations where they can compound their already worsened credit worthiness rating. Negative triggers can limit the financial mobility of the account holder and hard inquiries will also do the same by lowering the account holders’ FICO score. These should be informed services and if they are done without consent, the account holder can dispute its accounting entry.

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