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Myths about Credit reports you should know

By Janet Lacey
Published: Friday, June 18th, 2010

The concept of credit rating and the associated scores is such a big phenomenon that people actually get scared when you talk about it. The truth is that credit reports aren’t really something you need to be afraid of and probably something that you can use to your advantage if you know all about it. After all, the more you know, the better it is for your money. You wouldn’t want to do something drastic and end up in trouble at a later stage. Think ahead and plan well with your money so that your finances don’t look mismanaged in your credit score.

Marital Status and Credit Reports

It is not clear as to who specified that credit reports are dependent on your marital status. Perhaps this myth was derived from the facts used for getting car insurance, but the truth is that it is never a factor that is going to alter your credit score. In fact, most of your personal information is quite irrelevant. Your employment information and your outstanding loans are what truly matter. Even after you are married, you will continue receiving the same report, unless you have opened a joint account with your spouse. In this case, this account will be considered while your new report is being drafted.

Disputing your negative traits

If there are black marks on your credit report due to some activity that you were involved with in the past, no amount of disputing can rectify that. In fact, you might want to concentrate on improving something in the future rather than try to dispute something that has happened in the past. If the entry on your credit history was justified, no amount of dispute cases can rectify that entry. In fact, the credit bureaus involved in making your reports take a lot of precaution to ensure that your scores are what they are supposed to be.

There is more than one credit score

This is actually not a myth, but the reality. There are in fact three bodies involved in developing your credit scores. The three bodies responsible are Experian, Equifax, and Transunion. Each credit bureau will generate a score, which is why you will have three distinct scores to look at. Hence, don’t think that if you know one score, that is it. It helps to know all three scores, since they are different and bound to be important to know. Try to keep track of all three scores as much as possible.

Shopping continuously lowers the scores

When you are buying a lot of big items like cars and expensive electronics, they are counted as a single enquiry by the credit bureaus, if it is within a 14 day period. Hence, if you are worried that the purchase of these items and repetitive queries might worsen your credit report, think again. These queries are normal and credit bureaus anticipate them. Consecutively, you shouldn’t worry about getting penalized for such multiple queries and go ahead and do your shopping in peace. In fact, paying your bills on time is important to get a good credit score.

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