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Consult a Credit Report Before Making a Decision

By Faye Mergel
Published: Sunday, September 6th, 2009

Experts advise consumers to check their credit reports first before refinancing their loans. Financial specialists say that this will help consumers make a decision on whether they should apply for a loan or not. Studies on credit reports show that about 25% of the annual financial reports are inaccurate. It is also common for consumers to find out that their reports contain out of date data or information. The unfortunate thing is that most of them find out too late. They only know about these errors after their creditors review their credit reports. As a consequence, most of them get low credit assessment scores and they do not get the lower interest rates they deserve.

Consult a Credit Report Before Making a DecisionTo avoid this mishap, finance specialists strongly advise consumers to take advantage of the free credit report services available online. These credit report websites have access to the three major credit companies in the country: TransUnion, Equifax, and Experian. To get their reports, consumers must provide some personal and financial information, such as their state and social security number. By viewing their credit reports, consumers will know which debts they have paid off that were not cleared in the credit bureaus. They will also know if there are debts which are erroneously associated with their names.

Consumers often face the problem of high-interest loans and balloon mortgages. In order to get out of oppressive loans, they choose to refinance. Refinancing happens when a person applies for a low-interest loan to pay off a high-interest debt. When refinancing, a consumer will get better financial assessments from lenders or providers if he is able to correct every error in his financial report. To make sure that lenders get the most accurate and positive information from customers, the consumer must check his credit report 2 to 3 months before applying for a loan. This is ample time for finance bureaus to research on a client’s credit status and updates their database accordingly.

Getting a financial report has another positive impact on a consumer. It will allow him to know his credit score and will encourage him to improve it. However, most finance specialists also warn consumers to be careful with the credit report website they go to. Credit record scams have been rampant since January 2005. Experts would say and agree that if a credit record site asks for payment for using their services, it is better to look for another web site. Credit reports can be availed for free, and there is no need to spend money.

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