An significant part of a financial journey is a credit report. This is vital because we all find that one or the other time in life we need credit. It may be for purchasing an asset such as a Home or a Car, financing Education, coping with emergencies such as medical emergencies, financing a marriage, a vacation, or easing crunching at the end of the month.
No matter what the need might be, this form of need is credited. What you need to apply for credit, though, is a decent credit score. Not only is a credit responsible, it keeps your credit report clean. It is a good credit score.
A Clean Credit Report
What is a clean report about a credit? The report is error free, and any feedback will harm your credit health and end up impacting your chances of earning credit the next time you need a credit card or loan.
Six basic steps to help clean up your credit report are given to you.
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Steps to clean up your Credit Report |
What it means |
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Get your Credit Report copy |
You can get it for FREE at Credithelpindia. |
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Verify the information |
Check if the information given in the report is all correct. |
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Get rid of the errors |
If you encounter any error, remove it immediately. |
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Evaluate the number of your credit accounts |
If you have many accounts, it’s time to free up some account and improve your debt to income ratio. |
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Resolve negative accounts |
Negative accounts reduce your credit score. Resolve these accounts at the earliest with Credit Help India’s help. |
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Improve credit score |
Improve credit score to get the best loans and credit cards. |
Step 1: Obtain A Copy Of Your Credit Report
You should review your report first of all in order to be able to update your loan report. It is good to either reach out to a competent credit management service like us who can help you understand your credit report and suggest you to take the correct steps to clean up your credit report and boost your credit score. You are not familiar with the credit report and the details it contains and how it affects you.
And it is high time you look at your credit report if you are someone who has never looked at it. Knowing your loan report and its elements will allow you to address your credit report issues more quickly, if any. Check your credit score and study.
Step #2: Verify The Information In The Report
Your credit score is assigned on the basis of the details concerning your credit conduct, which your lenders submit to the Credit Bureaus. It provides information on all your credit accounts, whether open or closed, your repayment history: whether it has been replaced or is not repaid promptly, your credit use ratio, your credit mix, your credit history and your PAN's extreme request. It includes all your credit accounts, whether open or closed.
The information in your credit report is very important to review. Not all will be right, some mistakes may have gone into your credit report.
Step #3: Get Rid Of The Errors In The Report
Errors on your credit report may have an incorrect effect on your credit score, often reducing your score. Your credit report must be checked as much as possible to decide if any mistakes exist in your report.
It's very easy to correct errors in a simple dispute resolution procedure if you notice any errors in your report.
The most commonly found errors in a Credit Report are:
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Error Type |
What it means |
Effect |
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Identity Issues |
Incorrect PAN or personal information |
Medium-High |
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Account Errors |
Wrong reporting of credit limit, loan balances, account status |
High |
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Identity theft |
Someone else uses your identity and conduct fraudulent transactions under your name |
High |
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The PAN is the basis for a credit score. PAN numbers or names can be mixed with those of another person with similar documents due to surveillance or clerical error.
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Such mistakes which show an incorrect credit cap, incorrect loan account balances, closed loans as Settled or Written Off or same loan more than once.
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Credit report errors can also be attributed to identity fraud, in which a person uses another person's identity to receive credit. These are more serious in nature and should be reported to the Police .
Step #4: Evaluate The Number Of Credit Accounts You Have
A clean credit report should show your creditworthiness as well as being error-free. You should focus on the amount of your credit accounts while you are finishing sorting the errors on your credit report.
It might be the time for you to review the situation and try to close some if you have multiple credit accounts such as loans and credit cards. You will find it hard to get new loans if you pay EMIs above or near a specified cap of 30% of your gross income.
It is good in such cases to plan a budget to prepay such loans so that a portion of your revenues is issued.
Step #5: Work On Getting Negative Information Off Your Report
Negative details such as settlement, written off, suit filed etc could be due to your earlier delay, or default on repayment of loans and credit cards, . A loan report with negative details is converted into a low loan score that can affect your future loan prospects.
It is therefore good to get your credit report off the negative details at an early point. Your report on a representation or submission from your end cannot just be deleted.
However, experts warn you that you will stay on your credit report when it comes to significant negative data such as payments or defaults. It
Step #6: Start Working Towards Building A Good Credit Score
There will always be a need for credit. It cannot be achieved immediately or over a period of weeks to build a good credit score. It needs continuing attempts to be liable for a longer period of time.
It could take three months for some people, and it might take up to a year for some people, depending on the size of the report and the amount of negative information you receive.
As the credit score and credit report have recently grown significant, it is not possible to be lax and have a good score and report.