How to Start Your Own Business – More Steps for Improving Your Credit Score

Now that you’ve been proactive in managing your credit, making progress on that front, it’s time to peek at how lenders see you, how you measure up in their eyes.

Instructions

Difficulty: Easy

1. Get your credit reports.
   There are three major credit bureaus, Equifax, Experian, and Trans Union. You need to order reports from all of them.
2. Correct all errors.
   It’s practically inevitable that there will be mistakes which is why it’s important to keep a written records of all dealings with the credit bureaus. It’s particularly difficult to clear identity theft problems. I’ve had a cell phone bill, for an account I never opened dogging me for years. Yet again this past week, I dusted off my police report and the original notice to the collection agency to have it resolved.
   
   Bank mergers can also cause problems as transferred accounts become charge offs. Check everything then followed the procedures outlined to correct mistakes. At this point it’s particularly important to make sure that you are listed as being employed at your current job. If it’s not on the credit bureau’s list, send evidence of employment like a pay stub. Before striking off on your own, you want to muster the strongest credit profile you can for a credit line.
3. Check again.
   Let the changes you’ve made percolate through the system for a month. If you haven't received your updated report, then request the appropriate credit bureaus to run your reports again. You can request them on line or through these toll free numbers, Equifax (1-800-685-1111), Trans Union (1-800-916-8800) and Experian (1-888-397-3742) If after 45 days there has been no response to your action, you can file a grievance with the Federal Trade Commission under the Fair Credit Reporting Act.
4. Get your FICO Score.
   Your FICO score is a numeric rating developed by Fair Isaac & Co to assess the likelihood that you’ll pay your bills as contracted. The factors I’ve outlined in the last three postings all bear on your score which ranges from 350 to 850. Scores of 700 and above are your target. The rating directly affects not only the amount you’ll be able to borrow, but the rates you’ll have to pay.