Declutter Your Credit Reports For Spring

While spring is known for inspiring a hefty “to-do” list in many a home, it’s also prime time to get your financial house in order. If you haven’t done a thorough inspection of your credit in a while, dust off your credit reports and take a fresh look at your credit scores.

Your credit file is only as accurate as the information your creditors provide to TransUnion®, Equifax® and Experian®. You might be surprised by what’s been swept under the rug that can tarnish your scores.

Here’s a spring “credit-do” list to help you get started:

  1. Weed out errors on your credit reports. Errors that grow undetected and uncorrected can strangle your credit scores and limit your financial options for years. We’ve listed a few of the more common culprits.
  • Accounts that are incorrectly reported as late or delinquent.
  • Closed accounts reported as open.
  • Accounts with an incorrect current balance or incorrect credit limit.
  • Unauthorized accounts due to identity theft.
  • Less common, and harder to correct, is a “mixed file” error in which another person’s credit information ends up on your credit reports, or vice versa, because your names are an exact match, or very similar.
  1. Prune negative information that should have fallen off your credit reports. By law, credit bureaus are only allowed to list negative items for a certain amount of time.
  • Collections, paid tax liens and Chapter 13 bankruptcies can only remain on your reports for 7 years.
  • Chapter 7 bankruptcies and unpaid tax liens can stay on your reports for 10 years.
  1. File a dispute to correct errors, outdated information or fraud that can damage your scores.
  • All three credit bureaus are required by law to respond to your dispute within 30 days.
  • If you request it, each bureau must send a notice of correction to those who received your report in the past six months – or during the past two years for employment purposes.
  1. Clean up your own messes. If your scores have dropped due to your own actions (or inaction), take steps to wipe away the negative impact.
  • If you have past due accounts, make it top priority to get caught up, or contact creditors for assistance.
  • If you have an account in collections, negotiate with collectors to reach a reduced payment agreement to mark the account as paid-in-full.
  • If you owe a lot on several accounts, re-think your budget to reduce your debt wherever possible.
  1. Build on your successes. If you’ve seen a vast improvement in your scores, put them to work for you.
  • Check the finance charges you pay on your credit cards – then call to request a lower interest rate. If you have been a responsible card-holder who always pays on time, you might just get it!
  • Higher credit scores can also help you get lower auto insurance premiums.
  1. Actively monitor your credit and personal information. Checking your own credit does NOT hurt your scores – and can help you catch errors or suspicious activity, early, that may pose a threat.
  • Review your credit reports for changes when you sit down to pay your bills each month.
  • Update your credit scores once-a-month to see where you stand with all 3 credit bureaus.
  • If you’re already signed up for monitoring services, pay attention to every alert you receive.

Use springtime as your springboard to do a deep cleaning of your credit reports – and start monitoring for changes to keep a shine on your scores.

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