Preparing TO START your independent life as young adult on your own can be fun and exciting, but, it also means taking on new responsibilities. Credit decisions you make now can and will have long term consequences.
Do you know that your credit history has a direct impact on your ability to get?
• Utility Services
• Cell phones
• Rent an Apartment
• No Flight List
• Potential Lenders
A file about you is created by the first legitimate inquiry from one of the above mentioned sources; when you start applying for a credit card, a personal loan, or insurance etc…
This document is called a CREDIT REPORT and is maintained by the credit reporting companies, such as Equifax, Experian and Trans Union. Your credit report will in time, show inquiries and periodic reports from credit grantors, mainly BUT NOT EXCLUSIVELY!
Credit reports also list:
• Your residential address
• Place of employment
• How you pay your bills
• Legal – judgments, bankruptcy etc…
• 3rd Party Collection Agencies trying to collect skipped accounts
This information is used to evaluate your application for credit, insurance, employment, or renting a place to live, in other words YOUR CREDIT WORTHINESS = How much of a RISK are YOU?
It is advisable to obtain a copy of your credit report and make sure the information reported is accurate, complete and up-to-date, before, applying for a loan for a big ticket item like a car loan, insurance, mortgage or apply for a job.
This step also helps guard against IDENTITY THEFT; this can be one of the worst experiences to go through!
Constant vigilance is the most prudent way to protect your valuable information! Get in the habit of obtaining a copy of your credit report at least twice a year.
Identity theft is when some unauthorized entity uses your personal information, such as:
• Your name
• Social Security Number
• Credit Card Number
Usually, identity thieves use your good information to open new lines of credit and when the debt is not honored per the contractual agreement, this derogatory information is reported on your credit report. It becomes your responsibility to exonerate yourself from the bad or inaccurate information, however, in the mean time your ability to get credit, insurance or a job is affected. (See my e-article “Identity Theft – Protect Yourself”)
BACKGROUND CHECKS – some employers check into your background either before deciding to hire you or keep you on the job. One of easiest and cheapest ways of doing this is by pulling your credit report. Please note! You have rights under federal, state and city laws.
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