Solving the Mystery of Credit Reports
Credit Bureaus
• 3 major credit bureaus• Equifax• Experian• TransUnion
• Credit information is reported to bureaus
• Not all creditors report to all 3• Regulated by Consumer Financial
Protection Bureau
The Fair Credit Reporting Act
• You may access your own file
• You can dispute inaccuracies
• Outdated information must be removed
• Access to your file is limited
• You must be told if information is used against you
Obtain Your Report
• Through Annual Credit Report Request Service
• Centralized service• One free year (more if fraud suspected)
• Through the credit bureaus• Fee for report
FICO vs. Vantage
FICO Score VantageScore
Range 300-850 Range 501-990
No letter grades for FICO Uses letter grades to spell out your credit history• 901-990 = A or Super Prime• 801-900 = B or Prime Plus• 701-800 = C or Prime• 601-700 = D or Non-Prime • 501-600 = F or High Risk
Takes into account 5 components Takes into account 6 components
Thin file consumers often cannot generate a credit score at all, or are scored with inflated, high scores because they have few credit actions on file
Claims to score thin file consumers more accurately by providing predicative scores for consumers with limited histories
The Fair Credit Reporting Act
Sections of the Report
Identification • Name, DOB, SS#, Address
Public Records • Bankruptcy, judgment, liens
Accounts • Payment history, balance, date opened
Inquiries • Record of requests for your file
Trade Lines
• Creditor name/partial account number • Date account opened• Payment history (on‐time, delinquent,
charge‐offs)• Date of last activity (DLA)• Current balance• Joint/individual account• Current status• Credit limit
Credit Scoring
• FICO scores range from 300‐850 • Score is based on several factors
10%
35%
30%
15%
10%Types of Credit Used
Payment History
Amounts Owed
Length of Credit History
New Credit
• Positive information canremain indefinitely
• Most types of negative information 7 years from when first reported
• Chapter 7 bankruptcy reportedfor 10 years
• Collection accounts 7 years
How Long Will it Stay?
• Fill out dispute form at website of credit bureau reporting inaccurate information
• Send any mail certified, and keep copies of everything
• Use 100‐word statement to explain if dispute fails
Correct Inaccuracies
Beware Credit Repair
• Charge fees to do things you can do for yourself for free• Company may be engaging in illegal activities in your name• Take steps yourself to dispute incorrect or outdated
information
• Preventing fraud
• Protect your information• Shred anything with your account numbers• Review credit report• Monitor statements carefully
Identity Theft
Damage Control
• File police report• Contact credit bureaus• Contact creditors• Monitor accounts• Review credit report quarterly• Contact any other affected organization
• DMW• Social Security• Financial Institutions
• ChexSystems• Used when opening new accounts• Tracks returned checks
• National Tenant Network• Used by landlords• Reports evictions
Other Types of Reports
www.AnnualCreditReport.comChexSystems ‐ 1‐800‐428‐9623Federal Trade Commission ‐ www.FTC.govwww.VantageScore.com & www.MyFICO.com
Resources
Final Thought
With a little awareness and effort, you can have and keep an excellent credit history that will open a lot of
opportunities in your financial life.
Questions?
BALANCE is a free financial education and counseling service available to all VCCU members. Services include: • Webinars• Counseling services• Podcasts and short videos• Online tools• Debt repayment options• Credit report review• And more….
Call toll‐free 888.456.2227 or visit vccuonline.balancepro.org
Ventura County Credit Union
805.477.4000 • 800.339‐0496 • vccuonline.net
• Camarillo• Thousand Oaks• Moorpark• Simi Valley
• Ventura• RiverPark at the Collection in Oxnard• Oxnard• Port Hueneme
Our mission is to improve the financial well‐being of our members and our community.
We’re social!
8 convenient locations
Pattie BragaSenior Community Development Officer805.477.4052 work805.797.3985 cell
Thank you!