Friday, May 8, 2009

Credit Repair - Is it important?

Credit repair is hugely important to all of us because a poor credit record can have a dramatic impact on our lives. In fact, there are many car insurance companies that now utilize the consumer's credit rating to determine the amount of the premium they will charge, because statistical evidence has shown that lower the overall credit rating, tends to equate to more insurance claims.

If you want to purchase a new home or take out a bank loan, or perhaps even before you are offered a job, you will have to undergo a credit search, the results of which will then determine if you are "suitable" to be offered a mortgage, a loan or that job.

Credit repair has become big business now because of the amount of errors that are filed on a credit report. It has been estimated that over two thirds of credit reports contain at least one error. These errors will not simply vanish - they need to be proactively corrected. It has been reported that having only one to two errors corrected on a credit report can improve your credit rating by between 50 to 100 points!

How then, would having these errors eradicated, affect you?

Say for example you called your credit card company and asked them if you could have a lower interest rate on your card. Well, chances are they would say yes because you could go elsewhere and negotiate a better deal due to your good credit rating. Why would you choose to pay 30% on your balance when you could re-negotiate to 12%? This same scenario does not only apply to your credit cards, but also to your mortgage, to your car loan, to your bank loans and pretty much any other debts you may have too!

So, if you are thinking about a new credit card, or you want to get a new car on loan, now is the time to assess your credit ratings and do any credit repair that needs doing. It's a process and it will not happen over night. The sooner you do this the better!

This article was contributed by Joseph Archibald who writes for and moderates

1 comment:

  1. i hope i had a credit card.. nice post.. keep it up...