credit reports pg2

credit reports pg2

How Does a Low Credit Score Affect My Interest Rate?

Lenders estimate your ability to pay back money based on your credit score. The risk factor they take on is built-in to your interest rate as a financing fee . Therefore, a low credit score results in a higher interest rate, higher monthly fees, and a higher amount of interest being paid over the total life of the loan.

The following chart illustrates the difference in the amount of interest paid over the life of the same loan with three different credit score scenarios. A borrower who increases his or her credit score from 620 to 720+ can potentially save $601 per month on mortgage payments, $7,214 per year, and approximately

Disputing Errors On the Credit Report

If you are in the process of reviewing your credit reports, the first thing to do is make sure that the information contained within the reports is correct. In June 2004, The U.S. Public Interest Research Group published the results of a survey it conducted involving 200 adults in 30 states to test the validity of credit reporting.

Their findings were as follows:

  • Twenty-five percent (25%) of the credit reports contained errors serious enough to result in the denial of credit;
  • Seventy-nine percent (79%) of the credit reports contained mistakes of some kind;
  • Fifty-four percent (54%) of the credit reports contained personal demographic information that was misspelled, long-outdated, belonged to a stranger, or was otherwise incorrect;
  • Thirty percent (30%) of the credit reports contained credit accounts that had been closed by the consumer but incorrectly remained listed as open.

SOURCE: U.S. Public Interest Group Research; One In Four Credit Reports Contains Errors Serious Enough To Wreak Havoc For Consumers, US PIRG Press release, 06/17/04
http://uspirg.org/uspirgnewsroom.asp?id2=13650&id3=USPIRGnewsroom

If you find that you have errors on your credit report, follow this
procedure to correct those errors.

  1. Make a copy of the report and circle the item(s) you are questioning. Keep your original copy for your own records.
  2. Prepare a letter to the Credit Reporting Agency (CRA) that provided you with the report in question, and request to have the erroneous item(s) removed. If you have proof of payment for an item in question, include a copy of that documentation.
  3. Prepare a letter to the creditor reporting the problem, especially if you feel you are a victim of fraud or identity theft. Inform the creditor that you are disputing an error
    reported to the Credit Reporting Agency (CRA), state why the claim is inaccurate, and include any relevant documentation to prove your point.
  4. Send your correspondence via certified mail.

You should receive a response from the Credit Reporting Agency (CRA) within 30 to 45 days.

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BUYorREFI Financial (NMLS 1838307)
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Rhett Laufenburger NMLS# 221295

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Surprise, AZ 85374

Number:
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BUYorREFI Financial 14780 W Mountain View Blvd Surprise AZ 85374 (NMLS # 1838307). 480-225-6699. Copyright © 2021 BUYorREFI Financial. All Rights Reserved. This is not an offer to enter into an agreement. Not all customers will qualify. Information, rates, and programs are subject to change without prior notice. Not all products are available in all states or for all loan amounts. Other restrictions and limitations apply. BUYorREFI Financial is an independent mortgage broker and is not affiliated with the Department of Housing and Urban Development or the Federal Housing Administration. MB-1000724