If money makes the world go round, it turns out on a credit axis. In the speaking industry, the best founders think of credit as an investment in themselves. Instead of going to the bank for a loan or looking for angel investors, get tens of thousands of dollars in capital through credit cards. That is, if your credit report indicates to the credit card companies that you can, of course, invest this money wisely and pay them back.
However, what if credit reports are not always accurate? We tend to think that they have to be, and just accept that when we get a credit limit, it has to be based on something truthful and fair in everything. That may not be true. Arnita Johnson-Hall is a millennial credit coach and consumer credit advocate and her blog, Luxurious Credit, has been helping women understand their credit. And this is crucial, because, according to CBS News, “79% of credit reports contain errors, and 25% of these errors result in a consumer not being denied credit.”
At a time when entrepreneurs need more financial trajectories than ever before, knowing how to check your credit report, scan for mistakes, and get more credit can be a lifetime or death to your business. Johnson-Hall has been helping women argue about the errors in their credit reports for nearly a decade – here are her recommendations.
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How to check your credit report
Johnson-Hall says the first and most important step to understanding your credit is to know how to analyze a credit report. “Realizing your credit report can make the difference between fair credit and big credit,” she explained. “It is only when you have a detailed understanding of where you stand with your lenders, sponsors and creditors that you can really see what your current credit conditions are and how you can improve them. ”
To do this? Get a credit report and of course go through it with a fine tooth comb. “I always urge delegates and women to stop taking the report for face value or just truth. Just because it’s a report from a reputable credit company doesn’t mean it’s completely accurate. ”
Johnson-Hall said the major credit firms (Equifax, Experian, and TransUnion) all share the same information in the credit reports, but in slightly different formats. “The important thing to know is that these credit reports are exactly what companies or creditors see when they run your credit,” she explained. “It’s important to evaluate the accuracy of everything, but especially to look for the following.”
- Safescan warning. “This is how you know whether or not you have been a victim of identity fraud,” Johnson-Hall explained. “The report overrides your social security number to see if it has been used or related to another person, dead or alive. ”
- Profile Summary. “This includes relevant information such as your maximum and minimum credit limits, how many accounts you have open (including foreign bureau accounts), and the existence of public records.”
- Search warning, that is how many queries have been made for credit claims or too many rent queries.
- Tradelines, which is where your credit account details will be. This can include account numbers, terms of agreement, credit limit, balance due, 24 month history, obscenity, and more.
“Evaluate everything in the credit report, and look for anything that is not true,” Johnson-Hall asks. “It is vital that every lender who sees your report gets an accurate picture of your credit history.”
Promoting your credit
Johnson-Hall said one key way to improve your credit report is to add a user statement. “This is where you can share your side of the story, or add color to specific sections,” she explained. “For example, there may have been interesting cases for litigation in the past, but that was many years ago and you’ve been working through it. ”
Beyond that, sometimes your credit needs to be renewed if it’s not exactly where you want it. “A lot of credit development comes down to habits, such as staying with your habits and paying bills on time,” Johnson-Hall explained. “I’ve found that a lot of the women I work with don’t mean being late on their lips, but it’s their habit to put them aside when they get them, and forget they pay them. ”
Therefore, getting self-paid bills or paying them straight away can restore a credit score. She also recommends decluttering and simplifying your entire financial practice. “Opt for electronic bills instead of paper bills, and organize this expense information on online apps or resources. Apps like NeatDesk or NeatReceipts are great ways to save paper receipts without having a bunch of them on your desktop or scattered around your house. Log them right after you recover from dinner or shopping, so you don’t forget or miss them.
“Plus, create a routine way to look through your expenses each week to see where the money is going. Also, consider putting a large portion of your income into savings to resist the temple of spending just for the sake of spending. There is a tendency to see that there is disposable money, and then start thinking about what you can spend on it. Eliminate this bias as much as possible so that you have more than enough for your lips. ”
Credit building is a two-pronged strategy: making sure your current credit report is accurate, and doing your part to boost your credit, one small financial practice at a time.