Credit Problems Need To Be Addressed

Many consumers, from time to time, have experienced credit problems. It is nothing to be ashamed about. However, you can do something about it.

What kind of credit problems will show up on my credit report?

The three major credit bureaus – Experian, Equifax and TranUnion – collect financial data on consumers and generate a report that financial institutions use to judge credit worthiness. The credit report contains several categories that could affect a consumer's credit.

Too much debt is one of the most prevalent credit problems many consumers have. Their debt to income ratio tells potential lenders how much debt a consumer has compared to their income. If the consumer does not make enough money every year to pay off what they owe another creditor, the lender may deny the consumer credit.

If a consumer has too many delinquent payments reported to the credit bureaus by the lender, it could affect their credit score. Creditors want their payments by the specified due date. While some creditors will let a few late payments go unnoticed by the credit reporting bureau, a consumer who is chronically delinquent is reported to the credit bureaus.

Too many hard hit inquiries may also negatively affect a credit report and cause credit problems for the consumer. A hard hit inquiry may be recorded by the credit reporting bureaus every time a lender requests a consumer's credit report in response to a loan or credit card application.

How do credit problems affect your ability to obtain a credit card or loan?

These credit issues can affect a consumer's ability to obtain credit. The first thing you can do to resolve your credit problems is to request a copy of your credit report. A consumer is entitled to one free credit report every year from each of the credit reporting bureaus. You can visit www.annualcreditreport.com to request a copy of your credit report.

Without a credit report, you will not be able to tell if there is inaccurate information on your report that needs to be corrected. Inaccurate information on a credit report can cause credit problems, too. If you find inaccurate information on your credit report, you can dispute it with the credit reporting bureaus.

If you would like more information on credit problems and how to fix your credit, visit the Federal Trade Commission website or contact one of three major credit reporting bureaus. For more information on debt related issues, contact an NCO Financial Systems, Inc representative. Contact information for NCO Financial Systems, Inc. can be found here on our consumer help unit website.

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