NFIB

A Check in Time Saves Your Credit Line!
04/ 11/ 2002

Knowing the state of your credit report before applying for a business loan or asking for extended credit is a shrewd move for any business owner. In fact, a good credit report is so important to a business that it is crucial to be aware of your rating at all times. Whether or not you get that loan or extended credit line may depend on a network of three major credit reporting bureaus. It is a good idea to check your credit report to know where you stand before problems pop up and upset your plans. In today's Workshop, Edith Helmich goes over some ways to save your credit line and avoid errors.

The three major national credit bureaus are:

Equifax
P.O. Box 740241
Atlanta, GA 30374-0241
(800-685-1111)
Web site: www.equifax.com

Experian (formerly TRW)
P.O.Box 2104
Allen, TX 75013-0949
(888-397-3742)
Web site: www.experian.com

Trans Union Corp.
760 W. Sproul Road
Springfield, PA 19064-0390
(800-888-4213)
Web site: www.tuc.com

Once you get a copy of the report, check to see that the following information is correct:

• Your name(s)
  
• Social security number
  
• Date of birth
  
• Residence Addresses
  
• Employers
  
• Pending accounts and accounts that have been closed
  
• Legal time limits:
  -- Bankruptcies must be removed after 10 years.
  -- Suits and judgments, tax liens, arrest records and most other kinds of unfavorable information must removed after 7 years.
  
• Delinquent payments, defaults or other problems.
  
  

The Fair Credit Billing Act requires creditors to correct errors promptly and without damage to your credit rating. If false information on your credit report is not removed, you can sue and, if successful, be awarded damages, punitive damages, court costs and attorney's fees.

If the credit report contains indisputable damaging information, being aware of these disclosures still provides an opportunity to minimize the damage. If your credit history lists defaults on previous loans, bounced checks, late payments or other problems, your explanations or immediate corrections (paying off delinquent accounts) may lessen the impact on future credit lines.

A quick checklist of the credit report basics that lenders evaluate includes:

• Timely payment history
  
• Total debt
  
• Number of credit report requests
  
• Unused credit eligibility
  
• Monthly income
  
• Employment history
  
• Occupation
  
• Home ownership
  
• Mobility/Moving History
  
  

The best preventive measures for establishing and maintaining a good credit record include borrowing judiciously and paying your bills on time. A history of on-time payments and credit card payoffs are worth their weight in gold-- or future loans! A check written in time to avoid a late payment is the very best kind of insurance for a good credit report.

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