Experian, TransUnion and Equifax are three major credit bureaus in the United States, and they are the agencies that gather financial information on every American consumer. The information collected informs your potential creditors of how well you have paid your bills in the past.
When you apply for a mortgage or an auto loan, prospective lenders will want to know something about your financial history. This information will help them decide whether or not you are likely to re-pay the loan. For this purpose, they will ask to do a credit check, and they will obtain your credit reports from the bureaus listed above.
The Consequences of a Low Credit Score
If your future lenders discover that you have obtained a department store credit card, for example, but that you have missed payments, they may be wary of lending you a large sum of money for a house or a car. If they decide to offer you the loan, they may charge you a very high interest rate. This makes the loan much more expensive than if you could have qualified for a lower rate.
Lenders are not the only people who will be interested in what is written in your credit reports. If you are applying for a job where you will need to be in charge of money, the employers will ask to do a credit check. If they read in your reports that you have significant debts, they may place your resume at the bottom of the pile. Because you have low credit scores, insurance companies may charge you higher rates, and you may need to offer the utility companies a deposit before you can obtain services from them. That’s why Consumer Credit Counseling is so helpful for people in need.
What Consumer Credit Counseling Can Teach You
A Consumer Credit Counseling company like CreditGuard will help you increase your credit scores and maintain them at a high level. You will learn how to read your credit reports and how you can correct faulty entries. You will learn what your future creditors will look for in your reports and how you can ensure that you receive the best interest rates possible.
Don’t apply for a new loan before you learn everything you can about your credit reports. Contact a credit management company for the counseling you need today.