Public Employee Press

Be fiscally fit for the New Year
Your credit Questions Answered

By ALFREDO ALVARADO

As the nation copes with a deep economic crisis, many members are making their top New Year’s resolution to get their own financial house in order. One of the foundation stones of that house is having good credit.

When DC 37 members have credit problems, they can count on the Consumer Law Unit of the union’s Municipal Employees Legal Service for assistance. The unit — which aided 500 members during 2007 and is on the way to a higher tally for 2008 — helps members clear up inaccurate credit reports and renegotiate loans.

To find out if you have a credit problem, get a copy of your credit report. The Fair Credit Reporting Act requires each of the nationwide consumer reporting companies — Equifax, Experian, and TransUnion — to provide consumers with a free copy of their credit report, at their request, once every 12 months.

Members can get more information about repairing their credit history, retirement planning and setting financial goals at the Jan. 10 workshop being offered by the union’s Municipal Employees Housing Program. Representatives from the Municipal Credit Union, the Dept. of Consumer Affairs and MELS will be leading workshops.

Amalgamated Bank will be participating and will offer members incentives for opening new accounts.

What’s in a credit report?
A credit report includes information on your income, debts and credit payment history. It also indicates whether you’ve been sued or arrested or have filed for bankruptcy. Your credit file however, may not reflect all of your credit accounts. Although most national department store and all-purpose bank credit accounts will be included in your file, not all creditors voluntarily supply information to the credit bureaus.

Who uses the information?
Nationwide consumer reporting companies sell the report to creditors, insurers, employers, landlords and other businesses that use the information to evaluate applications for credit, insurance, employment or renting an apartment.

Why is it important to get my credit report?
Your credit report has information that affects whether you can get a loan — and how much interest you will have to pay to borrow money. You should check your report to make sure the information is current and accurate, especially if you plan to make a major purchase, such as a car or house, or apply for a job.

How can I order my free report?
The three consumer reporting companies have set up a central Web site, a toll-free number, and a mailing address through which you can order your free annual report. You will need to provide your name, address, Social Security number and date of birth. If you’ve moved during the last two years, you may have to provide your previous address.

To order your report, call 1-877-322-8228 or visit annualcreditreport.com. If you request the report online, you should be able to access it immediately, or you can download a request form and mail it to Annual Credit Report Request Service, P.O. Box 105281, Atlanta, GA 30348-5281. Do not contact the reporting companies individually.

What if there is a mistake in the report?
If there is inaccurate information in the report, you should contact the credit bureau and the company that furnished the information to the bureau. Both are legally obligated to investigate your dispute. Consumers also have the right to know the name of anyone who received their credit report in the last year for most purposes or in the last two years for employment purposes. Any company that denies your application based on information from a credit bureau must supply the name and address of the credit bureau involved.

What is a FICO credit score?
Credit bureaus use a computerized mathematical model to combine many types of information in a credit file into one number — the credit score — that lenders, landlords and employers use to help determine whether they will trust a person with a credit card, loan or job. Credit bureau scores are often called “FICO scores” because Fair Isaac and Company developed the software. The scores range from 300-850, and higher is better.

Can companies improve your FICO for a fee?
The Federal Trade Commission cautions consumers to be wary of companies that claim they can “repair” your credit score for a fee. Commonly called credit clinics, these companies don’t do anything for consumers that consumers cannot do for themselves at little or no cost. Beware of any organization that offers to create a new identity and credit file for you.