Yes, there is usually a correlation between the contents of your credit reports and your credit score. For example, negative items like late payments and charge-offs cause your credit score to drop. However, Illinois consumers working to boost a low credit score should pay attention to more than just this three-digit number. This is especially true if they need a loan in the near future. Different lenders have different approval standards. Some use software programs in order to approve or deny loan applications. So, these lenders may approve you as long as your credit score falls within an acceptable range. However, other lenders in Illinois actually look at your credit history. Then, if these lenders spot certain negative items that make you seem risky, they might reject your application even if your credit score meets their typical standards.
Red Flags on Credit Reports that Might Scare Off Illinois Lenders
Illinois lenders are more likely to delve deeply into your credit history when you apply for a mortgage. Financing a home usually requires a large loan and a lengthy commitment from the borrower. Therefore, most mortgage lenders maintain higher approval standards.
If, for instance, it is clear that you have had major financial trouble in the past, a lender may want a good explanation for the resulting credit report trauma. Items such as bankruptcy, charged-off debt, and tax liens are big red flags for lenders. Even with a revived credit score, certain lenders in Illinois won’t work with you if these types of items haunt your credit reports.
Some lenders even notice behavior patterns in credit histories. If it appears that an applicant has a history of late payments or high credit usage, but has recently turned things around, a lender may still ask about this past behavior. Why? Likely, they want assurance that the potential borrower won’t fall back into old patterns.
When Illinois Consumers Can Explain Red Flags on Credit Reports
When an Illinois lender looks closely at your credit reports and credit history, it isn’t necessarily a bad thing. This, at least, gives you an opportunity to explain why there is evidence of financial disaster on your credit reports. If a slew of expensive medical bills caused your bankruptcy, for example, they may treat your case with more leniency. Lenders might also feel better about an applicant having four charged-off accounts if they know that all of this happened in the wake of a job loss.
If you do have a good explanation for negative items on your credit reports, prepare to show documented proof. This supporting evidence will show the lender that you are organized and ready to accept the responsibility of a car loan or mortgage.
Why Illinois Consumers Should Check for Credit Report Errors Before Applying for Loans
Before lenders look at your credit reports, you should know what they contain – and the truth might surprise you. Many Illinois consumers don’t realize that about 80% of credit reports are flawed in some way. This is because creditors and credit reporting bureaus frequently mishandle consumer information and make mistakes. Unfortunately, some of these mistakes are BIG. It sounds bizarre, but it is entirely possible that someone else’s delinquent account is listed on at least one of your credit reports. How? If you and this other person share the same name and live in the same town, your credit files might get mixed. You may also have paid accounts still listed as “unpaid” and other harmful inaccuracies on your credit reports from TransUnion, Equifax, and Experian – the three major credit bureaus.
In addition to finding and removing credit report errors, it is now more important than ever to check your credit reports for signs of identity theft. Following the massive Equifax data breach, about 143 million consumers found out that their most sensitive data was stolen by hackers. Because this data breach involved Social Security numbers, affected consumers will remain vulnerable to identity theft for years to come.
No Illinois loan applicant wants their approval chances to drop because of credit report errors or fraudulent accounts. So, check go to www.annualcreditreport.com, and request free copies of your credit reports from the three major credit bureaus. The Fair Credit and Transactions Act (FACTA) allows Illinois consumers to do this every 12 months.
The Free and Legal Way to Get Better Credit
Illinois consumers looking to buy a home should be aware of a very important rule about credit report disputes. That is, in order to qualify for a mortgage, you may not have open disputes on your credit reports. Therefore, it is important to get your credit reports cleaned up well in advance of applying for a home loan.
Calling Credit Repair Lawyers in Illinois is the best and easiest way to clear away credit report errors, unauthorized charges, and fraudulent accounts. When you contact our firm, and experienced credit attorney will do whatever it takes to get you clean credit reports for free. Even if we file lawsuits on your behalf to get the job down, you pay nothing out of pocket.
The Free and Legal Way to Get Better Credit
Don’t let errors on your credit reports bring your credit score down. At Credit Repair Lawyers of America, we’ve been cleaning up credit reports for consumers since 2008 for free. How do we do it? All of our fees come from the defendants in settled cases. This is why our clients pay nothing for the work we do.
Let’s start the conversation about what we can do for your credit. Set up your free consultation today by calling Attorney Gary Nitzkin at (773) 360-0665 or sending him a message through our contact page.
For more information about Free Credit Repair, please visit https://creditrepairlawyersam.com/illinois/credit-repair/.