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Check your credit report as part of debt reduction plan

Created: On July 21, 2011 @ 2:31 pm In

It’s important to know what’s in your credit file if you’re following a [1] debt reduction plan. The information contained in your credit report can serve as a cautionary tale about your past spending habits, and as motivation for getting your finances back on track.

How to check your credit report

Check your credit report at least once a year. You’re entitled to get a free report every 12 months from each of the three major credit reporting agencies: Equifax, Experian and TransUnion. If it’s been a long time since you’ve seen your reports, request all three to become familiar with the information contained within them. After that you may want to stagger reviewing the reports throughout the year. Visit [2] Annualcreditreport.com to request a copy of your files.

Reviewing reports can help with debt

So exactly how does reviewing a credit report help with debt reduction? Information on your report can be used to determine who you owe money to and how much your outstanding balances are. While you probably already are familiar with the monthly statements you receive for various loans and other accounts, there’s always the possibility that you have outstanding credit card debt or other obligations you haven’t dealt with like accounts that have been turned over to collections.

Reviewing your report also allows you to correct any inaccurate information. Check everything from your name, social security number and addresses, to names of creditors owed. Credit reports often have incorrect or outdated information, and it’s on you to fix it. You can also ask to have certain information removed from your file, such as bankruptcies older than 10 years.

Change your habits to repair credit

As you make changes in your spending habits and begin to pay down debt, you’ll see that reflected in your credit report and credit score. Credit scores can be increased by lowering your debt-to-income ratio, paying off credit card debt and paying bills on time. If you need help setting up a debt reduction plan that can help improve your credit history, consider finding a reputable [3] debt counseling firm that can help.

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URL to article: http://www.debthelp.com/blog/2011/07/21/check-your-credit-report-as-part-of-debt-reduction-plan/

URLs in this post:
[1] debt reduction: http://www.debthelp.com/debt-consolidation/credit-counseling.html
[2] Annualcreditreport.com: https://www.annualcreditreport.com/cra/index.jsp
[3] debt counseling: http://www.debthelp.com/debt-consolidation/credit-counseling.html