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Credit Education



Credit plays an important role in today's world. Learn how to manage your credit and protect against fraud.

What is a Credit Report?

A credit report, or credit history, is a report of the information maintained in your credit file by a consumer reporting company that could be provided in a consumer report to a third party, such as a lender.

Credit Report Information

The typical consumer credit report includes four types of information:

Personal Information - including your name, current and previous addresses, telephone number, social security number, date of birth and employment history.

Public record information - includes bankruptcy claims, unpaid tax liens and overdue child support payments. This information can remain on your record for up to 15 years.

Account summaries - includes account information, such as the date opened, credit limit, balance, payment patterns, and cosigners. Positive credit information may remain on your report indefinitely, while most negative information remains up to seven years

Credit inquiries - shows who has requested your credit information, includes the date of the request and how long the request will remain on your report.

What Information is Not in Your Credit Report?

The following information is not reported or collected as part of your credit report:

•Race, religion, medical history, personal lifestyle, political preferences, friends, criminal record.
•Checking and savings account information

Get a Copy of Your Credit Report

You are entitled to receive a free copy of your credit report from a consumer reporting company under Federal law and the laws of various states.

You can request this free credit report from any of the 3 nationwide consumer credit reporting companies, Equifax, Experian and TransUnion, through the Annual Credit Report Request Service, visit www.annualcreditreport.com. You can get one report from each of the three reporting companies each year.

Reviewing your Credit Report

You should review your credit report whenever you apply for a new credit card, a loan, or before a major purchase, to assure the accuracy of the information being reported about your credit.

Correcting Errors on Your Report

If you believe there is an error on your report, federal law allows you to challenge inaccuracies and correct your credit files, at no fee. Contact the credit bureau that supplied you the report of any errors to ensure a quick resolution.

Building a Positive Credit History

Building positive credit history shows you can manage your financial responsibilities and will improve your borrowing power. Positive credit information remains on your credit report forever, while negative information drops off over time. The following suggestions will help you create a positive credit history:

Pay your bills on time . Most lenders look at the most recent information on a report. Paying your bills on time will start creating a positive credit history.

Maintain an accurate file , by providing complete, accurate and consistent identification on your credit applications. this will minimize the chance that your credit file will be mixed with another file.

Review your credit report annually for accuracy and before making a major purchase.

What is a Credit Score?

A credit score is a number based on statistical analysis of your credit file that represents your creditworthiness. These are dynamic numbers that change as elements in your credit report change; as you generate positive credit history your credit score will increase.

Lenders use credit scores to help them decide whether or not to give you a loan or a credit increase, because they are consistent and objective they help lenders assess risk more fairly. The most common credit score used is called a FICO score.

Each of the three main credit bureaus (Experian, Equifax and TransUnion) use a generic scoring model based on their own version of the FICO score with their own names. Experian has the Experian/Fair Isaac system, Equifax has the Beacon system, and TransUnion has the Empirica system.

Individual lenders often use a custom credit score which incorporates a FICO score and other criteria that are important to their individual products and lines of business.

Your credit score only reflects your likelihood to repay debt responsibly based on your past credit history.

What Factors Impact Credit Score?

Credit scores are affected by elements in your credit report, such as:

  • Number and severity of late payments
  • Type, number and age of accounts
  • Total debt
  • Public records

Like your credit report, the following information does not impact your credit score:

  • Your age, race, color, religion, national origin, sex, marital status or medical history
  • Your salary, occupation, title, employer, or employment history

Improving Your Credit Score

Credit scores reflect your credit history with more emphasis on recent information. The length of time it takes to rebuild your credit history depends on the negative elements in your report; delinquencies may remain on your report for seven years while bankruptcies stay on for ten years. You may improve your score by:

Paying your bills on time . This is an extremely important factor in generating a good credit score.

Keep your outstanding balance low . High outstanding debt can lower your score.

Apply and open new credit accounts only as needed. These actions indicate you may be taking on new debt. You need to prove you can manage your current credit responsibly.

Pay off debt rather than moving it around. Owning the same amount but having fewer open accounts may lower your score.

What is Credit Fraud?

Credit fraud can include the following:

Identity theft: the unauthorized use of your personal identification information to commit fraud

Identity assumption: long-term victimization of identification information

Unauthorized changes on your existing accounts

How Criminals Get Your Information

Criminals can gather information in a variety of ways:

  • Stealing mail or going through your garbage
  • Eavesdropping or looking over your shoulder
  • Sending unsolicited email (spam and phishing)
  • False telephone solicitation
  • Changing your address, diverting billing statements to another location.

Warning Signs

There are several warning signs to look for that may indicate fraud:

  • Inquiries or information on your credit report that you did not initiate
  • Billing statements with strange charges
  • Bills from unknown sources
  • Receiving calls from creditors or collection agencies

Recovering from fraud

If you believe you are a victim of fraud, the following information may help you recover:

Place a Fraud Alert: Placing a fraud alert on you credit report prevents an identity thief from opening more accounts in your name. Contact one of the three consumer reporting companies to place a fraud alert.

Contact your creditors: Contact each creditor and inform them of the fraudulent activity.

Document all contacts: Make notes of everyone you speak with; ask for names, department names, phone extensions and record the date you speak with them.

Follow up: Make sure everything a creditor has requested is received and follow up with a call or a letter for confirmation.

Review reports regularly: Review your credit report shortly after reporting the fraud and annually after that to ensure everything is resolved and that no new incidents of fraud have arisen.

Keep your files: Keep all notes and correspondence in case they are needed in the future.

If you're a victim: If you believe that someone has used your information to fraudulently acquire or use a Dell Preferred Account, or if you are a member of law enforcement investigating an identity theft, click here for more information.Smex