Credit Report compared...

Unfortunately, identity fraud can strike practically anyone and it usually does, with people from all walks of life having their financial status turned upside down because of the reckless moves of other people that they might not even know.

Identity fraud is costing the British economy an estimated £2 billion each and every year, an astonishing amount which is showing how widespread this problem really is. Thankfully, the companies that offer credit reports can do a lot to rectify the damage which can be done to a credit report when an identity is hijacked – even if it isn’t the actual consumer’s fault. 25% of all British adults have been affected by identity fraud in one way or another: whether it be by falling victim to criminal activity, or knowing someone who has.

One such credit report company, Experian, can even allow the prevention of ID fraud to be possible, alerting a consumer to suspect activity via text, in what are known as ‘ID fraud alerts’. Any inaccuracies and suspect activity that you proceed to spot by analysing your data can then be reported to the authorities, who will take all of the action necessary in order to guarantee that a problem is fully corrected.

New reports have also suggested ways that a person can stop the damage that identity fraud can take on their lives, through prevention rather than cure. In order to prevent fraudsters from getting sensitive information, experts are urging consumers not to give personal details over the telephone if they are not anticipating a phone call which is made to their home. This is because in some examples it can be hard to verify the authenticity of a particular organisation.

Also, the importance of the shredder has also been highlighted. This because of the way that some fraudsters are more than happy to sift through the bins of various people in order to find compromising information which can be used in fraudulent activity. By destroying bank statements and other letters concerning your finances, you can greatly reduce the vulnerability you pose to yourself and your family.

Checking your free credit report frequently can prevent any nasty surprises – and, with many companies offering different services concerning your credit rating, you can be more financially aware than ever before: something which can be highly beneficial concerning the economic climate, and how many people are watching their pennies.

You may want to consider doing a thorough check on your credit report if you haven’t done it for a while. You might be surprised at how inaccurate and out-of-date many of these reports really are. If you’re like me, though, you assume that everything is okay until you get denied a loan or apply for a credit card that gets turned down. Then, you know something must be wrong and finally take the initiative to investigate the matter.

I finally took the leap and evaluated my own credit report after I was initially declined a loan. I was shocked by the things I found on that report. They listed debts I had paid off over a decade ago and still listed them as being unpaid. I never knew these debts were still on my report and I was furious with the companies that were happy to take my money but didn’t bother to update my records, making my credit report look bad.

I discovered that, even though I had made payments on time and the debts were clear, these parts of my report were ruining my chances of getting the loan I wanted because it looked as though I still had longstanding unpaid debts. The loan companies use my credit report to evaluate my application and to determine my ability to pay back a loan. This is called the ‘customer’s capî, by the way. The word ‘capî means ‘capacity to payî.

I used to be a loan officer once, so I should know the importance of having accurate information on an individual’s credit report. As a loan officer, I would look at the applicant’s report and make some calculations to see what the person’s ‘capî was. From that, we knew who were the most likely to be able to make payments on the loan we were offering them and who weren’t. Loans were granted and denied on the basis of the individual’s ‘capî and their credit report. I hated telling people they couldn’t qualify for a loan but, business was business, and we really had to do it.

The math involved in granting a loan is complex, but basically, if we decide a person’s debt is higher than his or her income, he or she won’t ‘cap‘. This means that the person just won’t get the loan they are looking for. The loan officer needs to make these determinations so that the loan company won’t end up making a bad decision and so that the customer won’t be overtaxed by loans they can’t afford.

In my case, the credit report showed that I may have problems making payments on the loan I was interested in because I still had these outdated balances showing up as obligations. After a few tense phone calls, I was able to fix my credit report and, in spite of the hassle, I got the loan I was looking for.