Borrower FAQs

Where does my credit information come from?

The credit comes from the credit grantor – credit card companies, auto and home lenders and retail stores. Information is also obtained from court records which my include bankruptcy filings, tax liens and judgments.

What is a credit score?

A credit score is a numerical representation of your statistical likelihood to repay credit that is extended to you. Scores range from 350-850.

The credit score comes from a propriety model developed by Fair, Isaac & Company (FICO). The model takes all the detail account information from your report and processes it with different weights and scoring factors, resulting in the score.

What is calculated into a score?

Details such as on time and late payments, how late the payments are, how many accounts are open, the proportion of balances to credit limits on revolving accounts, whether there are collections, bankruptcies, judgments, liens and how new accounts are.

Your score is a “snapshot” at a specific moment. Your scores can change with new actions and with the passage of time. For example, the farther in the past derogatory information occurs, the less impact it has on the credit score.

I ordered a copy of my credit report directly from the bureaus and the score is different (higher/lower) than the score on the credit report obtained by my broker. Why is that?

The scores on the credit report obtained by the bureaus contains person credit scores as opposed to the mortgage credit scores obtained by your broker. Every industry (auto, mortgage, credit cards) use different score models to calculate scores, so within each industry your scores can vary. Personal scores uses it’s own model.

How long do accounts (negative and positive) stay on my report?

Credit accounts:

  • Accts paid as agreed remain for up to 10 years.
  • Accts not paid as agreed remain for 7 years.

Collection accounts:

  • Remain for 7 years from the original inception date of the collection

Public Records:

  • Chapters 7 & 11 remain for 10 years from the date filed.
  • Chapter 13 –open or dismissed – remains for 7 years from the date filed.
  • Unpaid tax liens remain indefinitely.
  • Paid tax liens and judgments remain for up to 7 years from the release date.

Why do Experian, Equifax and Trans Union sometimes have different information?

Creditors voluntarily provide information to the credit bureaus and are not required to report information to all three. Some companies do not report to the bureaus at all. The bureaus all report information on a national basis, but some creditors favor reporting to the bureau closest geographically or through some other preference. Because of this, occasionally information will vary from one bureau’s report to the next.

The balances on some of the accounts on the credit report I received are incorrect as I have recently paid things down/off. How can I correct this?

Credit grantors supply information on a periodic basic, so the balance shown may not be the balance you know it is today. If the balance reported was correct at sometime during the date it was reported, it is not necessary to dispute that balance. The new balance will be reported the next time the credit grantor reports to the bureaus.

I pay my bills on time every month and have no late pays or collections. Why does my credit score seem low?

Even with a perfect payment history, there can be other factors that will lower your score. Revolving accounts that have high balances in proportion to their credit limits (for example a credit card with a high limit of $3500 and a balance of $3000). This can activate a negative factor that can drop your score. Keeping balances on credit cards at or below 50% of the high credit is always optimal and even more so at below 30%.

Too many revolving debts can also have a negative affect on your score. The optimal amount is three. Two major credit cards (Visa, Mastercard) and one minor credit card such as a department store card.

Any new debt can, at the onset, also have a negative impact on your score until you establish up to a year of good payment history on it.

I have several accounts on my credit report that were included in my divorce decree and belong to my ex spouse, but they are still on my credit report. How do I get rid of them?

A divorce decree does not supercede an original contract with a creditor and does not release you from legal responsibility on the accounts. You must contact each creditor individually and seek their legal binding release of your obligation. Only after that can your credit history be updated accordingly.

I have no credit (or only negative credit) and I can’t get any credit card or finance company to approve me. How can I start to establish credit?

Apply for a secured credit card. This is a credit card that is secured by a savings account the equals the limit of the credit card. The savings account is held by the bank through which you get your secured credit card. After a year or so of exhibiting a good payment history, most companies will change your secured credit card into an unsecured one.

I have a collection account appearing on my credit report that I need to pay. Should I pay the collection agency or the original creditor?

Always first contact the collection agency this is reporting on the credit report and try to negotiate a settlement with them. If they are no longer collecting on the account, find out if they have returned it to the original creditor or sold it to another agency. If the company is no longer collecting on the account, they should no longer be reporting on your credit report. You should request a letter from them saying they are going to remove their entry from your credit report as they are no longer collecting on the account. You should also request they report the line as deleted to the bureaus. If they fail to do this, you have the letter as backup and can send it to the bureaus yourself.

Will paying off a collection remove it from my credit report?

No, paying off a collection account will not remove it from your report. Unless it was filed in error, a paid collection account will remain on your credit report for 7 years.

I have tried to contact a collection agency that appears on my credit report so I can pay it but they are out of business. How can I take care of this?

If the collection agency reporting on your credit report is out of business you will need to dispute this item directly through each bureau that is reporting it. If in their investigation they conclude that the company is out of business they will remove it from your report.

There are debts on my credit report that do not belong to me. What should I do?

If you have accounts on your report that you feel are not yours, you may be a victim of fraud or identity theft, or you could have a mixed file. (Your file has been mixed with someone elses). You should contact the creditor immediately and also contact all three bureaus (Equifax, Experian, Trans Union) for more information on what actions to take.

I have inquiries on my credit report that I did not authorize. How can I get them removed?

Companies are not supposed to make inquiries into your credit without your permission. If there are inquiries you do not recognize, you need to contact the bureaus directly to dispute these items.

Why is my credit report mixed with my relatives or others with similar names?

The bureaus do not rely solely on a consumer’s social security number to match the credit file. They also look at the name and address. This is where “junior” and “senior” files often get mixed.

For borrowers who share their homes with extended family, it is very possible for their credit to get mixed because the names will match (or be similar) and the addresses will match.

If this is the case you need to contact each credit bureaus that is reporting the incorrect information to have it corrected.

How can I ensure I will not be or have not been a victim of credit fraud or identity theft?

Order a copy of your credit report once a year from each bureau and go over it carefully for mistakes and debts that might not belong to you. You can also put a fraud alert on your file by contacting each bureau.

A few other tips on protecting yourself:

  • The next time you order checks have only your initials (instead of your first name) and the last name put on them. If someone takes your checkbook, they will not know if you sign your checks with just your initials or your first name, but your bank will know.
  • When you are writing checks to pay on your credit card accounts, DO NOT put the complete account number on the “For” line. Instead, just put the last four digits. The credit card company knows the rest of the number, and anyone who might be handling your check as it passes through all the check processing channels won’t have access to it.
  • Put your work phone number on your checks instead of your home phone. If you have a PO Box, use that instead of your home address. If you do not have a PO Box, use your work address. Do not have your SS# printed on your checks.
  • Make a copy (front and back) of all your credit cards, licenses, etc and keep the photocopy in a safe place. It is also a good idea to have a photocopy of your passport.
  • If you have had your credit cards stolen the first thing you need to do is cancel them and let the creditors know that it has been stolen. You then need to file a police report in the jurisdiction where they were stolen. This proves to credit providers that you were diligent, and this is the first step toward an investigation. You then need to contact the 3 bureaus to place a fraud alert on your name and Social Security number.

How can I improve my credit?

These are basic steps to take to improve your credit.

  • Make your monthly payments on time.
  • Keep balances on revolving accounts low.
  • Don’t apply for new credit unless it’s absolutely necessary.

Fraud and Identity Theft: Corporate and Personal Costs

Fraud costs the American economy millions of dollars per year in losses.  Between January and December, 2003, the Federal Trade Commission received over half a million consumer fraud identity theft complaints, with losses of over $400 million reported.  The losses affect consumer savings accounts, retirements and the ability to purchase homes.  Bank accounts have been emptied with no recourse.

Increased e-commerce from the rise in Internet use has opened the doors for easier fraud perpetration.  While companies involved in information technology have invested in increased security, fraud prevention is a continuing battle requiring the awareness of both consumers and businesses.  The good news is that there are simple steps you can take to help prevent unauthorized access to your information and finances.

Although fraud can take many forms, our advice will be mainly focused on the types that most affect credit reports and scores.  We have also provided additional links at the end of this section for further research.

How to Prevent Fraud & Identity Theft

There are several ways you can help prevent fraud and identity theft.

  • Destroy private records and statements. Tear up, or shred credit card statements, solicitations, and other private documents that contain private financial information.  Any information you keep, be sure to keep in a secure place.
  • Secure your mail. Empty your mailbox quickly, or get a PO box so criminals don’t have a chance to steal credit card pitches.  Never mail outgoing bill payments and checks from home.  They can be stolen from your mailbox and the payee’s name erased with solvents.  Mail them from the post office or another secure location.
  • Safeguard your Social Security Number. Never carry your card with you or any other card that may have your number, like a health insurance card.  And don’t put your number on your checks.  It’s the primary target for identity thieves because it gives them access to your credit report and bank accounts.
  • Don’t leave a paper trail.  Never leave ATM, credit card or gas station receipts behind.
  • Never let your credit card out of your sight.  Worried about credit card skimming?  Always keep an eye on your card or when that’s not possible, pay with cash.
  • Know who you’re dealing with.  Whenever anyone contacts you asking for private identity or financial information, make no response other than to find out who they are, what company they represent, and the reason for the call.  If you think the request is legitimate, contact the company yourself and confirm what you were told before revealing any of your personal data.
  • Take your name off marketers’ hit lists.  In addition to the national “Do-Not-Call registry 1-888-832-1222, you can also cut down on junk mail and opt-out for credit card solicitations by calling 1-888-5-OPT OUT.
  • Be more defensive with personal information.  Ask Salespeople if information such as a Social Security or driver’s license number is absolutely necessary.  Ask anyone who does require you Social Security number – for instance, your insurance company – what their privacy policy is and whether you can arrange for the organization not to share your information with anyone else.
  • Review your credit card statements carefully.  Make sure you recognize the merchants, locations, and purchases listed before paying the bill.
  • Guard your information.  Do not give out your account numbers, login information, or passwords for online transactions to others.
  • Know your delivery dates.  Know when your account and bank statements come to you by mail and contact the account holders or bank when you do not receive them by the usual dates.
  • Beware of unencrypted websites.  Make sure you do not send your credit card information for online purchases through websites that are not secured & encrypted, or by mail.
  • Watch your ATM card.  Be aware of those behind you when using the ATM machine; guard viewing access to your pin entry.
  • Don’t fall for telephone solicitations.  Do not give your credit card, Social Security number, or other personal information to telephone solicitors.  If you are interested in the product, research the company and its product first and call them back to order if legitimate.  Do not give any personal information over the phone in exchange for the promise of “winning” anything.
  • Email solicitations.  If you receive an email directing you to the website of a company with which to do business, requesting you to provide account numbers or other private information, do not provide the information.  Contact the company directly to determine the legitimacy of such a request.
  • Be careful where you write your information down. Do not write account information or pin numbers on cards or places whereby a thief may be able to access both credit cards and pine numbers in the same theft – for example, do not write your pin number on the back of your credit or ATM card.
  • If you think you have become a victim of identity theft or fraud, act immediately to minimize the damage to your funds, financial accounts, and credit report.  Below is a list of some actions that you should take right away:

    Contact the Federal Trade Commission (FTC) to report the situation:


    • By telephone toll-free at 1-877-ID-THEFT (877-438-4338 or TDD at 202-326-2502, or
    • By mail to Consumer Response Center, FTC, 600 Pennsylvania Avenue, N.W., Washington, DC 20580.

    You may also need to contact other agencies for other types of identity theft.

    • Your local office of the Postal Inspection Service if you suspect that an identity thief has submitted a change-of-address form with the Post Office to redirect your mail, or has used the mail to commit fraud involving your identity.
    • The Social Security Administration, if you suspect that your Social Security number is being fraudulently used (call 800-269-0271 to report the fraud.)
    • The Internal Revenue Service if you suspect the improper use of identification information in connection with tax violations (call 1-800-829-0433 to report the violation.)

    Call the fraud units of the three national credit bureaus:


    • To Report Fraud, call 800-525-6285 or write to P.O. Box 740250, Atlanta, GA. 39374-0250.
    • To order a copy of your credit report go to or call 800-685-5000 or 800-685-1111.
    • To dispute information in your report, call the phone number provided on your credit report.
    • To opt-out of pre-approved offers of credit, call 888-567-8688 or write to Equifax Options, P.O. Box 740123, Atlanta, GA 303-74-0123.


    • To report fraud, call 888-EXPERIAN or 888-397-3742, fax to 800-301-7196, or write to  P.O. Box 1017, Allen, TX 75013.
    • To order a copy of your report, go to or call 888-EXPERIAN.
    • To dispute information in your report, call the phone number provided on your credit report.
    • To opt-out of pre-approved offers of credit and marketing lists, call 800-353-0809 or 888-5OPTOUT or write to P.O. Box 919, Allen, TX 75013.


    • To report fraud, call 800-680-7289 or write to P.O. Box 6790, Fullerton, CA. 92634.
    • To order a copy of your credit report, go to or call 800-888-4213.
    • To dispute information in your report, call the phone number provided on your credit report.
    • To opt-out of pre-approved offers of credit and marketing lists, call 800-680-7293 or 888-5OPTOUT or write to P.O. Box 97328, Jackson, MS. 39238.

    Contact all creditors with whom your name or identifying data have been fraudulently used. For example, you may need to contact your long-distance telephone company if your long-distance calling card has been stolen or you find fraudulent charges on your bill.

    Contact all financial institutions where you have accounts that an identity thief has taken over or that have been created in your name but without your knowledge.  You may need to cancel those accounts, place stop-payment orders on any outstanding checks that may not have cleared, and change your Automated Teller Machine (ATM) card, account, and Personal Identification Number (PIN).

    Contact the major check verification companies (listed in the CalPIRG-Privacy Rights Clearinghouse checklist) if you have had checks are stolen or bank accounts set up by an identity thief.  In particular, if you know that a particular merchant has received a check stolen from you, contact the verification company that the merchant uses:

    1. CheckRite: 800-766-2748.
    2. ChexSystems: 800-428-9623 (closed checking accounts)
    3. CrossCheck: 800-552-1900
    4. Equifax: 800-437-5120
    5. National Processing Co. (NPC): 800-526-5380
    6. SCAN: 800-262-7771
    7. TeleCheck: 800-710-9898.