Amalgamated Bank

Credit Report Money Sense Tips

Before you apply for a loan, it is important to make sure that you have taken care of “getting your house in order.” This means creating a realistic spending plan, reducing or eliminating any outstanding debt, and verifying that the information on your credit report is correct. Following these few simple steps will help you on your way towards good credit and improve your chances of receiving a personal loan.

How can I obtain my credit report?

Consumers can request one credit report for free each year from each of the major credit reporting agencies (TransUnion, Equifax, and Experian). Requests can be made by: ·

  • Visiting www.
  • Calling 877-322-8228
  • Writing to Annual Credit Report Request Service
    P.O. Box 105281, Atlanta, GA 30348-5281

If you do not have a credit history, you may also consider building an “alternative credit” report. When applying for a loan, many lenders will also take your alternative credit report into consideration.

Several companies offer to monitor your credit history and provide you with your credit reports in exchange for a fee. This is an expensive and unnecessary service because by law you are entitled to one free credit report from each major credit reporting agency and the cost of ordering additional credit reports is less than the fee charged by credit monitoring companies.

What's in your credit report?

Factors in your credit report include information about you and your credit experiences, such as your credit payment history, the number and type of accounts you have, late payments, collection actions, and outstanding debt. This information informs your credit score. Here is a general breakdown of the different facts that are figured into your credit score:

  • Your credit payment history - about 35%
  • How much you owe and your available credit - about 30%
  • Length of credit history - about 15%
  • New credit applications - about 10%
  • Mix of credit - about 10%

What are some ways I can improve my score?

  • Pay your bills on time
  • Check your credit report and correct and inaccuracies
  • Pay down outstanding balances
  • Generally, use no more than 30 percent of your credit card limit
  • Be careful about transferring old balances on established credit to new sources of debt
  • Be aware that paying off a collection account, or closing an account on which you previously missed a payment, will not remove it from your credit report.

What do potential lenders and creditors look for?

  • Character - Does the borrower appear fiscally responsible?
    • A good credit report and score?
    • A good past history of paying on time?
    • A set of good financial and personal references?
  • Capacity - Does the borrower have the ability to repay the loan?
    • Is the applicant employed?
    • Are there other sources of income?
    • What are the applicant's expenses (is there net income after expenses?)
  • Capital
    • Does the applicant have any savings, or investments?
    • Does the applicant have any collateral such as real estate?
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