If you want to buy a $20,000 car over a 48-month period, then you should expect to get a 6.5% interest rate and pay $2,700 in interest over the loan’s lifetime. However, if you have a low credit score, then your interest will be 11% or higher, meaning you’d pay $4,800 in interest for that same car! Finding free credit repair services is so critical because it sets the price you get on mortgages, auto loans, school loans and credit card interest rates. Who wouldn’t want the best deal?

The first step toward credit repair is getting your free online credit score. Thanks to the Fair Credit Reporting Act, you are legally entitled to one free report each year from each of the three main credit bureaus, which are Experian, Equifax and TransUnion). On your credit report, you’ll see whether or not you have a high or low credit score, as well as all the outstanding debts you owe, people who have checked your credit report, loans you’re paying off and other financial information that is readily visible to loan officers.

It is important that you check this report each year to make sure all of your financial records are up-to-date. Any past late payments, collection accounts or blemishes will be on your record for seven years, but your account status should be updated and your score should reflect your recent activity. It’s not unusual to find errors or dated information, so keeping your records accurate is one way to repair bad credit.

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This entry was posted on Saturday, November 8th, 2008 at 11:58 am and is filed under Financial Services. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.