Boost Your Credit Score: 8 Helpful Credit Monitoring Apps

Two smiling women look at credit monitoring apps on their cellphones.

Maintaining a healthy credit score requires a good bit of focus, determination and hard work. There’s a lot to keep up with: We need to pay our bills on time, reduce debt and maintain a low debt-to-credit ratio, among other requirements—all to ensure a top-notch credit score. We can use all the help we can get! To that end, here are eight credit monitoring apps that can help keep your credit building on track.

1. Credit.com

One of the only truly free credit monitoring apps—most others require you to have a paid subscription to their digital service in order to use the “free” app—the Credit.com mobile app allows you to access your entire credit profile, including your credit score and insight into how it compares to your peers. You’ll see where you currently stand, see how your score has changed—and why—and get credit information and money-saving tips tailored to your score.

Availability: Apple and Android

Cost: Free

2. myFICO

The myFICO app is free, but it requires an active myFICO account, which means it effectively costs $20 per month or more, depending on which features you want. With this app, though, you can view and monitor your FICO scores—the most widely used credit score—and credit reports. They also provide a FICO Score Simulator, which shows you how your score may be affected if you take certain actions.

Availability: Apple and Android

Cost: Free, but requires an active myFICO account

3. Lock & Alert from Equifax

Lock & Alert from Equifax lets you lock and unlock your Equifax credit report to protect against identity theft and fraud. You’ll get an alert any time your account is locked or unlocked so you know you’re the one in control. A credit lock is not as secure as a credit freeze, but it does offer some level of protection and is generally easier to turn on and off. This app works only for your Equifax credit report, so if you want to lock all three reports, you’ll have to work with TransUnion and Experian separately.

Availability: Apple and Android

Cost: Free

4. Experian

The Experian mobile credit monitoring app lets you track your Experian credit report and FICO score, with an automatically updated credit report every 30 days. The app also comes with Experian Boost, which can help you boost your score. The app alerts you when changes to your report or score occur, and offers suggested credit cards based on your FICO score.

Availability: Apple and Android

Cost: Free, but some features require a paid Experian account

5. Lexington Law

If you’ve signed up for credit repair services with Lexington Law, you can use their free mobile app to keep track of your progress. In addition to providing access to your credit reports from all three credit bureaus and updates on ongoing disputes, the money manager feature, similar to Mint, helps you track your income, spending, budgets and debts.

Availability: Apple and Android

Cost: Free, but requires a paid Lexington Law account

6. TransUnion

The TransUnion mobile app allows you to refresh your credit score and credit report daily to see where you stand. It offers instant alerts if anything changes and offers Credit Lock Plus, which allows you to lock your TransUnion credit report to avoid identity theft and fraud. The Debt Analysis tool lets you calculate your debt-to-income ratio, and it allows you to view public records associated with your name.

Availability: Apple and Android

Cost: Free, but requires a paid TransUnion Credit Monitoring account

7. ScoreSense Scores To Go

ScoreSense offers credit scores and reports from all three credit bureaus and daily credit monitoring and alerts to changes on your reports. This app also provides creditor contact information so you can address errors on your report quickly and efficiently. Score tracking features let you review how your score changes over time and how it compares to your peers.

Availability: Apple and Android

Cost: Free, but requires a paid ScoreSense account

8. Self

Self helps you build—and track—your credit, making it great for people just establishing their credit profile or trying to rebuild damaged credit. Self offers one- and two-year loan terms, but instead of getting the money up front, the amount is deposited into a CD. You make regular payments for the term of the loan (at least $25 per month), and then get access to the money. There is no hard inquiry to open the account, but your payments are reported to all three credit bureaus, helping build your credit. Plus, while you are repaying your loan, you will have access to free credit monitoring and you VantageScore so you can track your progress.

Availability: Apple and Android

Cost: Free, but requires a Self loan repayment of at least $25 per month

Credit Monitoring Apps to Fit Your Needs

With so many different options, you’re sure to find a credit monitoring app that meets your needs. And don’t forget: you can always check your score for free using Credit.com’s free Credit Report Card.

The post Boost Your Credit Score: 8 Helpful Credit Monitoring Apps appeared first on Credit.com.

Source: credit.com

I Was Denied an Auto Loan. Now What?

Bright sunshine shines in the windshield of a car as a person with a backwards baseball cap drives with one hand on the steering wheel.

You’re in the market for a new car but you’ve been denied an auto loan. Now what? Here’s what you need to know about why you may have been denied and what to do to make sure it doesn’t happen again.

Why Do I Keep Getting Denied for Auto Loans?

Unfortunately, there are many reasons a bank might reject your application for a car loan. If your loan application has recently been denied or you keep getting denied, it might be due to one of these common reasons:

  • Application errors. Sometimes, the application could be rejected because of an error you made when filling it out. A missed section, some incorrect information, a missing form or another mistake can mean your loan is ultimately denied.
  • Bad credit. Bad credit is a common reason for auto loan denial. A score below 670 is usually considered a bad credit score, and this damages lenders’ trust in your ability to pay off a loan.
  • Too much debt. A high debt-to-income ratio can make lenders leery. If you have a number of loans or credit cards with large amounts of debt, this raises your DTI and may lower your chance of getting approved for future loans, car loans included.
  • No credit. Lenders look for proof of consistency in paying off past loans when reviewing your application. If you have no credit history, lenders may feel they don’t have enough information about your ability to pay off a future loan.

What Can I Do If My Loan Application Is Denied?

You have a few options when you’ve been denied an auto loan, depending on the reason you were rejected.

Application Error

If you were rejected because of an application error on your part, you should contact the bank as soon as you can. Hopefully, the mix-up can be resolved and your request will be approved. If not, the lender will tell you when you can reapply.

Poor Credit

If you were rejected because of poor credit, check your credit report so you can determine what is negatively impacting your score. Depending on what your report says, look into ways to improve your credit so you can be approved next time. Pay your bills on time, and use your credit cards to make and then repay smaller purchases. Keep in mind that building or rebuilding your credit can take a while. Don’t be disappointed if it takes months or even a year or two to really get your score where you want it.

If you need a loan sooner, consider adding a cosigner to your application that can be your backup if you fail to pay the loan. Lenders feel more comfortable with this method, and it’s a good way to prove dependability.

Debt

If you were rejected because you already have too much debt, it’s important to reduce that amount in steady increments. Set a budget and stick to it, tackling the largest debts first. Avoid adding any debt to what you already have. Examine your credit card usage for any unnecessary expenses and cut back on those in the future.

No Credit

If you don’t have a credit history, now’s the time to start. There are a lot of ways to start building your credit: you might be able to become an authorized user on someone else’s credit card or find a co-signer for your loan, for example. You also might want to apply for a secured credit card or credit card for no credit.

Find the right credit card for your needs. Learn more.

Does Getting Denied a Loan Hurt My Credit?

Getting denied for an auto loan doesn’t in itself hurt your credit score. The lender didn’t extend anything, so there’s nothing that can hurt your score. However, multiple denied applications at once could hurt your score.

A bank conducts a “hard inquiry” when you apply for a loan. This can cause a drop in your credit score slightly—about five to ten points—whether you’re accepted or not. If you apply for too many loans, numerous hard inquiries on your credit can cause a larger drop.

What Are My Other Options?

If you don’t have time to build or rebuild your credit, can’t get a co-signer, and need a car fast, there are two options to be considered as a last resort.

“Buy Here Pay Here” Dealers

Stop by your neighborhood “Buy Here Pay Here” (BHPH) auto dealer, and one way or another, it will probably get you into a car. It won’t be a new car, and it will probably have lots of miles on it, but at least you’ll get a car you desperately need to get you to and fro.

The BHPH dealer won’t want to talk to you about interest rates. Your local BHPH will focus on your expected monthly payment and ask for a really big down payment. They mostly care about whether or not you have a current, steady income. Based on that, they’ll determine how much they are willing to lend and which car options are available to you. It’s not a great way to buy a car, but for millions of Americans, it is the only way they can make this significant a purchase.

Unfortunately, purchasing a car at a BHPH dealer isn’t a credit boost at all. They usually don’t report anything positive to credit reporting agencies, but they will report negative actions like a missed payment or repossession. Always ask about their late payment policies before making a decision.

Alternative Credit Bureaus

If your credit score is low or your credit history is light based on traditional credit trade lines (credit cards and loans), but you have a solid history of paying your everyday bills, you may be able to take advantage of alternative credit scoring methods. If you can prove your creditworthiness by having your everyday bills verified, some companies will work with alternative credit scoring methods to offer credit. Alternative credit generally doesn’t carry the same weight as traditional credit lines, so interest rates likely will not be as competitive.

At this point, you can go to any dealer and buy the car you really want instead of being limited to the inventory on a BHPH lot. If you can afford the payments, you can buy a new car that’s under warranty and has no mileage on the odometer. If you can continue to work on your credit and improve your credit score, refinancing may even be available down the road.

However, many lenders still do not use alternative credit and don’t view it as proof of reliability. Most of these alternative credit companies also don’t report your findings to the major credit bureaus. So, while these alternative creditors may be a short-term option, building credit through traditional methods should be a priority.

Why Would I Get Rejected for a Car Refinance?

If you were denied for refinancing, it’s probably because of a poor credit score or a high DTI. Usually, these are the same as the reasons you might be denied an auto loan. Your score may have been satisfactory when you purchased the vehicle but taken a few hits since its purchase.

How to Get Approved Next Time

Before you reapply for an auto loan, make sure all your information is in order. Gather your records and make sure everything is ironed out and correct before you go to a lender. For a better shot at loan approval, your credit score should be in a comfortable range, and you shouldn’t have any large outstanding debts. Always check your credit score before you apply. If it’s not high enough for loan approval, work to improve your credit first. Then, make sure you’ve determined what type of payments and interest you can afford.

If you do get denied, don’t worry! By making sure you meet all of the income, credit and debt requirements for an auto loan, you can increase your chance of getting accepted the next time you apply.

The post I Was Denied an Auto Loan. Now What? appeared first on Credit.com.

Source: credit.com

How Much Does a Cosigner Help with Getting Auto Loans or Better Loan Terms?

A woman in a bright yellow dress drives a silver car.

Imagine you’re shopping for a new car and finally find a reasonably priced set of wheels that you like. But when the dealer pulls your credit, that seemingly affordable monthly payment is no longer available to you. Instead, you’re offered a subprime car loan at 10% or even 20% interest because your credit isn’t strong enough to get a better rate.

How much does a cosigner help on auto loans when you’re facing this type of situation? Get more information below to help you decide whether seeking a cosigner is the right option for you.

How Does a Cosigner on a Loan Work?

A cosigner is basically someone who backs the loan. They sign agreeing that if you don’t make the payments as promised, they will step in to pay them.

If you don’t have much of a credit history or your credit is bad or poor, lenders are typically hesitant to give you an auto loan. They perceive you as risky. Will you pay as agreed? There’s not enough data or credit history for them to make that call.

However, a cosigner with a long history of good credit is different. The lender is more likely to believe that this person willpay as agreed. So, if you can get a cosigner to back you, you might have a better chance of getting a loan or getting better terms.

How Much Does a Cosigner Help With an Auto Loan?

How much can you save? Imagine you finance $37,851, the average price for a new light vehicle in the United States as of February 2020.

The average interest rate as of the end of 2019 for new car loans was 5.76%. If you’re able to get that interest rate and a loan term of 72 months—that’s 6 years—you would pay a total of $44,742. That’s $6,891 in interest and a monthly payment of around $621.

If you financed at 10% without a cosigner for the same terms, you’d pay a total of $50,488 for the vehicle. That’s $12,637 in interest and around $701 in monthly payments.

This is obviously just an example, but you can see that a cosigner can save you a lot. In this case, it’s $80 a month and more than $5,700 total.

Cosigner Versus Co-Applicant

It’s important to note that having a cosigner for a car loan is not the same thing as having a co-applicant. A co-applicant buys the vehicle with you. Their credit history and income are used alongside yours to determine if you, together, can afford the vehicle. The co-applicant also has an equal share of ownership in the vehicle purchased with the loan.

A cosigner, on the other hand, doesn’t have an ownership share in the vehicle. Their income may also not be a factor in the approval. Typically, they’re along only to provide a boost in the overall credit outlook.

What Are Some Downsides of Having a Cosigner?

Most of the risks or disadvantages are held by the cosigner. If you don’t pay the loan, they could become responsible for it. They could also suffer from a lower credit score if you’re late with car payments because it might get reported to their credit too.

As a borrower, you might experience a few disadvantages in using a cosigner. First, you have to get someone to agree to this, and you typically want it to be someone with good credit. Trusted family members are the most common cosigners, but that could mean that they might want to have a say in what type of vehicle you get.

And if something happens and you can’t pay the vehicle loan for any reason, you run a personal risk. You could damage your relationship with the cosigner if they do end up having to pay off the loan or face damage to their credit.

So, Should You Get a Cosigner for an Auto Loan?

The decision is personal. Before you do anything, check your credit and understand where you are financially. That helps you know what your chances for getting approved for a loan are on your own and how much loan you might be able to afford.

Then, check out some potential auto loans and consider whether you should apply for them on your own. If you know your credit is too poor or you try to apply for a loan and don’t get favorable terms, talk to a potential cosigner. Be honest about your situation and have a plan to pay the loan on time each month so they feel more confident supporting you as you make this purchase.

Apply for an auto loan today!

The post How Much Does a Cosigner Help with Getting Auto Loans or Better Loan Terms? appeared first on Credit.com.

Source: credit.com

Is Investing During Coronavirus a Good Idea?

A man in a suit and tie works on his cellphone and laptop at the same time.

The coronavirus bear market might look appealing to some. But for many, the economic changes that come with COVID-19 cause anxiety and uncertainty. Investing during coronavirus, when you can buy stock or other assets for lower prices, might sound like mathematical sense, but is it right for you?

Go to Guide
Privacy Policy

Start with the information below—and the advice of your
financial planner—to make an educated decision for yourself.

A Look at the COVID-19 Stock Market

The stock market took a beating as the coronavirus
began to sweep across the US. On Feb. 20, 2020, the Dow Jones Industrial
Average was 29,219.98 points. By March 23, 2020, it had dropped to
18,591.93 in an extreme slide downward related to the pandemic.

But even as the Dow continued to drop, economic experts were warning people not to panic with their money. Peter Mallouk, a chief investment officer, said he was worried people would make irrecoverable mistakes by using emotion- and fear-based decisions in managing their portfolios.

And in fact, the Dow did start to climb again, reaching as high as 23,949.76 on April 14, 2020. While it’s likely to rise and fall throughout the pandemic, economic experts predict the stock market will eventually rally.

Some Reasons a Rally Is Likely

Nothing falls forever. Eventually, the economy will
begin to rise again. Consumers are eventually going to hit the market with enormous
demand.

According to MarketWatch, the economy in the US is about 70% driven by consumer culture—the buying and selling of goods and services. During the coronavirus quarantine, many people have been stuck in their homes or limited in how they can shop, dine or recreate. Once stay-at-home orders are lifted and people start to get back to a new normal, there’s likely to be a huge spike in spending.

MarketWatch also predicts that changes in supply chains
and money from various economic stimulus efforts will continue to stimulate the
stock market. While no economic future can be 100% predicted, historical trends
support some of these predictions.

Should I Invest During Coronavirus?

But an eventual rise in the stock market isn’t a free pass to go all in. Investment adviser Ric Edelman says knowing how to proceed according to your own situation and needs is important. Regardless of what the economy might be doing right now or in the future, understanding your own financial goals is the place to start.

First, consider how long you have to regain lost wealth or build new wealth. Someone who is on the verge of retirement or already retired may not have the time it takes to wait for bear market investments to increase in value. Older adults might want to stick with low-risk investments or savings accounts that maintain what wealth they already have.

Next, consider your current financial status. “Buy low, sell high” might be the prevailing wisdom among investors, but it only works if you have the money to buy with. Many families are facing loss of income or jobs right now, and it might not be the time for investing. Instead, it might be time to work on your personal budget and negotiate with creditors to reduce expenses, at least temporarily.

Finally, consider how risk adverse you are. No investment is a sure thing, but some
do come with more risk than others. Understanding what you can afford to lose
helps you determine which types of investments might be right for you.

Investing During Coronavirus: Where and How?

Ultimately, only you can decide if investing during
coronavirus is the right move for you. Once you make that decision, though, you
have many options to choose from. Here are just a few possible investments that
might be right for you.

  • Buy stocks that have dropped enough to make them affordable but are for companies that you feel will weather the storm and come out swinging after the pandemic.
  • Invest in companies that have enough cash. Most expert-level investors are still looking for opportunities, but they’re being picky and opting for companies that have strong cash flow and stable balance sheets. Now isn’t the time to make big gambles, especially if you’re not young enough to recover before retirement.
  • Consider investing in real estate, which historically has weathered recessions and global economic crisis better than many other options.

If and how you invest is a very personal decision—and
always a big one. It’s a good idea to seek help from personal financial
advisers or other wealth management professionals even in good times. Consult
professionals for help understanding the best ways to support your
wealth-building goals if you decide to invest during coronavirus.

Other Coronavirus Support

Coronavirus has impacted more than just our investment opportunities. If you’re worried about other money or credit questions at this time, check out our COVID-19 finances guide. From keeping eyes on your credit to what to expect from stimulus packages, Credit.com has information to help you plan and manage your money during this time.

The post Is Investing During Coronavirus a Good Idea? appeared first on Credit.com.

Source: credit.com

Skipping Renters Insurance? Why That’s a Bigger Risk Than You’d Think

As a finance writer, I am surrounded by people who know a lot about managing money. But even those with the most money know-how can still miss financial must-haves.

For instance, in a recent conversation, a few of my coworkers stated they didn’t have renters insurance. This puts them among the 59% of renters who don’t have renters insurance, according to a poll from the Insurance Information Institute. On the other hand, 95% of homeowners carry homeowners insurance.

Granted, renting comes with fewer property responsibilities than owning. But don’t assume you can skip insurance for your home simply because you’re leasing it. Go without it and you’ll expose yourself to some major risks.

See why opting for a policy is protection you can’t live without, and learn how renters insurance can help smooth over the following five major renting crises.

1. Damaged Belongings

If you’re asking yourself whether you need insurance as a renter, a better question might be, Can you afford not to have it?

If the relatively small cost of a renters insurance premium—typically between $15 and $25 per month—seems too expensive, consider the alternative, suggests John Espenschied, agency principal of Insurance Brokers Group.

“Imagine replacing all your clothes, furniture, electronics, food, personal items, and priceless personal memorabilia,” he says. With renters insurance, the insurer will cover most or part of the value of damaged items. Without this coverage, you’re completely on the hook for all those costs.

Espenschied tells a story of one of his clients, a young woman to whom he recommended rental insurance multiple times. She declined the coverage.

Months later, there was an electrical surge in the building. “It took out everything she owned that was plugged in, including the TV, computer, and several other items,” Espenschied explains. These items were permanently damaged and unusable.

Had she opted for renters insurance, Espenschied could have helped her submit a claim and get the money to replace those belongings. Unfortunately, without the policy there was nothing he could do.

Don’t put yourself in the same position—get a renters insurance policy. On top of that, take steps to document all belongings and valuables so you can prove ownership in a renters insurance claim.

2. The Temporary Loss of a Habitable Home

Some disasters—such as fires, flooding, and electrical issues—can require extensive repairs and render your rental uninhabitable. Your landlord will usually handle these repairs, but if you lose the use of your home, your landlord might only be required to refund a prorated rent for the days you can’t live in your rental.

But if you’re out of a place to live, your daily rent rate might not cover any decent hotels or other temporary housing options.

But there’s good news: “Most renters insurance policies can help you in the event something happens to your apartment or house and you have to live elsewhere while it’s repaired,” says Jennifer Fitzgerald, CEO and cofounder of insurance comparison site PolicyGenius.

Typically, you can find a hotel nearby and your renters insurance will cover the costs of your stay until you can resume habitation of your home.

3. Stolen Belongings

Renters insurance typically includes coverage for theft and burglary too. If your home is broken into or burglarized, you can file a claim with your renters insurance provider to replace any stolen or damaged items.

“It even covers your belongings when they’re not physically in your home,” Fitzgerald says. “So if you take your laptop with you to the local coffee shop or on vacation and it’s stolen, your policy could help cover the costs of getting it repaired or replaced.” Renters insurance will usually be the policy that covers theft of personal items from your car too.

If your home is broken into or your purse is stolen from your car, promptly notifying authorities is an important step—filing a renters insurance loss claim will usually require a police report of the theft.

4. Personal Liability for Legal Damages

The most important protection your renters insurance provides, however, might be personal liability protection.

“If your dog bites someone or a food delivery person slips and falls, you’re covered,” says Stacey A. Giulianti, chief legal officer for Florida Peninsula Insurance. Instead of being held personally responsible for those damages, your insurer will step in and help. “The carrier will even hire and pay for an attorney to defend any resulting lawsuit.”

This can be especially important if you are found responsible for damage to adjacent properties as well, Espenschied says. For example, renters insurance will cover you if your toilet or tub “overflows and leaks into the neighbor’s unit below, causing damage to their personal property and cost to repair the building.” You may also be covered if a kitchen fire in your apartment causes damage to the unit above you.

The damage and loss can easily add up to tens of thousands of dollars. In cases like these, renters insurance can be the difference between smooth recovery and huge financial loss or even bankruptcy.

Make sure you understand your coverage. “Every policy is different, so talk to an agent and read your policy terms,” Giulianti warns.

5. An Eviction for Violating Your Lease Agreement

Many lease agreements include a clause in which the tenant agrees to purchase a renters insurance policy. These common clauses usually clarify that the landlord’s property insurance coverage does not extend to your personal belongings.

If you sign a lease with such a clause, you are agreeing to maintain this insurance coverage throughout your residency there. If you fail to get a policy or allow it to lapse, your landlord is within their rights to serve you with a “comply or quit” notice and possibly begin eviction proceedings.

If you don’t currently have a policy, reconsider getting renters insurance. Alongside a healthy emergency fund, having the right insurance can bring vital financial security to your life. For the cost, renters insurance provides protection and peace of mind.

“Most renters can get a policy for around $20 per month,” Fitzgerald says. “That’s a small price to pay when you think about the fact that if you don’t have renters insurance, you’ll be forced to cover the cost of replacing any and all items damaged.”

Procuring a renters insurance policy is a smart step toward financial security. With the right policy, you can avoid debt in an emergency and protect your possessions and your home. If you’re ready to buy a home, learn more about the ins and outs of home mortgages in Credit.com’s Mortgage Loan Learning Center. And to be financially prepared for anything, it’s also a good idea to build your credit score so you can qualify for loans and other credit when necessary. See where you stand with a free credit score from Credit.com.

Image: istock 

The post Skipping Renters Insurance? Why That’s a Bigger Risk Than You’d Think appeared first on Credit.com.

Source: credit.com

What Does Having a Derogatory Public Record on My Credit Report Mean

I Found a Judgment on My Credit Report. Now What?

Since the National Consumer Assistance Plan went into effect in 2017, public records must meet strict requirements in order to appear on consumer credit reports. Civil judgments and tax liens do not meet these new requirements, so they were removed from credit reports. At this point, the only derogatory public record that should appear on your credit report is bankruptcy. If a tax lien or civil judgment still appears on your credit report, you should dispute that record with the credit reporting agencies.

How Much Do Public Records Affect Credit Scores?

Bankruptcy can cause a FICO score to drop by 200 points or more. A filing may lower credit scores for seven to 10 years and be difficult to remove from a credit report unless any information is inaccurate.

The decision to exclude other public records slightly increased FICO scores for many consumers and resulted in increases of 20 to 40 points in some cases.

Bankruptcies and Your Credit Report

Bankruptcies are the one public record that are still included on your credit report. In most cases, they will remain on your report for seven to 10 years.

You can dispute an inaccurate report of bankruptcy or one being reported beyond the statute of limitations. Review your report for any inaccuracies and contact the credit bureaus to dispute inaccuracies if need be. If a credit bureau claims to have court verification of a bankruptcy, you should send a procedural letter to determine how they verified the public record on credit report. Follow up with the courts to determine whether the bankruptcy was actually verified.

〉 Learn more about when and why you should file bankruptcy and how doing so will affect your credit.

Civil Judgments and Your Credit Report

Civil judgments result when a creditor sues you for an outstanding debt and wins. That creditor then has more avenues for pursuing payment: they may now satisfy delinquent or outstanding debt through wage garnishment or by seizing funds from checking or savings accounts.

Judgments are no longer factored into credit scores, though they are still public record and can still impact your ability to qualify for credit or loans. Lenders may still check to see whether any outstanding judgments against a potential borrower exist. You should pay legitimate judgments and dispute inaccurate judgments to ensure these do not affect your finances unduly.

〉 Learn more about how to deal with civil judgments.

If a civil judgment is still on your credit report, file a dispute with the appropriate credit reporting agencies to have it removed.

Tax Liens and Your Credit Report

Tax liens are filed by the IRS when you don’t pay your taxes. A lien is automatically filed when you owe more than $10,000. When the IRS files a tax lien against you, it essentially gives the agency first dibs on any payment you receive from selling or liquidating your assets to pay your debts.

While tax liens are no longer reported on credit reports, they can significantly impact your financial situation in ways that indirectly affect your credit score.

〉 Learn more about tax liens.

If a tax lien is being reported on your credit report, file a dispute.

How to Deal with Derogatory Public Records

Although judgments and tax liens are no longer filed on credit reports or factored into credit scores, these penalties can undermine your financial standing. If a derogatory public record is filed against you‚ you should monitor the effects on your credit and ensure that information pertaining to your filing is accurate.

Check your reports regularly to ensure they are fair, accurate and up-to-date. You can watch for changes by getting your free Credit Report Card and credit score monitoring from Credit.com.

〉Sign up now!

The post What Does Having a Derogatory Public Record on My Credit Report Mean appeared first on Credit.com.

Source: credit.com