Hello fellow steemians, and friends in this edition we talk about how negative credit reporting affects your credit, and how you can avoid it happening to you. lets begin shall we?
Negative reporting usually happens when you miss making payments on time. They can also happen when a bill is missed and gets sent to collections, among a few other less common reasons. The most damaging to a credit rating is a late payment. then to an slightly lesser degree are notice of collections. Creditors place among other things, timely repayment of their loans as most important. By simply making certain your payment is on time your credit rating will not suffer any severe losses. Collections are another thing the reporting agencies consider detrimental to credit worthiness, and most collections agencies will submit a delinquient payment notice every month the account isn't paid.. this will cause you to bleed your credit score a slow and painful death. Where a late payment can be as little as a one month hiccup that can drop your credit score as much as 50 points, an account in collections can nibble anywhere from 5-30 points each month the debt is unpaid.
No matter how many other positive things you have going for your credit a missed payment, and an account in collections can wipe out all of your hard work restoring/building your credit. If you recieve a notice of late payment, or account in collections... do not panic. The late payment can be recovered easily enough by getting back to ensuring your payments are on time. The accoount in collections is a little more difficult, as you will have to usually make a full payment of the balance to the collection agency in question. And then will have to send notice of payment to each of your credit reporting agencies(trans union, equifax, experian..here in the states)and show them proof of payment , and request they remove the derogatory mark on your credit.
Lastly, i want to touch on just how easy, and important it is to use a credit monitoring site to regularly(i check weekly, but once a month is fine)check on your credit. there are two largely known credit apps out there currently that i am aware of... CreditKarma, and CreditSesame. Both are free credit monitoring sites, Both have a great set of helpful advice and tools to help you repair your credit rating.
this is all i have for you on this installment, please feel free to follow, if you're interested in more.
And as always, feel free to upvote the content if you found it helpful/entertaining. I welcome anyone who wishes to follow me. thank you for your time.
Dean