© South-Western Educational Publishing Chapter 17 Credit Records and Laws Establishing Good Credit Credit Ratings and Legal Protection
GOALS © South-Western Educational Publishing Lesson 17.1 Establishing Good Credit Discuss the importance of credit records and summarize how and why records are compiled. Describe the five Cs of credit. Explain how to get started using credit.
© South-Western Educational Publishing Credit Records Your credit file How information is gathered and used Types of information stored
© South-Western Educational Publishing Credit Records Every person who uses a credit card or takes out a loan begins to establish credit.
© South-Western Educational Publishing Controlyourcredit.gov
© South-Western Educational Publishing How credit scores are used
© South-Western Educational Publishing Credit scores may vary
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Important information about credit scores
© South-Western Educational Publishing Credit bureau Credit history Credit report Subscribers
© South-Western Educational Publishing Credit report – where?
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Free Credit Report A Warning About "Imposter" Sites The FTC advises consumers who order their free annual credit reports online to be sure to correctly spell annualcreditreport.com, or link to it from the FTC's website to avoid being misdirected to other websites that offer supposedly free reports, but only with the purchase of other products. annualcreditreport.com
© South-Western Educational Publishing Free Credit Report While consumers may be offered additional products or services while on the authorized website, they are not required to make a purchase to receive their free annual credit reports.
© South-Western Educational Publishing Credit Monitoring How to Monitor Your Credit Report
© South-Western Educational Publishing Creditworthiness Character Capacity Capital Conditions Collateral Five Cs of Credit
© South-Western Educational Publishing Character
© South-Western Educational Publishing Capacity
© South-Western Educational Publishing Capital
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Getting Started with Credit Begin with a savings account. Open a checking account. Open a store credit account. Get a small loan. Apply for a credit card.
GOALS © South-Western Educational Publishing Lesson 17.2 Credit Ratings and Legal Protection Describe credit ratings and a point system for determining creditworthiness. Outline the contents of a credit report. Discuss the protections provided by the major credit laws.
© South-Western Educational Publishing What makes up a credit score?
© South-Western Educational Publishing Payment History
© South-Western Educational Publishing Type of credit in use
© South-Western Educational Publishing New credit
© South-Western Educational Publishing Length of credit history
© South-Western Educational Publishing Debt
© South-Western Educational Publishing Credit Ratings Excellent credit rating Good credit rating Fair credit rating Poor credit rating
© South-Western Educational Publishing The impact of negative information on your credit score How long do you think late payments stay on your credit report?
© South-Western Educational Publishing Late payments
© South-Western Educational Publishing The impact of negative information on your credit score How long do you think collection accounts and charge-offs stay on your credit report?
© South-Western Educational Publishing Collection accounts and charge-offs
© South-Western Educational Publishing The impact of negative information on your credit score How long do you think bankruptcies stay on your credit report?
© South-Western Educational Publishing Bankruptcies
© South-Western Educational Publishing The impact of negative information on your credit score How long do you think unpaid tax liens stay on your credit report?
© South-Western Educational Publishing Unpaid tax liens
© South-Western Educational Publishing Negative Information
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Closing Accounts – can be harmful
© South-Western Educational Publishing Credit Inquiries Whenever you or someone else accesses your credit report, an inquiry is created. Some inquiries can hurt your credit score.
© South-Western Educational Publishing Good Inquiry vs. Bad Inquiry
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Credit Reports Summary of information Public record information Credit information Account detail Requests for credit history Personal information
© South-Western Educational Publishing Inaccurate information When you find an error Write to the credit bureau & information provider Send certified mail Credit bureau has 30 days to respond
© South-Western Educational Publishing Credit repair Fixing Credit Card Errors
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Credit Laws Consumer Credit Protection Act Fair Credit Reporting Act Fair Credit Billing Act Equal Credit Opportunity Act Fair Debt Collection Practices Act
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Missed car payments
© South-Western Educational Publishing Fair Debt Collection Practices
© South-Western Educational Publishing Parts of a credit report a credit report THANK YO U F O R B A N K I N G WITH Your First Bank Please address all future correspondence to: Credit Reporting Agency Business Address City, State PERSONAL IDENTIFICATION INFORMATION Your Name 123 Current Address City, State Previous Address(es) 456 Former Rd. Atlanta, GA P.O. Box XXXX Savannah, GA Social Security #: Date of Birth: April 10th, 1940 Last Reported Employment: Engineer, Highway Planning
© South-Western Educational Publishing PUBLIC RECORD INFORMATION Lien Filed 03/93; Fulton CTY; Case or Other ID Number-32114; Amount-$26,667 Class-State; Released 07/93; Verified 07/93 Bankruptcy Filed 12/92; Northern District Ct; Case or Other ID Number-673HC12; Liabilities-$15,787; Personal; Individual; Discharged; Assets-$780 Satisfied Judgement Filed 07/94; Fulton CTY; Case or Other ID Number ; Defendant- Consumer; Amount-$8,984; Plaintiff-ABC Real Estate; Satisfied 03/95; Verified 05/95
© South-Western Educational Publishing Collection agency info COLLECTION AGENCY ACCOUNT INFORMATION Pro Coll (800)XXX-XXXX Collection Reported 05/96; Assigned 09/93 to Pro Coll (800)XXX-XXXX Client-ABC Hospital; Amount-$978; Unpaid; Balance $978; Date of Last Activity 09/93; Individual Account; Account Number JC
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