Check whether Equifax reduces your score or not
Credit reports and credit scores are one of the important components of financial life. Banks referring to your credit report and score, analyze your creditworthiness in the course of extending credit to you in terms of credit cards or loans. One’s credit rating can also affect other aspects such as rental housing applications, insurance premiums, and even job offers. Thus, it is necessary to learn what influences credit scores and whether Equifax reduces them.
What is Equifax?
Equifax along with Experian and TransUnion are the three credit reporting agencies that operate in the United States. These agencies gather data on your accounts, how you use credit, and your payment history and assemble it into credit reports. They also determine your credit scores which capture the summary of your creditworthiness.
Equifax currently has records of over 200 million credit reports filed by Americans. Their reports and scores are being relied on by lenders, landlords, employers, and others to know whether you are financially reliable or not. Therefore, Equifax can greatly affect you and how you handle your credit and finances.
Equifax and Your Credit Score
Let me make one thing clear – Equifax, as it relates to your credit, does not negatively impact your credit score. In essence, they just obtain credit information from furnishers such as banks and other lenders and integrate it into your credit file. What influences your credit score is not Equifax but the underlying data that is used to create the credit score.
But if there are mistakes in your Equifax credit report, then those mistakes can hurt your score. So, if any of the information in your Equifax credit report is incomplete or contains incorrect data, it can lower your credit score making you more of a risk than worth to lenders. Slight inaccuracy may reduce credit score by a few points and then you are limited in your ability to acquire credit at reasonable interest rates.
This paper will focus on the Equifax data breach and how it affected credit scores.
The one that took place in 2017 was of Equifax company which declared that 147 million Americans’ data was leaked including personal and financial details. Although the data breach exposed personal information and one could say it potentially harmed the credit scores or reports of the affected individuals, it did not physically affect them.
Nevertheless, the breach that Equifax suffered did enhance the vulnerabilities to identity theft and fraud. Names, Social Security numbers, birth dates, addresses, and some parts of their driver’s licenses as well as credit card details were pilfered by the cybercriminals. Using this info, identity thieves may be able to open accounts in your name or make charges on your credit card.
As a second step, if you did fall prey to identity theft due to the Equifax breach, you will then observe a further decline in your credit scores and credit reports. Any hard inquiry, payment that was made, or collection might appear on the report if someone uses your information to open accounts. This negative activity would then reduce your credit rating.
How to Perform Equifax Credit Check for Mistakes
Since the information that is contained in your Equifax credit report is used in computing your score, you must review the credit report for errors that you are seeing on your report that will push down your credit score unnecessarily.
To get your Equifax report you can go to www.annualcreditreport.com free of charge. This is the sole legal website that provides the free annual credit report you are legally entitled to receive as per federal laws.
When you review your Equifax credit report, look for these common errors:
- There is the account that you don’t have any connection with
- Some of them are such as an incorrect personal detail like an improper address.
- Accounts that were marked as being in arrears and which were settled on time
- Balances listed incorrectly
- These included cases where a client’s account was closed and yet it was listed under the open accounts.
If you notice any errors or any items that look fraudulent, you should challenge that to Equifax. Support it with documents such as bank statements or receipts that may have been received from the organization. This organization is mandated by law to respond to complaints of such nature within one month. You know, if Equifax cannot confirm the item, then it has to delete this item from your credit report. This can help to even out your credit score.
You can also request Equifax to attach a 100-word statement arguing the disputed item should not be deleted if it stays on your file.
How Long Does It Take For Certain Items To Remain On Equifax Credit Report?
Consumers also have another question or concern that has to do with how long negative marks remain on Equifax reports to affect scores.
By law, most negative credit items can stay on your Equifax credit report for 7 years including:
- Late Payments
- Collections
- Charge-Offs
- Foreclosures
- Bankruptcies
- Tax Liens
- Civil Judgments
- Most Hard Inquiries
The credit bureau Equifax cannot report these items to your credit report after 7 years and they cannot penalize your score for it. However, it is equally true that negative items such as missed payments will likewise be eliminated after 7 years along with positive items like your record of timely payment.
There are a few exceptions such as public record bankruptcies and unpaid tax liens that can go as far as 10 years or indefinitely depending on FCRA on your Equifax report.
Hard inquiries are typically reported for 2 years except for those involving mortgages, student loans, and auto loans, which can be reported for up to 3 years.
Eventually, it is clear that while Equifax itself will not decrease your credit rating, mistakes on your Equifax credit report and fraudulent credit activity due to the Equifax breach will. THE ONLY two ways to safeguard your credit standing are by frequently visiting the Equifax report to check for errors and ensuring that your identity is secure.
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