because you have a poor credit report
mean you won’t be able to get credit. Creditors
set their own credit-granting standards and not
all of them look at your credit history the same
way. Some may look only at more recent years to
evaluate you for credit, and they may grant credit
if your bill-paying history has improved. It may
be worthwhile to contact creditors informally to
discuss their credit standards.
If you’re not disciplined enough to create a
workable budget and stick to it, work out a
repayment plan with your creditors, or keep track
of mounting bills, consider contacting a credit
counseling organization. Many credit counseling
organizations are nonprofit and work with you to
solve your financial problems. But not all are
reputable. For example, just because an
organization says it’s “nonprofit,”
there’s no guarantee that its services are free,
affordable, or even legitimate. In fact, some
credit counseling organizations charge high fees,
or hide their fees by pressuring consumers to make
“voluntary” contributions that only cause more
Most credit counselors offer services through
local offices, the Internet, or on the telephone.
If possible, find an organization that offers
in-person counseling. Many universities, military
bases, credit unions, housing authorities, and
branches of the U.S. Cooperative Extension Service
operate nonprofit credit counseling programs.
financial institution, local consumer protection
agency, and friends and family also may be good
sources of information and referrals.
If you are considering filing for bankruptcy, you
should know about one major change to the
bankruptcy laws: As of October 17, 2005, you must
get credit counseling from a government-approved
organization within six months before you file for
>>> See more in the Guide
Reputable credit counseling organizations can
advise you on managing your money and debts, help
you develop a budget, and offer free educational
materials and workshops. Their counselors are
certified and trained in the areas of consumer
credit, money and debt management, and budgeting.
Counselors discuss your entire financial situation
with you, and help you develop a personalized plan
to solve your money problems. An initial
counseling session typically lasts an hour, with
an offer of follow-up sessions.
Even if you don’t have a poor credit
some financial advisors and consumer advocates
suggest you review your credit report periodically
because the information it contains affects
whether you can get a loan or
and how much you will have to pay for it.
to make sure the information is accurate,
complete, and up-to-date before you apply for
a loan for a major purchase like a house or
car, buy insurance, or apply for a job.
to help guard against identity theft.
That’s when someone uses your personal
information — like your name, your Social
Security number, or your credit card number
— to commit fraud. Identity thieves may use
your information to open a new credit card
account in your name. Then, when they don’t
pay the bills, the delinquent account is
reported on your credit report. Inaccurate
information like that could affect your
ability to get credit, insurance, or even a