Credit Report Freeze - What is a Credit Freeze?

Data breaches are more common than you think. MNCs like Facebook and Target have problems with data breaches and hacking of private information.

Credit information can include driver’s license, credit card details, date of birth, social security number, email ID, phone numbers and more. In the hands of hackers, this information can be problematic. It is understandable that the average person wants to be more cautious about sharing their private information online.

You can freeze your credit but before you do that, there are a few things you should know.

What is a Credit Freeze?

In case of a data breach, a credit freeze is highly recommended. When you freeze your credit, you prevent anyone who tries to steal your information by opening an unauthorized account in your name. By freezing the credit, you lock down your credit information and thus prevent any misuse and theft. People who wish to try to steal it won’t be able to.

Here’s an example:

Let’s say that you are looking for a loan or a credit card. You apply for them at a bank. The bank will now decide whether or not to give you the loan or the credit card depending on your credit report. You will have to show the bank your credit report, but you can choose to “freeze” the information. You can call your credit reporting agency to freeze your details. On doing this, only the bank can see your details and information, no one else.

However, even after freezing, it shall be accessible to you and your current creditors.

• You can access your credit information and still get your free credit reports.
• Your current creditors and your debt collectors can access the information too.
• Your credit score won’t be affected by a Credit Freeze.
  

How to freeze your credit?

To do that, you’ll need to call your credit bureaus separately. Tell them about your intention and follow their processes, which may be different from one bureau to another. You may need to share all the necessary details in order for them to find and lock such information. Once the bureaus have frozen your credit, you’re set. No one can access it without your explicit permission and authorization to the credit bureaus.

Pros of a credit freeze

• It can prevent identity theft
• It is free
• You can lift a freeze temporarily in case you need to get the information checked by a credit bureau
  

Cons of a credit freeze

• It can be time-consuming since you need to contact and follow the process of all credit bureaus separately
• Credit freeze can offset your other priorities, for instance when you apply for loans or credit cards. In such cases, you’ll need to lift the freeze temporarily, which still delays the application process
• Credit freeze won’t help you when a hacker already has stolen your information, or if it has happened in the past
  

Credit freeze can be a good option if you want to protect your data from a data breach or from online fraudsters. However, the process can be long. Consider that before taking the decision.

6 Stranger Things That Affect Your Credit Score

The series Stranger Things, if you may have noticed, is quite strange. Particularly strange extra-dimensional creatures hell-bent on destroying the known universe for some strange reason - sounds strange enough.

You don’t need to worry about those strange things, however. Believe it or not, there are stranger things going on in your credit report. So forget everything else and get ready to defend yourself against the strange entities that wreak havoc on your credit score.

The Ambiguity of Credit Scores

When it comes to your credit score, there are several things that may seem confusing. For instance, you may think that you are pulling all the right strings, yet find that your credit score takes a beating. You may think that since you are making your monthly payments on time and not maxing out your credit cards, your credit score will only rise. Unfortunately, this is not always true.

Your credit score can be adversely affected by several lesser-known factors.

Six Things That Wreak Havoc on Your Credit Score

• Avoiding credit: You may think that if you have no credit cards with which to borrow, your credit score will be on top. Unfortunately, it does not always work that way. It may even seem counterintuitive, much like the Upside Down. After all, it makes more sense to have a high credit score if you have no debts and loans. In reality, it is not all that simple.
  
  
• Credit score is calculated based on the appropriate use of a particular mix of credit products. If you have been avoiding credit products such as credit cards, you would get what is known as a ‘thin file.’ A 'thin file' means that there is not enough data to assign you a credit score.
  
  
• When you close your unused credit card account: It may seem natural to close the credit card accounts that you have no plans of using. The problem is that doing so will lower your credit score. Your credit utilization ratio influences around 30% of your credit score. This ratio measures the credit used against the credit limit. For best results, keep this ratio below 30% of the credit limit.
  
  
• Taking credit offers: It can be pretty infuriating to know that even if you do take advantage of credit offers, you are penalized. Yes, you guessed it right; even this penalty has to do with your precious credit score.
  
  
• Every time you take a credit offer, the loan provider starts a hard inquiry into your credit history. The problem here is that each hard inquiry brings down your credit score a little bit. Remember that there is also a maximum limit of inquiries allowed by the creditor for getting approved.
  
  
• When you consolidate your credit debt to a low-interest card: Let’s go back to the credit utilization ratio. The issue is that even if the rest of your cards have zero balance, one maxed-out credit card is enough to make your credit score suffer.
  
  
• Administrative mistakes in the credit report: Mistakes in the credit report is common. As you can understand, this is capable of making your credit score go haywire. The score can be brought down sharply by a great degree when the mistake recorded is significant, even if not your fault at all.
  
  
• These mistakes happen for several reasons. For instance, people having common names are more vulnerable. If you face a similar situation, here’s what you need to do. You can get a credit report per quarter from the credit bureaus. Follow the instructions provided by the agencies to detect any mistakes, and make sure that you report them immediately.
  
  
• Not paying bills: You may not pay a bill for just about any reason. You are safe for as long as the lender or service agency remains oblivious. If they do find out about your exploits, there will be a black mark for that in your credit report, while delinquent accounts will be given over to a collections agency.

Where to get your credit report from? - Where do CIC’s get all your information from?

You may already know by now, but it begs repeating, especially when there is information which is not given elsewhere on the web.

You can get your credit report from the three main credit bureaus in India, who are also called Credit Information Companies or CICs.

Now, not all CICs offer you your report for free. There are some from whom you’ll need to buy it.

However, every single time lenders want to check your credit score, they have to pay a fee.

Needless to say, lenders check your credit score every time you apply for a loan or credit card.

Where do CIC’s get all your information from?

You may now be wondering where on earth these CICs get your information from.

Well, that’s no mystery.

They get your financial and personal information from the various financial institutions like banks from whom you have taken loans, or have applied for one.

Credit reports allow lenders to minimize defaults in repayments by knowing beforehand who has a bad credit history. Even though your credit score is not the only factor in getting a loan, credit reports do have significant weight and are considered to determine your eligibility.

Why are they so important?

Credit Scores are important both for you and the lender, as we have discussed earlier.

For the lenders, it is a measure of your creditworthiness.

Having a high score means you have a healthy and consistent repayment habit, while a low score indicates the opposite.

What are they used for?

Credit reports tell lenders how creditworthy you are.

For lenders, your creditworthiness is perhaps one of the most important factors. After all, they’re more likely to give you a loan when they are sure of your ability to pay the loan back, in time and with interest.

If a person has a low credit score, it means he or she is not very creditworthy. Most lenders won’t want to risk their money on them. And even if people with low credit scores get loans luckily, such credit shall be accompanied with pretty high interest rates and long repayment periods, which means you’ll end up paying a whole lot of money just because you are plagued with a poor credit score.

Because of this, it is much better to improve your credit score before asking for credit. Those with high credit scores get the best loans and credit cards

How to Understand Credit Report - Fathom the Components That Determine Your Credit Score

The relevance of the credit score and credit report isn't unknown to anyone keen to apply for loans or credit cards.  A credit score is calculated based on several components, which are mentioned clearly in your credit report. Hence, to achieve a good credit score and to maintain it, you need to learn and understand these components. If you are wondering whom to consult for insights on your credit report, relax! mymoneykarma is here to assist you.

How to Understand Your Credit Report

Learn About the Sections That Your Credit Report Contains

Generally, your credit report is divided into these four major sections:

• Information on Credit Accounts: If you have been using credit for a long time, this section will cover a significant portion of your credit report - reflecting your credit history. It will include all the information from your past accounts, such as the creditor's name, payment history, the date of opened and closed accounts, etc.
  
  
• Personal Details: This section includes information such as name, current address, date of birth, etc. Other information such as employment history and previous addresses can also be present in the report.
  
  
• Hard Inquiries: When you apply for a new line of credit, the lender pulls your credit score, and that initiates a hard inquiry. This inquiry is shown on your credit report, and it remains for seven years. Here, you need to make sure that you don’t apply for new credit within a short span of receiving the previous one; otherwise, it can affect your credit score.
  
  
• Collection Accounts: When you don't pay the debt for a long time, the creditors pass on your account information to the collection agencies, and this remark stays on your credit report for a longer duration.

Fathom the Components That Determine Your Credit Score

The following are the various factors that determine your credit score, as we discussed above:

• Credit Utilization: You should keep your credit card limit utilization below 30% to ensure that it doesn't harm your credit score.
• Payment History: On-time payments can help you in building a good credit score, whereas late payments can harm it and can lead you to pay penalties.
• Credit History: The longer the credit history, the stronger will be your credit score.
• Credit Mix: A mix of credit accounts(such as loans, credit cards) when used in the right proportion can help you in gaining a good credit score.
  

Here, the crux is that taking care of all these factors will ensure that your credit report always shows a green flag to creditors.

How to Fix Credit Report Errors - Dispute Errors on Your Credit Report

Are you feeling angry, exasperated, or frustrated?

You trusted them, but they let you down. They made a mistake, and that mistake is costing you big time.

Perhaps this is the feeling you get when your credit score takes a hit through no fault of yours. Your report has otherwise been spotless, until the credit bureau ended up making errors. Since they affect the credit score in the end, such incidents are regrettable. With a flawed score, you are much less likely to get loans or credit cards, and it could affect a lot of your financial prospects.

Why Would Your Credit Report Have Errors?

Here's what happens. Every month, your lenders and creditors send details of your loan account to one of the three major credit bureaus, namely Experian, TransUnion, and Equifax. These are the organizations that ultimately create and update your credit report.

There can be errors in the calculation for a number of reasons. These mistakes can include reportings from accounts that are not yours, inaccurate transactions, payments mistakenly reported as being made late, and much more.

You need to ensure that the credit account records are accurate. This brings us to the next question...

How Do You Locate These Errors?

Now, if you wish to check for credit report errors, the best thing to do is to check your credit report. Remember the credit bureaus we named above? All of those give you a credit report once a year, for free! This means that you can check your report thrice a year. Additionally, if you have been turned down for loans etc. due to your credit score, you can get one more free credit report.

If you are not able to get these reports for free, don't worry. You can buy these from the bureaus for a sum of Rs.550 - Rs.1400.

Study the report from a bureau each quarter and compare them at the end of the year to identify discrepancies or mistakes.

Now that you have learned how to spot mistakes, let's see how you can dispute credit report errors.

Common Credit Report Errors

Common errors that are disputed are:

• Accounts that don't belong to you
• Payments reported late while they were made on time
• Wrong loan amount/credit limit/account balance
• Wrong creditor
• Incorrect account status
  

Dispute Errors on Your Credit Report

You may have thought that you can dispute all credit report errors. Technically yes, but that does not necessarily mean that a change will reflect accordingly.

While you do have the provision to dispute anything in the credit report, the credit bureaus shall still investigate and only remove items that they are authorized to remove. Issues you can dispute are those that are incomplete, inaccurate, out of date, or unverifiable.

Here are a few points to remember: negative items remain on your credit report for seven years, and bankruptcy remains for ten years.

If you have had any negative items for longer than seven years, then you can confidently dispute it as a credit report error.

What You Can Do When a Credit Bureau Will Not Fix an Error

Credit bureaus are required by law to report to an inquiry within 30 days. If you send additional documents after that, the period for the bureaus to respond becomes 45 days. If they do not answer, you can sue them in court.

However, there are things in your credit report they are not liable to remove. For instance, bankruptcy can't be removed before a period of ten years is up.

Disputing Errors - the Process

You can place complaints against credit report errors in three ways: through mail, online, or by phone.

Dispute Credit Report Errors Online

While this way is convenient, it is not without its drawbacks. You get to check the status of your records and the dispute only online.

When you dispute credit report errors online, you get results online only. To do so, you must provide your confirmation number. However, one cannot complete the process entirely online - you still have to mail the required documents as proof.

Dispute Credit Report Errors by Mail

Getting results this way will take more time, but there are many benefits. For one, when you communicate by real mail, it leaves a paper trail. Since the credit bureaus need to respond to you within 30 days, you can be sure of a response. In case they don't, you can sue the bureau in court.

For disputing through mail, you need to write a letter with information regarding which item should be removed and why. You should include proof of the error as well.

Disputing Through Phone

You will usually find a number in your credit report to use for disputing errors. Use it. Also make sure that you remember when you made the call, whom you spoke to, the information shared, the nature of the dispute, and the proof submitted.

It may happen, however, that you may need to contact the concerned credit bureau for more information.

Is Loan Rejection Hurting Your Credit Score?

It hurts when your loan application is rejected. However, it hurts your credit score more than it hurts you. Getting rejected for a loan is bad for the score, not just for the short term, but for the long term as well. Getting rejected once increases your chances of getting rejected by other lenders as well. Yes, these things do get recorded in your credit report, and thus damage the score.

If your credit score is low, it can be due to a wide variety of factors. It can be due to debt settlements, on-payment of debts, not paying debt installments on time, high credit utilization, and much more. Thus, there can be many reasons for a low credit score.

The good news is that there are just as some ways to improve or increase it. But you won’t go into those points in this article. Here we shall detail out the impact of a rejected loan application on your credit score.

What is the credit score?

Your credit score is a 3-digit number that measures your credit worthiness, or how likely you are to repay loans. If the score goes down due to whatever reason, other lenders will see you are a risky candidate to give loans to.
Impact of a loan rejection on your credit score

Lenders make a credit inquiry each time you apply for a loan. This is known as a hard inquiry, which alone lowers your score if just a little bit. This is why experts warn not to apply at too many places at once for credit, as it only increases the risk of multiple rejections.

Thus, be careful before applying for credit. If there is a rejection, ask the bank or lender why it was so. Ensure that you don’t make the mistake again while applying next time.
Reasons why your loan may have been rejected

There can be many reasons behind a loan rejection. To know the reason behind a loan rejection, and what is affecting the score, check your credit report. Here are the common reasons behind a low credit score.

• Taking multiple loans: Do you have more than one loan account? If so, banks are more likely to refuse you loans and even credit cards. This is because they see you as one with an unstable personal finance since you are always in need of loans.
• Loans defaulted: Too many of these, regardless of whether it was solely your account or whether it was a joint-loan account, you will be penalized by loan denial later on. Banks don’t want to give loans to one who has defaulted on loans.
• Credit score remarks: Loan defaults are not the only problem which can lower your credit score. Did you make a debt settlement with a bank? If so, then your credit report now contains the remark “settled.” This makes it hard to get loans later. However, you can still get credit if you give security. Lenders are more likely to reject unsecured loan applications at this point.
• Employment status: Incidents of late salary credits and when the employer is not well-known to the bank can give rise to loan rejections.

6 things to do to raise your credit score?

Here are a few things you can do to get back on track. It’ll take time, but you’ll get there.

• Pay off all debts
• Have a low credit utilization ratio, below 30%
• Pay overdue bills
• Do not take multiple loans
• Get a loan tenure which suits you
• Get mixed loans

How to Fix Credit Report Errors - Common Credit Report Errors

Are you feeling angry, exasperated, or frustrated?

You trusted them, but they let you down. They made a mistake, and that mistake is costing you big time.

Perhaps this is the feeling you get when your credit score takes a hit through no fault of yours. Your report has otherwise been spotless, until the credit bureau ended up making errors. Since they affect the credit score in the end, such incidents are regrettable. With a flawed score, you are much less likely to get loans or credit cards, and it could affect a lot of your financial prospects.

Why Would Your Credit Report Have Errors?

Here's what happens. Every month, your lenders and creditors send details of your loan account to one of the three major credit bureaus, namely Experian, TransUnion, and Equifax. These are the organizations that ultimately create and update your credit report.

There can be errors in the calculation for a number of reasons. These mistakes can include reportings from accounts that are not yours, inaccurate transactions, payments mistakenly reported as being made late, and much more.

You need to ensure that the credit account records are accurate. This brings us to the next question...

How Do You Locate These Errors?

Now, if you wish to check for credit report errors, the best thing to do is to check your credit report. Remember the credit bureaus we named above? All of those give you a credit report once a year, for free! This means that you can check your report thrice a year. Additionally, if you have been turned down for loans etc. due to your credit score, you can get one more free credit report.

If you are not able to get these reports for free, don't worry. You can buy these from the bureaus for a sum of Rs.550 - Rs.1400.

Study the report from a bureau each quarter and compare them at the end of the year to identify discrepancies or mistakes.

Now that you have learned how to spot mistakes, let's see how you can dispute credit report errors.

Common Credit Report Errors

Common errors that are disputed are:

• Accounts that don't belong to you
• Payments reported late while they were made on time
• Wrong loan amount/credit limit/account balance
• Wrong creditor
• Incorrect account status
  

Dispute Errors on Your Credit Report

You may have thought that you can dispute all credit report errors. Technically yes, but that does not necessarily mean that a change will reflect accordingly.

While you do have the provision to dispute anything in the credit report, the credit bureaus shall still investigate and only remove items that they are authorized to remove. Issues you can dispute are those that are incomplete, inaccurate, out of date, or unverifiable.

Here are a few points to remember: negative items remain on your credit report for seven years, and bankruptcy remains for ten years.

If you have had any negative items for longer than seven years, then you can confidently dispute it as a credit report error.

What You Can Do When a Credit Bureau Will Not Fix an Error

Credit bureaus are required by law to report to an inquiry within 30 days. If you send additional documents after that, the period for the bureaus to respond becomes 45 days. If they do not answer, you can sue them in court.

However, there are things in your credit report they are not liable to remove. For instance, bankruptcy can't be removed before a period of ten years is up.

Disputing Errors - the Process

You can place complaints against credit report errors in three ways: through mail, online, or by phone.

Dispute Credit Report Errors Online

While this way is convenient, it is not without its drawbacks. You get to check the status of your records and the dispute only online.

When you dispute credit report errors online, you get results online only. To do so, you must provide your confirmation number. However, one cannot complete the process entirely online - you still have to mail the required documents as proof.

Dispute Credit Report Errors by Mail

Getting results this way will take more time, but there are many benefits. For one, when you communicate by real mail, it leaves a paper trail. Since the credit bureaus need to respond to you within 30 days, you can be sure of a response. In case they don't, you can sue the bureau in court.

For disputing through mail, you need to write a letter with information regarding which item should be removed and why. You should include proof of the error as well.

Disputing Through Phone

You will usually find a number in your credit report to use for disputing errors. Use it. Also make sure that you remember when you made the call, whom you spoke to, the information shared, the nature of the dispute, and the proof submitted.

It may happen, however, that you may need to contact the concerned credit bureau for more information.

7 Ways to Supercharge your Personal Finances

Everyone has financial goals. What’s yours? Is it to buy a nice condo, or just to manage your personal finance better? In this article, we are going to help you out in getting you back on track to financial health.

Establish a baseline

In this fitness industry, there is something called a baseline. So what is a Baseline? It is a set of few exercises given to determine where you are in your fitness journey. Based on that, you get a new fitness plan, diet plan, etc. For the purpose of this article though, it will refer to where you are in your financial state.

• Check your credit score for errors: You know that you can get a free credit report a year, right? Well, why not check your credit report for errors. Get the help of a professional if you don’t know how it works. Check for errors, and yes there may be errors, is important because these can cause some problems. Errors here won’t affect the score, but the same errors will tell you why your credit score is the way it is.
• See where the money is moving: If you always have money problems at month end, it is never too late to see where you are spending the most. Once you know what is taking up so much of your money, you can find ways to save.
  

Here’s some quick fixes

Here are a few, small and easy fixes which can make a big difference in your financial life.

• Think about lowering your interest rates: If you are paying a lot by way of interest rate, or credit card interest rates, think about getting a balance transfer credit card. This allows you to move over to a credit card which has 0% APR for some months. You can use this time to pay the debt without worrying about the time.
• Set up over-the-limit alerts and low-balance alerts: Missed payments and using up too much of your credit facility will come to haunt you later. To ensure that you always have enough money in your account, think about setting up alerts. Also think of setting up warnings for when you are nearing 30% credit utilization ratio.
  

Improve your stamina

These are ways to maintain your financial health without stress.

• Set up automatic bill payments: If you pay for things regularly, for instance subscriptions, memberships and EMIs for loans, why not set up automatic payments when possible? It is easy to make mistakes without this. Automatic payment leaves one thing less to worry about.
• Make money transfers to accounts that are only dedicated to debt payoff: If you are a serial shopper and splurger, think about opening your separate checking account which is dedicated to that goal only. As soon as you get your salary, automatic transfers send the money over to that account. This way, you’ll always have money to pay your bills, you’ll pay off debts, and will have less money to splurge.
• Have small payments with less-used credit cards: If you have old credit cards you don’t use anymore, don’t throw them off. Use them. Use these to make small transactions to keep the cards active. Shutting down old credit cards affects your credit score.

How to Remove Delinquencies From Your Credit Report - Delinquent Account

Past mistakes can haunt you - and if it is a grave financial mistake, like a delinquent account, it can haunt you for seven years on your credit report. However, it has often been seen that delinquent accounts on your credit report keep nagging you although they should have been taken off your report after a period of seven years. What should you do in such a scenario? Read on to find out.

What Is a Delinquent Account?

If you have a credit account and you fail to make payments after the due date, your account is considered to be delinquent. Ideally, a delay by one day results in delinquency. However, in practice, the prevailing trend among lenders is to wait for two missed payments to declare an account as delinquent.

Delinquent accounts hurt your credit score significantly. They also spoil your credit history, as they appear on your credit report and stay on it for seven years. Delinquent accounts won’t help you when you want to remove the records either.
Consequences of Delinquency

Delinquent accounts can have short-term as well as long-term repercussions. These are the possible troubles that you may face if you drive one of your accounts into delinquency.

• A single delinquent account can cause an immediate drop in your credit score.
• Multiple delayed or missed payments can result in a 100 point drop in your credit score.
• Lenders will not trust you, and you will not be able to get credit in the future.
• Your credit report will be tainted for the next seven years, as the delinquency will be recorded on your credit report. Even after you settle the debt, the record will remain and serve as a warning to potential lenders that you might not be reliable with credit.
• The record might not be auto-removed after seven years, and you might have to spare a lot of time and effort to get the error rectified.

How to Remove a Delinquent Account

Credit bureaus strive to remove the negative information before the completion of seven years - roughly around six years nine months. However, they often make errors and fail to remove the records. In such a situation, the onus lies upon you to act quickly and get the matter resolved. Experts from mymoneykarma are here to guide you.

• Verify and Confirm the Age of the Debt: If you suspect that negative information is on your credit report for longer than it should be, the first step for you would be to pull out your credit report and scrutinize it to verify the exact age of the delinquency. It doesn't matter if your account was written off or sold off to an external collection agency. The date considered is the date on which you had initially missed or failed to make a payment to the original creditor. If your delinquency date was 1st January 2010, the information must not stay on your credit report for a single day after 1st January 2017. Keep your old credit reports handy - you might have to fish out the date on which the creditor reported your delinquency.
• Check with Each Bureau: Each credit bureau need not make identical credit reports. The creditors might not report to all the bureaus, and thus, your credit report from each bureau will differ. The delinquency may not be there in all the reports. Therefore, it is ideal that you get hold of a copy of your credit report from all three bureaus and inspect them.
• You are entitled to get a free copy of your credit report once a year from each bureau. However, you can access your credit report at any time by paying a nominal amount to the concerned credit bureau. You must find out which bureaus are still listing the outdated old debt and contact them to get the record removed. For regular updates, you can check your credit report with mymoneykarma.
• File a Dispute: Once you have zeroed in on the credit bureaus that haven't removed outdated or inaccurate information from your credit report, you need to contact them and file a dispute to remove delinquent accounts. The three main credit bureaus -  TransUnion, Equifax, and Experian - have their own dispute management system. You could fill up and submit the dispute form online or download the form and send it to the bureau via post. When you register a dispute, you should attach copies of all the documents needed to support your claim. You must make your plea convincing and foolproof so that the credit bureaus take it seriously. The credit bureau will contact the reporting creditor to verify your claim and settle the dispute accordingly. The issue should ideally be resolved in 45 days. Additionally, you could also consider approaching the reporting creditor with the issue to ensure quick redressal of the problem. In either case, try to obtain an acknowledgment of receipt of the complaint to keep proof of the date on which you had filed the dispute.

Why Late Payments Matter

Most money lenders charge a late payment fee nowadays. These penalty fees can vary according to how late you paid, the type of loan, and more. Some money-lending organizations even increase the yearly APR as the penalty, even if you make a single late payment.

Paying debts late can have severe financial consequences, as it can negatively affect your credit report. If the score drops significantly, you won’t get any new loans. Since the repayment history makes up for 35% of your credit score, you don’t want to be making late payments at all.

A single late payment may not do much harm, but several of those in quick succession may do a lot of damage, making it hard for you to get new loans at all. Even if you do manage to get a new loan, the terms would be strict, and the interest rate would be much higher.

If you fall far behind on your payments, and if the bank deems so, your debt account could be transferred to a debt collection agency. When this happens, the impact on your already bad credit score shall be more significant still. It will be tough to then improve a bad credit score.
Check Your Updated Credit Score

Delinquent accounts are something that you don’t want to have on your plate. Thus, you should regularly check your credit score report at least once a year. If there are debts to be paid or delinquent accounts to take care of, deal with them first.

Rebuild Credit Score with Secured Credit Cards - Repair Credit Report

Secured credit cards are quite popular and highly sought after. However, there are a few limitations to them too. In this blog, you’ll learn how to rebuild your credit score with a secured credit card, how to convert to an unsecured credit card, and much more.

What is a Secured Credit Card?

It is a type of credit card designed for individuals who are looking to build credit. However, it is often used as a result of lack of access to regular (unsecured) credit cards, as they haven't yet established enough credit score. It could be a supportive start for someone without any credit history or for someone trying to rebuild their damaged credit history. It is known as a "secured" card because it is secured by some money that you have to deposit against the card's credit limit. A secured credit card can safely hold your hand and guide you to a prosperous credit history.

Secured Credit Cards Vs. Regular Credit Cards

The only difference between the two is that a secured credit card is sanctioned against security (cash) deposit, which unsecured credit cards don't require. Secured cards often have higher fees than unsecured ones. You might have to pay an application fee and yearly subscription fees as well. The penalty APR could be quite high for these cards.

If you are wondering why, the answer is quite simple: a person who isn't creditworthy, is unreliable with credit. Hence lenders impose high interest rates on them. Apart from these aspects, secured credit cards are just like regular unsecured credit cards and function on similar terms.
How Do Secured Cards Work?

If you are looking for a chance to build or rebuild your credit, a secured credit card could be a suitable option for you. You just need to approach the bank and apply for a secured credit card. You should know that there isn't a guarantee of getting a secured card just by paying a deposit. Your documents will be scrutinized, and the application will be approved only when you meet the requirements of the issuer.

Once your application for a secured card is approved, you must pay the security deposit to get the card. The issuer sets a credit limit for you, which is secured with the cash deposit. After you make the initial deposit, secured cards work precisely like the unsecured ones. You can use the card wherever credit cards are accepted. As you make purchases, your credit utilization rate rises.

The card issuers report your monthly activities to credit bureaus - your credit score fluctuates accordingly. You must not assume that you don't have to pay monthly credit card bills since you have already paid a deposit. The deposit is for security reasons so that lenders don't run at a loss if you ever fail to repay your dues. Just like regular credit cards, you have to repay your credit card bill every month within the due date. If not, an APR is imposed on your outstanding balance.

You can use these cards judiciously to repair your credit report. In general, you should be careful with the way you are using your secured credit cards. You should always ensure a clean record of positive activities to improve your credit health. Use the card responsibly and pay your balance on time. In this way, you can build or rebuild your credit using the card. What more? You can gain and redeem reward points as well!

What are the drawbacks of a Secured Credit Card?

Secured credit cards seem to be the ideal solution to all your problems. But wait, is it?

Let's take look at the disadvantages of using a secured credit card.

1. There is a greater likelihood of higher interest rates.
2. Secured credit card fees are between $30 to $50.
3. It gives you a low spending limit.
4. The security deposit shall not be accessed until the account is closed.
   

How can Secured Credit Cards Improve Your Credit Score?

Secured Credit Cards help improve your credit score to a large extent. Listed below are the scenarios in which your credit score could benefit from a secured card.

1. New Users: You must be aware of the fact that a credit card is the best way to build credit; a good credit history gives you access to better credit facilities. However, if you are new to the financial world, you might not have a good enough credit score to qualify for regular credit cards. A person with a low credit score is not creditworthy in the eyes of potential lenders. Secured credit cards come of use in such a scenario. It is easier to qualify for a secured card than the unsecured ones, because you are paying a security deposit to the lender - in case you fail to repay, the lenders have a fall-back option and won't incur a loss. If you make payments on time and maintain a perfect credit utilization ratio, your credit scores will increase for sure. Once you have successfully earned enough credit score, upgrade to a regular credit card, and follow mymoneykarma’s tips to use it efficiently.
2. Rebuilding Credit: Your credit could take a severe blow due to many reasons - missed or delayed payments, delinquency, accounts in collections, repossession, foreclosure, etc. In such a scenario, your credit history would be spoilt, and you might have to rebuild it from scratch. A low credit score doesn't let you take new credit cards. How would you rebuild your credit then? Secured credit cards could be the perfect solution. It is easier to qualify for a secured credit card than the unsecured ones. If you get approval for a secured card, you could maintain a spotless credit history of low usage and timely payments to improve your credit score significantly. If your application is rejected, get help from mymoneykarma and learn. how to re-apply. Keep track of your credit score at mymoneykarma as well.
3. Improving Credit: Secured cards can come to use even though you already have good credit with endless opportunities for new unsecured cards. Let's assume that you have reached the maximum credit limit that you are entitled to, yet you wish to increase your credit limit by another Rs.2,00,000. Unsecured credit cards might not help you here as your request won't be approved, but secured ones definitely will. You could make a security deposit of Rs.2,00,000 and reap the benefits of a bigger credit limit.

How Do I Convert to an Unsecured Credit Card?

If you maintain a steady and clean credit history, your secured card can be considered for an upgrade. Most issuers have their terms and conditions which you need to qualify to upgrade. If you maintain a history of timely payments and low credit balance, you are more likely to get an upgrade soon.

A few secured credit card issuers review your account after a year of usage and upgrade you to a regular card if you meet the requirements. For some cards, you might have to apply for an upgrade. Once you have reached the target credit score and successfully improved your credit history, you can apply for a new unsecured credit card with another credit card issuer.

How to Fix Credit Report Errors - Dispute Error On Credit Report

Why Would Your Credit Report Have Errors?

Here's what happens. Every month, your lenders and creditors send details of your loan account to one of the three major credit bureaus, namely Experian, TransUnion, and Equifax. These are the organizations that ultimately create and update your credit report.

There can be errors in the calculation for a number of reasons. These mistakes can include reportings from accounts that are not yours, inaccurate transactions, payments mistakenly reported as being made late, and much more.

You need to ensure that the credit account records are accurate. This brings us to the next question...

How Do You Locate These Errors?

Now, if you wish to check for credit report errors, the best thing to do is to check your credit report. Remember the credit bureaus we named above? All of those give you a credit report once a year, for free! This means that you can check your report thrice a year. Additionally, if you have been turned down for loans etc. due to your credit score, you can get one more free credit report.

If you are not able to get these reports for free, don't worry. You can buy these from the bureaus for a sum of Rs.550 - Rs.1400.

Study the report from a bureau each quarter and compare them at the end of the year to identify discrepancies or mistakes.

Now that you have learned how to spot mistakes, let's see how you can dispute credit report errors.

Common Credit Report Errors

Common errors that are disputed are:

1. Accounts that don't belong to you
2. Payments reported late while they were made on time
3. Wrong loan amount/credit limit/account balance
4. Wrong creditor
5. Incorrect account status
   

Dispute Errors on Your Credit Report

You may have thought that you can dispute all credit report errors. Technically yes, but that does not necessarily mean that a change will reflect accordingly.

While you do have the provision to dispute anything in the credit report, the credit bureaus shall still investigate and only remove items that they are authorized to remove. Issues you can dispute are those that are incomplete, inaccurate, out of date, or unverifiable.

Here are a few points to remember: negative items remain on your credit report for seven years, and bankruptcy remains for ten years.

If you have had any negative items for longer than seven years, then you can confidently dispute it as a credit report error.

What You Can Do When a Credit Bureau Will Not Fix an Error

Credit bureaus are required by law to report to an inquiry within 30 days. If you send additional documents after that, the period for the bureaus to respond becomes 45 days. If they do not answer, you can sue them in court.

However, there are things in your credit report they are not liable to remove. For instance, bankruptcy can't be removed before a period of ten years is up.

Disputing Errors - the Process

You can place complaints against credit report errors in three ways: through mail, online, or by phone.

Dispute Credit Report Errors Online

While this way is convenient, it is not without its drawbacks. You get to check the status of your records and the dispute only online.

When you dispute credit report errors online, you get results online only. To do so, you must provide your confirmation number. However, one cannot complete the process entirely online - you still have to mail the required documents as proof.

Dispute Credit Report Errors by Mail

Getting results this way will take more time, but there are many benefits. For one, when you communicate by real mail, it leaves a paper trail. Since the credit bureaus need to respond to you within 30 days, you can be sure of a response. In case they don't, you can sue the bureau in court.

For disputing through mail, you need to write a letter with information regarding which item should be removed and why. You should include proof of the error as well.

Disputing Through Phone

You will usually find a number in your credit report to use for disputing errors. Use it. Also make sure that you remember when you made the call, whom you spoke to, the information shared, the nature of the dispute, and the proof submitted.

It may happen, however, that you may need to contact the concerned credit bureau for more information.

Documents Needed as Proof

Here are some of the documents that you are expected to submit in case of disputes:

1. Proof of name, address, date of birth, and PAN card number - in case they are provided incorrectly in reports,
2. Copy of driver's license
3. Your recent statement from the bank
4. Your PAN card number
5. A canceled check to show you paid bills on time
6. Billing statement to confirm your credit card balance

How to Remove Negative Remarks from Your Credit Report

What Are These Negative Remarks?

A negative detail on a credit report indicates that an individual didn’t pay loans or bills for a long duration, thereby breaching the terms that were agreed upon while borrowing.

Where Do They Come From?

A negative remark can come on a credit report through three avenues:

   Banks and other financial institutions report negative information to the credit bureaus, which are then reported as a disparaging remark.

   Credit bureaus add public records such as bankruptcy in the credit report.

   Errors in the credit report: Mistakes in payment dates, account status, date of loan closure, etc.

Now, let’s discuss some of the frequent financial events that generate them:

Late Payments - If you have missed one or two payments, it stays as a minor form of negative record on your credit report. But if you delay payment every month, the severity of remarks will invariably increase.

Debt Settlement - If your account has been reported as delinquent, it will be mentioned negatively on your credit report even if you manage to settle the debt with the lender.

Foreclosure - A foreclosure happens when you fail to pay mortgage EMIs, after which the bank attempts to force a sale of the house that was used as collateral for the loan.

An Account in Collections - When a creditor comes to believes that you will ultimately not pay what you owe them - usually after consecutive missed payments - it can mention the account as ‘charge off’ for tax purposes. After a creditor has charged off, it will sell your account to a collections company to get a payment from you.

Bankruptcy - If your case has been filed as bankruptcy, the negative information on your credit report will never be removed. Even if your debts are discharged in bankruptcy, the balances will be reported as 0. This negative record will be visible as a black spot on your credit report for not less than a decade.

How Long Do They Stay?

Generally, for events such as foreclosure or late payments, negative remarks blemish a credit report for almost seven years, continually serving as a reminder of poor credit history. However, in the event of bankruptcy, it can stay for up to 10 years.

How Do They Affect You?

It damages your credit score

Your credit score will slump based on the severity of negative remarks on your report. For instance: A ‘late payment’ remark would affect your score less drastically in comparison to a ‘foreclosure’ remark.

Lenders won’t trust you

Negative remarks will taint your credit report for up to seven years, giving potential lenders a red signal that you can’t be trusted. They will either give you a lesser amount than requested or will charge a higher interest rate to compensate for the risk they are taking in lending money to someone who has a history of questionable credit behavior.

What Can You Do About It?

Monitor your credit report

Start checking your credit report regularly, so that if you come across any errors or an unexpected drop in your credit score, you can work on the problem at the right time. For checking your credit report for FREE, use mymoneykarma's intelligent finance tool.

Verify the age of the debt

Negative records normally get removed after seven years in most of the cases. However, if it doesn’t, then you may have to directly request the credit bureau to delete it.

Report the errors in your credit report

In case you are not at fault and have become a victim of mistakes committed either by the lender or the credit bureau, take prompt action accordingly.

Work on improving your credit score

Removing negative remarks from your credit report is not a one-day task. But as they say, time heals all wounds.

Start taking baby steps to improve your credit score either by clearing the due credit card payments or by paying more than the minimum due amount. With time, these steps can repair the impact of negative remarks on your credit report.

How Often Do Companies Report to Credit Bureaus?

 Credit Scores Come from Credit Reports

The very first thing to understand is that credit score comes from credit reports. Yes, credit reports are the only place where you can find the scores. You get the report once a year from special bureaus like Equifax, Experian, and TransUnion. Just apply to them, and you should be getting the report within a few weeks.

However, do remember that these get updated weekly and even several times daily. This is why it is essential to know how long it takes for a credit report to be updated.
When Do the Lenders Report to the Credit Bureaus?

This is one confusing question that bothers everyone. And most annoyingly, this question does not have an answer. There is no such rule or law that insists upon a particular date for the lenders to submit their records to the credit bureaus. However, there are patterns that one could observe to understand the trend of a lender’s reporting habits.

Typically, the card-issuing companies report to the credit bureaus on your statement closing date. The credit bureaus can take up to a week to update this information. The three main bureaus - Equifax, Experian, and TransUnion, follow different timelines. They update your information at different times, speeds, and frequencies.

On the other hand, there isn't a hard-and-fast rule that your financial activities would be reported to the bureaus positively at the end of your billing cycle. It's mostly at the discretion of your card-issuing company. The company could report your information daily, weekly, monthly, or even quarterly. However, the popular trend is that the lenders report it at least once a month.

The credit bureaus do not insist that all lenders submit the information within a particular date every month. Each lender adheres to its schedule. Hence, your credit score is in constant flux. It can change at any moment - within days, or even within hours — as and when various lenders supply information about your credit activity.

How Often Are Credit Reports Updated?

It would be interesting for you to know that Experian, one of the most significant credit bureaus, takes care of more than 220 million credit reports. That’s a lot, right?! Now, once the score or transaction is reported, updates to the credit report happen quite fast.

However, this update is not in real-time. This is because Experian has processes in place dedicated to making sense of the information, correcting errors, following up, etc. It is essential to know how often your credit scores and credit reports change.

Equifax, another major credit bureau, takes care of 210 million credit reports a year. When new financial information is received, the report is updated within three days. Well, now you know how long it takes for a credit report to be updated.
Lenders Don't Need to Report to Credit Bureaus

In case you are striving to boost your credit scores and improve your credit health before making a large purchase, you would need to ensure that a positive credit history is reported.

But here’s the catch: All lenders do not report your activity to the credit bureaus. Even if they do, they don't need to report to all the credit bureaus. Credit reporting is entirely a voluntary practice. Credit card companies do it so that they can gauge the consumers’ creditworthiness, and they don’t necessarily reveal which credit bureaus they report to. Therefore, it is ideal for you to keep your credit score in good standing at all times.

When the credit bureaus receive your information, they typically amend your credit report right away. They recalculate your credit score immediately. If you've been maintaining a favorable status quo, then one untimely payment won't make much difference in your credit score. However, in case you miss a payment or cause a delay for more than 30 days, you will find a considerable drop in your credit score.

How to Find the Perfect Credit Card - Apply for Credit Card

Choosing a credit card can be very confusing. There are countless credit cards available on the market, offering different tempting schemes. It is natural for you to get baffled.

Well, there is no "best" credit card. Each person has different needs and preferences, and you must carefully evaluate yours to determine which card would work well for you. Financial experts at mymoneykarma can guide you on this journey.
Check Your Credit Report

The first and foremost job on your to-do list would be to check your credit score. By doing so, you will know which cards you are eligible for and accordingly eliminate the rest from your list of consideration. If you have an exceptional credit score, you will probably be eligible for almost all available credit cards, especially the ones with amazing perks. If you have a comparatively low credit score, your options would be less.
Generally, all the credit bureaus give you a free copy of your credit report once a year. You could also check your latest credit score for free with mymoneykarma's credit score tracker, or you could approach the credit bureaus and buy a copy of your credit report. If your scores aren't that bright and shiny, you should postpone your plans of getting a new credit card and instead focus upon improving your score in the meantime.
Identify Your Preference

You must narrow down on the exact reason for getting a credit card.
Are you trying to build your credit?
Are you planning to save some money on interest?
Are you looking for attractive rewards?
The card you choose must have features to meet your specific requirements. If you don't fly much, a card offering airlines privileges will hardly benefit you. Similarly, if you already have a stellar credit history, a secured credit card might not fit your purpose.
If you are a fresher in the credit world, you would want to build credit. Regular credit cards would be inaccessible to people with low credit scores. A student card or a secured credit card would be ideal for you. These are issued against some collateral (such as a fixed or a cash deposit), which you can get back once you have built enough credit to switch over to a regular credit card. Secured cards could be of use even when you are trying to rebuild a damaged credit history.
If your objective is to save on interest, you should opt for a low-interest card or a balance transfer card. Some people prefer using a credit card only during emergencies; a low-interest or 0% APR card would suit their purpose.

Some might have irregular income and thus carry a credit balance at times; this situation can be handled by a balance transfer card which can help settle high-interest debt easily and at lower interest rates. However, these cards might be inaccessible to those with a poor credit score.

If you are a smart user and know how to use credit cards responsibly, you should go for a rewards credit card. These cards typically have higher APRs, but you will never incur interest if you pay off your credit balance in full every month. These cards offer myriad rewards and benefits on every purchase you make.
Narrow It Down

Our website has an amazing section where you can look for the perfect card for you. Click here to access our flourishing list of available credit cards. Here are a few things that you must consider as you browse through the credit cards available for you.

How to Fix an Error on Your Credit Report - Credit Score

 My credit report has always been admirable; it has never received a single derogatory remark. A few years ago, I had applied for an auto loan, with high hopes of purchasing my dream car.

I was appalled to discover that I wasn't eligible for an auto loan. What’s worse - I had no clue as to why it was rejected!

Upon further probe into my credit report (which I hadn't bothered to check earlier), I was shocked to discover that I had an unknown delinquent loan account! Of course, it was a reporting error. However, the loan was rejected, my car purchase plans were postponed, and I had to wait for quite a long time to get the matter sorted out.

How Do Mistakes in Credit Reports Cost You Financially?

Mistakes in credit reports are very common as well as blunderous. If they go unnoticed, these mistakes can fatally damage your credit health for no fault of yours at all. A reporting error can occur for multiple reasons and on multiple aspects of your financial life.

   It could bring down your credit score and also put you in difficult situations.

   It could spoil your credit health with a disparaging remark.

   Lenders can refuse to lend money to you due to these credit report errors.

Read on to understand how serious these mistakes can be and how you can keep yourself safe from their consequences.

What Kind of Errors Could Turn Up on Your Credit Report?

Your credit report could contain simple mundane credit report errors such as incorrect name, address, gender, and erroneous identity numbers like PAN, Aadhaar, or date of birth. These credit report errors do not affect your credit score. You do need to get them rectified nonetheless.

There could also be mistakes in the payment dates, account status, date of loan closure, etc. Such mistakes are severe and will affect your credit score. Your loan application could get rejected or you could be blacklisted by banks due to these errors on your credit report. If you find one of these mistakes, you need to act immediately.

However, this is not exactly the limit. Errors on credit reports could be way worse. Someone else's loan could appear on your credit report, or there could be a mistake in the amount overdue. These errors have serious implications and can harm your credit report considerably.

If you wish to keep your credit report clean, you must keep tracking your credit score from time to time. You can use mymoneykarma's Intelligent Finance Tool to stay on top of your credit reports. Whenever you spot a mistake, act immediately and get it rectified.

Who Makes These Errors?

Compiling a credit report is a multi-layered process. The banks and financial institutions make data entries and submit them to the credit bureaus; the credit bureaus aggregate your data from different sources and formulate a report. The credit report errors could occur at either or both of these stages.

There are a plethora of possible errors at the submission stage. The data submitted by the financial lenders is compiled and entered by many people. Human errors are natural. Manually entered data could have typographical mistakes.

There could be other mistakes pertaining to your credit behavior as well, such as payment or settlement status, latest balance, outstanding amount, etc. Credit report errors could also originate from the time lag between collecting the data and submitting it. Here’s an example-

Let's assume that your payment date is on the 5th of every month and the lender submits its reports on the 8th - your payment submission might not reflect in the report and your account status might not get updated.

Sometimes banks outsource the task of loan collection to third-party agencies, who might collect the amount from you but make a slight delay in depositing the same and informing the bank about it. Cheques might also take time to be processed and hence your submission dates might be erroneously recorded.

At the aggregation stage, there could be manual as well as machine errors. Bureaus generally use complex algorithms to assess your data. There could be computational errors due to unavailability or similarity in personal details. For example, your name could be the same as another person's and his or her loan could appear on your credit report by mistake.

Monitor your credit report - Reasons Why You Should Monitor Your Credit Report

Consolidated record of your finances in a detailed document is called credit report.Credit bureaus like Equifax, Experian, and TransUnion maintain this record. They evaluate your financial information to calculate your credit score, which is a numerical score that decides your creditworthiness.
 
Based on your credit score a potential lender can know how trustworthy your to get a credit or loan.you should have a habit of monitor your credit at least once a year.

Reporting Errors :

Credit Report errors are quite common and Your card-issuing company might make mistakes while filing your report with the credit bureaus.

Here are a few common errors that you must look out for:

1. A new address or phone number that is not yours
2. Error in the spelling of your name
3. Unknown accounts owned by someone with a name that’s similar to yours
4. The same debt or payment failure note listed multiple times
5. Incorrect dates
6. Mistakenly reported delinquency or late payment
7. False record of the current balance
8. Incorrectly recorded credit limit
9. Closed accounts that are marked as open
10. Accounts appearing various times with different creditors listed
11. Unauthorized accounts
12. Statements in which you are an authorized user, but you are marked as the primary user.
    
    
     

 

4 Reasons to check your credit score - Why you should monitor credit score ?

4 Reasons why you should monitor your credit score :

•     Reporting Errors
•     Identity Theft
•     Financial Infidelity
•     Progress Report

A credit report is a detailed document that contains a consolidated record of your finances. Credit bureaus like Equifax, Experian, and TransUnion maintain this record. They evaluate your financial information to calculate your credit score, which is a numerical score that decides your creditworthiness.

Reasons Why You Should Monitor Your Credit Report :

Reporting Errors :

Credit report errors are quite common. Your card-issuing company might make mistakes while filing your report with the credit bureaus. It is also possible that the credit bureaus make errors while consolidating your overall credit report.

Identity Theft :

Have you heard about credit card fraud, scams, data breaches, and identity thefts? Sounds scary, right? An imposter could steal your personal information, such as Aadhaar and PAN, driver’s license number, date of birth, or other financial information and use it for their own financial gain. These are serious crimes that can not only affect your finances but also ruin your credit history.

Financial Infidelity :

Infidelity indicates a breach of trust. There have been those unfortunate situations wherein a person was betrayed by a trusted or loved one. Don’t be surprised. Incidents like this have become quite frequent, and many people suffer although it is not their fault at all.

Progress Report :

Checking your credit report gives you clarity and aids you in planning your finances well ahead. Your credit report tells you exactly how much you owe to whom and by when you need to settle the amount. If you are in debt, you get to know about the total amount and also track your monthly progress in resolving the debt.

What is good Credit Score ? - 4 tips for good credit score

Fix Your Credit Utilization Ratio

You should keep your credit utilization ratio within 30%. If you notice that your expenses are exceeding 30% of your credit limit, your credit scores will inevitably drop. Consider increasing your credit limit in such a situation.

A higher credit limit automatically brings down your credit utilization rate, provided that your expenditure or credit balance remains constant.

You may call your credit card issuing company and request for an increase in the credit limit or make an application online.

You could also get another credit card for the same purpose. However, increasing your credit limit isn't a piece of cake, and you might have to go through a rough road.

Once you successfully manage to improve your credit limit, spend carefully - your expenses must not increase.

This will balance out your credit utilization rate, and a low utilization rate boosts the credit score.
Don’t Apply for Too Many Credits Simultaneously

Hard inquiries deduct points from your credit score. If you apply for too many lines of credit at a time, each will amount to a hard inquiry.

These hard inquiries remain on your credit report for quite some time. Many hard inquiries at a time will not only reduce your credit score but will also make you seem quite desperate for cash.

Hence, lenders will not be able to trust you. So whenever you apply for credit cards, spread the applications apart over a long period.

How can I stop unauthorised companies to check my credit history?

A hard inquiry can be hard on your credit score, especially if it is an unrecognized one. Now you must be wondering how it could be unrecognized. Well, a hard inquiry could have happened for several reasons. It could have come from an authorized lender, it could be a reporting error, or it could even indicate possible identity theft. Let me tell you about these three issues in detail.

A hard inquiry on your credit report can ideally be made only with your permission. An organization cannot make a hard inquiry unless you authorize it. However, some situations can be confusing.

Even if you haven’t applied for a loan or a credit card recently, you might have undergone minor changes in your lifestyle that resulted in a hard inquiry. You might have inadvertently permitted your internet service provider, cable company, teleservice provider, and even your landlord to conduct a hard inquiry on your credit report. You probably signed on documents without carefully reading them, hence not realizing that you have authorized the company to perform a hard inquiry. Even upgrading your credit card or applying for an increase in credit limit could result in a hard inquiry.

If you find a hard inquiry that you didn't authorize, it could either be a reporting error or fraudulent activity. You can keep an eye on your credit report using mymoneykarma's Intelligent Finance Tool. 

This tool shows you the source of all hard inquiries made on your credit report. Once you know the name of the lender under suspicion, you can search online for contact details and approach the concerned lender to check the reason for the hard inquiry.