Their curious eyes, your credit report

DALLAS – James Alderman’s efforts to remove what he says is a costly error on his credit report provide a lesson on who can pull your credit report and what you can dispute on the all-important document.

Businesses can pull your credit report under several circumstances, and they don’t always have to ask your permission. And the mere act of a creditor pulling your report can affect your credit score, depending on how the query is classified.

Your credit report is your lifeline to obtaining loans, insurance or credit cards. Maintaining a “clean” report is vital, so it’s always in your best interest to dispute anything you consider inaccurate.

“My credit file is of utmost importance to me right now, given that I have an aging vehicle and a 25-year-old house and I’m in the process of adopting a 12-year-old orphan boy,” Alderman said. “Major expenditures are in my near future, and I can’t afford to pay more for everything because some … company wrongfully pulls my credit report and drives the score down.”

Alderman, an engineering technician from Carrollton, Texas, said his dispute with Avis Rent A Car System LLC started last November while he was on vacation in Hawaii. He reserved and paid in advance for a rental car from Avis as part of a vacation package.

When he went to pick up the car, he used a debit card instead of a credit card to secure the deposit needed.

Avis declined to talk specifically about Alderman’s case. However, company spokesman John Barrows did say the company pulls a credit report only when a customer uses a debit card to rent a car “as opposed to simply using it to pay for their charges upon return.”

“This is a typical procedure in our industry in order to minimize the potential for loss associated with this form of payment,” Barrows said in an e-mail response.

Alderman’s situation brings up issues consumers need to know about their credit report and who can access it.

“The big problem, and where our consumer protection laws are woefully inadequate, is that they pulled a credit report without my authorization,” Alderman said. “This practice should be illegal.”

It isn’t. The only time you must give written permission is when your employer, or prospective employer, seeks to check your credit report.

“Congress felt that because employment is someone’s livelihood, that there be should some special additional protections for consumers, knowing that this information may play a role in their employment decision,” said Rebecca Kuehn, assistant director of the Federal Trade Commission’s Division of Privacy and Identity Protection.

The law lists other “permissible purposes” for which your credit report may be pulled without your express permission. Those include:

• Credit transactions or collections.

• Underwriting insurance.

• Determining eligibility for a license or other benefit granted by a government that’s required to consider an applicant’s financial responsibility or status.

• A business transaction initiated by a consumer.

• A review of an account to see if a consumer continues to meet the terms of the account. An example is your credit card company checking your credit report regularly to determine whether you’re still creditworthy.

The second issue that Alderman disputes on his credit report is the classification of Avis’ viewing the report as a “hard inquiry,” which he says can hurt his credit score.

He’s right.

There are two types of inquiries. Soft inquiries occur when you check your own credit report or when a credit card issuer prescreens you before sending an unsolicited credit card offer. They don’t hurt your credit score.

But hard inquiries do affect your score. That’s when you apply for a loan and a lender checks your credit.

Lenders typically view multiple hard inquiries over a short period of time unfavorably, interpreting them as an indication that you’re looking to take on new debt.

Equifax ultimately agreed to remove the hard inquiry from Alderman’s credit report.

His experience underscores the importance of asking whether your credit report will be pulled. If you want to dispute an inquiry on your credit report, go through the same process as you would with any item you’re questioning on your report.

Consumers sweat over inquiries more than necessary, said Rod Griffin, manager of consumer education at credit bureau Experian.

“No one is ever declined solely because of an inquiry,” he said. “It’s the late payments (and high balances) and other problems that are really what’s important. Inquiries lose any value in a very short period of time.”
news source : http://www.thenewstribune.com/business/story/315513.html

Know Your Score

(CBS) Should you decide to use a lending institution, your power to borrow money is linked to your credit score. Do you know yours? Stephanie AuWerter, editor of Smartmoney.com, joined us with some advice on learning and improving your score.

In times like these, a good score is more important than ever. Because of the ongoing credit crisis, lenders have pulled back. Whether you're looking for a mortgage, a credit card or a small business loan, the standards are now tougher. If you want to get the best rates, you need a great score. FICO scores range from 300 - 850 and you should shoot to have a score of 750 or higher. The good news is you can take steps to increase your score fairly quickly. Step number one is to know where you stand and you can pull your score at myFico.com.

The worst thing you can do to your credit score is not pay a bill on time. It will crush it. But if that's happened to you, you have nothing to lose by calling up the lender and asking that they remove it from your credit report. They have absolutely no reason to accommodate you, but if you've been a good customer and if you have a good reason they may be willing to work with you. It certainly doesn't hurt to ask.

You also need to pay down your cards. Not surprisingly, big debts hurt your score. FICO does not like to see you reaching the upper limits of your credit line. And that's particularly tricky right now because some credit card companies are lowering the credit lines of certain customers. You want to keep your balances at 50% or less of your total available line. So pay down those debts .

Also, hang onto unused credit cards. Old cards that you don't use much any more may be helping your score. Part of your credit score is based on the length of your credit history. Also, cards that have untapped balances help with your credit utilization rate. It helps that you have untapped credit. So don't cancel an old card, provided you're not paying for it, and maybe once a year or so, make a purchase with it. It will help.

Finally, fix your mistakes. Nearly 80% of credit reports have mistakes on them, 29% of which are serious enough to result in a credit denial. So pull your report and give it a good review. You can do it for free once a year at annualcreditreport.com. If you find a mistake the credit bureau has 30 days to verify that the information is accurate, or else it has to be removed.
news source : http://www.cbsnews.com/stories/2008/03/23/business/main3960888.shtml

Credit Card Hearing Starts With a Surprise

The first big surprise of Rep. Carolyn Maloney's hearing on her proposed credit cardholders' bill of rights was who wasn't speaking. A few minutes before the hearing began Thursday, her spokeswoman explained that the consumers the congresswoman had invited to testify were no longer being asked to do so, out of concern that credit card providers couldn't respond to the consumers' tales of woe unless waivers had been signed. It wasn't clear why the waivers weren't immediately handed out and signed. (Maloney later released a statement expressing her disappointment and commitment to having the "regular people" testify at a future date.)

Maloney's bill of rights would mandate 45 days' notice of any interest rate increases and prohibit card companies from raising rates because of behavior related to other accounts. It is one of a handful of credit card reform proposals being debated in Congress. Sens. Ron Wyden and Barack Obama have also proposed a five-star rating system to help consumers easily evaluate cards' policies.

Industry groups, including the American Bankers Association, vigorously oppose such changes. "The Maloney bill could lead to a lot of negative consequences," says Ken Clayton, managing director and general counsel at ABA. He says controls that limit credit providers' ability to price credit according to risk—that is, charge higher rates to consumers who are more likely to default—will increase prices and limit credit access for all consumers.

news source : http://www.usnews.com/blogs/alpha-consumer/2008/3/14/credit-card-hearing-starts-with-a-surprise.html

Bill would allow credit reports to be frozen

Without dissent, the Senate on Thursday gave preliminary approval to Arizona’s first law allowing consumers to freeze their credit reports.

SB1185 is designed to stop identity thieves from applying for credit cards, loans or other debt in the name of innocent — and unaware — victims.

The measure crafted by Sen. Amanda Aguirre, D-Yuma, permits individuals to forbid the three major credit reporting agencies from providing credit reports without their specific permission. Without such a report, businesses and lenders are unlikely to extend credit to someone.

The measure, which now needs a final Senate vote, sets up procedures for consumers to unfreeze their reports using a personal identification number when they want to buy something.

news source : http://www.eastvalleytribune.com/story/111408

Asia Day Ahead: U.S. Stocks Decline; FBI Probes Countrywide

March 10 (Bloomberg) -- U.S. stocks fell a second day after the biggest drop in jobs since 2003 sent energy and mining companies lower, overshadowing an advance in banks spurred by a Federal Reserve plan to make more cash available to lenders. The dollar dropped for a fourth straight week against the euro after the U.S. unexpectedly lost jobs for a second month in February.

TOP STORIES/MOST READ ON BLOOMBERG

TIPS Show Fed Loses Control of Inflation as Yields Go Negative

Bond investors have never been so sure that the Federal Reserve will lose control of inflation. They're so convinced that they're giving up yields just to buy debt securities that protect against rising consumer prices.

Countrywide Is Probed by FBI for Possible Fraud, Person Says

Countrywide Financial Corp., the largest U.S. mortgage lender, is under investigation by the Federal Bureau of Investigation for possible securities fraud, according to a person familiar with the probe.

IMF Nods to Spending Spree by Asian Countries Hit by U.S. Slump

Asian governments are abandoning spending restraint and trying to get their consumers to do the same in their battle to overcome slowing growth.

MAIN ECONOMIC RELEASES TODAY Japan's January Machine Orders Seen Rising 2.7% From December China's Trade Surplus Seen at $22.5 Billion, Narrows Vs Year Ago China's Feb. Producer-Price Inflation Seen Accelerating to 6.9% Japan's Money Supply, Bank Lending Figures for February Are Due Japan's Merchant Confidence Index for February Will Be Released South Korea's Producer Price Index for February Is Released New Zealand's House Prices Report for February Will Be Released

MAIN COMPANIES/EARNINGS

MAIN ANALYST UPGRADES/DOWNGRADES *CHINA NETCOM CUT TO `NEUTRAL' AT CREDIT SUISSE *NATIONAL AUSTRALIA BANK CUT TO `SELL' FROM `BUY' AT CITI *HUTCHISON TELECOM RAISED TO `OUTPERFORM' BY CREDIT SUISSE *SEKISUI HOUSE CUT TO `NEUTRAL' AT CREDIT SUISSE *ST. GEORGE BANK RAISED TO `BUY' FROM `NEUTRAL' AT MERRILL *ALLCO FINANCE CUT TO `SELL' FROM `HOLD' AT CITI *FORMOSA INTERNATIONAL HOTELS CUT TO `UNDERWEIGHT' AT JPMORGAN *DR. REDDY'S LABS CUT TO `HOLD' FROM `BUY' AT CITIGROUP *CONSOLDIATED MEDIA CUT TO `NEUTRAL' BY MACQUARIE *SINGAPORE PETROLEUM CUT TO `PEER PERFORM' AT BEAR STEARNS

ASIAN MARKETS

The Nikkei 225 futures contract due in March tumbled 460 points to 12,780. The Hang Seng Index futures for March slumped 610 to 22,560. The S&P/ASX 200 Index futures due in March dropped 94 to 5,176 at 6:35 a.m. in Sydney.

U.S. STOCKS DROP ON UNEXPECTED LOSS OF JOBS; ENERGY SHARES FALL

U.S. stocks fell for a second day after the biggest drop in jobs since 2003 sent energy and mining companies lower, overshadowing an advance in banks spurred by a Federal Reserve plan to make more cash available to lenders.

TREASURY THREE-MONTH BILL RATES RISE AS FED INCREASES LENDING

Treasury three-month bill rates rose after the Federal Reserve announced plans to add as much as $200 billion to the banking system over the next month to offset a deepening credit crisis.

DOLLAR HAS 4TH STRAIGHT WEEKLY DROP VERSUS EURO ON JOBS LOSSES

The dollar dropped for a fourth straight week against the euro after a government report showed the U.S. unexpectedly lost jobs for a second consecutive month in February.

EUROPEAN STOCKS DECLINE; AXA, BHP BILLITON, VEOLIA LEAD DROP

European stocks fell for the fourth day this week as investors speculated credit-market losses will deepen for financial companies and an employment report added to evidence the U.S. may slip into a recession.

EUROPEAN BONDS HAVE WEEKLY GAIN ON STOCKS DROP, GROWTH CONCERN

European 10-year government bonds rose for a second week as traders bet losses in stocks and signs economic growth is faltering will boost demand for the safest securities.

CRUDE OIL FALLS AFTER U.S. JOBS REPORT SIGNALS ECONOMIC SLOWDOWN

Crude oil fell after a report showed that the U.S. lost jobs last month, signaling that demand will slow in the world's biggest energy-consuming country.

GOLD DECLINES AS DOLLAR REBOUNDS AGAINST EURO; SILVER STEADY

Gold fell after the dollar rebounded from a record against the euro. Silver was little changed.

HIGHLIGHTS FROM NEWSPAPERS

Nissan to Sell Electric Car in France by 2012, Ghosn Tells JDD

Nissan Motor Co., Japan's third-largest automaker, will introduce an electric vehicle to France by 2012 at the latest, Chief Executive Officer Carlos Ghosn told Journal du Dimanche.

news source : http://www.bloomberg.com/apps/news?pid=20601101&sid=aQsCsRfNBfPo&refer=japan

Time to refinance

NEW YORK (CNNMoney.com) -- Interest rates on 30-year mortgages are down and mortgage applications are up. Is it time to refinance?

The big headline here is that interest rates on the 30-year fixed mortgage are at historic lows. According to the Mortgage Bankers Association, the rate is at 5.98%.

"Back in the 1980s, rates were at 15% or 16%," says Bob Moulton of Americana Mortgage. Remember, interest rates don't automatically go down when the Fed cuts the prime rate. Instead, interest rates respond to overall market sentiment.

2: Wanted: Good Credit

Even after the rate-cutting binge the Fed has been on, the rates on a 30-year fixed mortgage went up. That's what makes this decline so newsworthy. So, if you have an adjustable rate mortgage, and you plan to stay in your home for at least 2 to 3 years, you may really benefit from refinancing.

Banks want to loan money to people with good credit. In fact, they're insisting on it according to Melissa Cohn of Manhattan Mortgage. For some lenders, that's a score of 680, while other lenders are only considering those with credit scores above 720. Banks are being more selective in terms of borrowers according to Moulton.

So, if you do have excellent credit, take advantage of the products out there. If you want to refinance, negotiate with your lender. You have leverage here, especially if you refinance with a lender who holds your original mortgage.

3: Jumbo loans

If you can, take out a home equity line of credit. You don't have to tap into it, but it's nice to have in an emergency.

A jumbo loan is a mortgage that's more than $417,000. As part of the economic stimulus bill signed by the president, the limit for these mortgages will be temporarily raised from to $729,750.

This has been a tough area because lenders are reluctant to back these loans. And if that becomes a reality, it means you may be able to get a lower interest rate on a jumbo loan.

4: There are bargains

Here's another bit of good news, if you bought a no-income jumbo loan and your credit score has improved and you're able to provide tax returns, you may be able to get a full-income jumbo loan, says Moulton. And that's cheaper and less risky than a no-income jumbo.

Home prices are the lowest they've been since 2004 according to a report by lender National City Corp. Price declines and improved affordability during the last three months of 2007.

So, if you've been on the sidelines, wondering whether to invest in this turbulent market, it's time to start doing your research. No one really knows when the market will hit bottom. It makes sense to thoroughly investigate the area you're interested in.

news source : http://money.cnn.com/2008/03/06/pf/saving/toptips/

Commodities strong as investors flee credit markets

A big week for commodities last week as yield and profit hungry financial investors continue to pile into the sector desperate for performance after the disasters of credit markets.

Gold set an historic high above $US975 on Friday, as speculators chased it higher, despite the late climb in the US dollar against the euro.

The driving force was more fears about the US economy and worries about financial stocks, including America's biggest insurer, AIG, which reported a big loss from credit derivatives, sparking worries about its health.

The late strength in the greenback saw traders take profits, while silver jumped to a 27-year peak near $US20 an ounce before falling. Palladium surged nearly 4 percent to its highest price in over six years.

Comex gold set a record for the third day in a row, hitting $US975.90 an ounce before falling to $US975 an ounce for the April contract. The spot month, March, finished at $971.10, both new record closes.

Gold has risen 16% this year on the top of 2007's 32% rise.

Silver rose to $US19.92 an ounce on Comex before falling to $19.808 for March spot and $US19.861 for April delivery.

Platinum hit a high of $US2,161 an ounce and was ended at $US2,158 for the spot month and last week's record of $US2,192.

Sugar rose to its highest level in 18 months after Federal Reserve Chairman Ben Bernanke urged the US to cut tariffs on imports of cane-based ethanol from Brazil, the world's largest producer.

Brazil used more than half of its sugar-cane crop to make ethanol for domestic consumption, instead of for human use.

The call came as oil prices returned to over the $US101 a barrel level.

The US imposes a tax of 54 US cents a gallon on ethanol from Brazil to protect the locally made ethanol, which is sourced from corn.

The tariff has allowed a number of big companies, such as Archer Daniel Midland and Cargill establish large ethanol businesses, while there's a fleet of smaller operation which are now struggling as corn prices hit record levels.

The tariff is due to finish at the end of this year but it's an election year, so you'd have to bet on it being extended if only for crass political gain and not any economic or business reason.

Sugar futures for May delivery finished at 14.69 US cents a pound in New York after touching 14.83 US cents, the highest for a most-active contract since August 2006.

Mr Bernanke told the US Congress on Thursday that he favoured open trade. "I think that allowing Brazilian ethanol, for example, will reduce costs.'' If commodity prices come down, including energy prices and raw-food prices, I would expect to see finished-food prices come down as well.''

Including Friday's gain, sugar prices have risen by more than 35% so far this year, thanks mainly to the activity of speculators and hedge and index funds.

News source : http://www.livenews.com.au/Articles/2008/03/02/Commodities_Strong