Will Your Credit Scores Improve July 2017?
Millions of Americans’ credit scores will improve this weekend. Due to a change in what credit reports include, your credit score may go up between 10 and 40 points. This change is due to a class-action lawsuit filed by consumers who say their credit histories were incorrect. They claimed that other people’s data was included in their credit reports. Their credit scores declined as a result. They also argued that it was too difficult to get these errors corrected. Now credit scores improve July 2017 for many Americans.
As a result, credit bureaus are changing their policies. These changes are related to tax liens and civil judgments. A tax lien occurs when the government takes full or partial control of your assets because you didn’t pay taxes. Civil judgments occur when a court orders you to pay as the result of a civil lawsuit settlement. Both tax liens and civil judgments can negatively affect your credit score.
Until now, tax liens and civil judgments were included on credit reports when only minimal information was available. Errors were relatively common. If someone shared your name, the credit bureau might wrongly add their tax lien or civil judgment to your credit history. New policies will help prevent this “mislinking” of credit reports.
Starting on July 1, credit reports won’t include tax liens and civil judgments with incomplete data. To be included, records must include names, addresses, and either social security numbers or dates of birth. Without this identifying information, the credit event won’t appear on anyone’s credit report. This process should prevent future mistakes. Credit bureaus will remove old data that doesn’t meet the qualifications. The bureaus will also begin checking every 90 days for new updates to public records. This will help guarantee that corrections happen quickly.
Will Some Credit Scores Improve July 2017?
It’s possible. Between 5% and 7% of the population is likely to see a change in their credit score. This equates to around 11 million American consumers. FICO reports that most will see increases of between 10 and 20 points. However, some may see improvements of 40 points or more.
To determine if you’re likely to see a change, pull your credit report before July 1. You can use annualcreditreport.com to get a free report from each of the three major credit bureaus once a year. Check the public records section of your report. This is where tax liens or civil judgments would appear. If there are no public records on your report, you probably won’t see a change to your score.
If you notice a tax lien or civil judgment on your report before July 1, pull another credit report a few weeks later. Watch if there is a change in your public records, you’re likely to see a bump in your credit score. It may take a few weeks or months for this to happen. You can watch for changes when you monitor your score. Several credit card companies offer free credit monitoring tools. This is a great reason to start using them if you aren’t already.
If there’s still an incorrect public record on your second credit report, contact the credit bureau to request a resolution. You can find contact information on each bureau’s website. It will be helpful to have your credit report from the bureau available when you make the call. Some credit bureaus may require you to write a letter to request removal. If your credit card company offers credit monitoring, they may also be able to help. Contact your card’s customer service hotline to ask what resources they provide.
Why does it matter if My Credit Scores Improve July 2017?
While most people will see only a small change in their credit score, every point helps. This is especially true if you’re on the border between score ranges. For example, a five-point jump that moves you from bad credit to average credit could have significant results. Likewise, moving from good credit to excellent credit could also open new opportunities. Check each credit bureau; there will be different credit scores.
Did your credit scores improve July 2017? Not one of the lucky people who will see a credit score improvement on July 1? You can still build your credit the old-fashioned way. Establish secured credit card accounts if you don’t already have them, then use them responsibly. Make small purchases on credit. Make payments on time, every time. Pay down balances whenever you can. Using these simple steps, you’ll see ongoing improvements to your credit score. In fact, your score may regularly improve more than it would from a tax lien or civil judgment correction.