Credit Repair and Your Auto Insurance

Credit Repair and Your Auto Insurance

Your credit score can be the modern equivalent of a scarlet letter. If you have missed payments, defaulted on loans or otherwise sabotaged your credit report, obtaining a new credit card or loan will be Herculean in difficulty; did you know that this can extend to your car insurance as well? Yes: even if you have a spotless driving record, your pockmarked credit report can mean that you have to pay more on auto insurance. Insurers see it two ways: if you have a bad credit score, you may be more likely to pay them late or not at all; you may also be seen as driving as irresponsibly as they think you have used your credit.

If you have a credit score below what FICO considers a good score (higher than 650, with a 700 being in the upper reaches of attainable credit), you may have to pay much more for your auto insurance or even risk being rejected for coverage. Even though some legislators are pushing to have the credit component removed from auto insurance formulas on the basis that your credit does not indicate your likelihood of being in an accident, these proposed laws keep getting shot down.

What can you do if you are one of the many Americans in this position? Repairing your credit is the first step you can take. Late payments are one of the nastiest culprits of bad credit, so budget yourself carefully to ensure you pay all bills on time from this point forward. Pay off your worst debts first to keep from accumulating interest, but don't close those accounts down, since keeping accounts for a long time will boost your creditworthiness.

Once you've done all you can on your own, order your credit report (you are entitled to one free one from each major credit bureau through http://www.annualcreditreport.com, or you could order them for a fee more than once per year). If you find inaccurate information or debts you did not make, notify the credit bureaus about the problems. They have thirty days to either find proof or erase the offending item. You may need assistance in this project, from advice to someone on your side contacting the bureaus. The Innovative Credit Consultants are dedicated to helping you achieve the success you deserve, starting with improved credit and ending with you having your financial dreams realized.