Credit Matters- Your Credit Report

I should have known something was up with my friend Sandra when she called me at 7 in the morning. In all the years I have known her, she has never called me before noon. Not even the time she sat next to Denzel on a flight from L.A. to New York.

"I was on the red-eye," she said when we got together for dinner, dish and details and I asked why she didn't phone me with the news the moment she stepped off the plane.

"So?"

"So the red-eye lands in the morning," she said, rolling her eyes as if that explained everything. Which is why, when Sandra called at the crack of dawn, I should have known it was an emergency.

It was. The crisis, I learned, was a function of two things--the fact that, the week before, she had found the home of her dreams via a fabulous real estate agent, and the fact that, the night before, she had found out her chances of getting a loan to buy it via a funky credit rating.

I'd like to tell you that, thanks to a sympathetic bank, Sandra's less-than-stellar credit history wasn't an issue. That she got not only her dream house, but a sweet interest rate. I'd like to tell you that, but I would be lying. The truth is, like so many Black women, Sandra didn't pay too much attention to credit matters--not the subject in general, or how it affected her specifically--until she found out just how much credit matters.

If I tell you the house Sandra wanted was amazingly affordable and astonishingly beautiful (it was both), you will understand why losing it produced this single, but very specific piece of advice from her to all grown-up Black women: Get a copy of your credit report. Now! Before a bad one leaves you sobbing like Patti LaBelle in the If You Asked Me To video. Not only is it cheap (credit reporting agencies can charge you no more than $8 for your report and must give it to you free if you've been denied credit or employment because of information in it), the process is supereasy. For instructions, contact one of the "Big Three" reporting agencies: Equifax at 1-800-685-1111; Experian at 1-888-397-3742; TransUnion at 1-800-916-8800).

Even if you aren't in the housing market, here are a couple of things that might move you to action. First, your credit report affects all kinds of decisions about you, including if you can get insurance, an apartment, or if you are offered a job. Second, by law you have the right to correct any erroneous information in your file.

But what if the information in your credit report isn't wrong, just funky? What if, like loads of folks, you earn a decent income, but you're deep in debt? (When I say deep, I mean deep. Clients of the Consumer Credit Counseling Service, the best-known nationwide, debt-counseling organization, have an average annual income of $29,425 and an average debt of $23,184!) Is there hope for a Sister whose credit rating is circling the drain?

Yes, absolutely. But first the bad news. Only two things can improve a bad credit rating--time and re-established credit. Nobody --no company, no organization, no association--can remove negative information from your report if it's timely and accurate.

The good news is, not only can bad credit be improved, you don't need a credit repair company to do it. You can be your own debt doctor. There are all kinds of excellent, free education campaigns that are dying to show you how. To get closer to her dream of homeownership, for example, Sandra is using the Fannie Mae Foundation's guide, Knowing and Understanding Your Credit. (To order online, log on to www.homebuyingguide.org, or call 1-800-611-9566.)

The National Endowment for Financial Education is another great resource for Sisters seeking high-quality, unbiased personal finance information they can immediately apply to their lives. (To learn more, log on at www.nefe.org.)

As Sandra found out, our knowledge can become our strength. We just have to be willing to take the first steps toward obtaining it.