While applying for a credit of any sort, you should remember that your credit rating plays a major role in deciding whether you will get the credit or not. The lender contacts the credit bureau to check out your credit report. A low rating will either disqualify you from getting the credit or will limit the credit that you will receive. Hence you should scrutinize your credit rating carefully.
Find out what is mentioned on your report beforehand. You might find that you are penalized for events that you are not responsible for e.g. if you are unwilling to settle the bill because of billing error on the part of lender. Sometimes, the credit bureaus too can err. About 70% of people suffer due to the errors made by the bureau. Hence ensure you go thoroughly through your report before applying for the loan.
If you find there is error on your credit report, take steps to improve your credit rating.
Start by getting a copy of your credit report. Remember, law provides you the access to this report once a year or any time when you fail to get the credit. Ask the credit bureau referred by the lender for the report.
Next step is to verify the accuracy of the report. Ensure all the details are correct. Report any errors to the credit bureau. They will conduct an investigation within 30 days and revert their finding back to you. The errors are rectified and details that cannot be easily verified will be taken off the report.
If you find the process very difficult or do not have time, hire a company to help you with the process. Investigate this company thoroughly with better business bureau. Find out their track record. Do not be taken in by the company, which claims to improve your credit record immediately. Credit repair is a slow process, taking long to resolve.