Credit Repair. Increase Your Credit Score!
For consumers who have consistent excellent credit scores, experts warn that ignoring regular reviews of credit reports can spell trouble. Credit reports account for all of the credit activity going on in a consumer’s financial life. It may also be the first indicator that something is wrong and further investigation is necessary in regard to financial criminal activity.
Identity and credit card theft is still on the rise and if consumers forgo checking into their own credit reports, they may be missing red flags that someone has hacked their identity. Because technology has afforded may more ways for criminals to secure credit card and other personal information, it is imperative for consumers to Read more…
The debt of the United States is growing by leaps and bounds and as a result, Standard & Poor has downgraded the nation’s credit rating. While the effects of the lowered credit score of the country have yet to be fully determined, it is safe to say that the excess spending in Washington reinforces the need for consumers to get a handle on personal credit scores.
Consumers are still spending too much and not paying off debts in a timely manner. Those who are in need of financing in the immediate future need to consider credit repair efforts before applying for a loans or new lines of credit. With the nation’s debt crisis affecting many things, interest rates being offered on loans and credit cards will likely rise
Those who already have bad credit scores need to Read more…
When you’re dealing with debts and negative credit report entries, there are two time limits you should know – the statute of limitations on debt and the credit reporting time limit. Many people get these two time limits confused, but it’s important that you get them straight. One impacts you in a lawsuit and the other deals with negative information on your credit report.
Debt Statute of Limitations
Each state has a law that defines how long a creditor or collector can win a civil lawsuit for a debt that you allegedly owe. The time limit varies from state to state depending on the type of debt. For example, a credit card balance may have a different statute of limitations from an installment loan.
There are a few important things to know about the statute of limitations. First, the statute of limitations is like a stopwatch. The clock starts ticking on the last date of activity on an account. It can start over if you take certain action on an account, like making a payment or payment arrangement. In some states, even stating that the debt is yours can restart the statute of limitations.
The statute of limitations does not stop a creditor or collector from Read more…
Negative records on your credit report can cause a substantial drop in your credit score. While the tips and strategies we teach at CreditRepair.org may be helpful for many, they will not be as effective in case you have negative records, which keep bringing your score down.
Deleting Negative Records
There are professional credit repair agencies, which specialize in removing negative items from clients’ credit reports. We highly recommend Lexington Law because of their astonishing track record (see the short sample on the left), client testimonials, company ratings and true expertise in this space.
If you want to learn about a company’s services, the best people to ask are its current and former clients! Watch the video below to see what people have to say about their experience with Lexington Law and the result of the service on their credit scores and reports.
As credit-wise consumers, we have been told over and over that we should never disclose our personal financial information to other individuals without good reason. Identity theft and credit scams are rampant and consumers need to practice discretion when it comes to their top secret personal information in order to protect themselves and their finances.
The Fair Credit Reporting Act was established to protect the private information of consumers by limiting who is allowed to access credit reports and conduct credit inquiries. In order to understand how the protection works, consumers need to understand who is and who isn’t allowed to review their personal credit profile.
Here is an outline of the accessibility of your credit report to others:
Credit Card Companies
Since credit card companies offer lines of credit to consumers, they have a right to determine the risk you may present for defaulting on your legal obligations. The credit card company uses your credit profile and score to calculate a rate of interest on the card before issuing you credit approval. By signing the credit card application, you give Read more…
Late payments go through several stages. In the beginning, the consequences are mild, there’s very little impact to your credit. As you get become more delinquent on your payments, your credit is affected more, your balance grows and it’s harder to get caught up. Understanding the stages of a late payment may make you want to work harder to keep your payments on time.
Less than 30 days late
If you’ve only missed your due date by a few days, you’re still less than 30 days late. Your credit card issuer will charge a late fee (which may not show up until your next bill), but at this point, nothing goes on your credit report. Send your payment before your next due date and the credit bureaus will never know you were late.
30-89 days late
Once you’re 30 days late, however, the credit card issuer will update your credit report to show that your payment was late. If you catch up on your payments, your account status will go back to current, but the old late payment still remains. On the other hand, if you miss your payment again, making you 60 days late, your credit card issuer can charge the maximum late fee of $35. After that, your interest rate increases to the default rate.
90 to 180 days late
Between 90 and 180 days late, the late notices continue to be Read more…
If you have been turned down for financing, you typically had to remain in the dark as a consumer when the rejection letter came. Consumers have a right to request a free copy of their credit report after being denied financing but were essentially left to their own devices when it came to figuring out why they had their application turned down.
However, starting this week, the Dodd-Frank Financial Reform Act will change the way rejections work. A new rule is being implanted that requires lenders to explain in greater detail why a consumer received a denial. Lenders are now required to display credit score information used to make the rejection decision. Consumers will be able to see their credit score range as well as the credit history data that was used in the decision process. The rule also allows consumers to be told about the factors that contributed to the decision, including negative information that affected the consumer credit score. The lender must also disclose which credit reporting agency provided the information.
On July 21, the new Consumer Financial Protection Bureau will officially launch and will be responsible for enforcing the new rules. Consumers will now have Read more…
Since the credit crunch, more people have decided to use debit cards instead of credit cards for their purchases. On one hand, using debit cards can be smarter since the transactions come straight from your checking account – you don’t have to repay a credit card balance. But, there may be some drawbacks to using your debit card; your credit score could be affected.
What Affects Your Credit Score
Using a debit card in itself isn’t going to affect your credit score. Your checking account activity isn’t normally listed on your credit report. Even overdrafts don’t appear on your credit report unless the account gets closed and you never pay back the delinquent balance. Of course, that’s a stretch. You need your checking account so you’ll probably clear up any overdrafts quickly and your credit score won’t get hurt in that way.
What does happen when you choose your debit card for purchases is that your credit card gets neglected. After your credit card is inactive for several months, the credit scoring calculation ignores that account on your credit report. If this account has a good amount of available credit, your credit utilization could go up and your credit score will drop. Fortunately, all you have to do to reactive your credit card is use it. Once your account becomes active again, the credit scoring calculation will once again include that account in your credit score.
Credit card issuers don’t like inactive credit card accounts. In fact, your credit card issuer could close your account if it remains dormant for several months. A closed credit card would affect your account in the same way as an inactive account. The difference is Read more…
When the economy suffers a downtown, your credit, unfortunately, may suffer too. But this may be the worst possible time to have a bad credit score. If you find yourself back on the job market, you’ll often need to have good credit to land a job and keep paying your bills. In a recession or tough economy, take necessary precautions to keep your credit intact.
Build an emergency fund.
If you’re actively paying off debt by sending lump sum payments every month, you may want to scale back on those payments for a few months while you save up an emergency fund. An emergency fund can help keep you afloat for a few weeks or months if you suffer a pay cut or get laid off. But, if you’re really close to paying off your credit cards – like a couple of months – it’s okay to knock out those credit card bills. Then, once you’re done start up your emergency fund.
Call a credit counseling agency.
After suffering a job loss, you may not be able to afford your credit card payments. Get in touch with a credit counseling agency immediately. They can work with your creditors to lower your interest rate and minimum payment. Your credit card billing statement will have the number to a credit counseling agency. Otherwise, you can visit the National Foundation for Credit Counseling’s website, NFCC.org.
Get a forbearance or deferment on your loans.
When you can’t afford your loan payments, Read more…
Credit report disputes aren’t always successful. Sometimes you believe something shouldn’t appear on your report, but the bureau disagrees and continues to report the item you disputed. If you can’t get an item taken off your report, you can tell your side of the story.
Your Right to a Personal Statement
The Fair Credit Reporting Act, the law that covers credit report disputes, gives you the right to add a 100-word personal statement to your report. You can use this brief paragraph to explain why an entry is has been listed on the report. For example, a fraudulent account may have been reported in your name, but the bureaus refuse to remove it because the card issuer continues to say that it belongs to you. Your 100-word statement would explain the identity theft and state that you tried to dispute it but were unsuccessful.
Personal statements don’t necessarily have to explain errors on your report. They can also be used to explain why you fell behind on payments, e.g. a long period of unemployment or an injury. The personal statement can be used to explain that you aren’t a deadbeat and you have a legitimate reason for falling behind on your payments.
Make sure your personal statement doesn’t cast you in a bad light. You don’t want to say something like “I was young and didn’t realize late payments would affect me.” That type of statement probably won’t give the lender a good Read more…
Sometimes you may find yourself in a hurry to boost your credit score a few points, for example, to get a better interest rate on a loan. If you know there are credit report errors dragging your score down, but you don’t have time to wait for the dispute process to update your credit report, you may be a candidate for rapid rescoring.
How Rapid Rescoring Works
The credit bureaus offer rapid rescoring as a service to lenders and mortgage brokers. The lender can get the proof of your report error, send it to the bureaus, and have your report updated in about 48 to 72 hours. That’s much sooner than the 30-45 days it would take if you went the regular dispute route.
For rapid rescoring to work, the credit card issuer has to agree to remove the information from your report. Or, you need to have proof of the error. For example, if someone has opened an account in your name, you may have an identity theft affidavit showing that you didn’t open that account. The lender can send your affidavit to the bureaus and have your report updated.
Having high credit card balances can hurt your score and your chances at getting a loan at a good interest rate. If you have the money to pay off the balance, at least enough of it to bring the credit utilization to Read more…
Failing to make your payments on time will lower your credit score, but that may be the only reason that appeals to common sense. Stranger ways to lose points abound.
It takes years to build up a good credit score, but very little effort to trash it. In fact, sometimes it is the actions you take to manage your credit more responsibly that lower your score. Obviously, missing payments affects your score negatively, as it should.
If you have several cards and aren’t using them, you might naturally think that getting rid of available credit and loans would show how responsible you are, and get you a nod of approval from the credit police, wouldn’t you? Actually, the opposite is true. Closing card accounts lowers your available credit, so the ratio between any debt you have and the amount you can make use of becomes higher. This is known as your debt to credit ratio, or debt load.
Say you have three credit cards, each with a $1,000 credit limit. That means you have $3,000 available to you. If you charge $1,000 on one card, your debt load is now $1,000 from $3,000, or 33.3% So now you have a monthly payment, and realize that by the time you get it all paid off (depending on your interest rate), you are going to pay $1,400 for $1,000 worth of stuff you didn’t really have to have after all.
You’re thinking like a grown-up now. Proud of your new awareness, you cut up one of your other cards since you will never be so frivolous as to charge $3,000 worth of stuff. You call the bank and Read more…
In order for a small business to become financially successful, it has to be able to stand on its own two feet. While most businesses need to rely on the owner’s personal credit history and score before a business can be established, there must be a point of separation to ensure the stability of the business. If a business can not establish or repair its own line of credit, there is a chance the business will not succeed financially or otherwise. Bad credit can mean other vendors and companies will not want to conduct business with your small business. Your business credit must be trustworthy, especially in light of the current economy of the nation.
In order to develop and maintain good business credit, it is important for a business owner to make the effort to keep credit in good shape. Here are 4 of the basic rules for maintaining good business credit:
Take the Personal Out of Business
Once you make the decision to separate business finances from personal ones, it is essential for you to not look back. Keep records separate and utilize money in the same manner. Develop a solid system for keeping the business accounting of its own accord and not extending credit from the business for personal reasons. Doing so can either jeopardize your Read more…
Most consumers realize they have a credit score – a number that indicates whether you have good or bad credit. It’s a number creditors and lenders use to decide whether to approve your application and what interest rate to give you. But, there are several other scores businesses use that aren’t as publicized. Some of them are not even available for consumer use.
Your credit card issuer has a wealth of information about your shopping habits and uses this information to determine just how risky of a borrower you are. Creditors may use your behavior score to determine your limit, to raise your interest rate, raise your annual fee, or cancel your credit card all together. Using your card at certain places, like pawn shops, can make you seem riskier.
Because card issuers don’t share the score, or the factors that influence the score, it’s impossible to raise your score. Cutting back on your plastic utilization used to share your behavior score can negatively affect you too – creditors may misinterpret the reason you’re using your credit card less.
Banks use your bankruptcy score to predict the likelihood that you’ll file bankruptcy in the near future. They may use your bankruptcy score to charge you higher Read more…
A divorce can not only be a painfully emotional time, it can also do a number on your credit rating forcing you to deal with financial hassles of credit repair in addition to the many other aspects of the process. While divorce proceedings do not directly harm your credit, the financial fallout from a contested divorce can damage it.
How Divorce Impacts Credit
Couples who marry typically combine and are jointly responsible for the various expenses and financial obligations obtained during the marriage. When a divorce is sought, couples often have issues dividing up those obligations and as a result some of the bills do not get paid. Whether the missed payments are done out of spite or simply due to the lack of funds, the scores of both parts of the former couple will suffer as a result.
Late or missed payments on your mortgage, credit card bills, or other financial obligations can drop your score by a lot of the financial trouble is long-term. Additionally, the black marks on your credit history will remain with you for 7-10 years Read more…