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Credit Restoration Tips

admin — Sat, 10 Apr 2010 00:30:11 +0000

It seems like more and more credit restoration services are popping up by the minute. You can spot the advertisements for them online, on television and on the radio almost everyday. While I believe the awareness of credit repair and the help available to consumers is a good thing, it can also be very confusing on who to turn to.

When choosing a credit restoration service, one should always research the company’s reputation. Many of the new services that are popping up mean well, but they are not as advanced as some of the credit restoration services that have been around for awhile. I would recommend sticking with a service that has been around for at least a couple years. The more you can find out about them, the better.

Do-it-yourself credit repair is another wise way to mend your credit history and can be a little less expensive. I say “can be” because if you are able to get the same results as a credit restoration service, you are obviously going to save yourself some money. However, if you are not able to get the same or better results as a credit repair service, it may end up costing you hundreds and even thousands of dollars in the long run. I’m not saying that to scare you, but you should take caution when trying to attempt repairing your credit on your own.

Most websites are eager to tell you that credit restoration should be done individually by the consumer. I agree that it should be as well, but encouraging consumers to just jump right in to it without warning them of the horrible consequences that could happen is just very bad advice. The way I look at it is this: Either way you are going to spend time and/or money if you have bad credit, either by paying higher interest rates, spending the time to learn credit repair, or paying for a credit repair service to fix it for you. It’s your choice, but let it be known that sometimes when you try to skimp on things this important it can end up biting you in the end.

By: Chane Steiner

Understanding What is a Fico Score and Tips on Hiring the Best Credit Repair Service

admin — Mon, 08 Mar 2010 22:27:55 +0000

FICO score is a credit scoring system that was developed in the1950s by Fair Isaac & Co. Today, the three major credit reporting bureaus Experian, Equifax and Trans Union all use FICO scores to evaluate the credit worthiness of almost 90% of the adult Americans. FICO scores can range from 300-850 and these scores are calculated on the basis of scoring models and mathematical calculations that are not revealed to the public. The higher the FICO score, the lower the risk to the creditor and hence if your FICO score is high, you end up with lower interest rates, faster loan approval time, lower insurance premiums and better employment prospects. If your score is low, you may be in need of the services of the best credit repair firm that can help you take repair action via a personalized credit repair program.

A FICO score of a person is determined by studying a person’s credit history. Late payments, charge offs, judgments/liens, bankruptcies, foreclosures, the total amount of credit used and the total credit that is currently available, credit cards issued, employment history, the amount secured as loans, their repayment history are all considered while determining a person’s FICO score. It is a snap shot of the credit worthiness of a person that is used by creditors when they evaluate any credit application. Persons with a FICO score of less than 500 are said to have a bad credit record and this qualifies them to seek the help of one of the firms offering best credit repair services. There are several genuine firms that operate online offering credit repair service for a nominal fee. The legally trained and experienced credit repair specialist will make it easy for those who wish to remove negative or inaccurate information from their credit reports in a hassle free manner.

The three main credit reporting agencies use three distinct types of FICO scores. The FICO score used by Equifax is referred to as BEACON, the one used by Experian is referred to as Experian/Fair Isaac Risk Model and the one used by Trans Union is referred to as FICO Risk Score, Classic. Each of them is compiled taking into account the data currently available at the individual credit reporting agencies. With credit repair support from a team of professionally qualified experts, people will have little difficulty in erasing erroneous reports and inaccurate information while the personalized repair plan of action ensures that they make improvements to their FICO score steadily. You can improve your FICO score and repair your credit report by hiring the best credit repair firm.

Don’t Fall Victim To Credit Repair Scams

admin — Thu, 04 Mar 2010 00:35:05 +0000

If you suffer from poor credit, you’ve probably seen advertisements for credit repair services. Many ads for credit repair services claim to be able to remove bankruptcies, create new credit identities, and even erase bad credit.

Beware! Many of these credit repair companies exist only to cheat money out of their customers. Many people have paid hundreds of dollars in fees, only to find that these credit repair companies simply vanish because they can’t deliver what they have promised. Don’t be fooled, the only real way to improve your credit report is with time, effort, and a good payment history.

But if you decide to try out a credit repair service, there are certain warning signs you should look for to decide if the company is legitimate. A credit repair service should not want you to pay for credit repair services before any services are provided. Another warning sign is if a credit repair service recommends that you not contact the credit bureau directly or refuses to answer questions about your legal rights as a debtor.

Some phony credit repair services will advise you to creat a new credit identity by applying for an Employer Identification Number to use instead of your Social Security Number. If you follow this illegal advice you may be commiting fraud, and find yourself facing prosecution. It’s a federal crime to make false statements on a loan or credit application, to misrepresent your Social Security Number, or to obtain an Employer Identification Number from the IRS under false pretenses.

While no one can legally remove accurate and timely negative information from a credit report, the good news is that the law does allow you to dispute information on your credit report that is inaccurate or incomplete. According to the Fair Credit Reporting Act, you can dispute mistakes or outdated items for at absolutely no cost to you. Just ask the credit reporting agency for a dispute form and/or submit your dispute in writing. Include supporting documentation, clearly identify each item in your report that you dispute, explain why you dispute the information, and request a investigation be done. Make sure you remember to keep a copy of the dispute for your records. If the new investigation reveals an error, you can ask that a corrected version of the report be sent to anyone who received your report within the past six months. If the reinvestigation does not resolve your dispute, you can have the credit bureau include your version of the dispute in your credit report.

Luckily, many states have laws regulating credit repair companies. So, if you believe you have been cheated by a fraudulent credit repair service, don’t hesitate to report the company to your local consumer affairs office or your state attorney general.

By: Dave Robinson

How To Repair Bad Credit – Don’t Pay For Credit Repair Services

admin — Wed, 20 Jan 2010 04:05:53 +0000

Credit can be a sore subject, especially when a person’s credit history is continually blemished by late payments and delinquent accounts. Some people would rather just ignore their credit history, but the reality of the matter is that there are often times when a credit score will be checked for more than just obtaining credit; employers, potential landlords, and insurance companies all utilize credit histories to predict a person’s reliability and trustworthiness.

For persons who simply close their eyes to their bad credit, there comes a time when they must make an effort to repair it. It may be tempting to simply pay a credit repair service to take care of the repair instead of personally engaging in the task. After all, there is an abundant pool of credit repair companies to choose from, and many consumers feel overwhelmed at the prospect of attempting to take care of repairing their credit themselves. Some consumers may not even realize that they can take care of the repair without assistance from a professional company. Rest assured, it can be done, and in all likelihood a person can do it better than a company would.

There are two different types of credit repair services: consumer credit counseling services (CCCS) and “We’ll Fix Your Credit” type companies. Despite CCCS being a much more reliable alternative to the other alternative, there are several credit counseling services who take advantage of the non-profit status afforded by the government to swindle desperate people out of money. Stories abound of payments being made late or not at all and of ludicrous fees eating up consumers’ money. A sound counseling service will not charge for using the service, as it is creditors who make these sorts of programs possible. Creditors love these types of services even though they generally require lower interest rates and forgiveness of some fees, because they prefer a consumer who pays off a delinquent balance bit by bit with the aid of a company rather than not paying off the balance at all.

Those companies who advertise so prevalently, claiming to be able to erase bad debt from credit effortlessly yet for a fee, are best shunned. These companies may indeed get negative items removed from credit reports, but the outcome is only short-term. By the time the consumer realise the debt is back on their report the company is long gone with their money.

Perhaps the best way to repair credit is to do it yourself. Those same collectors, who call at all hours, insisting on payments and usually being rude, will mellow down if you are suddenly willing to cooperate. The next time one calls don’t hang up or yell at them for hounding you. Instead, explain to the collector that you are aware that you owe the money and you are going to pay and tell them a realistic amount that you can pay back monthly.

You may be astonished to discover that an amount as small as 10 dollars a month can ward off the collectors. Some financial experts even suggest sending a copy of your budget to the collector to show them that you aren’t kidding when you say you only can spare a few dollars. This proves to the collections company that you’re serious, and they may stop the phone calls. Even if the manageable payments are minute in comparison to the balance owed, it is legions better than ignoring the problem. After all, you did incur this debt, and it is your responsibility to pay.

If at all possible, contact the company prior to your accounts going bad. If you know you are going to have problems paying your bills this month there is nothing wrong with calling up your lenders and requesting what is called a “skip pay.” This means you skip making a payment one month, without penalty, in an effort to stay afloat. That may be just what you need to get your monetary affairs back in order. Keep in touch with your creditors, try to pay your bills promptly, and stay devoted. Why pay for something that you can do on your own?

By: Ivan A Cuxeva

First Steps to Credit Repair

admin — Fri, 01 Jan 2010 14:07:48 +0000

Having bad credit can make life difficult. When you have bad credit you are denied many of the things that other people enjoy and it often seems like you cannot get ahead. You can wait it out if you have the time or you can take steps to improve your credit.

In 1970 the Fair Credit Reporting Act or the FCRA for short was enacted by Congress to protect consumers against inaccuracies and inconsistencies on reported credit. This act allows consumers to dispute inaccurate and untruthful listings on their credit report. It also allows the consumers to receive a free copy of their own credit report one time per year. An amendment in 2003 made it so that the consumer could receive this report at no charge.

The very first step to improving and repairing your credit is to get this report. There are many places online that offer you the opportunity to get this report but just remember that one report per year is free and you should not be paying anybody to get your one free report each year.

After you get the report you need to verify the information and check for inconsistencies. It is estimated that up to 75% or more of all credit reports are inaccurate and have mistakes. This is actually a benefit to you because you can dispute those mistakes and if they are not verified within a certain time period they must be completely removed from your report.

You have the right to dispute your credit and do whatever you can to improve and repair your credit. You can do it on your own or you can hire a professional company to help you out. In no way are you required to hire someone to help you and you may find that you would prefer to do it on your own. However, the process can be frustrating and time-consuming and you may appreciate the fact that someone else can help you get it done. Hiring a professional credit repair service is not something that you need to do but it can be a benefit if you have too much on your plate as is and you could use the convenience of letting someone else handle it to get it done in a timely manner.

Whether you do it on your own or with a professional you need to be aware that it is not legal to get fair and honest reporting removed from your credit. If you really do have the bad credit you would probably be better off trying to improve the credit you have left and improving your financial situation all around.

Do your homework as you are trying to repair your credit because there are some things that may surprise you such as the fact that it may hurt you more to pay off an old charged-off debt than to leave it alone. The reason why is because the negative credit stays on your report from the date of the last activity and when you pay off an old charge-off the time it stays on your report starts anew.

There are many different things you can do to improve your credit including repairing old and inaccurate reporting and doing things that will raise your credit score. The FCRA gave consumers the right to know and participate in what is reported on their credit report so take advantage of that fact if you have credit problems.

By: Karen Lynch