What Do You Want?
How serious are you about credit repair? Some people are happy to improve their credit, others are not satisfied until they master their credit scores. If you are aspiring for credit repair perfection, then you are ready for a lesson in the Zen of FICO.
Credit Repair Matters
Your credit score is just a number, and yet it can have a huge impact on your life. And in the wake of the credit-meltdown of 2007 creditors have tightened their guidelines and will now make sure you pay dearly for any deficiency in your credit score. Credit repair has never been more important.
Looking For Credit Repair Enlightenment
Do you want to master your credit scores? Are you ready for the Zen of FICO? If so, you will need to explore the deeper truths of credit repair - to understand the meaning behind the numbers. You need to enter into the mind of the creators; you need to know what Fair, Isaac and Company is trying to do.
A Bit of Background
Lenders base their underwriting decisions on credit scores they purchase from the three credit bureaus. The bureaus all use a scoring model called the FICO score. FICO is an acronym for Fair Isaac and Company, the developer of the score. Each bureau has re-branded the FICO score for marketing so you may hear it called by different names, but the formula is the same.
Why the Scores are Different?
You may notice that your three credit scores are different. This is because each credit bureau receives information from a slightly different mix of creditors. If you were to examine your three reports you will see that some accounts are missing on each bureau. Timing is also a factor; a recent change in your credit may be reported at one bureau before the others.
A Method to Their Madness
The FICO model is designed to measure the likelihood that you will meet your obligations. The purchasers of credit scores make money by lending you money. Their earnings come from interest you pay, along with any fees they charge. These creditors may measure your qualifications in other ways, but your credit score is the final criteria.
Be the Score, Grasshopper
To master the art of credit repair means to grasp the connection between your life and your credit scores. You need to understand that you are communicating information about your credit worthiness every day of your life. You provide the data that will determine your credit scores every time you make a payment, apply for credit, or open or close an account. What messages are you sending today? Let’s take a look at the behaviors that influence your scores. As we explore the components of credit scoring you will find an intuitive understanding arising; you will begin to make sense of the way FICO interprets your behavior.
Making Your Payments
Your payment history is a big component. Every time you make a payment you are telling the FICO model that you are responsible. You need to communicate this fact on a regular basis. If you don’t have sufficient credit your credit repair effort will not succeed. Installment accounts are good, but there is nothing like well managed revolving debt to improve your scores. You should have at least three credit cards. And if you really want results you must keep them active.
Your Account Balances
Here is another category of information that can shed light on the mystery of credit repair and the Zen of FICO. Think about your revolving accounts again. What message are you sending to FICO if you run your balances up to the limit? You are telling FICO that you are irresponsible. This may not be the case, but Fair Isaac and Company figured out that people with maxed out cards are much more likely to default than people who restrain their spending. A maxed out credit card is credit repair suicide. Conversely, the lower the balances relative to your high credit limit the better you will score. Do you see the logic?
The Length of Your Credit History
Cleaning up your credit report is an essential part of credit repair, but don’t close good accounts. FICO loves old accounts; the older the better. Old accounts indicate stability. Conversely, new accounts make FICO nervous. If you give in to the temptation to spend every penny of your new credit limit you may not be able to pay your bills. Again, that may not be the case, but statistically the evidence indicates increased risk. And measuring risk is what FICO is all about.
Those Darn Inquiries
We already know that FICO is not wild about new accounts. And where do those new accounts come from? From the FICO perspective, they come from credit inquiries. That’s right, every time you have someone run your credit you are telling FICO that you are about to get into debt. New debt means new risk. And FICO is all about risk. So Zen up your credit repair efforts and make sure you communicate the right message. Let FICO know that it has nothing to worry about. The more clearly you convey this message the higher your score will be.
Monday, April 28, 2008
Monday, April 21, 2008
Credit Repair: Set Yourself Free
Time For a Change!
Are you ready for a change? Are you tired of hiding from your bills, dodging collection calls, feeling like you took a wrong turn? A nationally recognized credit repair expert offers some advice on setting yourself free.
Realize Your Potential
No more hiding. It’s time to move on, to be free, to stop looking over your shoulder. You can do it. You can realize your potential. It’s time to get straight with your credit. Let me help you start the credit repair process. It will be the best thing you ever did. Take one step at a time, and before you know it you will be free. No more worries about old debts or troublesome collectors. No more hiding from your bills. Let’s brighten up your life, starting today.
Credit Repair and Inner Peace
Coming clean is such a relief. Let’s imagine what your life might look like. Picture yourself as straight with everyone. Opening your mail is no longer a bad moment in your day. Now when you sort through your bills you feel confident. You are living within your means; you have reserves in a savings account, and real peace of mind. You can do this. We can do it together. Let’s try. Let’s get the credit repair process underway.
Getting Right with Your Credit Cards
If you are behind on credit card payments, but not yet in collection status, there is a little-known credit repair solution called “re-ageing.” This process will allow you to convert your past due balance into a current balance, and eliminate all late payments from the account history - the perfect credit repair outcome. Re-ageing is designed for people that have been through a period of hardship and are now ready to get back on track; so you must clearly tell the creditor that you are in this category.
Just call the credit card issuer and tell them that you would like to take advantage of their re-aging policy. After reviewing your request they will ask you to make three on-time payments upon which your account will be brought current. Some card issuers refer to this process as “curing”. If the person you are speaking with does not know what you are talking about, ask for their supervisor. Organize your thoughts before you call. Remember to tell them that your life has changed and you are going to be a great customer!
Straighten Out Your Student Loans
Student loans are in a unique category of debt, and will never go away. You need to pick up the phone and deal with it right away. But there is good news. First, the law requires that student loan lenders accommodate borrowers by making repayment as flexible and affordable as possible. And second, there is assistance available to help you understand your rights. I promise that this credit repair task will be easier than you think.
If you are having issues with your student loans - if they are past due, or even long since in default, please call the Student Loan Ombudsman Office at (877) 557-2575. Everyone qualifies for student loan rehabilitation and consolidation regardless of credit history. Rehabilitation will remove the default status from your credit report, and consolidation will allow you to restructure your payments for affordability. Call today to explore your legal rights.
Credit Repair and Your Credit Report Mess
Now for the fun part of the credit repair process! It’s time to clean up your credit report, and I believe you will find a goldmine of potential hidden in the mess. People with past credit problems are virtually guaranteed to have significant errors on their report. The great thing about credit reporting errors is that they can be removed. This is the heart of credit repair, and a moment of revelation for many people. Careful legal proofreading can eliminate a large percentage of the derogatory information. Just watch your credit scores come back to life.
Planning Your Life With a Budget
There are many great credit repair strategies. A credit repair professional can guide you through the process to insure that every possible angle has been considered. But at the end of the day the focus is going to shift to you. The long-term success of your credit repair program lies in your ability to maintain your payments. You must live within your means. I recommend taking the time to develop a budget. Does this sound boring? Remember that knowledge is power. This little bit of homework can make a big difference in your life.
Get a pen and paper and list every expense you have. Include everything from necessities to entertainment. Compare your expenses to your income. This can be an eye-opener. Is there enough left over each month to contribute to a savings account? Don’t think of budgetary decisions as austerity. There is strength in doing the right thing. And the payback will be surprising. Great credit will lower the cost of every dollar you borrow. Balance will return to your life, your savings will grow, and you will discover real inner peace.
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Are you ready for a change? Are you tired of hiding from your bills, dodging collection calls, feeling like you took a wrong turn? A nationally recognized credit repair expert offers some advice on setting yourself free.
Realize Your Potential
No more hiding. It’s time to move on, to be free, to stop looking over your shoulder. You can do it. You can realize your potential. It’s time to get straight with your credit. Let me help you start the credit repair process. It will be the best thing you ever did. Take one step at a time, and before you know it you will be free. No more worries about old debts or troublesome collectors. No more hiding from your bills. Let’s brighten up your life, starting today.
Credit Repair and Inner Peace
Coming clean is such a relief. Let’s imagine what your life might look like. Picture yourself as straight with everyone. Opening your mail is no longer a bad moment in your day. Now when you sort through your bills you feel confident. You are living within your means; you have reserves in a savings account, and real peace of mind. You can do this. We can do it together. Let’s try. Let’s get the credit repair process underway.
Getting Right with Your Credit Cards
If you are behind on credit card payments, but not yet in collection status, there is a little-known credit repair solution called “re-ageing.” This process will allow you to convert your past due balance into a current balance, and eliminate all late payments from the account history - the perfect credit repair outcome. Re-ageing is designed for people that have been through a period of hardship and are now ready to get back on track; so you must clearly tell the creditor that you are in this category.
Just call the credit card issuer and tell them that you would like to take advantage of their re-aging policy. After reviewing your request they will ask you to make three on-time payments upon which your account will be brought current. Some card issuers refer to this process as “curing”. If the person you are speaking with does not know what you are talking about, ask for their supervisor. Organize your thoughts before you call. Remember to tell them that your life has changed and you are going to be a great customer!
Straighten Out Your Student Loans
Student loans are in a unique category of debt, and will never go away. You need to pick up the phone and deal with it right away. But there is good news. First, the law requires that student loan lenders accommodate borrowers by making repayment as flexible and affordable as possible. And second, there is assistance available to help you understand your rights. I promise that this credit repair task will be easier than you think.
If you are having issues with your student loans - if they are past due, or even long since in default, please call the Student Loan Ombudsman Office at (877) 557-2575. Everyone qualifies for student loan rehabilitation and consolidation regardless of credit history. Rehabilitation will remove the default status from your credit report, and consolidation will allow you to restructure your payments for affordability. Call today to explore your legal rights.
Credit Repair and Your Credit Report Mess
Now for the fun part of the credit repair process! It’s time to clean up your credit report, and I believe you will find a goldmine of potential hidden in the mess. People with past credit problems are virtually guaranteed to have significant errors on their report. The great thing about credit reporting errors is that they can be removed. This is the heart of credit repair, and a moment of revelation for many people. Careful legal proofreading can eliminate a large percentage of the derogatory information. Just watch your credit scores come back to life.
Planning Your Life With a Budget
There are many great credit repair strategies. A credit repair professional can guide you through the process to insure that every possible angle has been considered. But at the end of the day the focus is going to shift to you. The long-term success of your credit repair program lies in your ability to maintain your payments. You must live within your means. I recommend taking the time to develop a budget. Does this sound boring? Remember that knowledge is power. This little bit of homework can make a big difference in your life.
Get a pen and paper and list every expense you have. Include everything from necessities to entertainment. Compare your expenses to your income. This can be an eye-opener. Is there enough left over each month to contribute to a savings account? Don’t think of budgetary decisions as austerity. There is strength in doing the right thing. And the payback will be surprising. Great credit will lower the cost of every dollar you borrow. Balance will return to your life, your savings will grow, and you will discover real inner peace.
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Wednesday, April 16, 2008
Credit Repair and Your Mortgage Rate
Be Prepared!
Do you plan to apply for a mortgage soon? Here is a discussion of the latest change in the way the mortgage industry determines your interest rate, and what you can do about it.
Mortgage Time
Your mortgage is probably the largest financial obligation in your life; and the interest rate on your mortgage can have a major impact on your monthly budget. Here is a very important fact you may not be aware of. Early in 2008, with very little publicity, mortgage lenders began to implement new risk based pricing schedules. Risk based pricing is tiered pricing based on credit score, and will affect your life more than you think.
What Risk Based Pricing Means to You
Tiered mortgage pricing may sound like old news, but it is a significant departure from old pricing methods which treated all prime borrowers the same. Under the new pricing methods you may qualify for the best home mortgage available, but end up paying a premium rate if your credit scores are in the low end of the acceptable range. Conversely, you will be rewarded for having excellent credit. The potential payoff from an intelligent credit repair effort has never been greater. From now on every point on your credit score counts.
The Subprime Dilemma
In mid 2006 subprime lenders began to close their doors. Today only a few subprime lenders remain. There was a time when a subprime mortgage was a reasonable alternative for a borrower with credit issues. In many cases subprime rates were comparable to prime loan rates. Those days are over. Subprime rates now carry a significant premium. Many borrowers find themselves faced with a choice between a subprime mortgage and postponing their purchase until their credit improves. Many prospective borrowers choose to delay their purchase and join a credit repair program.
Credit Repair, Getting Started
There are many ways to repair your credit. If you do not have any time constraints, I advise you to contact a credit repair professional for a consultation and then do whatever is needed to clean up your credit and optimize your credit scores. If you have limited time you will want to be very cautious about making any changes. The right choices can translate into thousands of dollars over the life of your mortgage.
Credit Building
You may be aware that mortgage lenders often require that you have a minimum number of current accounts reporting on your credit. Aside from this common lender requirement, open accounts will be a boon to your FICO score. If you have limited credit you may want to open two or three new secured credit cards; credit building is often a critical step in the credit repair process. But beware that it can take up to four months to get the benefit of these new accounts. In fact, initially your credit score will fall. This is because the FICO model will see a new inquiry and a new account with no track record at all. So, if you need your credit score in the immediate future you should not be opening new accounts today.
Reduce Those Revolving Balances
Reducing your revolving balances can have a significant impact on your credit scores and provide a great start to your credit repair effort. The current FICO scoring model considers 5 different debt-to-limit ratios. The lower your balance compared to your credit limit the better your score. The 5 ratios currently in use are 20%, 40%, 60%, 80%, and 100%. If you have the ability to reduce your balances to below 20% of your limit you will get the greatest benefit. The potential impact is so significant that many people borrow from friends and family to make this happen. On the other side of the coin, to let your balances approach 100% of your high credit limit can shave 50 points or more from your score.
The Power of a Rapid Rescore
If you have paid down the balance on a revolving account and want to accelerate the process of updating your credit scores, you may contact the credit card issuer and ask for a letter stating your new balance. When you get the letter, give it to your mortgage broker and ask them to do a rapid rescore. Within three days your scores will be updated to reflect the new low balances. A rapid rescore is a powerful credit repair tool offered only through mortgage brokers. You cannot request a rapid rescore through the credit bureaus.
Watch Your Step
If you will be applying for a mortgage soon you should be cautious about all credit activity. Paying down account balances is always fine, and opening new accounts, as mentioned above, may be a necessary step in your credit repair program if you have enough time. Generally speaking any credit repair effort should be made carefully with an understanding of the implications for your FICO scores. If you are uncertain, consult a professional. It’s your credit!
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Do you plan to apply for a mortgage soon? Here is a discussion of the latest change in the way the mortgage industry determines your interest rate, and what you can do about it.
Mortgage Time
Your mortgage is probably the largest financial obligation in your life; and the interest rate on your mortgage can have a major impact on your monthly budget. Here is a very important fact you may not be aware of. Early in 2008, with very little publicity, mortgage lenders began to implement new risk based pricing schedules. Risk based pricing is tiered pricing based on credit score, and will affect your life more than you think.
What Risk Based Pricing Means to You
Tiered mortgage pricing may sound like old news, but it is a significant departure from old pricing methods which treated all prime borrowers the same. Under the new pricing methods you may qualify for the best home mortgage available, but end up paying a premium rate if your credit scores are in the low end of the acceptable range. Conversely, you will be rewarded for having excellent credit. The potential payoff from an intelligent credit repair effort has never been greater. From now on every point on your credit score counts.
The Subprime Dilemma
In mid 2006 subprime lenders began to close their doors. Today only a few subprime lenders remain. There was a time when a subprime mortgage was a reasonable alternative for a borrower with credit issues. In many cases subprime rates were comparable to prime loan rates. Those days are over. Subprime rates now carry a significant premium. Many borrowers find themselves faced with a choice between a subprime mortgage and postponing their purchase until their credit improves. Many prospective borrowers choose to delay their purchase and join a credit repair program.
Credit Repair, Getting Started
There are many ways to repair your credit. If you do not have any time constraints, I advise you to contact a credit repair professional for a consultation and then do whatever is needed to clean up your credit and optimize your credit scores. If you have limited time you will want to be very cautious about making any changes. The right choices can translate into thousands of dollars over the life of your mortgage.
Credit Building
You may be aware that mortgage lenders often require that you have a minimum number of current accounts reporting on your credit. Aside from this common lender requirement, open accounts will be a boon to your FICO score. If you have limited credit you may want to open two or three new secured credit cards; credit building is often a critical step in the credit repair process. But beware that it can take up to four months to get the benefit of these new accounts. In fact, initially your credit score will fall. This is because the FICO model will see a new inquiry and a new account with no track record at all. So, if you need your credit score in the immediate future you should not be opening new accounts today.
Reduce Those Revolving Balances
Reducing your revolving balances can have a significant impact on your credit scores and provide a great start to your credit repair effort. The current FICO scoring model considers 5 different debt-to-limit ratios. The lower your balance compared to your credit limit the better your score. The 5 ratios currently in use are 20%, 40%, 60%, 80%, and 100%. If you have the ability to reduce your balances to below 20% of your limit you will get the greatest benefit. The potential impact is so significant that many people borrow from friends and family to make this happen. On the other side of the coin, to let your balances approach 100% of your high credit limit can shave 50 points or more from your score.
The Power of a Rapid Rescore
If you have paid down the balance on a revolving account and want to accelerate the process of updating your credit scores, you may contact the credit card issuer and ask for a letter stating your new balance. When you get the letter, give it to your mortgage broker and ask them to do a rapid rescore. Within three days your scores will be updated to reflect the new low balances. A rapid rescore is a powerful credit repair tool offered only through mortgage brokers. You cannot request a rapid rescore through the credit bureaus.
Watch Your Step
If you will be applying for a mortgage soon you should be cautious about all credit activity. Paying down account balances is always fine, and opening new accounts, as mentioned above, may be a necessary step in your credit repair program if you have enough time. Generally speaking any credit repair effort should be made carefully with an understanding of the implications for your FICO scores. If you are uncertain, consult a professional. It’s your credit!
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Monday, April 14, 2008
Credit Repair: A New Professional
Change is Natural
Everything changes. No industry stands still. Henry Ford’s Model T was revolutionary, and opened the eyes of the world to new possibilities. But by today’s standards, the Model T, as important as it once was, has its place only in the past. Virtually every aspect of the early model automobile has been improved on, far beyond what Henry Ford could have imagined in his day.
The Changing Credit Repair Industry
The Internet has grown into a vibrant worldwide business community. In this environment competition thrives and new ideas come to life at amazing speed. New participants have entered the credit repair arena and brought fresh life to the business. Some older members have updated their methods; while others, perhaps top heavy with technology, continue to stand their ground even as the earth shifts beneath their feet.
The New Breed Appears
From this dynamic mix has appeared a new breed, the true credit repair professional. This new breed has a true mastery of the craft, and an impressive arsenal of tools capable of delivering results beyond the imagination of the early pioneers in the industry. Everything about the business is changing. And the changes involve you.
Credit and Your Life
There is nothing as important to your financial life as your credit. The content of your credit report, along with your credit scores, will determine the interest rate you pay on everything from your credit cards to your mortgage. The impact of your credit on your life can be staggering, and should not be taken lightly. The word is out.
The Problem of Errors
The three major credit bureaus maintain credit files on over 200 million Americans. A staggering amount of data moves through the credit reporting system. Errors are common and can translate into enormous costs for consumers; and yet, in a terrible percentage of cases these errors go unrecognized. This phenomenon is more damaging than you might think. Identifying errors on your report involves more than just spotting unfamiliar account information. The majority of credit report errors are compliance violations that you will not find without training.
FICO, A Lack of Understanding
Lenders base their underwriting decisions on the content of your credit report along with the numeric value of your FICO scores. These FICO scores have a major affect on your life, and yet few people have any knowledge of how they work. Here again, a lack of understanding results in a huge cost. A well-informed reshaping of your credit may have a dramatic impact on your credit scores. Even simple changes can bring major improvement, yet without proper information this potential remains untapped.
The Credit Repair Professional
The prevalence of credit reporting errors, coupled with a lack of understanding of FICO scores, result in a terrible cost to consumers, often having the greatest impact on those who can afford it the least. The credit repair professional provides an important, and often life changing, service by assisting in the identification and removal of credit reporting errors. In addition, a credit repair professional is a conduit for information about legal rights, rehabilitation opportunities, and credit restoration tools that can be employed to your benefit.
The Results You Need
The goal of a credit repair program is to improve your credit. Along with the skillful identification and removal of reporting errors, the process may include specific recommendations for building new credit, managing existing debt, rehabilitating defaulted obligations, and handling collectors. All of this must take place within the context of optimizing your credit scores. The credit repair professional operates in a fiduciary capacity and will utilize the widest range of tools to insure quick and lasting results.
Personal Service
You are unique, and so is your credit. There is no generic approach to credit repair that will do you justice. No credit repair software has the ability to spot the compliance errors on your credit report, or to determine the proper balance of accounts to optimize your credit scores, or to help you determine the right approach to take with an active collector. There is no one-dimensional credit repair program that will produce the results you deserve. True professional credit repair is about personal service. You cannot afford to settle for less.
What it Means to You
The credit repair professional will make sure that everything possible is done to help you reach your goals. The professional approach to credit repair can mean everything to you. Do you want real results? Do your want to see your scores improve? Do you want your credit to meet or exceed lenders requirements? Wait until you experience what a real professional can do for you!
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Everything changes. No industry stands still. Henry Ford’s Model T was revolutionary, and opened the eyes of the world to new possibilities. But by today’s standards, the Model T, as important as it once was, has its place only in the past. Virtually every aspect of the early model automobile has been improved on, far beyond what Henry Ford could have imagined in his day.
The Changing Credit Repair Industry
The Internet has grown into a vibrant worldwide business community. In this environment competition thrives and new ideas come to life at amazing speed. New participants have entered the credit repair arena and brought fresh life to the business. Some older members have updated their methods; while others, perhaps top heavy with technology, continue to stand their ground even as the earth shifts beneath their feet.
The New Breed Appears
From this dynamic mix has appeared a new breed, the true credit repair professional. This new breed has a true mastery of the craft, and an impressive arsenal of tools capable of delivering results beyond the imagination of the early pioneers in the industry. Everything about the business is changing. And the changes involve you.
Credit and Your Life
There is nothing as important to your financial life as your credit. The content of your credit report, along with your credit scores, will determine the interest rate you pay on everything from your credit cards to your mortgage. The impact of your credit on your life can be staggering, and should not be taken lightly. The word is out.
The Problem of Errors
The three major credit bureaus maintain credit files on over 200 million Americans. A staggering amount of data moves through the credit reporting system. Errors are common and can translate into enormous costs for consumers; and yet, in a terrible percentage of cases these errors go unrecognized. This phenomenon is more damaging than you might think. Identifying errors on your report involves more than just spotting unfamiliar account information. The majority of credit report errors are compliance violations that you will not find without training.
FICO, A Lack of Understanding
Lenders base their underwriting decisions on the content of your credit report along with the numeric value of your FICO scores. These FICO scores have a major affect on your life, and yet few people have any knowledge of how they work. Here again, a lack of understanding results in a huge cost. A well-informed reshaping of your credit may have a dramatic impact on your credit scores. Even simple changes can bring major improvement, yet without proper information this potential remains untapped.
The Credit Repair Professional
The prevalence of credit reporting errors, coupled with a lack of understanding of FICO scores, result in a terrible cost to consumers, often having the greatest impact on those who can afford it the least. The credit repair professional provides an important, and often life changing, service by assisting in the identification and removal of credit reporting errors. In addition, a credit repair professional is a conduit for information about legal rights, rehabilitation opportunities, and credit restoration tools that can be employed to your benefit.
The Results You Need
The goal of a credit repair program is to improve your credit. Along with the skillful identification and removal of reporting errors, the process may include specific recommendations for building new credit, managing existing debt, rehabilitating defaulted obligations, and handling collectors. All of this must take place within the context of optimizing your credit scores. The credit repair professional operates in a fiduciary capacity and will utilize the widest range of tools to insure quick and lasting results.
Personal Service
You are unique, and so is your credit. There is no generic approach to credit repair that will do you justice. No credit repair software has the ability to spot the compliance errors on your credit report, or to determine the proper balance of accounts to optimize your credit scores, or to help you determine the right approach to take with an active collector. There is no one-dimensional credit repair program that will produce the results you deserve. True professional credit repair is about personal service. You cannot afford to settle for less.
What it Means to You
The credit repair professional will make sure that everything possible is done to help you reach your goals. The professional approach to credit repair can mean everything to you. Do you want real results? Do your want to see your scores improve? Do you want your credit to meet or exceed lenders requirements? Wait until you experience what a real professional can do for you!
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Tuesday, April 1, 2008
Credit Repair and the Art of Finding Errors
More Than Meets the Eye
Credit reporting errors can ruin your credit scores and cost you money. It is essential that you examine your reports periodically to spot these errors. But do you know what to look for? A nationally recognized credit repair expert has some information that may surprise you.
The Invisible Threat
Are you aware of the errors on your credit report? Do you know what to look for? Most people are under the impression that the information on their reports is correct if it looks familiar. Unfortunately, a cursory glance through your reports in search of unfamiliar information is virtually guaranteed to miss a significant number of errors. Effective credit repair requires a thoughtful and informed effort and should not be taken lightly. Over 100 million Americans have errors on their credit reports serious enough to cause them to pay premium interest rates on every dollar they borrow. The cost of credit reporting errors can be significant. Can you afford to throw money away unnecessarily?
Looking Under the Hood
Have you ever had car trouble and lifted the hood to locate the problem? Unless you are a mechanic you probably didn’t achieve much. The first step in the credit repair process is the search for credit reporting errors, and it’s a lot like lifting the hood of your car. You might spot something, but your chances are better if you know what to look for.
Two Types of Errors
Credit reporting errors may be grouped into two general categories; obvious errors, and compliance errors. Obvious errors, such as accounts that don’t belong to you are easy to find. Compliance errors generally relate to a real event, but should not report as a matter of law. These may not look like errors at all, but anyone familiar with the nuts and bolts of credit repair knows they make up the vast majority of erroneous reporting.
Collection Issues
Because compliance errors relate to a recognizable event usually means that they go unchallenged, and needlessly damage your credit scores for years. Collection accounts often fall into this category. Collections are often sold and re-sold. Collectors who no longer own a debt may not report the collection on your report. A shocking number of reported collections have no legal right to show on your report. And yet, the system provides no mechanism or incentive for collectors to cease reporting when they should. Here’s a handy credit repair fact: collections change hands regularly and should be challenged even when they look current.
Reporting Period Violations
Reporting period violations are also in the category of compliance errors and often go unchallenged. Most derogatory information should stop showing on your report after seven years. People starting a credit repair effort are usually aware of this fact, but an impressive number of these errors escape notice. Creditors are responsible for furnishing the credit bureaus with accurate start dates for these reporting periods. Unfortunately, creditors do not always provide the proper dates, and may even inadvertently reset the start dates under certain circumstances. Did you know that the reporting period starts with the original default and cannot be reset by subsequent debt holders? If an account is charged off and sold to a collector, and eventually a sequence of collectors, the likelihood of a reporting period error increases exponentially and the damaging information may report for years past the proper expiration date.
Those Darn Credit Cards
The relationship between your credit card balance and the high credit limit can have an enormous impact on your score. Did you know that it is common for credit card issuers to misreport high credit limits? The affect on your credit scores can be dramatic. If you have a credit card with a $1,000 balance and a $10,000 limit, and the creditor were to erroneously report your card with a $1,000 limit – just equal to your current balance - your score could fall significantly. How much will it fall? Many consumers involved in a credit repair effort are confused about the effect of a derogatory item on their credit score. Did you know that the impact of an error on your score will vary depending on the overall content of your report? The more credit you have, and the older your accounts are, the less impact a single problem will have. On the other hand, if your credit is relatively lean, a single error can be devastating. In either case, it is worth examining your report carefully to insure your high credit limits are correct.
Déjà Vu Credit
Have you ever examined your report and seen the same account more than once? You’re not alone. Duplicate accounts occur all the time and impact your scores exactly the same as if they are real, additional debt on your report. Another common error of a similar nature involve closed accounts which continue to report as open with balances. Like too many other types of errors, these are often passed over with a shrug during a credit repair effort, but may be costing you money.
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Credit reporting errors can ruin your credit scores and cost you money. It is essential that you examine your reports periodically to spot these errors. But do you know what to look for? A nationally recognized credit repair expert has some information that may surprise you.
The Invisible Threat
Are you aware of the errors on your credit report? Do you know what to look for? Most people are under the impression that the information on their reports is correct if it looks familiar. Unfortunately, a cursory glance through your reports in search of unfamiliar information is virtually guaranteed to miss a significant number of errors. Effective credit repair requires a thoughtful and informed effort and should not be taken lightly. Over 100 million Americans have errors on their credit reports serious enough to cause them to pay premium interest rates on every dollar they borrow. The cost of credit reporting errors can be significant. Can you afford to throw money away unnecessarily?
Looking Under the Hood
Have you ever had car trouble and lifted the hood to locate the problem? Unless you are a mechanic you probably didn’t achieve much. The first step in the credit repair process is the search for credit reporting errors, and it’s a lot like lifting the hood of your car. You might spot something, but your chances are better if you know what to look for.
Two Types of Errors
Credit reporting errors may be grouped into two general categories; obvious errors, and compliance errors. Obvious errors, such as accounts that don’t belong to you are easy to find. Compliance errors generally relate to a real event, but should not report as a matter of law. These may not look like errors at all, but anyone familiar with the nuts and bolts of credit repair knows they make up the vast majority of erroneous reporting.
Collection Issues
Because compliance errors relate to a recognizable event usually means that they go unchallenged, and needlessly damage your credit scores for years. Collection accounts often fall into this category. Collections are often sold and re-sold. Collectors who no longer own a debt may not report the collection on your report. A shocking number of reported collections have no legal right to show on your report. And yet, the system provides no mechanism or incentive for collectors to cease reporting when they should. Here’s a handy credit repair fact: collections change hands regularly and should be challenged even when they look current.
Reporting Period Violations
Reporting period violations are also in the category of compliance errors and often go unchallenged. Most derogatory information should stop showing on your report after seven years. People starting a credit repair effort are usually aware of this fact, but an impressive number of these errors escape notice. Creditors are responsible for furnishing the credit bureaus with accurate start dates for these reporting periods. Unfortunately, creditors do not always provide the proper dates, and may even inadvertently reset the start dates under certain circumstances. Did you know that the reporting period starts with the original default and cannot be reset by subsequent debt holders? If an account is charged off and sold to a collector, and eventually a sequence of collectors, the likelihood of a reporting period error increases exponentially and the damaging information may report for years past the proper expiration date.
Those Darn Credit Cards
The relationship between your credit card balance and the high credit limit can have an enormous impact on your score. Did you know that it is common for credit card issuers to misreport high credit limits? The affect on your credit scores can be dramatic. If you have a credit card with a $1,000 balance and a $10,000 limit, and the creditor were to erroneously report your card with a $1,000 limit – just equal to your current balance - your score could fall significantly. How much will it fall? Many consumers involved in a credit repair effort are confused about the effect of a derogatory item on their credit score. Did you know that the impact of an error on your score will vary depending on the overall content of your report? The more credit you have, and the older your accounts are, the less impact a single problem will have. On the other hand, if your credit is relatively lean, a single error can be devastating. In either case, it is worth examining your report carefully to insure your high credit limits are correct.
Déjà Vu Credit
Have you ever examined your report and seen the same account more than once? You’re not alone. Duplicate accounts occur all the time and impact your scores exactly the same as if they are real, additional debt on your report. Another common error of a similar nature involve closed accounts which continue to report as open with balances. Like too many other types of errors, these are often passed over with a shrug during a credit repair effort, but may be costing you money.
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
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