by Adam | Dec 12, 2014 | Credit Repair
Credit card accounts don’t go away on their own, but you should make a few consideration before chopping up a bunch of credit cards with scissors. Why Cancel a Credit Card Account? There are many good reasons for closing a credit card: An open credit card account that you don’t use is at risk for identity theft You may wish to close a credit card account so you are not tempted to use it and get in more debt Annual fees or expired promotions make it unfeasible or costly to keep it open You want to close a card with a high interest rate and open a new one with a lower rate When You Should Keep A Credit Card Account Open It’s not always wise to close a credit card account, and it has to do with your credit score. Your “credit utilization rate” is one factor the credit bureaus use to determine your score, and when you cancel a credit card account you are reducing your available credit. If you are carrying debt, then your utilization rate will go up because your current debt will be a larger percentage of your overall credit limit. A utilization rate above 10% will start to have a negative impact on your score. It’s also a good idea to keep certain accounts open for a long time, since it shows that you have a long credit history, which can improve your score. If you’ve had a credit card account for many years, it might be a good idea to keep it open. How to Close a Credit Card Account Safely Without Dinging Your Credit...
by Adam | Dec 8, 2014 | Credit Repair
Credit repair can be frustrating and complex. To determine your credit score, the credit bureaus take into account many different factors which they weigh in different amounts. While there are many things you can do that will help improve your score over time, there are many myths about credit repair that just won’t go away. Let’s go over 5 of the most common credit repair myths, so you can separate myth from reality when it comes to improving your credit score! Myth 1: Closing multiple accounts will increase my score Some people think that if they close all their credit card accounts after they’ve paid them off, not only will it help keep them from racking up more debt but it will also improve their score. The truth is that while paying down your debt will help raise your score, closing a bunch of accounts will reduce your overall “credit limit,” or the amount of credit available to you. This can actually hurt your score, since the credit bureaus want to see that you have available credit, but that you’re not using too much of it. Instead, keep one or several credit card accounts open, but don’t use more than 10% of the available credit (or better yet, pay them down to zero every month). Myth 2: Opening multiple accounts will magically increase my score If having a lot of available credit improves your score, then opening a bunch of new credit cards should give you a good boost, right? Wrong. The credit bureaus also take into account “credit inquiries,” and every time you open up a new line of...
by Adam | Nov 28, 2014 | Credit Repair
Credit repair can be a lengthy and frustrating process. Once you’ve finally achieved a healthy score, there are a few things you need to do in order to prevent it from slipping again. Self-discipline is vital to a healthy credit score. The key to achieving a score in the high 700’s (and possibly up into the 800’s) is through cultivating good spending habits. Here are a few handy rules-of-thumb when it comes to your credit. Use Credit, but Use it Wisely To maintain a high score, you still need to use credit. Lenders want to see that you’re using credit responsibly, and if you’ve gone a long time without using credit at all that can actually lower your score. So you don’t necessarily have to cut up all your credit cards and close all your accounts once they are paid off. Keep at least one credit card (or possibly several), and use it responsibly. Don’t Use More Than 10% of your Credit Limit While you should be utilizing your credit, you should never carry a high balance on any credit card. If you carry a balance that is more than 10% of your credit limit, it can negatively impact your score. Instead, keep your balance below 10% of your limit, and ideally pay your balance down to zero every month. This has the double benefit of strengthening your credit score and making sure you don’t spend money on interest. Don’t Miss a Payment A single late payment can ding your credit score. Don’t let all your hard work slip away with missed monthly payments. Instead, set up an automatic payment plan....
by Adam | Nov 21, 2014 | Uncategorized
When you print out your credit report in its entirety, the big stack of papers can be a little daunting. You can probably tell if you’ve got a great score, or one that could use a little improvement, but what does all the extra information mean? And how can you use the information contained in your credit report to improve your score and repair your credit? There’s more to a credit report than just the score. If you have a low score, then the key to improving it lies within the report itself. Here are 6 steps to unlocking the secrets of your credit report and finding ways to improve your score. Step 1: Double Check Your Personal Information for Errors At the top of your report is personal information that identifies you, including your name, present and past addresses, and employment info. If any of this is inaccurate it could negatively impact your score, so double check every little detail to make sure it’s correct. A misspelled name or incorrect address could mean that someone else’s credit history is being included on your report. When you spot errors, these are the easiest to fix. You can send a credit dispute letter to the credit bureaus or get the help of a credit repair company. The credit bureaus are required by law to fix any errors to your report in a timely manner, and at no cost to you. Step 2: Review Your Credit Summary The next portion of your credit report is your credit summary. It provides an overview of the report, including the types of accounts, number of current and...
by Adam | Nov 11, 2014 | Credit Repair
Divorce has a way of destabilizing life in unexpected ways. For example, your credit score may be at risk of taking a hit during a divorce, unless you’re careful and take several steps to protect it. This is because the typical married couple’s finances are so intertwined, that disentangling the various debts and accounts can take significant time and effort. As long as you are vigilant (and keep a spirit of cooperation with your ex-spouse), then there’s no reason why your credit score should go down after your divorce. Get Copies of Your Credit Reports Your first step should be to obtain copies of all three credit reports from the credit reporting bureaus. This will allow you to identify all your accounts that are jointly held between you and your spouse. As part of the divorce process, you may be issued a “divorce decree” by the court. This is a way of splitting up assets and debts between the two parties, but it’s up to you to do the legwork. You’ll need to contact creditors, close accounts, set up new accounts, and all other necessary steps yourself. Do Your Best to Close Your Joint Accounts BEFORE you Divorce Ideally, once your divorce is finalized you won’t have any active joint accounts. This isn’t always possible, depending on many factors including whether or not you’re carrying any balances. But as long as you continue to hold joint accounts with your ex-spouse, then your credit score will be affected by his or her missed payments, bankruptcy, etc. The best way to close a credit card account, obviously, is to pay the balance off...
by Adam | Nov 4, 2014 | Credit Repair
On the complete spectrum of credit scores (350 for bottom-of-the-bucket scores, and 850 for unattainable perfection), it’s likely that your score leaves a few things to be desired. For example, maybe you have an overdue payment from several years back still haunting your score, or an error that you’ve been attempting for months or even years to correct. One of the most frustrating things about credit scores is that even one relatively minor negative item can bring down an otherwise squeaky-clean report. No matter how many positives there are in your report (low revolving balances, established credit history, years and years of on-time payments), that one mistake or negative item still sticks out like a sore thumb. Even One Negative Item Can Drop Your Credit Score Substantially It’s sad, but true. Most of the time, these blemishes will stick around on your credit report for years and years (late payments last for 7 years). On the other side of the equation, improving your credit score is much harder than wrecking it. Building up good credit history takes years of dedication and perseverance. Fixing errors often involves writing multiple letters and enduring a long bureaucratic process. So why is it so important to guard your credit from any negative items? Why is it necessary to maintain a squeaky-clean credit report? Credit Is Ubiquitous in Our Society Your credit score touches on so many aspects of your life. For example, a good credit score can help you: Get a home mortgage Secure a low interest rate on any type of loan Get a car loan Land a job Start your own business Take out a student loan While...
by Adam | Oct 31, 2014 | Credit Repair
As a resident of the U.S., you are most likely aware of your rights to free speech, bear arms, and to vote. But did you know that you have credit rights as well? Our credit scores are a useful way for banks and lending agencies to determine whether you’re a good candidate for a loan. But any errors can derail your ability to secure a loan or even find a job, and identity thieves can wreak havoc on your score if they get ahold of your information. To address these concerns, the U.S. legislature has passed and revised several consumer protection laws. Here are a few laws that pertain directly to your credit score, and the steps you can take to repair any damage and fix mistakes contained in your score. The Fair Credit Reporting Act (FCRA) The takeaways of the Fair Credit Reporting Act, and how they apply to repairing your credit, are that: Credit reporting companies must investigate any claims you make Credit reporting companies are required to fix or delete any incorrect information found on your credit report The Fair and Accurate Credit Transactions Act (FACTA) If you don’t know already, then you should now: you are entitled to one free credit report every year. This law requires all three credit reporting companies to provide you with a free report every 12 months. The website, www.annualcreditreport.com, is set up for this exact purpose. Having access to your credit report is the first step to catching identity thieves and repairing errors. The Fair Credit Billing Act (FCBA) This law, passed in 1974, provides you with the tools...
by Adam | Oct 24, 2014 | Credit Repair
If you want to improve your credit score, there are a few steps you can take that will potentially make short-term improvements, and strategies that are a bit more long term. One long-term strategy is to pay off all your outstanding debt. How much debt you carry determines up to 30% of your credit score, so reducing that amount will help boost your score. But it can be difficult to pay off debt especially if you carry large balances. You need a plan; a strategy for paying off credit cards and loans as quickly as possible. Two possible approaches you could take are the Avalanche method and the Snowball method. First you need to tally all your debts. Make a list of credit cards, student loans, car loans, etc. (excluding your home mortgage), including their respective balances and interest rates. You’ll use this information to plan your next move. The Avalanche Method to Paying off Debt To pay off debt using the “avalanche method,” you arrange your debts by interest rate. Zero in on the balance with the highest interest, and throw all the money you can at it. Keep all other payments at a minimum, but dedicate every extra penny to paying off the credit card or loan with the highest interest. Once you finish paying it off, move to the next item on your list and focus on that one. This creates an “avalanche” effect, knocking out your most expensive credit cards first until you’ve annihilated all your debt. In the long run, the avalanche method saves you the most money. When you carry a balance with a high interest...
by Adam | Oct 16, 2014 | Credit Repair, Uncategorized
Credit report errors are frustrating and difficult to repair, but they happen more often than you might think. If your credit report is full of errors, you’re not alone; and it’s your right by law to have those errors removed. You can do the legwork yourself by sending out letters to all the relevant credit bureaus and lenders, or you can hire a credit repair company to use their expertise on your behalf. Legitimate errors are common, and they come in many shapes and sizes. Here are some of the errors, discrepancies, and inaccuracies that happen most often. Inaccurate Personal Information A misspelled name, or a middle initial left out, can lead to problems on your credit report. For example, simple errors like this can make it so another person’s credit history is mistakenly placed on your report. To avoid these errors, make sure all your personal information is accurate and complete: social security number, full name, work history, current address, etc. Identity Theft Identity theft is when someone uses your social security number, name, and other information to fraudulently open an account. It can damage more than your credit; identity theft can potentially hit your finances hard, especially if you don’t notice it for a long time. Credit monitoring services can help catch identity theft before it’s too damaging. You can also freeze your credit until the errors are resolved, if you think you’ve been a victim identity theft; this prevents anyone (even you) from accessing your credit. Unfortunately, repairing your credit after identity theft is complex and time consuming. You may benefit from legal help and a...
by Megan | Apr 23, 2014 | Uncategorized
Dealing with soft or hard hits on your credit report can greatly impact your everyday life, especially if you have an interest in taking out a loan or if you want to apply for a credit card in the future. Understanding how to repair your credit is a way for you to not only find relief from the financial strain you have been experiencing in your everyday life, but also mental and emotional relief. Why is Credit Important? Credit is important if you ever have an interest in taking out a mortgage for a home or property you are investing in, along with taking out loans for potential business ideas and entities you have in mind. Additionally, credit is also important if you want to apply for store credit cards, business credit cards or even emergency credit cards for all of the members of your family to use in dire situations. The better your credit is, the more perks you will receive when you are taking out loans or applying for credit cards. Additionally, when you have a good credit score, you can also find credit cards and loans with lower overall interest rates and extended payback options. Checking Credit Reports You can check your credit reports by checking with official agencies as well as by requesting reports to check your credit right from home, online. Additionally, a credit repair specialist who works for a professional company can also guide and assist you through the process of checking different credit reports you have in your name over-the-phone or in person, depending on the service you have selected to use...
by Megan | Apr 21, 2014 | Uncategorized
A high level of personal debt continues to be a source of stress for many in today’s economy, and it often leads to a certain level of desperation among debtors who have seen their wages gradually grow stagnant. Particularly in a difficult economy, the likelihood of defaulting on regular debt payments becomes an unfortunate fact of life for those consumers who were irresponsible with previous spending. Overly high balances on credit cards and missed payments will, of course, lead to a lower credit score, thus making future purchases on credit much more difficult. In situations like these, desperation may lead to a debtor consulting with a credit repair company. What is a credit repair company? At it’s core, a credit repair company is an organization hired in order to review a person’s credit history, identify potential fraudulent charges, and dispute these charges with one of the major credit reporting firms. If some of these questionable charges are removed from a debtor’s credit history, this may lead to an improvement of their credit score. While in theory this beneficial for someone struggling with debt, in practice in results in a risk of debtors being taken advantage of by unscrupulous credit repair firms. For instance, credit repair companies often charge high fees, thus barely leaving a dent in the overall amount of debt that someone owes. Many of the services that credit repair companies provide could be pursued by the debtor themselves for free, and the Federal Trade Commission provides resources for consumers to better understand the dispute process. The most damaging strain of credit repair companies are those who offer...
by Megan | Apr 18, 2014 | Uncategorized
There are many reasons why people may find themselves in need of credit repair. Loss of a job, overwhelming medical bills or failure to properly plan for other unexpected life events can contribute to credit problems. Many people do not know what their credit score is until they try to make a big purchase such as a car or a new home. With less-than-stellar credit, the consumer may be denied a loan or be only able to get one with a high interest rate. Bad credit affects many aspects of a person’s life, causes unnecessary stress and limits the ability to live out the American dream. Being denied credit for a loan or having a prospective employer hesitate to offer you employment because of a record of poor financial responsibility sends up a red flag that your credit needs repairing. Good credit is even needed to establish utility service such as electricity, phone or cable. This is just another reason to maintain good credit or make every effort to repair bad credit at the first indication that there is a problem. Fortunately, there is a solution for those who need to repair their credit and get on with their lives. Some people take the proactive approach back to financial health and attempt a do-it-yourself process of repairing their own credit. This process requires an enormous amount of time and effort, which many people cannot afford because of employment and family demands. They may feel that they do not possess the knowledge or expertise required to meet the challenge required to fix their credit problems. For these people there are...
by Megan | Apr 16, 2014 | Uncategorized
Having a bad credit score can impact your ability to take out a loan, apply for a credit card, rent or buy a home, apply for a job, receive insurance or buy a car. Are you worried about your credit score? You’re not alone. Neither are you out of luck. First, there are the preventive measures. Consistently pay your bills on time. Pay monthly balances in full. If you borrow, keep your account balance around or below 50% of your credit limit. But what if your score is already low? It may not work if you want to immediately shift to a score of 800, but you can slowly repair your score. Here are a number of tools for improving your credit. Get your credit score. (You can find it for free in many places online.) You actually have three credit scores—one for each of the three major credit bureaus, Equifax, Experian and TransUnion. Though they’re based on the same model, they tend to differ by as much as 20 points. Mortgage lenders will pull all three. Scores change whenever your creditors report new information, like your credit card balance. You’re entitled to one free credit report from each bureau every year, so take advantage of the opportunity. Get the reports at annualcreditreport.com and look for errors like misreported late payments and excessive loan amounts. Diagnose your credit score. It’s not enough to merely know your score. Pay bills within the grace period. Lenders report late bills after 30 days. After just one delinquency, your score can fall as much as a hundred points, so use this grace period...
by Megan | Apr 14, 2014 | Uncategorized
Great credit opens doors to low interest rates, loan approvals, and better prices on things like car insurance. On the other hand, bad credit may make it impossible to get financing, and it may even influence a job search. Repairing credit is a vital project if you’re considering applying for a mortgage, thinking about buying a car, or looking at a new credit card. The process isn’t instant, and it will take consistent attention paid to credit health; however, the results will be well worth it when you get the keys to your first house or drive off in a new vehicle while enjoying terrifically low interest rates. Simple First Steps At the beginning of the credit-repair process, you’ll want to handle a few pieces of housekeeping. These small tasks will help you create a plan for long-term success. Your first step is to read your credit report, from top to bottom. Everyone knows what a credit score is yet many people never check on that number or the credit report that influences that number. You can request a free copy once a year of your credit report from each of the 3 main credit reporting agencies: TransUnion Equifax Experian If you’re trying to repair your credit, you probably already know that the report is going to be in bad shape. However, that’s not why you want to look at it. Your goal in this phase is to find errors and get them corrected. If you find mistakes on your report, you or your credit repair agency can contact creditors or the credit bureaus to get those errors removed...
by Megan | Apr 11, 2014 | Uncategorized
If you have a poor credit score, you are probably paying more than you need to for things like loan interest and insurance. If this is the case, improving your credit score can save you a lot of money. Even if you have an average credit score, you may still want a better one since better credit means you pay even less for loans and insurance. Fortunately, your credit score can be repaired; however, it is important to note that the credit repair process is not usually fast and will take effort and patience on your part. Beware of quick fixes as these may cause trouble in the long run. Important First Steps to Credit Repair While it may take awhile for you to see a benefit, you can start implementing the steps right away. Get Your Credit Report Request your free copy and look for errors. Your score is calculated based on the data in your credit report; therefore, an error in it could affect your credit. Dispute any errors you find with the credit bureau that provided the report. Sign up for a Credit Card If your score is not good enough to qualify you for a regular credit card, get a secured one. Make sure to get one that reports to the three main credit bureaus. Use Credit Sparingly Having a big balance will hurt your credit score even if you pay your monthly bills in full. The portion of the credit extended to you that you utilize is what will be reported to the credit bureaus, it can have a dramatic effect on your score....
by Megan | Apr 9, 2014 | Uncategorized
How can a bad credit score be improved? It is hardly unusual to encounter consumers who are struggling financially because of a bad credit score that they have due to poor financial decisions in the past. Perhaps a credit card bill simply became too high, and missed payments started to stack up despite the insistence of collectors. Alternatively, many recent graduates find themselves deep in student loan debt and struggling to find work, resulting in tough financial times and a greater risk of default. One silver lining to this otherwise difficult situation is that there are concrete ways to improve a credit score, no matter how desperate the situation may appear to be at first. While some of these basic steps can be taken by anyone looking to improve their score, other measures may require some outside help. Starting easy: better spending habits The first and easiest step to improving a suffering credit score is, of course, making sure the problem does not get any worse by halting all credit card spending. The levels of debt that result in a poor credit score may seem imposing at times, but it is impossible for a debtor to spend their way out of them. Rather, it is essential to consistently pay down existing debt and focus on sources of debt with high interest rates, such as credit cards. Credit scores are calculated in part on how much available credit someone is using, so it is essential to pay down cards that are close to their limit. Conventional wisdom maintains that it is best to begin with a card that has the...
by Megan | Apr 7, 2014 | Uncategorized
Getting into credit card debt can sometimes feel like an insurmountable uphill battle to take on. However, your credit score is so important that there is no avoiding it or hoping that it’ll fix itself. Instead, there are ways that you can repair your credit score and get back to once again having the same benefits that come with a higher number. If you have bad credit, here are some tips for how to fix it and how to get back on a better financial track. Evaluate The Situation When you look at all of the debt that you owe, it can often times look like amounts that are impossible to pay off. However, the key is to instead look at those numbers individually so that they seem less intimidating. The first step to repairing your credit should be evaluating the situation as hand. Consider which debts need to be paid back the fastest and which ones have less detrimental affects on your overall number. Breaking things up into smaller payments can often bring a breath of fresh air, which makes for an easier method of paying things back. Consider Your Credit Card A credit card is a tricky thing when it comes to your credit. If you don’t have a credit card, then it’s time you pick one up and start using it. Then again, if a credit card is a reason that you are in financial trouble now as it is, then you may want to consider not spending as much on the card that already has a high balance on it. A credit card is intended...
by Megan | Apr 4, 2014 | Uncategorized
Credit repair companies can help people to find and remove negative items on their credit reports that are bringing their credit score down. Getting your good credit back can be an uphill climb when trying to do all the investigation on your late payments, charge offs, bankruptcies and other items on your own. A credit repair company will have the knowledge and experience in working with the major credit bureaus to repair your credit. Credit repair companies will go over all your items on your credit report and give you recommendations on how they will fix the negative items. They know all the federal consumer laws and how to communicate with the credit bureaus on your behalf. The credit repair agents know how to keep explicit records on how items are being handled and how to stay on top of ridding your credit report of all the negative charges. Many people question what the factors are that affect their credit score and have no knowledge of all the fundamentals involved in fixing their reports. Individuals do not understand how to dispute the questionable and negative items on their reports. Credit repair agents will investigate all items and have those items that are inaccurate or not able to be verified removed from your credit reports. Credit repairing agencies may offer additional services of protecting and monitoring your credit rating after all the negative actions have been removed. The first step is to dispute false and inaccurate items using the Fair Credit reporting act to remove all questionable information from the credit reports. If there are problems with certain items on...
