A standard dispute containing verbiage similar to the following:
update my account #XXXX to reflect, the actual credit limit, your reporting of
this account with my high credit can easily be perceived as fraud and an attempt
to diminish my credit rating. This improper reporting has caused me denial for
credit and has caused severe financial and emotional distress. I am sure that is
not your intention, and appreciate your expeditious response..
Please contact National Foundation for Consumer Credit or 1-800-388-2227 for information on debt management.
Inquiries can be classified into two categories; soft and hard inquiry. A hard inquiry shows up on credit report due to transactions you have initiated such as applying for a credit card, car loan, asking for a credit limit increase, set-up utility bills and applying for a new job. These inquiries typically stay for two years. Although, many will disappear within one year. As a general rule, limit inquiries to 7 per year only. Soft inquiries happen when existing creditor does a maintenance review of your file, when you pull your own credit report and a promotional credit is extended to you. Soft inquiries do not affect your credit rating. After a bankcruptcy discharge, debts that were discharged should be reported in the same category along with "good items" as accounts that are current. They should not be reported under derogatory category. Obtain a free credit report annually from Free Annual Credit Report. Upon bankcruptcy discharged, establish new trade lines by secured credit card and get an auto loan.
GET RID OF YOUR COLLECTION ACCOUNTS. Did you know that paying a collection account can actually reduce your score? Here’s why: credit scoring software reviews credit reports for each account’s date of last activity to determine the impact it will have on the overall credit score. When payment is made on a collection account, collection agencies update credit bureaus to reflect the account status as “Paid Collection”. When this happens, the date of last activity becomes more recent. Since the guideline for credit scoring software is the date of last activity, recent payment on a collection account damages the credit score more severely. This method of credit scoring may seem unfair, but is it possible to pay a collection and maximize your score?The best way to handle this credit scoring dilemma is to contact the collection agency and explain that you are willing to pay off the collection account under the condition that all reporting is withdrawn from credit bureaus. Request a letter from the collector that explicitly states their agreement to delete the account upon receipt/clearance of your payment. Although not all collection agencies will delete reporting, removing all references to a collection account completely will increase your score and is certainly worth the involved effort.
GET RID OF YOUR PAST DUE ACCOUNTS. Within the delinquent accounts on your credit report, there is a column called “Past Due”. Credit score software penalizes you for keeping accounts past due, so Past Dues destroy a credit score. If you see an amount in this column, pay the creditor the past due amount reported.
GET RID OF YOUR CHARGE-OFFS AND LIENS.
Charge-offs and liens do not affect your credit score when older than 24 months. Therefore, paying an older charge-off or a lien will neither help nor damage your credit score. Charge-offs and liens within the past 24 months severely damage your credit score. Paying the past due balance, in this case, is very important. In fact, if you have both charged-off accounts and collection accounts, but limited funds available, pay the past due balances first, then pay collection agencies that agree to remove all references to credit bureaus second.
GET RID OF YOUR LATE PAYMENTS.
Contact all creditors that report late payments on your credit and request a good faith adjustment that removes the late payments reported on your account. Be persistent if they refuse to remove the late payments at first, and remind them that you have been a good customer that would deeply appreciate their help. Since most creditors receive calls within a call center, if the representative refuses to make a courtesy adjustment on your account, call back and try again with someone else. Persistence and politeness pays off in this scenario. If you are frustrated, rude and unclear with your request, you are making it very difficult for them to help you.
DO NOT CLOSE OLD CREDIT CARDS.
Strive for owning 3 to 6 credit cards. You may close credit cards if they are less than 2 years old and you have over six credit cards. 15% of the score is determined by the age of the credit file. Use old credit cards once every six months to avoid it from becoming inactive and unused in credit scoring.
For everyone else, there are standard FICO scores, which range from 300 to 850. The median is 723, meaning half of consumers score better and half score worse. The higher the number, the stronger the rating. TAX LIENS.
Paid tax liens that have been paid, released or satisfied can be deleted from a credit report and public records within 30 days. Federal unpaid tax liens can be deleted if they have balances less than $25,000 with on time payments to the IRS.
Credit Bureaus - Here's how you can contact each credit bureau:Equifax: 800-685-1111, www.equifax.comExperian: 888-397-3742, www.experian.comTransUnion: 800-888-4213, www.transunion.com Each bureau credit score should be close to one another. However, sometimes they are not and there are several reasons for this. The first reason is not all creditors report the same information at the same time to each agency and creditors are not required to report to all credit bureaus. The 2nd reason is each credit bureau uses its own customized version of the FICO credit scoring model developed specifically for that agency and its data. Thus, the results may differ. The 3rd reason is some information may not follow the individual completely due due to different names because of marriage or variations in their name or different addresses. That's why it's imperative that you must check your credit report at least once a year.
Myth: If you have a good FICO score, one late payment won't hurt it.Fact: A first-time delinquency can drag down your score by at least 100 points. The later the payment, the more the damage.
Myth: You have to pay to fix errors on your credit report.Fact: Nobody needs to pay to fix errors. Contact the credit bureau that created the report and work with the bureau to erase mistakes. The process usually takes abut 1 billing cycle to complete. If you can't wait - we can assist you with service that could help expedite the process.
Myth: You will be penalized for checking your credit report.Fact: People can check their credit report or score as many times as they want without hurting their credit rating. When shopping for a mortgage, your credit can be checked multiple times in a 30-day period without penalty.
Myth: You should close as many credit cards as possible before applying for a mortgage.Fact: Having credit cards open does not harm your credit score and can even help if they are in good standing. Having them maxed out hurts.
Myth: It will take seven years to improve credit.Fact: Most negative items will remain on your credit report for up to seven
years, as long as they are accurate, verifiable, and actually occurred within
that period of time. Of course, many items are NOT accurately reported, and are
not verifiable. Therefore they can be removed.
Myth: Foreclosure or bankruptcy permanently hurts your credit score.
Fact: Foreclosure will remain for seven years and Bankruptcy Chapter 7 will remain for a decade and Bankruptcy Chapter 13 will remain for seven years. In both cases - the bankruptcy will remain in the public records section for 10 years. You can buy again in as little as 2 years depending on your circumstances.
Myth: The credit bureaus are government agencies.
Fact: Credit bureaus are for profit companies. They collect data to sell to lenders and providers and ARE NOT affiliated with the government. They are governed under Federal Trade Commission.
What is Rapid ReCheck?
A premium service that assist borrowers who have erroneous and derogatory information on their credit files that may be negatively affecting their FICO scores or if borrowers want to accelerate payoff information on their accounts. Our credit vendor can assist in expediting corrections to credit files at the bureau level. After corrections are made, files are re-accessed in order to obtain an updated credit score. Files are corrected and credit scores updated within 3 - 4 business days (instead of 30 days).
What is the Rapid ReCheck process?
The consumer must contact the creditor to obtain supporting documentation for the requested change. We will provide copies of this documentation to our credit vendor - CREDCO. CREDCO then verifies the documentation and forwards to the bureau(s) for the profile to be updated. The bureaus notify CREDCO when the file is updated and CREDCO pulls a new report to receive the updated score and releases the new file to us.
What documentation is required to process a Rapid ReCheck?
The bureaus require letters from the creditors or certified court documents. These documents do not have to be originals, but must be verifiable. The letters must include the creditor name, address, phone number and a contact name. Consumers must contact the creditors in questions directly to obtain the documentation.
How much does one change in a credit profile affect the score?
In general - paying off credit cards/trade lines and removing derogatory remarks will increase your score (all else the same). However, due to the multiple factors involved in determining a credit score and the dynamic on-line nature of credit scoring, it is impossible to determine how much one change will affect a score.
If derogatory information is removed from a report, will the score automatically increase?
In most cases - Yes. However, it is also possible that a score will not change and it may even decrease. Scores are not based solely on derogatory information. Other factors such as length of credit history, types of credit in use and the pursuit of new credit are also considered. The analysis of the credit profile can include one or more of these mitigating factors, which may change in conjunction with the derogatory information in question.
Why does CREDCO charge for Rapid ReCheck?
The bureaus charge us for the accelerated file maintenance service and for re-pulling the credit report after the file is updated. In addition, since this is an entirely manual process, there are significant labor costs. The cost is $30 per account/trade line per credit bureau.
Most people can tell you pretty much to the penny how much their mortgage or rent is every month. They can tell you how much they pay each month for their car loan. However, they have no clue what percentage of their income should be allocated towards housing or transportation. Many simply don't know.
Budgeting using percentages help you increase savings, repay and reduce debt, prevent impulse spending, distinguish between a need and a want and identify expenses that can be reduced.
Following is a sample guidelines of budget allocations (including comfortable or affordable ranges):
Keep in mind these percentages and line items are just guidelines. They help you establish a barometer. The range and categories will depend on a lot of factors, whether you're married, have children or live in a high-cost area. If 60 percent of your income is spent on housing, transportation and food, you've got to make the remaining 40 percent work by refiguring the percentages.
Everyone is different, and each one of us have a percentage for each item.
If you end up with credit card debts:
According to the Better Business Bureau:
Debt collectors have access to your credit files. They can check if you have bought a new home, have cable services or have recent purchases on credit. Bottom line - COMMUNICATE with bill collectors even your respond is you can't pay right now.
Everyone is unique. Complete the form below and I will contact you personally.