Our Credit Repair Blog

Grand Rapids Credit Repair and Credit Report Expertss

Credit repair. What's the best method?

Credit Repair, figuring out your end goal

When it comes to credit repair one must carefully consider their end goal. Typically when once goes to repair their credit, they have a goal in mind. You may be looking to buy a home or car. You may be simply trying to get out of debt. Depending on the goal you are going to have a different credit repair strategy. Credit repair done properly can save you thousands of dollars in interest on future loans and even money on your car insurance.

Making a purchase after completing credit repair?

If your goal is to make a purchase that requires your credit reports and scores to meet certain criteria, then your credit repair process may be different from an individual simply trying to settle debts. When it comes to credit repair and increasing your credit scores deletions and positive credit is going to be the focus. One of the most common mistakes made is not validating debts and properly paying collections.

Common sense may tell you that all you need to do is start paying collections and your scores will increase. Unfortunately it’s that simple. When it comes to collections it’s not actually the balance that’s hurting the credit scores. The Date last reported, payment history and date of last activity are the factors that are hurting the scores.  Many times you can actually do more damage to your credit than good, by improperly paying these accounts. When it comes to credit repair you should first validate with the goal of getting deletions or leverage.

Deletion’s are very common as accounts (even though they are legally yours) need to meet certain criteria under the FCRA or must be removed from you reports. Leverage to negotiate settlements can also be obtained by validating negatives under the FDCPA. This can be used as a tool to negotiate a savings on settling  debts and deletions or positive reporting a part of a settlement agreement.

Credit repair with the goal getting debt free

When in the process of credit repair with no other goal then paying off debts, the main focus is going to be getting the best settlement where the most amount of money can be saved. Make sure to get your settlement agreements in writing and to pay creditors via cashiers checks and certified mail.

 

 

 

 

Credit Repair, Debt Settlement and Tax Time

Credit Repair and Tax Time

As many debt collectors and consumers already know tax time is a great time for credit repair. Creditors know that tax time typically brings many consumers a large influx of cash that many wouldn’t normally have on hand and as a result offering much lower settlement offers than usual. Creditors usually aim to settle accounts for about 50-70% but lower their settlement offers to 25-50% around tax time.

Credit Repair and Debt Settlement 101

When It comes to taking advantage of this great time of year to settle debts one must consider several things when negotiating settlements and working on credit repair.

Keep in mind that credit repair and debt settlement are different in regards to the fact that the focus in debt settlement  is on saving you money in settling debts while credit repair is more concerned with your credit reports and credit scores.  While the two services can work hand in hand most don’t consider the benefits of both when settling debts.

Lets say your goal of settling debts is to clear up your credit so you can buy a home in the months to come, well if you aren’t mindful of how an account my report after a debt is settled you may do more damage than good to your credit reports and scores.

Credit Repair and Debt Settlement 201

Below are several tips to keep in mind when negotiating settlements depending on your end goal. Keep in mind its vital to determine why you are going to be settling these debts. If your goal is to avoid getting sued or your wages garnished your game plan is going to be different from one who may be looking to get a mortgage, new car or refinance a current loan on the next several months.

1. Not matter what the goal, if your settlement agreement isn’t in writing it’s not real. You would be amazed at how many consumers settle debts with creditors that haven’t been finalized in writing. The consequences can be huge! The creditor can legally come after you for the remainder of the balance and not only that, since you have just made a payment you have just reset the Statute of Limitations for the credit or to collect and report the debt.

2. Determine your end goal. If your end goal is saving a bunch of money when settling the debt, than it doesn’t necessarily matter how the creditor reports the account to the credit bureaus once its paid. If you goal is credit repair than you would want to negotiate that the creditor deletes the account from your credit reports as part of the settlement.

3. Have a game plan. When it comes to settling debts and credit repair most people fail because they simply have no game plan. Before you call a creditor you should know what you’re going to offer as a settlement and why. Tools such as a budget sheet, call log and offer in compromise letter’s are a must.

Conclusion on credit repair, debt settlement and tax time.

Tax time is the time of year to work on credit repair and debt settlement. Before you pick up a phone do your self a favor and do some research. There are endless resources and companies that offer honest ethical credit repair and debt settlement services.  The key is to take advantage of this all important time of year when you have extra money mixed with the fact that creditors are willing to negotiate.

 

Credit Repair and Mortgages

Credit repair and a home loan

For the things that matter credit matters. This couldn’t be more true when talking about obtaining, maintaining or refinancing a home loan or mortgage. Did you know that the whole basis of a credit score is for lenders to determine to chance of you going 90 days late on a loan? A single late payment on your home loan can drop your credit scores up to 100 points! In this article I am going to talk about credit repair in regards to getting, maintaining or refinancing a mortgage.

As you will soon find out the first step to getting approved for a home loan depends on your credit reports and scores.  The reason I say credit reports and scores is because you need both to meet certain criteria for your home loan to be approved. An FHA loan seems to be the most popular type of loan consumers are applying for currently. Most lenders are looking for a minimum credit score of 620-640 and for most non-medical collections to be paid. Credit repair is a vital tool in assisting consumers to prepare their credit reports for an approval of a loan.

Credit repair when refinancing a home loan

When refinancing a home loan credit repair is common. Many individuals are refinancing their home loans in efforts to free up money. With that being said those on tight budgets typically have collections, maxed out credit cards and a late payment here and there on their credit reports. As these negatives results in lower credit scores credit repair is a powerful tool. Consumers need to know what credit repair steps to take and common mistakes to avoid.

For instance not when settling collections its best to negotiate a deletion as part of the settlement or setup a payment arrangement where the creditor stops reporting negative marks and starts reporting your payments. When it  Comes to credit cards it may be easier to get a credit limit increase or add another credit card then paying down a balance to increase your scores (be careful though as not to get your self further into debt). Good faith adjustments are another credit repair tool that is often utilized.  Getting a creditor to remove a late payment can cause a huge credit score jump. This technique is called a “Good Faith Adjustment”.

Credit repair when applying for a Mortgage

When applying for a mortgage credit repair is not only a great tool to ensure you get approved for a home loan, it’s also a great way to make sure you are getting the best rate with the least amount of questions or concerns from a lender.

Before applying for a home loan all negative accounts should be properly validated with the credit bureaus as many can be deleted for being inaccurate, outdated, unverifiable or incomplete. It’s also very important in credit repair to make sure you have the right amount of positive credit reporting to the credit bureaus.  Last but not least you need to know how and when to settle debts as you may hurt your credit more than help.

As many will tell you obtaining good credit is easy. They say avoid credit repair by simply paying your bills on time. While that is the truth, credit repair is an important tool.  As many know, the loss of a job, illness, divorce, stolen identity and several other of lives curve balls can not be avoided.

Credit Repair and The Holiday's

Credit Repair and the Holiday’s

As you may already know, though you may not be in need of credit repair, my articles are typically written from the view of the credit repair process but can be applied if you have perfect credit and are simply interested in maintaining a great credit standing.  It has been  my experience that many individuals actually exit the holiday seasons with worse credit and more debt than before the season started. My goal, less credit repair more credit wisdom.

The desire to bless our kids, friends and family, fueled by marketing, sales and desire to keep up with the Jones’, leaves many consumers with empty bank accounts and maxed out or several new credit cards. Credit repair may be the next step to those individuals as maxed out credit cards, the opening of new credit cards and possible late payments due to overspending can significantly damage credit reports and credit scores.

Avoid Credit Repair, Be Proactive

In regards to being proactive around the holidays, my wife and I have found it is best to save all year-long. Your probably saying “Yeah Right”! I am barely scraping by and you want me to start saving for Christmas in March? Well actually, yeah. Think about this, our bills are always fluctuating but we find a way to pay the bill when their due, right?

Well, what if you setting aside money for the holidays was an actual bill you had to pay monthly. Not only that, but this bill also reports to the credit bureaus and can help or hurt your scores depending on if you pay it or not. At our credit union this is called a share building loan. Basically our credit union creates a $500, 12 month CD in our name and we make monthly payments around $43. At the end of the 12 months, we have our $500 plus a little interest and 12 months of positive payment history on our credit reports. This is a great credit repair and savings tool in one easy to follow program.

Credit Repair and Special Holiday credit card offers

When assisting my clients in credit repair, one important factor is building and maintaining positive credit. Sometimes in credit repair, this involves opening or closing accounts. Credit cards a.k.a. revolving accounts are a very powerful credit repair tool. 30% of a credit score is based on amounts owed to credit available on credit card accounts (utilization ratios), 15% of a credit score is based on overall length of history, 10% of a credit score is based on types of credit and 10% is based on new credit. I shared that to explain how  easy it is to trash your credit scores (even if you pay your bills on time and have little to no negative accounts reporting) by taking advantage of the special holiday credit card offers.

Lets start by looking at how 30% of a credit score is based on utilization ratios. When it comes to credit cards, it is a proven fact that we spend more when we plan on paying with credit instead of cash. With that being said, we are quick to max out our credit cards, not even realizing how much we are spending.  When balances on credit cards go over 50%, credit scores will drop as the utilization ratio increases. Believe it or not, credit scores can quickly drop by 50-75 points when credit card balances approach the credit limits. The best credit repair technique is to pay down the credit card or get a credit limit increase to lower your ratios.

With 15% of a credit score being based on length of history, adding new cards can quickly lower credit scores as the overall length is instantly shortened. A good credit repair technique may be to strategically close some credit cards. If considering doing this, contact me and I will guide you.

FICO likes to see a maximum of three credit cards per consumer and typically for every three credit cards they like to see one installment account. Once over that amount, other accounts can have a negative effect on the credit scores and on that note, they do not like when too much credit is added in a short period of time. That makes up the other 20% of credit scores mentioned above.

In conclusion,  the goal of this article is not only to help avoid credit repair, but educate you how to navigate  through the holidays. The holidays are about family, fellowship, and faith. Don’t be that person that hurts themselves financially, in efforts to bless others, only to place yourself in a stressful financial situation  for the rest of the year.  This may cause you to be grumpy around all those your worked so hard to bless at Christmas. My Grandma was that lady, and I hope that I can learn from her mistakes and invest my time in others instead of going to in debt to buy them something that will either be discarded in a couple of weeks or sitting on a shelf. Avoid credit repair this year, spend wisely.

Credit Repair with Big Banks or Credit Unions?

Credit Repair and Banking, How do the two relate?

You may be thinking what does credit repair have to do with who I decide to have a banking relationship with. Lets take a look at how credit repair and banking relate and then determine what type of bank would best suit someone who is repairing their credit. As mentioned in the title of this article we are going to be comparing big banks to credit unions. In light of recent proposed debit card fees by big banks and the Move Your Money and Bank Transfer Day movements, now is a great time to compare big banks and credit unions side by side in regards to credit repair. Please know that when I say credit repair I am referring to credit score and report improvement, and maximizing your overall credit profile to ensure you are getting the best interest rates when applying for financing.

The connection between credit repair and banking is obvious then, the better the credit score and report the better the terms and conditions you are likely to be offered when applying for financing.

Credit union or Bank? Which one is more willing help to help with credit repair?

Many factors go into finding the right bank for your needs, but lets focus on selecting the proper banking relationship in regards to credit repair.

When it comes to credit repair one of the main hurdles that a consumer needs to overcome is finding someone to give them the chance to prove their ability to repay debt in order to rebuild their credit scores and reports. As the whole purpose of a credit score is to determine risk order rank and most banks look at credit scores when deciding if they are going to approve or deny a credit application, it can be very hard to find a bank willing to give you a second chance.

I have found that both banks and credit unions offer credit building loans and credit cards but have different criteria that must be met for an approval of credit.

  • Banks have corporate policies and procedures in place that give the banker no room for making subjective decisions where credit unions allow their staff more flexibility.
  • Banks typically approve or deny credit applications by only looking at a consumers credit score while credit unions look at other factors such as length of relationship with their customers, types of accounts customer currently has with them, previous loans that were paid successfully.
  • Banks and credit unions both typically offer credit building loans and credit cards. Typically when applying for a credit building you are asked to put down a specific amount which they turn around and loan you, You then pay that amount back. There is no risk as the money they loan you is secured. Banks typically require a minimum of $1000 where credit unions offer credit building loans with as little as $250. When in the credit repair process this is a great tool.

Credit repair assistance is more likely with a credit union.

When it comes to credit repair and banking I would have to say I recommend credit unions. Grand Rapids is full of great credit unions such as West Michigan Credit Union, Community West Credit Union and Lake Michigan Credit Union. Remember when in credit repair, new positive credit being a huge factor, make sure you are working with a credit union. Credit repair can be accomplished. Utilize your credit union

Credit Repair in regards to Foreclosures and Shortsales

Credit Repair and Life Circumstances

Credit Repair can be a great tool in recovering credit wise from many life situations such as an illness,job loss, divorce, bankruptcy, foreclosure or short-sale. In this article I want to talk specifically about credit repair in regards to a foreclosure and short-sale. I will talk about the effects a foreclosure/short-sale has on a credit report and score as well as explain life after foreclosure/short-sale. My hope is that this credit repair article will encourage you that there is life after foreclosure/short-sale and explain what that looks like.

Credit Repair and Foreclosures

When it comes to a foreclosure and it affects there are several different categories of topics to be discussed. Below are a few that we hope you find informative.

Foreclosure and credit reports- When you have a foreclosure listing on a credit report you want to make sure it is reporting properly. Many times the credit bureaus/creditors will have inaccurate information in the comments, dates, balance or payment history section.  Credit repair is a powerful tool in helping to address thee inaccuracies.  for more information about how credit repair works when you find an inaccuracy you gotta read this.

Foreclosure and credit scores – When it comes to a foreclosure and your credit scores there is verifying information when it comes to the impact score wise a foreclosure can have. The truth is that none knows exactly how much your scores will be impacted but its safe to say your scores are going to drop a minimum of 100+ points. Actually the whole scoring system is based on calculating the chance that any given consumer is going to go 90 days late on an account especially a mortgage.

Foreclosure and your next home- So the big question many people are wondering is when can I get back into a home. Well basically there are two main factors post foreclosure to consider when wanting to buy another home. First is the fact that federal loan guidelines do not under any circumstances allow a consumer to buy another home for three years. The other factor would be the credit reports and scores. That’s where credit repair comes into play.

Credit Repair and Short-sales

Short-sales and credit reports- When you have a short-sale listing on a credit report you want to make sure it is reporting properly. Many times the credit bureaus/creditors will have inaccurate information in the comments, dates, balance or payment history section.  Credit repair is a powerful tool in helping to address thee inaccuracies.  for more information about how credit repair works when you find an inaccuracy you gotta read this.

Short-sales and credit scores- When it comes to a short-sale and your credit scores there can be different  levels of an impact on credit scores. The reason for the different score impacts a short-sale can have are based on two factors: 1. Comments 2. Payment History. Comments can range especially with the credit system containing so many flaws. I have seen short-sales listed as foreclosures, collections and have no negative comments at all.When it comes to the payment history (35% of a credit score) and it effect on the credit scores, that all depends on hoe far in default (if at all) you were on your home before the short-sale was finalized.

Short-sale and your next home- So the big question many people are wondering is when can I get back into a home. Well basically there are two main factors after a short-sale to consider when wanting to buy another home. First is the fact that federal loan guidelines do not under any circumstances allow a consumer to buy another home for two years ( this rule was at two years, then three and is back to two). The other factor would be the credit reports and scores. That’s where credit repair comes into play.

Conclusion

Credit Repair can be a great tool when trying to restore your credit after the loss of a home.  If no credit repair is done your scores will rebound but nowhere near as fast. Credit Repair will not only help you grow your scores after the loss of a home, Credit repair will help you improve the overall health and look of your credit reports.

Credit Repair and Bankruptcy how the two relate.

Credit Repair and Bankruptcy

Ok so I bet you wondering what does credit repair have to do with Bankruptcy. Like most you may have the assumption that after bankruptcy there is not much you can do with your credit for 7 to 10 years, or that your bankruptcy wiped your credit reports clean leaving no need for credit repair.  Well sorry to tell you that’s not correct. Actually credit repair is a very important part of post bankruptcy restoration. Actually credit reports are full of errors after bankruptcy leaving credit repair as a very valuable tool in restoring your credit file after bankruptcy.  Bankruptcy doesn’t have to cripple you credit wise for the 7 to 10 years you may think. Actually you can use credit repair to recover from a bankruptcy in as little as a year.

Credit Repair, Bankruptcy Code, Fair Credit Reporting Act (FCRA) and Fair Debt Collections Act (FDCPA)

When it comes to credit repair and Bankruptcy, you have bankruptcy law the FCRA and FDCPA on your side. Le t me explain. After your bankruptcy discharges the above mentioned laws are very specific about the way the accounts included in your bankruptcy should be reporting and displayed on your credit reports.

Basically federal law states that accounts included in a bankruptcy should only display the account name account number and the status or comment of included in bankruptcy.  Other information such as dates, payment history, balances, or credit limits are not to be displayed as they either violate federal law or are considered an attempt to collect a debt that had been discharged in bankruptcy. With that being said credit repair is a very powerful tool that needs to be implemented in restoring your credit after bankruptcy.

Credit Repair steps after bankruptcy

Ok now it times to apply what we have just learned about credit repair and bankruptcy. Credit Repair after bankruptcy involves a couple of key steps. First you want to get your credit reports from the three major credit bureaus ( Experian, Equifax and Transunion). Now you want to locate all the accounts on your credit reports that were included in your bankruptcy. I recommend that you take your schedule D from your bankruptcy papers and use that as a guide.

Be aware you  are going to find accounts that were included in your bankruptcy that are still showing as open and active or not reporting that they were included in your bankruptcy at all. Also keep in mind as i stated above the accounts that were in your bankruptcy should only be displaying the account name, account number and that status or comment of included in bankruptcy.  Any other information displayed violates federal law.

Great so you have reviewed your reports and they are all marked up with errors, what now? You next step is to begin the credit report process by disputing the accounts with the credit bureaus requesting the accounts be deleted from your credit reports.

Credit Repair disputing tips:

1. Always ask for deletions (there is a right and wrong way to dispute)

2. Never give proof (you just verified the account is actually yours).

3. Never dispute online.

 

 

Credit Repair: Adding Authorized Users and Fair Isaac New Scoring Model

Credit Repair Techniques and The new FICO Scoring Model

Fair Isaac (hereinafter, “FICO”) proposed in 2007 a new scoring model which would completely disregard authorized user accounts. We are noticing that it has not really happened yet with any other bureau except maybe TransUnion in some cases. Equifax stated that they will not allow FICO to apply this model to their data and we haven’t noticed the change in Experian either. Whenever someone in the media request information from credit reporting agency as to if they will permit this model, their response is quite ambiguous. Why? Is it to stop Credit Repair efforts?

credit repair

Credit Repair Tip: When in credit repair positive credit is a must. If you have no new positive information credit repair will not be as effective.

Credit Repair Needs this see ECOA

I believe that new scoring model is illegal according to the ECOA. You can take the time to review the provision of the ACT and notice the following: (6) Credit history. To the extent that a creditor considers credit history in evaluating the creditworthiness . . . in evaluating an applicant’s creditworthiness a creditor shall consider: (i) The credit history, when available, of accounts designated as accounts that the applicant and the applicant’s
spouse are “permitted” to use . . . As it stands now, the law clearly states that “any” account which an applicant is permitted to use must be considered. Their authorized user accounts should be part of this provision.  This is a credit repair tool for sure.

Credit Repair, FICO and Lawsuits

Considering lawsuits that may follow, it appears that modification to the scoring system has not and probably will not happen. Maybe it was just a way to slow down the business interest of selling trade lines for credit repair and some actually believed that this caused the subprime
debacle. WOW!!

So as of now adding trade lines to a credit report in credit repair maybe and still
is a great way to build one’s credit score if we take your reference from the ECOA.

Free Credit Repair Consultation

Credit Repair in regards to Fico And Fako Credit Scores

 Credit Repair expert Garr Russell says “Far From the Truth”

In case you do not already know, there are many different types of credit scores available on the web. The only thing they have in common is that they are sold generically as “credit scores”. And the fact that they all seem to be thriving (and proliferating) can only be attributed to the wide-spread belief that by purchasing “your credit score” you are getting a universally standardized number. Alas, this is far from the truth.

Credit Repair wise-No Worry

Credit repair-wise, I would not spend too much time worrying over it. If you want to obtain your scores in order to benchmark your credit repair progress, spend the money and get the two FICO scores. Or you can skip it. Everything a competent credit repair company does is carefully designed to help, and unless you feel the need to monitor your FICO scores, you can rest assured they are going up, and you will see ample evidence of the results the next time you apply for a loan.

Credit Repair needed? Get Advance Knowledgecredit repair

The best reason to check your score is to get advance knowledge of the number a lender will see when you apply for a loan. Lenders use FICO scores – in many cases three FICO scores. There are three credit bureaus that matter, Experian, Equifax, and TransUnion; each of these bureaus compiles credit data from lenders, collectors, etc., and hence, there are three FICO scores, one each for the mix of credit data assembled by the three bureaus.

Pseudo-Scores

Getting your actual FICO scores is somewhat problematic. The credit bureaus do not sell FICO scores, nor do any of the websites that pop up when you do a search for “credit scores”. All of these scores are creations of either the bureaus, or of other enterprising entities cashing in on the opportunity created by the prevailing confusion. And there is a difference. These pseudo-scores (often called FAKO scores) bear little resemblance to the FICO scores that lenders use to evaluate your loan application. If occasionally the numbers do coincide, it is rarity, and certainly not to be relied upon.

Getting FICO Scores

You can get one of your FICO scores from MyFICO.com. When repairing your credit one score is fine for monitoring your progress until you get closer to your target credit scores. Credit repair can take a while so their is no point in paying for multiple credit monitoring services

Conclusion

Credit Repair progress be deceiving if you don’t have the same scores that lenders see. When in the process of credit repair it is both rewarding and exiting to get that FICO score watch alert that changes have taken place on your credit reports. Credit repair not only includes addressing negatives accounts in disputing but also building new credit and settling debts.

 

Fico credit scoring.... The alleged 850 and credit repair

Credit repair not the only answer

If I may take a page out of Mint’s Facebook “fill in the blanks” for a moment. You are more likely to ________________ than to achieve a FICO score of 850. Who is actually scoring FICO 850? Is that even possible? The published score range of the FICO score is 300 to 850. Having said that, the range really isn’t 300 to 850. The range is actually somewhere between 300 and 850. The actual range of the score depends on the variety and generation of FICO score being used to score your credit reports. While credit repair can be a powerful tool to get your score into the high 700′s and above perfect payment history on several accounts is mandatory.

 

Credit Repair anyone?

We’re much closer to the top end of the published range than we are to the bottom end 300. In fact, all but only a few of the worst performing consumers are well over 100 points away from that imperfect FICO score. The lowest score held by a U.S consumer is…387. That honor goes to a consumer living in the state of Virginia. That 387 is by far the lowest of the low. The second lowest is 404 (out of New York). There are also some 407s in Ohio and Texas. The state with highest minimum score is Vermont, whose worst-ranked credit consumer has a 462.

Credit score disclosure- Time for credit Repair

Many of you who have closed on mortgages over the past few years probably recall that you received a “credit score disclosure” document from your mortgage lender (a legal requirement since 2004). That document not only shows your scores but also in some cases shows the possible range of those scores. You may have notices that it’s not always 300 to 850. The real maximum The maximum score held by a U.S consumer is…834. There are consumers in New York, Florida, New Jersey and Pennsylvania who have achieved that score.

Free credit score websites

There are also consumers who live in Kentucky and Minnesota who have FICO scores of 831. Pretty much every other state tops out at 830. Keep a few things in mind. This is the generic FICO score and not the semi-customized version used by some credit card issuers and auto lenders. And, this is NOT any score you are given for free online. Some of the freebies top out at well over 900 and give the impression that you’ve got an impressive FICO score. And while I’ve never seen a verified example of someone with FICO 850, we’re certainly getting closer to perfection than we are to utter disaster. As mentioned earlier credit repair is not the only way to achieving an impressive FICO score.

 

The state with the lowest maximum score is Arkansas, at 818. The lowest average score is 657 and that honor goes to Mississippi. The highest average score is 717 from the state of Wisconsin.

You certainly don’t need FICO 850 to get what you want with a great rate. As long as you have 760s across the board at all three of the credit reporting agencies you’re in great shape can end your search for the elusive, non-existent 850.

If your scores are lower credit repair is a valuable service that you can greatly benefit from. Be careful when shopping for credit repair as their are several bad credit repair companies operating today. Be sure the credit repair company you choose does not charge in advance and that they check out with the BBB. We are proud to display our credit repair rating with the BBB on every page of our website.

SEO Powered By SEOPressor