Are You a Candidate for Credit Repair?

It is true that millions of people have benefited from credit repair. But there are many misconceptions about the subject that have led others to jump into credit repair programs before they were ready. If you are truly a candidate you are likely to see dramatic results in a short period of time. Your credit report can be tidied up and your credit scores optimized; many people see a complete transformation on their report and a significant jump in their scores within just a few months.

You Are Not a Candidate, if…

You are not a candidate for credit repair if you are having trouble paying your bills. Credit repair is not about eliminating debt or finding a way to erase legitimate obligations from your reports. There is little point in starting the process of cleaning up your credit if there will be new derogatory information reported each month. If you are in a financial bind there are several other options that you should investigate, including consumer credit counseling, debt negotiation, and bankruptcy. Prior to deciding on a course of action please take your time to research these options carefully.

You Are a Candidate, if…

You are a candidate for credit repair if your finances are reasonable stable. You must be able to keep up with your bills, and ideally have a little money left over for savings. The ability to contribute, even a small amount, to a saving account will allow you to create a safety cushion for unexpected expenses and to insure that you can preserve the fruits of your credit repair efforts. True progress may also require that you build new credit, and for many people this means opening secured credit cards. A secured card typically requires a small savings deposit ranging from 200 to 300 dollars, so you should have some money available to contribute to the cause.

Getting Started

If you are a candidate for credit repair there are several steps you must take to prepare for the process. This small investment of time at the outset will pay huge dividends. Too many people jump in blindly and consequently get frustrated, or more commonly get only half of the potential benefit. There are few things as important as your credit; you owe it to yourself to make sure the job gets done properly. When it comes to credit repair, short cuts are dead-ends. Here are some ideas about building the right foundation for your efforts.

Get Your Credit Reports

Start by getting all three of your credit reports. Credit reports are a little tricky to read. If you purchase your three bureau credit reports individually, or opt for the free reports offered through the government mandated site AnnualCreditReport.com you will be starting your project at a disadvantage. Give yourself the edge and invest in a good tri-merged credit report online. One of these reports should cost you less than 20 dollars and is well worth the money. Most tri-merged reports structure your credit information for ease of understanding and will allow you to make sense of everything you see.

Proofreading for Credit Repair

The goal of proofreading your credit reports is to indentify every single issue that is hurting your scores. Before starting there are two things you need to know. First, it is essential that you give yourself the benefit of the doubt; if there is any question in your mind about the accuracy of a derogatory item you should dispute it with the credit bureaus. Second, don’t skip anything regardless of how small. You might be surprised how little things can add up and impact your credit scores. It’s your credit. Everything matters.

Spotting Invisible Dangers

When you proofread your credit reports there are several special things to look out for. These issues are hard-to-spot legal and reporting problems that can depress your scores, and yet unless you are alert they will escape your notice. Underreported credit limits can make your cards look like they are over utilized, accounts often continue to report as open with a balance long after they have been paid and closed, duplicate listings are commonplace and should be eliminated, collectors are supposed to withdraw their listings completely when they sell the debt to another collector or return it to the original creditor, but they do not often comply. All of these issues can hurt your scores so look sharp!

Reach Out for Help

If at any time you feel overwhelmed by the task you should reach out for help. There are many professional credit repair services that can insure that the job gets done properly. These companies are typically very affordable and will make sure that nothing gets left out. The best of these credit repair firms will also provide additional services like score consulting, rehabilitation and rebuilding guidance, and more. It’s your credit. It matters. Good luck!

Copyright © 2009 Ian Webber. All Content. All Rights Reserved.

Credit Repair: How to Raise Your Credit Score

The word is out. Unless you are independently wealthy and can pay cash for everything, your credit score will determine the cost of every dollar you borrow, and consequently, the quality of your life. A nationally recognized credit repair explains how to raise your credit score. It’s easier than you may think!

Get the Big Picture

Do you want to have fantastic credit scores? Would you like to be approved for the lowest cost financing available when you purchase a home or an automobile? If so, you need to understand the factors that have the greatest impact on your credit scores – and how to control them. Credit repair can make a dramatic difference in your life; just take one step at a time.

Open New Credit Card Accounts

Credit scores take both the positive and the negative items on your report into consideration. Effective credit repair requires a balanced approach focused on cleaning up negative issues and building positive credit simultaneously. If you don’t have any open accounts in good standing you should open a couple of new accounts as soon as possible. Secured cards are an excellent option if you have had credit problems in the past.

Watch Your Balances

Credit cards are the most powerful credit repair tool available. But they can be your downfall too. It’s all about your balances. High balances can ruin your credit scores, while low balances can propel your scores to new heights. The FICO scoring model recognizes five different balance-to-limit ratios which measure the relationship between your balance and your high credit limit. The ratios are 20, 40, 60, 80, and 100 percent. Pay your balance down to below 20% of your high credit limit and watch your scores take off. But let your balance run up to the max and you may see 100 points come off your score. Just remember, the lower the balance the higher the score.

Avoid Store Cards – Sort Of…

Everyone loves a discount. So when the salesperson offers a discount if you open a new store card you may be tempted. Sometimes it makes sense. But if you plan to apply for a loan anytime soon you should decline the offer. Store cards have a funny way of sending your credit scores into a nose dive. This is because they usually involve a combination of an inquiry, a brand new account, and a new balance equal to the high credit limit. These three things combined are deadly. On the other hand, there is nothing wrong with saving money! Just make sure that you don’t need your credit score to be at its best in the next few months.

Clean Up Your Student Loans

Unlike other forms of debt there is no statute of limitation for student loans. This means that they are collectable forever. And the longer you ignore them the worse it gets. Are you behind on your student loans? Do something about it right now. But make sure you know your rights! Call the Student Loan Ombudsman Office at (800) 557-2575. They are there to help you understand your options. They will explain how you can rehabilitate or consolidate your student loans. They will also explain that you have the right to affordable payments and even deferment if you cannot afford repayment at this time. Pick up the phone. Include your student loans in your credit repair effort today!

Remove Old Collections

Are there collections on your credit report? Too many people make the mistake of believing that if it is on their report it is correct. Credit repair requires a healthy dose of skepticism. Don’t believe your eyes. Collections change hands regularly. Did you know that collectors who do not currently own the debt are not allowed to report it? There is a high probability that older collections should not be on your credit report. And if you see more than one collection for the same debt, at least one of them should not be there. Challenge those collections. Watch your scores take off.

Call Mom – Last Chance for Authorized User Accounts

Want a quick increase in your credit scores? Here is an easy credit repair trick. Call mom, or dad, or anyone you know that has excellent credit. Have them contact two of their credit card issuers and add you as an authorized user. You don’t have to use the card, and your donor can remove you at anytime. Within two months the account will appear on your credit report and your credit score will enjoy the benefit of your donors perfect account history for that account. Just keep in mind that this is not a long term fix. The new FICO scoring model has eliminated this loophole and the three credit bureaus will eventually adopt the new model. But it’s still good credit repair medicine!

Confused? Hire a Professional

Credit repair can be confusing. But there is no need to struggle along on your own. Pick up the phone and call a few credit repair services. Choose one that you are comfortable with and let them take over. A credit repair professional will make sure that everything possible is being done to clean up your credit report and optimize your credit scores. But don’t wait. The sooner you start the sooner you will be able to experience the benefits of your credit repair effort. Good luck!

Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.