Getting started with repairing your credit is one of the very best things you can do for your financial well being. At the hands of the credit system, you are being abused in the form of inaccurate reporting and an unfair credit scoring model. Through Credit Repair, you can do your part to make sure you get the credit score you deserve - a credit score that is truly indicative of your credit worthiness.
Choosing the right credit repair company to help you achieve your credit goals is pivotal. What follows are tips and things you should look for when choosing the best credit repair company for you.
1) Look for a credit repair company with experience
An experienced credit repair company will have taken the time to learn what tactics work best for each type of dispute. Having a large number of clients and a track record of removing many items means that a credit repair company has enough information to know what works and what does not.
2) Look for a credit repair company that has been in business for a while
Credit repair, like many other industries, has it's fair share of scammers. Preying on desperate people who long for a better credit score, fraudulent "credit repair" companies promise amazing results but the only thing they manage to do is take off with your money.
Fortunately, these companies never last very long. They are either run out of town or shut down by the FTC or local law enforcement. What this means for you is that you can usually trust a credit repair company that has been in business for a number of years.
3) Check out the company's BBB report
To start with, look for the BBB's rating of the company and their explanation of this rating. For example, the BBB report for the credit repair company Credit Bureau Experts shows the company as having an unsatisfactory rating because of unsubstantiated advertising claims made on their site.
Also look at the number of unresolved complaints to see if the company has been responsive to their customer's problems. Almost all companies will have some complaints, and the larger the company the more complaints it will have, but it is how they deal with these complaints that is important. Look for a company that addresses the concerns of its clients as opposed to a company like Credit Fix Now (see BBB report) who has an unsatisfactory rating with the BBB for not responding to to complaints.
4) Get the details on the company's payment policy
A common tactic of fraudulent credit repair companies is to charge you a large fee upfront and then either disappear with your money or otherwise not perform the agreed upon work. Many of the companies have been known to charge several hundred or even thousands of dollars before they will do any credit repair work.
Even though the practice of charging large upfront fees is illegal, there are still a number of smaller credit repair companies that try to get away with it. For example, the companies Credit Clean and Today's Credit Solutions are perfectly content to charge you one time fees of $1223 and $499.99 respectively for a year's worth of credit repair service. Granted, these companies may offer money back warranties, but that will be of little use to you if the company goes out of business or otherwise disappears.
5) Watch out for companies that guarantee to raise your credit score
To help protect you against credit repair companies who make impossible claims, the Credit Repair Organizations Act also forbids any credit repair organization from making guarantees about the results of their service when it pertains the the effect it will have on your credit reports.
While searching for a credit repair company, take note of any claims to "increase your credit score by 100 points", "lower your interest rates", or "remove all negative items from your credit reports". No company can legally make these claims and any company who implies they can should be avoided.
Wednesday, August 19, 2009
Credit Repair and Achieving Financial Security
Credit Repair, in the final analysis, is about your financial health
. You may start a credit repair program with concerns about the accuracy of your credit report, but in the end the real benefit of healthy credit is money in your pocket. Credit repair translates into a lower cost of borrowing, and consequently more room in your budget for saving.
Accelerate the Process
Are you ready to leave your financial stress behind? You can do this. Regardless of the current condition of your credit, a proactive approach can transform your financial life, and sooner than you think. Don’t make the mistake of believing that you are destined to spend years in credit limbo waiting for time to heal the issues of the past. An intelligent approach to credit repair will accelerate the process dramatically.
Two Basic Credit Repair Steps
There are two basic steps involved in the credit repair process. Each is as important as the other and cannot be ignored. When it comes to credit repair this balanced approach is required. Done right the results are dramatic. Are you ready to change your life, clean up your credit reports, boost your credit scores and enjoy all of the benefits that come with great credit? Let’s get started.
Understanding the Errors
The first step in the credit repair process is a methodical clean up of your credit report. Does this sound too obvious? You will be surprised. Most people imagine that if they recognize an item on their credit report it is accurate. This is far from the case. If you really want credit repair success you have to get rid of your preconceptions. An enormous percentage of derogatory information on consumer’s credit reports is reported in error.
Spotting Compliance Issues
In many cases these errors are compliance issues. Compliance issues are, by definition, based on some real event, but should not be on your report as a matter of law. Examples include duplicate accounts, derogatory information reporting beyond the reporting period limit, and collections reported by collectors whom no longer own the debt (having sold it to another collector, or returned it to the original creditor). Credit repair is about the details. And every detail matters. If you are confused you should hire a reputable credit repair service to manage the cleanup process for you.
Credit Restoration Time
The second step in the credit repair process is the rebuilding of your credit. Here also there are important details many people miss. A misstep can mean the difference between success and failure. Your credit score is determined by both the positive and negative information on your credit report. It is not enough to eliminate the erroneous derogatory information on your report. If you don’t rebuild your credit your credit repair efforts will fail. But you must rebuild it in a certain way.
The Key to Your FICO Score
You may think that if you pay your bills on time you will have good credit scores. Sadly, this is not true at all. The FICO scoring model is not designed to grade you on past behavior. Many people are horrified after a lifetime of perfect payments to discover that their credit scores are awful. This can be shocker. The FICO scoring model is a predictive model designed to measure the risk of future default and puts weight on such factors as account balances, the age of accounts, and even the type of accounts you open. Your credit repair efforts will succeed or fail based on your ability to shape your credit according to this predictive model.
Revolving Debt as a Credit Repair Tool
I suggest that you focus initially on your revolving debt. Stay away from store cards and consumer debt, such as furniture store accounts. Build your credit with MasterCard, Visa, American Express, and Discover Cards. If you don’t have any credit and can’t get a regular credit card, get two secured cards as soon as possible, and keep your balances low. A single maxed our credit card can knock one hundred points from your credit score. For comprehensive advice on balancing your credit contact a credit repair professional.
. You may start a credit repair program with concerns about the accuracy of your credit report, but in the end the real benefit of healthy credit is money in your pocket. Credit repair translates into a lower cost of borrowing, and consequently more room in your budget for saving.
Accelerate the Process
Are you ready to leave your financial stress behind? You can do this. Regardless of the current condition of your credit, a proactive approach can transform your financial life, and sooner than you think. Don’t make the mistake of believing that you are destined to spend years in credit limbo waiting for time to heal the issues of the past. An intelligent approach to credit repair will accelerate the process dramatically.
Two Basic Credit Repair Steps
There are two basic steps involved in the credit repair process. Each is as important as the other and cannot be ignored. When it comes to credit repair this balanced approach is required. Done right the results are dramatic. Are you ready to change your life, clean up your credit reports, boost your credit scores and enjoy all of the benefits that come with great credit? Let’s get started.
Understanding the Errors
The first step in the credit repair process is a methodical clean up of your credit report. Does this sound too obvious? You will be surprised. Most people imagine that if they recognize an item on their credit report it is accurate. This is far from the case. If you really want credit repair success you have to get rid of your preconceptions. An enormous percentage of derogatory information on consumer’s credit reports is reported in error.
Spotting Compliance Issues
In many cases these errors are compliance issues. Compliance issues are, by definition, based on some real event, but should not be on your report as a matter of law. Examples include duplicate accounts, derogatory information reporting beyond the reporting period limit, and collections reported by collectors whom no longer own the debt (having sold it to another collector, or returned it to the original creditor). Credit repair is about the details. And every detail matters. If you are confused you should hire a reputable credit repair service to manage the cleanup process for you.
Credit Restoration Time
The second step in the credit repair process is the rebuilding of your credit. Here also there are important details many people miss. A misstep can mean the difference between success and failure. Your credit score is determined by both the positive and negative information on your credit report. It is not enough to eliminate the erroneous derogatory information on your report. If you don’t rebuild your credit your credit repair efforts will fail. But you must rebuild it in a certain way.
The Key to Your FICO Score
You may think that if you pay your bills on time you will have good credit scores. Sadly, this is not true at all. The FICO scoring model is not designed to grade you on past behavior. Many people are horrified after a lifetime of perfect payments to discover that their credit scores are awful. This can be shocker. The FICO scoring model is a predictive model designed to measure the risk of future default and puts weight on such factors as account balances, the age of accounts, and even the type of accounts you open. Your credit repair efforts will succeed or fail based on your ability to shape your credit according to this predictive model.
Revolving Debt as a Credit Repair Tool
I suggest that you focus initially on your revolving debt. Stay away from store cards and consumer debt, such as furniture store accounts. Build your credit with MasterCard, Visa, American Express, and Discover Cards. If you don’t have any credit and can’t get a regular credit card, get two secured cards as soon as possible, and keep your balances low. A single maxed our credit card can knock one hundred points from your credit score. For comprehensive advice on balancing your credit contact a credit repair professional.
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