The Powerful Dispute Process

Your credit report contains the necessary information on how to contest or remove inaccurate or negative information. This varies slightly between the three major credit bureaus. Often you can challenge the reported information online.

How To Remove Anything

There are two primary ways to dispute information. The first is the official dispute process, and the second is to go to the creditor directly. Both provide opportunities to remove anything from your credit report including the most negative information such as bankruptcies.

 

The Official Dispute Process

The Fair Credit Reporting Act (FCRA) gives credit bureaus strict legal guidelines about what they can and cannot do. For instance, if you dispute any item on your credit report (online or in writing) with the credit bureau, it must verify the information With the original creditor or entity that reported it. However, if the original creditor does not reply to the dispute within 30 days then the credit bureau is required by law to remove
the item from your credit report.

You might think that the creditor will automatically respond and prove that the negative information about you is in fact, true. However, that is often not the case. 30 Days IS not a long time, and creditors may not have the manpower to verify every dispute within that period. Also, it is very common for creditors to keep only two years worth of information readily available. If it is not readily available, they will rarely spend the time
necessary to retrieve your information even if it is available. Also, companies these days are constantly buying other companies or they are swallowed up by other companies. Your information may not transfer to the new owners in a way that is easy for them to access. Often they don’t or can’t verify the disputed information and when they are unable to verify the information in 30 days, it must be deleted from your credit report.
Many courts (which record bankruptcies, liens, and garnishments) do not allow certain types of information to be verified for privacy reasons as well.

If the disputed item comes back as verified, they won’t allow you to dispute it again, but if you choose to, you can then dispute a different item in the damaging record. What do you dispute? Whatever you legally can. You can say you don’t believe the account is yours. You can say you believe the account is paid in full. You can say the date of delinquency doesn’t seem accurate. The idea is to keep at it until there is a break down on their end, your dispute slips through the cracks and your negative credit item goes away.

TIP: One caveat is that you should do this over a period of time. Slamming the credit bureau too much in a short period of time may result in an alert being placed on your account which may make it harder in the future to make changes.

 

When Is The Best Time To Dispute?

The best time to initiate a dispute IS right now. The sooner you start, the sooner it can be resolved. Remember, your credit improves over time, so the longer a negative item is on your report, the longer it may take to slowly improve your credit. Almost any kind of damaging information can be deleted in this way, including bankruptcy. In fact, bankruptcy is a great candidate for this method. Bankruptcies are recorded by the courts. After a period of time usually two years, bankruptcies are moved from being active cases to inactive and this results in different ways of retaining the information. In fact as unbelievable as it probably sounds, some courts still use microfiche! In some cases, courts do not have the resources to verify the accuracy of your bankruptcy and frequently do not respond to the dispute, especially if the dispute is over the type of bankruptcy reported where they have to read details of the microfiche or other less accessible means of data storage.

Contact Information To Initiate An Official Dispute

Contact information to initiate official disputes and to obtain current
mailing addresses for disputing by mail:
https://dispute.transunion.com
https://www.equifax.com/personal/disputes/
https://www.equifax.com/personal/disputes/

Keep a record of exactly what you submitted as the dispute, and if you do it by mail be sure to send it certified/return receipt (Experian requires the dispute to be filed online). The current mailing addresses and instructions can be found on each credit bureau’s website.

If you register the dispute online, follow the instructions, and print out the
filled-in dispute form for your records. If you register your dispute by mail, send it certified mail, return receipt requested. You will need to include your name, address, and phone number. Also include a copy of your credit report and highlight the disputed line. If you have supporting documentation for your dispute, include a copy of it as well. Always send copies and never the originals. Your credit report may only show a partial account number for security reasons, but it IS enough for you to dispute the information attached to it. You should always follow up with all requests to remove negative information. Don’t assume it has been taken care of. It is a good idea to check your credit report periodically yourself to make sure the negative information has been removed.

Sample Dispute Letter / Email

The following is a sample dispute letter to a credit bureau. You will need to change it to your circumstances as well as modifying for an email.

Your Name
Your Address
Your City, State, Zip
Date

Credit Bureau Name
Dispute Investigation Department
Address
City, State, Zip
Re: Formal complaint

Hello,

This letter is a formal complaint that you are reporting inaccurate credit information. As you are aware, credit reporting laws require credit bureaus to report only accurate credit information and I am distressed that you have included malformation that has damaging effects on my credit standing.

I am disputing the following item. The notation “settled for less than full balance” needs to be verified and deleted as soon as possible. I have also circled it on the attached copy of my credit report.

Bank of America, credit account 12334-67890, “settled for less than full balance”

Please delete the above malformation as soon as possible.

Thank you,
Your name
Social security number

Enclosures: include a copy of your credit report and if you have proof the disputed information is wrong, include it as well)

Sample Follow Up Dispute Letter/Email
If you have not heard back within 30 days, then you may want to ramp up the pressure and send a follow up letter. Here IS an example of a follow-up
dispute letter if you did not hear back in the 30 day window.

Your Name
Your Address
Your City, State, Zip

Date

Credit Bureau Name
Dispute Investigation Department
Address
City, State, Zip

Re: Formal complaint letter dated March 27, 2015

Hello,

This letter is formal notice that you have failed to respond to my dispute letter dated March 27, 2015, which was sent registered mail. I have enclosed a copy of the return receipt which you signed on March 29, 2015.

The Fair Credit Reporting Act, Section 611 (a) (5), gives you 30 days to investigate and respond to disputes from the date you received them. It is now April 30, 2015, which is 31 days after you received the dispute request. Federal law mandates that if you cannot verify and respond within the 30 day time period, you must delete all of the disputed information from my report. I expect you now to delete the disputed and unverified information.

If you do not delete this informational, then as a credit reporting agency, your failure to comply with federal regulations is in violation of the Fair Credit Reporting Act. You may be investigated by the FTC, and be subject to penalties and fines. You should know that I am maintaining detailed records of all my correspondence with you.

Included with this letter are a copy of my original request, and the dated receipt of the original letter, signed by you.

The notation from the following “settled for less than full balance” must be deleted immediately.

Bank of America, credit account 12334-67890, “settled for less than full
balance”
Thank you,
Your name
Social security number

Enclosures:

 

Working With The Creditor Directly

You can contact the creditor who reported the negative information and ask them to remove it. They have no obligation to remove accurate information, but if you can be persuasive and argue that it is in their interest, they may be willing to help. Keep the letter short and simple, provide the account that you would like changed, tell them about your history of being a long time customer with a positive payment history, and ask that they update your credit report. If you had a compelling reason for negative information, such as you lost your job but you are now back on your feet, you should add that as well.

The creditor’s address is listed on your credit report. If you don’t receive a response within two weeks, look for another address, which may show on either the credit report or on the creditor’s website. Then send the request again. While you can also sometimes make the request by phone, it is often ineffective since you will probably be speaking to a receptionist and not directly to the person who can actually order the removal of the
negative information.

Sometimes the creditor will respond that they cannot legally remove information from your credit report. This is NOT true and is usually said to make you go away. If this IS their response, you can inform them that the Fair Credit Reporting Act states that they can easily remove any information they have previously reported.
Sample Letter/Email To A Creditor

The following is a sample letter to a creditor. You will need to change it to your circumstances.

Your Name
Your Address
Your City, State, Zip

Date

Company/Creditor Name
Company Address
Company City, State, Zip

Re: Account Number

Hello,

As you know, I have been a loyal customer of yours for over 10 years. During that time, many other companies offered me credit cards with lower interest rates and better perks, yet I remained loyal to your company.

Recently, I learned that you reported that I made 3 late payments two years ago. While this may be accurate, you also know that I was a model customer both before and after this incident. I lost my job and had some health related expenses during this period. You may notice that the missed payments were a one-time aberration.

I am currently shopping for a mortgage and have found that those late payments will hinder that process and prevent me from getting a low interest rate.

Therefore, I am writing to request that you remove this negative information from my credit reports since it does not reflect my current timely payment status. I have learned through the Fair Credit Reporting Act that this is easily done. I would appreciate your willingness to repay my loyalty, responsibility, and recent clean credit history by removing these negative items from my credit reports.

Thank you and I look forward to remaining your customer for many more years to come.

Thank you,

Your Name

Sometimes the first letter is enough to do the trick. However, it is quite possible that the creditor will come back to you With a form letter about how they cannot do it or that it is against their policy. When this happens then it is time to become the squeaky wheel. Write to the company again, only this time bypass the lower level employees, to whom you sent the first letter. Send this second letter to someone higher up the food chain. Even the president if necessary (you can also send it by email if you have the addresses).

Follow Up Sample Letter/Email To A Creditor

Your Name
Your Address
Your City, State, Zip

Date

Company/Creditor President’s Name
Company Address
Company City, State, Zip

Re: Account Number

Hello,

Enclosed please find copies of two letters: 1. My original request, dated March 27, 2015, asking for help, and 2. The bureaucratic form letter I received back.

The returned form letter states that it is against your company’s policy to help me with my request. While I understand the need for company policies, I also understand that successful companies such as yours care about their customers. Especially long-term customers like me.

Your records will show that I have been your customer for quite a long time, and have paid over $3,000 in interest to your company. I hope to remain a long-term customer.

However, there exists a two-way street in maintaining successful business relationships, and I recall that in the past, your company made some inadvertent errors pertaining to my account. I forgave them, remained loyal, and continued our relationship.

I am hopeful I can count on you to reciprocate by removing the negative information that currently shows up on my credit report. Your assistance would give me an excellent chance of getting my family a home at a manageable mortgage rate.

I thank you in advance for your kind consideration.

Yours sincerely,
Your Name

Enclosures: [List what you are enclosing.] 

What To Do If The Follow Up Letter Didn’t Work

If the follow up letter still didn’t work, you can try writing a third letter (or email), only this time send it to the original recipients, and several high level employees. And add a CC so each of them can see who else has received it. It puts everyone on notice that you will not go away. It also may embarrass the original recipients, since they did not resolve the issue and now everyone knows about it. At this point, they typically will remove
the negative information just to make you go away.

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The Secrets of a Credit Score

Ultimately, your credit score is a reflection of the credit bureaus’ trust in you to repay future debts. The lower the score, the higher the risk in their estimation. In turn, a high score indicates that they believe you are a less risky borrower. In one sentence, the credit score is the predictor of how likely the credit bureaus think you will repay a loan or debt.

Are There Different Credit Scores And What Are They Called?

This is becoming a more complicated question every year. In the past there was one score: the FICO score (FICO is an American credit score company based in San Jose, California that has been producing credit scores since 1958). However, as there became an increase in public awareness of the scores, and therefore an increase in the number of people willing to pay to know their scores, the credit bureaus began producing their own independent scores (which of course, they charged you for) under several different names. Even FICO now has several different types of scores. To make it more confusing, the credit bureaus started a competing credit score called VantageScore. All of this can seem a chaotic environment for anyone wanting to simply know their score.

The good news is that it really is simpler than the credit agencies want you to believe. In spite of the jargon and frequent name changes for marketing purposes, they all use a similar formula and the variances in the scores are mostly based on their databases containing differently reported information.

Because of this, my best advice is to check your scores regularly but don’t get bogged down or focus too much on all the different score names. It is good to know them, but if you track them, be sure you are tracking the same reports each time. In other words, if you get a score from TransUmon every six months always compare it to prior TransUnion.scores. Don’t try to compare a TransUnion score to a prior Experian score
or a prior Equifax calculated score.

For the purpose of this blog, when the term “credit score” is used, the information pertains to both FICO and VantageScore.

What Is A FICO Score?

There are several types of FICO scores such as for installment loans, auto loans and others. The most common one is the “classic” or generic score. The classic score is generally between 300 and 850. In the last published year, the average FICO score was 689.

What Is A VantageScore?

The three credit agencies TransUnion, Experian, and Equifax banded together to offer this alternative to the FICO score. The VantageScore 3.0 range was changed in 2013 to 300-850. Even though the same formula is used across all three credit bureaus, the
VantageScore will vary between them since the information in their databases varies.

The credit bureaus currently use, or have in the past used, a variety of names for their scores including FICO Advanced Risk Score, the Beacon score, Score Power, Pinnacle, FICO Risk Score NextGen, Perclsion, and EMPIRICA. I would suggest you only focus on the FICO score and/or the VantageScore. Keep it simple.

How is your credit score calculated?

Your credit score is derived from a mathematical formula that analyzes all the data in your credit file. While it varies a little between the different credit reporting companies, the basic rules are the same. Some of the major factors that go into the algorithm to determine your score include things like debt level, credit history, and payment behavior. There IS no consistent way in which they are measured since the weight of each is dependent on all the other credit factors available. This makes it very difficult, if not impossible,to calculate how any one action will affect your credit score.Factors like ethnicity, religion and gender are not taken into consideration.

What Are The Largest Factors In Determining Your FICO Score?

Payment History: paying bills on-time over a period of time will improve the score. Missing payments will lower the score. Creditors typically update your payment information every 30 days. Payments on the following will affect your payment and credit history: credit cards, retail store credit, finance company and bank loans (such as car loans), and mortgages. Payment history is typically worth about 35% of your FICO
credit score.

Outstanding Debt: The bureaus look at how much debt you have in relationship to how much credit you have (your credit limits). The debt can include a mortgage, credit cards student loans and any other type of debt. Generally, lenders prefer your debt to be at 35% or less of your credit limits. An easier way to look at it is the percentage of credit used (credit utilization) compared to the total credit available. High balances on several accounts may be viewed by creditors as leading to future problems in making payments. Lenders also compare the current balances to the original balances. The more that has been paid off, the better. Outstanding debt is typically worth about 30% of your FICO credit score.

Credit Account History: A long established credit history will have a big impact on delivering a good credit score. Credit history is typically worth about 15% of your credit score.

Recent Inquiries: Applying for too much credit or too frequently will show up on your credit report. Too many inquiries or too many new accounts may be interpreted as you are taking on more debt than you can afford which, will negatively affect your credit score. This is especially true if you have a short credit history. Recent inquiries are typically worth about 10% of your credit score.

Types Of Credit: the credit bureaus like to see a balanced mix of accounts, both in number and types, and in credit and loans. This is particularly true if you have a short credit history because there is less information used to calculate your score. Types of credit are typically worth about 10% of your credit score.

Negative Information: obviously little to no negative information on your credit report is a good thing. But the number of and seriousness of negative items such as collections, tax liens, and bankruptcies will affect the score.

What Are The Largest Factors In Determining Your VantageScore?

In general, the following have the largest factors in determining your VantageScore:

Recent Credit: Too many new accounts and inquiries may be an indication that you are applying for more credit than you can handle. Recent credit is typically worth about 30% of your VantageScore.

Payment History: Paying on time over a period of time indicates a pattern of responsibility. Missing payments does the opposite. Payment history is typically worth about 28% of your VantageScore.

Credit Utilization: How much credit IS available and the debt-to-credit ration. Credit utilization is typically worth about 23% of your VantageScore.

Depth Of Credit: length of credit history and the types of credit you have had in that time period. Depth of credit is typically worth about 9% of your VantageScore.

Credit Balances: What your total debt is. Credit balances are typically worth about 9% of your VantageScore.

Available Credit: How much credit you have access to. Available credit is typically worth about 1% of your VantageScore.

What Makes The Credit Score Rise And Fall? Here is an example of how it works:

  1. You apply for a credit card.
  2. The company that offered the credit card (the creditor) requests your credit report from one of the three credit bureaus.
  3. The creditor then reviews the credit report and the other information you provided (such as income) in the application. It uses this information to determine if it will give the credit card, and if approved, the interest rate it will offer.
  4. After approval, the creditor will report your new account to the credit bureaus. From that point on, about every 30 days the creditor will update your record With balance and payment activity.
  5. As you use the credit card and make timely payments every month, your credit score will continue going up over time. However, if you miss a payment(s), it Will negatively affect your credit status and your score will drop. So your credit score changes With your financial activity.

How Long Does Information Stay On The Credit Report?

Depending on the type of information, the length of reported activity can range from 2 -10 years.

Here are a few examples:

  • Hard inquiries from applying for credit – 2 years
  • Late payments, collections, charge-offs, civil judgments, closed accounts – 7 years
  • Bankruptcy and foreclosure 7-10 years
  • Tax liens — indefinite

On the flip side, positive information will also stay on your record for lengthy times as well.

Fortunately, for the negative types of information, there are ways to dispute these and we will address them late in a future blog post on The Powerful Dispute Process.

What Is A Good Score?

The answer to this question is really dependent on the type of loan you are seeking and what the creditor has determined is a good score for their financial product. Generally speaking, the scores range from about 300-900. The higher the score, the better chance you have to be approved at the best rates. Also, a high score provides some bullet proofing should a negative item find its way to your credit report. My recommendation is that you check your score at least twice a year. Your goal is to see a higher score every time you check. If you want to set a goal, I recommend shooting for above 750 and keeping it there, but again, higher is always better.

Credit Score Myth Buster

Co-signing doesn’t mean you’re responsible for the account.  Co-signing or opening an account jointly makes both parties legally responsible and any activity on the account will show on the credit reports of both account holders. So for example, you co-sign for a relative’s or friend’s car loan, and they do not make the payments, your credit status will be affected negatively. It can be hard to stop this arrangement too. You would have to get the other party to refinance the loan (assuming they can do so) or talk the creditor into formally taking you off the account (which is unlikely if the other person stopped making payments).

credit score

The Credit Bureaus

What are credit bureaus?

Credit bureaus are also known as credit agencies or consumer reporting agencies (CRA). They collect personal, financial and other information from many different sources called data furnishers. Data furnishers are usually organizations with whom the person on record has had financial relationships with. They can include lenders, creditors, debt collection agencies, public records, courts, utilities and others.

That data is then made available to credit bureau customers to use in evaluating risks for everything from extending a loan to renting an apartment or buying a home.

Big Three – There are three major national credit reporting agencies maintaining your credit records, TransUmon, Equifax, and Experian. All three work independently of each other in gathering information about you. They have vast databases that track the credit history of several hundred million people around the world.

Creditors like banks and credit card companies use the database information to make lending decisions on consumers looking for credit. While all three are very large corporations with immense power, they still have to comply with the regulations of The Fair Credit Reporting Act. Experian IS the largest with $4-7 billion in revenues in 2013. Equifax with $1.9 billion in revenue is the oldest of the three agencies and maintains
information on over 400 million credit holders worldwide. TransUnion is the third largest credit bureau in the country with $1.1 billion in revenues.

Other Credit Bureaus

Beyond the big three, are several smaller agencies such as Innovis and PRBC (PRBC stands for Pay Rent Build Credit Inc.).

Innovis, sometimes called the fourth agency, has fewer data furnishers reporting to them, and they maintain fewer records than the big three. Innovis primarily provides two types of services to their customers, consumers who have made late payments in the past, and change of consumers’ addresses.

PRBC has a different thought process from the other four credit agencies. They provide “alternative” credit reports that allow consumers to provide their own non-debt payment history to PRBC. So the consumer can report their payments for things like insurance, phone, rent, utilities, cable and other payment activity that is normally not reported to the credit agencies.

Not A Credit Bureau

We have seen other resources and books call ChexSystems a credit bureau. While  it is not a credit bureau by definition, it is used by many of the same customers who use the credit bureaus because ChexSystems tracks consumers who have written bad checks or own money to banks for any reason.

What Are the Consequences of Not Improving Your Credit Score?

All of the information that is on your credit report will directly impact your overall scores. As we have discussed before as well, your credit score will alone determine how you can obtain credit and what kind of loans you can be approved for.

So, in short, the biggest consequence of not improving your credit score is that it will put you in a harder spot financially. Having a bad credit score likely means you won’t be approved for loans, and even if you are, the interest rates that a business offers you will be much higher than would be offered normally.

Let’s put this into perspective. Let’s say that you are looking to buy a house and have found one that costs $250,000 with a 30 year mortgage. You have an excellent credit rating (720 to 850), meaning that you are able to qualify for a good interest rate of, say, around 6%. This means that you would pay approximately $1,500 each month for the home.

Now, let’s say that you’re in the same situation, but you have a fair credit rating (630 to 689). Your interest rate would likely be increased a little in this scenario, at say 6.%, and thus your monthly payment would be higher (probably closer to $1,600 to $1,700). Or if you have a bad credit rating (629 or lower), your interest rate could be 7.5 to 8%. This would make your monthly payment closer to $1,800 a month, if not higher.

The point of this example is to show you how having an excellent credit rating will allow you to save money, as in several hundred dollars a month with your home mortgage payment alone. That’s going to add up to thousands of dollars in the space of just one year.

This is why it’s so vitally important to not only have a great credit rating, but to also maintain that rating. All it takes is one late mortgage payment for your overall credit rating to drop and for you to have to pay a higher interest rate.

However, if you’re still not convinced that having an excellent credit rating is important, here are the five biggest consequences of having a bad score and not
improving it:

YOU’LL PAY MORE FOR A HOME OR APARTMENT

As our last example just showed, having a bad credit rating can cause you to pay a higher interest rate when purchasing a house. Again, this will cost you a few thousand dollars over the coming months, which may be money you can ill afford to spend if finances are already tight.

The same goes for renting an apartment. Landlords will only want to work with tenants who have demonstrated that they can pay on time (as your credit score shows). A bad credit score is crystal clear evidence that you have typically been late with making payments, and as a result, they may not be willing to rent you an apartment.

CONSEQUENCES IN YOUR PERSONAL LIFE

Having a bad credit rating can have consequences in your personal life just as much as it does in your financial or business life. This is something that most people don’t think about, but it’s true. If you’re married or living with a significant other and you are unable to buy the home or car you wanted because of your bad credit rating, it’s not going to do any good for your relationship.

IT WILL BE HARDER TO START YOUR OWN BUSINESS

If you’ve always dreamed of starting your own business , you should know that for that dream to become a reality, you need to have a good or an excellent credit score. This is because when securing financing for a small business, you must demonstrate you have paid all of your monthly payments on time in the past.

YOU MAY NOT BE ABLE TO BUY THE CAR YOU WANT

Buying a car will be much like buying a home in that the car dealership or whoever is selling the car will request to view your credit score in order to see if they can trust you to make each of your monthly payments to them. If your credit rating shows that you likely won’t be able to make the payments on time or even if it’s iffy, they may still sell you the car, but only at a significantly higher down payment and interest rate.

Again, you’ll save money with a better credit rating. Keep in mind, after purchasing a vehicle, you’re going to have to pay insurance for it as well.

BAD CREDIT RATINGS ARE DIFFICULT TO IMPROVE

We’ve established that having a bad credit rating will be, well, bad. But there’s one more consequence that comes with having a bad rating: improving a bad credit rating is going to be extremely difficult. Your credit rating will be with you for the rest of your life, and subsequently, it will reflect your entire financial history, including the moments in your history where you will be unable to pay each of your bills, and that will lower your score.

Fortunately, the whole point of this book is to teach you how you can build up your credit score and maintain it at good or excellent levels. Right off the bat, one thing you can do right now to improve your score is to make it a habit to check on your score at least every month and evaluate it to see if there are any errors or things that you can fix.

By this point, we have established what your credit score is, the importance of checking your credit report, and the consequences of not improving your credit score.

Now, we’re going to spend the rest of this blog talking about how you can actually improve your score, and that starts with pinpointing what you need to improve.

What Is Your Credit Score?

While most of us have heard of the term ‘credit score’ before, far fewer of us know what it actually means. A credit score is simply a number representing the creditworthiness of any particular person. This score is given on a credit report by a credit bureau.

Why is your credit score important? It’s important because lenders, including credit card companies, banks, and car dealerships, will use your credit score to evaluate the potential risk that you are giving them when you borrow money from them.

In other words, based solely on your credit score, a lender will be able to determine if you quality for a loan, the limits of that loan, and your interest rate. If you have a poor credit score, they will more than likely simply choose not to lend you money, period.

This is why it is vitally important to boost your overall credit score in any way possible. Everyone from insurance companies to mobile phone companies to government departments to landlords will request your credit score before deciding to do business with you. To put this more simply, your life will just be a lot simpler with a higher
credit score.

But there’s no need to worry, because this blog is going to teach you everything you need to know about what you can do to raise your credit score by walking you through a proven ten-step process. We’ll discuss what your credit score is in more depth.

While we already defined what a credit score is in the introduction, we’re going to discuss it more in depth now.

A credit score will fall along a scale from 300 to 850. The closer your score is to that 850, the more appealing you will look to creditors and lenders.

Remember that your credit score doesn’t just determine whether a lender or creditor will do business with you. It also determines the limits of your loan and the total amount of interest you’ll have to pay. You want your credit score to be as high as possible. It’s really as simple as that.

What Exactly Determines Your Credit Score?

So, how is your credit score calculated? It’s calculated based on the figures in your credit report that compile your credit activity from the three primary credit agencies:
TransUnion, Equifax, and Experian.

These three agencies will determine whether you have bad, fair, good, or excellent credit according to this scale:

  • 720 to 850: Excellent Credit
  • 60 to 719: Good Credit
  • 630 to 689: Fair Credit
  • 300 to 629: Bad Credit

There are a variety of factors that will determine where your credit falls on this score, including the following:

  • Your record of payments that were made on-time
  • The age of your credit history
  • The balances you owe on your credit
  • The type of credit you’re using
  • How much credit you have applied for recently

Therefore, to build a good credit score, you need to dothe following:

  • Pay each of your bills on time (not just your credit card bills)
  • Keep the balance on your credit cards at 30% of your total available credit
  • Regularly’ check your credit score and see if there are any errors or mistakes that you could challenge
  • Don’t apply for multiple credit cards in a short period of time

Take note that a credit score does not mean you are doing good or bad financially, contrary to what many people think. It’s possible to owe a lot of debt and still have a decent credit score, or to have plenty of money and have a poor credit score.

In addition, a good or bad credit score also won’t hurt your job prospects. This is because potential employers will not cheek your credit score when you apply to work for them.

What If You Don’t Have a Credit Score?

If you lack a credit score, you will be someone who is called ‘credit invisible.’ However, you can only not have a credit score if you’ve never had a credit card or a ball of any kind (so if you’ve purchased a car, for instance, you more than likely have a credit score because you’re making monthly payments on the car).

However, just because you don’t have a credit score does not necessarily mean that you won’t have a Vantage Score, which looks at alternate data such as utility payments or rent for the past two years.

Next, let’s check out how you can check your credit report.

Checking Your Credit Report

Have you requested your free animal credit report recently? If not, you’re in the same camp as most people. However, checking your credit report regularly is also something that you want to be doing. It’s very sad that most people don’t, but it’s also something that is very easily fixable.

  • At the bare minimum, you will want to check your credit report at least once every year. There are a wide variety of reasons for why you should do so, including:
  • It’s a critical step towards building and maintaining a good credit score
  • It should be treated as something that you do regularly when managing your finances; just as you check your credit card bills and bank statements, you should also review your credit score to see where you stand
  • Managing your credit, which you can only do if you are aware of your credit score, is something you must do in order to be financially successful
  • If you believe that you may have been an identity theft victim or a fraud victim, your credit score will usually be the first indicator

How Can You Check Your Score?

As mentioned before, it is very easy to check your credit score. What you need to do is go directly to the FICO website, which will develop the FICO score that most lenders use.

FICO scores will be used by lenders and creditors that offer instant approval. In other words, it is the most universal credit score there is.

What you can do is purchase a credit report from any of the three primary credit bureaus, which, as mentioned before, are TransUnion, Experian, and Equifax. There are purchasing options clearly available on each of their websites.

You will need to give your personal identification information, of course, before you gain access to your credit score. There will be questions given to you that only you know the answers to, such as your Social Security number and what your vehicle or mortgage payment is.

If interested, you can also purchase a credit card monitoring service to monitor all activity on your credit report over one month. A monthly fee will be charged to you and your credit score will be provided. This will be helpful to you if you have been an identity theft victim in the past.

Even though you now know what a credit score is and how you can check your score, you may not yet be convinced that improving your credit score is something you need to do.

Why Credit Matters

Repairing one’s credit history and learning how to manage a good credit status are critical financial steps to creating a solid financial portfolio. I pride myself on with the best possible credit repair advice on the web.  They will also provide quick, efficient ways for consumers to repair their damaged credit and also learn a little more about staying out of the bad credit category.

A consumers major reason to clean up their credit usually comes when they have been turned down for one of the many kinds of financial help; loans, leases, mortgages…etc. That is not the way a smart credit consumer should be going about his financial business.  Instead consumers should be aware and knowledgeable about their credit history and what their current credit status is.  That is what I created this blog for.  We want to provide you with top notch credit repair help along with sharing our knowledge of helpful credit repair tips and credit managing advice.

Consumer credit is common place these days and many people that some form of credit card or credit based spending material.  Since, standard of living is higher then it was a couple of years ago, it is almost impossible to buy certain needs, such as a house or a car, with out a financial loan or lease.  However, not just anyone can receive a loan or a lease.  How lenders determine if you are qualified to receive a loan or lease from them is by checking the customers credit score.  If their credit score is good they will probably front the customer the money, but if it is bad the customer has a slimmer chance of receiving the loan they wanted or needed.   As you can see now how important your credit is and how crucial your credit repair will be.

This blog is composed of qualified professional credit advice and it is my sole priority is to help you restore your  and to teach my expertise to others. By continually improving consumer’s credit repair methods, I have created a very effective credit recovery program and this not only fast and easy. This credit repair strategy is guaranteed to give people the credit repair help they have needed.

Credit scores are not something that should be ignored nor neglected in today’s world. Consumer’s credit scores can affect more then just consumer’s interest rates, but credit can also ruin their chances of qualifying for loans, employment, home rental, leases, financial opportunities and possibly insurance premiums. It is important for consumers to be aggressive about their credit and fix their credit problems before they are denied. I understand concern for this issue and will provide them with the necessary materials to help lift their credit into a long healthy credit future.

After repairing past credit errors, it is an imperative to learn how to manage ones credit efficiently and wisely. Jumping blindly back into the credit game with out a heads up on what went wrong the first time will only bring the situation around full circle. Consumers can find the most professional credit repair help today. I will help control consumers credit for the future.

 

Improving & Maintaining Your Credit Score

Using Section 609 as a basis for improving your credit score is a great choice, but that doesn’t mean you’re free and clear for the rest of your life. You still need to constantly be aware of your credit score situation and work hard to maintain and further improve your credit scores. The following outlines some effective tips on how to maintain good credit and potentially even improve your credit score.

Five Tips to Build a Better Credit Score

  1. Dispute any existing errors. If there are any errors or inaccuracies on your credit score, you don’t always have to go to the lengths of writing a letter and quoting Section 609. You can talk to the parties involved and try to get it figured out. For example, if you have an outstanding medical bill from an urgent care facility that you were under the impression your insurance company would cover, contact your insurance company to have it addressed. The unpaid bill is likely affecting your credit score.
  2. Limit the number of inquiries. Too many inquiries into your credit can hurt your credit, so limit how often you reach out to potential lenders. In other words, limit how many credit products you apply for.
  3. Don’t wait to pay. You don’t have to wait for your credit card bill to come around once a month in order to pay your bills. You always have the option to pay earlier in the month, or even several times a month, if you have larger purchases and want to keep your balance down.
  4. Apply for a credit limit increase. You’ve probably heard that it’s best to stay under 50% of your credit limit on all cards, sometimes even below 30%. If you have some expensive purchases coming up, or you simply require more charges to be put on your credit card, talk to your credit card company about an increased credit card maximum to keep your percentage in check.
  5. Focus more on getting rid of new debt. Far too many people focus their energy on trying to erase debt from years ago. This can be seen as good debt, as it shows that you paid it off consistently over time if that is the case. Newer debt has more of an impact on your credit score, so make getting rid of that debt your primary focus.

Maintaining a good credit score is extremely important, so don’t discount the ability of any one of these methods to have an impact on your credit score. Credit scores are more of a big picture, so small steps toward a better credit score really do add up. While Section 609 might be a great loophole, it isn’t a permanent cure-all. Follow these tips to ensure that all debt and bad credit decisions are in the past, and that a solid credit score is in your future.

Credit scores have a bigger impact on everyday life than most people realize. Your credit can affect your financial decisions and opportunities, from buying a new car to renting the apartment you want, to taking out a loan, to increasing (or decreasing) the amount you pay for security deposits. Bad credit can and will follow you eve everywhere.

If your credit score is causing you problems, take a look at Section 609 of the Fair Credit Reporting Act and consider writing a dispute letter to the collection agency. Dispute letters commonly work to the writer’s advantage, so there is no harm in trying to get negative items removed from your credit report. This strategy could potentially help you clean up your credit quickly, paving the way for you to get your finances back on track.

Whether or not you follow through with this dispute, there are many other methods you can and should use in order to maintain and increase your credit score. Always remember to watch your spending, pay your bills on time, and fight any errors that may be reflected in your credit score. Your credit score is a reflection of your credit worthiness, so make sure it’s strong.

Ultimately, good credit can help you out in life, and this is not something to ignore. Take the steps to repair and strengthen your credit, and you’ll soon reap the rewards.