The truth about erasing bad credit and repairing your credit profile
By Adam | August 4, 2008
Hello-
There is a lot of misinformation out there these days about how to erase bad credit and repair your credit profile.
Today, I wanted to clear up some common myths about bad credit.
Every year, you can request the credit reports from the three agencies: TransUnion, Experian, and Equifax. The purpose in acquiring these reports is to check to ensure there are no errors contained therein.
* The myth that you cannot repair your credit is false. By writing to each agency and requesting that problems be looked at, error corrections can be achieved. According to the Fair Credit Reporting Act, the credit agency has to investigate any disputed item you bring to their attention. Once this information is verified, the item can be removed.
* The myth that you need to invest thousands of dollars to fix your bad credit is false. The notion that the only way to erase bad credit is by seeking the services of a credit repair agency is nonsense. While there are accredited agencies that can assist you in improving your credit, it does not come cheap. You can just as easily begin to repair your own credit by writing to the three agencies as well as the credit card companies in an effort to improve your credit score.
* The myth that bad credit will remain on the three agency reports is also false. If you have fallen into debt and cannot pay a particular credit card company, the bad credit will remain on the report for seven years. And if you file bankruptcy, it will be indicated on the agency reports for ten years.
* The myth that collection agencies can demand payment of a delinquent bill by calling you or your employer is false. Collections agencies are the bane of society. If you are contacted by a collection agency requesting payment for a bill that has not been paid, send them a letter requesting they cease and desist from contacting you. Sometimes it is better not to pay a bill that is long past due since it will only be placed on the three agency’s report for seven years.
* Another myth is that an inquiry made by a company can reduce the FICO score. This is incorrect. What does reduce the FICO score is if you apply for several credit cards in a relatively short period of time, max out your cards or have late payments attributed to a certain account.
The bottom line is that bad credit can be fixed. It will take some sacrifice on your part and may also entail contacting the credit card agencies as well as the credit card companies in an effort to show that you are willing to pay down your debts. There are many avenues you can explore to achieve a high FICO score. You can check the Fair Credit Reporting Act online that will offer the tools and resources you need to pay down your debts, repair bad credit and, in some cases, erase bad credit as well.
Thanks for reading.
-Adam
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Topics: Credit Repair, Credit Report, Credit Score, FICO Score, Fix bad credit, Fix your credit rating, Repair your credit | No Comments »
Use and stick to a budget to repair your credit
By Adam | July 22, 2008
Hello-
In order to repair your credit, you will have to cut your expenses to free up more cash to pay down your credit card bills.
To do this you need to setup a budget or spending plan is the new term that people seem to prefer.
Here’s some tips on how to setup and live with a budget:
Do you have goals in life? If any of those goals include bettering your finances, then start by creating a budget for yourself. Budgets let people see where they are spending all of their money and allow them to make changes.
When people think of a budget, they often see bars and handcuffs. No, you are not in jail but you may feel like you will be. However, a budget is simply your financial goals on paper. The truth is it will be hard for you to save for short and long term goals effectively without one.
The hardest part is the beginning. But, going through the motions of creating and implementing a budget helps you to stick to it in the end. Once you have faced the fact that you need one to succeed with your plans, living without one doesn’t feel like an option.
One way to live within your budget is through family accountability. I don’t mean walking behind someone and monitoring everything that they buy. It is more of a way to keep everyone on task. When you hand out allowances to the kids (if that is a part of your budget), remind them that the money must last a certain amount of time. Anything that they purchase including dining out at a fast food restaurant will be deducted from that money. Kids have a way of holding on to their money when they know they have to use it for their expenses.
Preparation is important. Let’s suppose that you have decided to carry your lunch to work to avoid spending money. Well, if you don’t fix your lunch ahead of time you are more likely to forget it and then be forced to eat out or eat nothing. The same goes for dinner.
When sticking to a new lifestyle it is necessary to give yourself all the help you can. Think about buying staples and not instant food items at the store. If you don’t make a grocery list, you are more likely to pick up things you don’t need and forget the things that you do need. Leaving your coupons at home means no additional savings to lower your grocery bill.
All of these things play into sticking to a budget. Agree ahead of time how you will commit to the budget. Waiting until the machine breaks down means costly repairs. If you feel yourself slipping, ask for help. Other family members are there to support each other and help to make these changes to your financial picture permanent.
How do you stick to a budget? Was it easy or hard? If a budget doesn’t work you can adjust the numbers to manage better. Don’t throw the entire system out the window and say that it doesn’t work. Give your budget a chance.
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Topics: Credit Repair, Get out of debt, Improve your credit score, Pay Down Debt, Pay Off Bills, Personal Finance, Reduce Spending | No Comments »
Resolve to get out of debt and repair your credit
By Adam | June 5, 2008
Hello-
Are you ready to get back in control of your life and your finances? Make the choice now to get out of debt and fix your credit.
Here’s some ways to help you get control of your debts:
Current statistics show that “8.3 percent of households owe $9,000 or more on their cards. On average, today’s consumer has a total of 13 credit obligations on record at a credit bureau. These include credit cards (such as department store charge cards, gas cards or bank cards) and installment loans (auto loans, mortgage loans, and student loans). Of these 13 credit obligations, nine are likely to be credit cards and four are likely to be installment loans.” Moreover, there were over “two million bankruptcy filings in 2005; an increase of 31% from 2004.”
While the statistics are staggering, undoubtedly the new figures for 2008 will be much higher. This is due to home foreclosures, the economic downturn, and overall increased debt among consumers. Thus, we have become a nation in debt.
The only way to get out of debt is to pay off the credit cards, avoid using credit cards except for emergencies, and pay with cash. According to the Federal Reserve, “a majority of U.S. households have no credit card debt. About a quarter have no credit cards, and an additional 30 percent of households pay off their balances every month.”
Resolving to get out of debt may be the single most difficult challenge we face today. The stress of living from paycheck to paycheck may be the proverbial wall that prevents most consumers from punching a hole in it in order to see a glint of daylight. But, steps can be taken to begin the process of digging out of this tunnel. Start with a budget that you can stick to; keep just one credit card on hand for emergencies, and start paying more than the minimum amount required.
For example, if you have multiple credit cards or other debts, begin by paying off one credit card, then take the money you would have used to pay that card and add it to the amount you would pay for the second debt owed. In this way, you will be adding more to the minimum amount required each month, and the debts will eventually be paid off one by one.
Paying for anything with cash these days seems like an antiquated notion. Every day, we are bombarded with new credit card applications that arrive in the mail. The problem is that we have fallen into society’s mindset that credit cards are a good, necessary, and convenient thing to have. But the truth is that debt is neither good nor necessary, but places us in a position of constant angst.
Here’s a little exercise: Take all the debt you currently have and add up the amount you pay in interest. Shocking, right? Think of what you could do with that money if you didn’t have debt. Credit card debt is the bane of society. Resolve to get out of debt; start planning now with a realistic budget. The sacrifices you make today will bring happiness and well being tomorrow.
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Topics: Boost Credit Score, Credit Repair, Fix bad credit, Fix your credit rating, Fix your credit yourself, Get out of debt, Pay Down Debt, Pay Off Bills, Personal Finance, Reduce Spending, Repair your credit | No Comments »
Credit Card Debt Relief
By Adam | May 21, 2008
You’ve been using that little plastic credit card more than you should have and now find yourself saddled with huge credit debt and no relief in sight. But don’t despair. The truth is that there IS relief for people who have a large amount of credit card debt. The average American carries $10,000 of credit card debt between two, three, and even four credit cards or more. That’s alarming when you think about it, and these people truly need some relief from the burden of credit card debt.
Carrying that much credit card debt seriously affects your ability to obtain loans for things like a car or a home. This is especially true if you are making late payments or skipping payments on your credit card debt. That’s why it’s important to find relief both monetarily as well as emotionally from the debt as soon as possible. There’s a reason why you’ve amassed this much debt, so addressing the underlying issues of why you’ve charged so much is just as important as trying to pay off your credit card balances.
First, you should not feel bad if you find yourself in a bad credit situation where you need to repay even a modest amount of credit card debt. Most all households across the United States have some type of credit card related debt and many of them need to at some point eventually seek out the services of a credit card debt relief service.
Consumers will find that debt relief from your credit cards can take on many different forms. The first step that you as the consumer should take is to owe up to whatever it is that you owe and what about your spending habits needs to be changed.
Are you someone who has the tendency to spend money that you don’t really have? Has a horrible medical issue arisen in your family that has resulted in turning to credit cards in order to take care of monthly expenses? Whether you find yourself in one of these situations or another one all together it is very important that you at least try to make the minimum payments until you can seek out a much better solution to your issues.
If you have a large debt to income ratio it is likely that seeking out a credit card debt relief is going to be your best option. Being committed to changing your spending habits is needed for debt relief services to be most effective.
Credit card debt relief services can help you work with your credit cards companies often reducing the total amount that you owe and help you get back on track to getting all your debt paid off. In time you will find yourself in a much better financial position and using your credit cards much more responsibly.
One of the best companies to help with credit card debt relief is Care One Credit
Topics: Credit Repair, Fix bad credit, Fix your credit rating, Get out of debt, Pay Down Debt, Pay Off Bills, Personal Finance, Repair your credit | No Comments »