Posts Tagged ‘clear credit’

Tips To Know What To Do With Your Credit Information

credit report services

Your credit information may be of no use to you. If you’re not planning on buying a house or renting an apartment, buying a car, taking out a loan, paying for college or getting a new credit card, then you won’t need to worry about getting your free credit score. However, most people need to visit www.AnnualCreditReport.com to get a listing of all late payments, charge-offs, debts, collections, loans, liens and types of credit accounts open, so they can get an honest appraisal of their borrowing power. Credit report services from Equifax, Experian and TransUnion each will offer you a free report once a year to help you see where you are and where you need to be financially.

Sometimes, you may look at your free credit scores and credit information only to find it rife with errors. First, get your free credit scores online from Equifax, Experian and TransUnion at www.AnnualCreditReport.com, then print them out and highlight any negative information. Circle disputed records. Check the expiration dates of the records. Bankruptcy filing records should have expired 10 years after the first filing date, charge-offs should be gone within 7 years, collection records should expire within 7 years and 180 days after the last late payment, closed accounts should be removed in 7 years, foreclosure records last for 7 years, inquiries will remain on your credit report for 1-2 years but will not hurt your overall score, judgments/court decisions will remain for 7 years after the filing date, late payments of more than 30 days remain for 7 years, repossession records persist for 7 years and tax liens can remain indefinitely, if unpaid, or else 7 years from the paid date.

To file a dispute about your credit information, you can write a dispute letter to each of the three major credit bureaus, which are Equifax, Experian and TransUnion. On the letter, include the date, your name, address, phone number and social security number. Just write “The following data is incorrect and should be updated,” then list each inaccuracy, explaining why it’s wrong and what it should be
updated with.

Attach a marked copy of your credit score report and include any communication, account records or statements that can help verify your version of the truth. Mail is the best way to dispute with Equifax and TransUnion, while Experian only allows online disputes. The credit bureaus then have 30 days to investigate and repair your credit info. Once it’s finished, they will send you a letter including what was or was not updated. If you’re not satisfied with the results, then you can try to resubmit with different documentation or go directly to the creditor to resolve.

To get more credit information, you can check out www.Credit.com. Here you can look up info on popular credit cards, like the Chevron credit card, learn how to plan to buy a house or a car, learn about overcoming challenges and poor credit scores, and get tools on planning for retirement. You can download money management worksheets and check out online finance calculators, as well as gain access to registered credit experts.

Popularity: 59% [?]

Consequence Of Foreclosure On Your Credit Report

improve credit scores

Many people who have been foreclosed upon hire a credit counselor to help mop up that messy credit report. Not only are all the missed payments tarnishing your record, but there’s a “Notice of Trust Sale” and a “Trust Deed Sale” sitting ugly as well. Chances are, there is more than one area you are struggling with, so prioritizing with a counselor can definitely help. It’s good to have someone working with you to improve your situation and increase the bad credit scores you’ve suffered. While the full impact of a foreclosure isn’t likely to go away over the next year, you needn’t suffer mercilessly for the next seven. Remember that the last 12 months factor most prevalently on your credit score, so a quick rebound is your best chance at regaining financial freedom once again.

First of all, you’ll have to face the long-term repercussions and navigate the waves of your poor decision if the foreclosure is already on your record. The next five years could be problematic and you may be turned down for lines of credit, a car loan or a personal loan. To get the best interest rate on a 30-year fixed mortgage, banks will require you to put 20% down and have a credit score of 740 or higher, although some banks may settle for 620 with 10% down. To get back on track with clear credit, pull your credit report at www.AnnualCreditReport.com to see where else you may need repairs.

So which is worse for your credit score, a foreclosure or a bankruptcy? Even though bankruptcy stays on your credit for 10 years and a foreclosure for 7, “a foreclosure is very serious to mortgage lenders,” said Ray Hooper, Education and Housing Director for the Consumer Credit Counseling Service. “They’re going look at a foreclosure more seriously than they will a bankruptcy that doesn’t include the house.” Hooper says if you’re receiving default notices but still want to keep your house, then you’ll need to catch up on those missed payments.

You can modify the agreement to a lower interest loan or ask for forbearance, which involves the lender agreeing to suspend payments until you get back on your feet. If you outspent yourself and wound up in a real pickle, then you can ask the lender to hold off on foreclosing until you sell. In some cases, you might not get the asking price and will still owe money to the lender. This procedure is called a short sale. In other cases, you may negotiate a “deed in lieu of foreclosure,” which means you will give your house back to the bank and walk away with nothing, including clear credit.

When faced with foreclosure, the first thing many people consider is bankruptcy. However, this should be used as a last resort because it is so damaging to your credit report. If you file for bankruptcy, then you will also still have to make your monthly payments, although you’ll have the protection of the court while you catch up. What many people don’t realize is that they can usually negotiate a repayment plan with their lender, which will allow them to catch up on missed payments over a period of 3-18 months, bit by bit. This will only have a moderate effect on your credit score that can be repaired within a year or two. If you began missing payments due to an unexpected medical expense, a loss of employment or another incident, then you can apply for a special forbearance, which will give you a small grace period before the payment schedule is resumed.

Popularity: 33% [?]

How To Move Towards A Good Credit Rating

good credit scores

Did you know that 60% of your credit rating is based on the activity within the last 24 months? You may be lamenting over those old collection accounts or an old bankruptcy filing, but if you have since gotten back on track, or plan to get back on track, then there is a silver lining for you. Borrowers can eradicate bad credit scores by establishing a short and long term financial plan aimed at mitigating bad debt and maximizing good debt.

Improving credit scores involves avoiding many things. In the order of importance, they are late payments, high credit card balances, closing credit card accounts and having too many in-store charge cards. Late payments carry 35% of the weight in terms of your credit score, so do not take them lightly, even if it’s just a store charge card, a cell phone bill or a rent payment. Your credit score can drop by as little as 20 points or more than 100 points, depending on how often you are late and how many accounts you’re late on, as well as whether you are 30, 60, 90, or more than 120 days late.

Secondly, your credit usage should be no more than 40% of what is offered to you. If your credit line is $1,000, then you should owe no more than $400, and that goes for all lines of credit you have open. If you have any maxed out cards, then pay them down until you hit the 40% mark! Some people think they should close out their accounts to “do the right thing” or “prevent overspending,” although this will decrease your overall credit offering and will reflect negatively on you.

Instead, work on paying those balances down and once you’re finished, aim to purchase one thing a year on those cards to keep them active, and pay them off right away. Lastly, opening and closing store charge cards just to get that 10-15% initial discount is a signal of irresponsible credit behavior and will not result in high scores for your credit.

There are also many things you can do to fix a poor credit rating. To get back on track, the first real step is, of course, paying down your debts. You’ll need money to get there, though, so you might have to pick up a second job, find a new job, work more hours or borrow a safety cushion from friends or family. You can’t dig out unless you have the funds to do so. Secondly, look at your monthly budget and figure out how much you’re willing to spend on all of your debts each month, allowing yourself an emergency fund cushion if you can. Then list your debts from lowest balance to highest balance, or lowest interest to highest interest, and begin by paying all minimum payments, with every extra penny going toward the highest rate balance. Once that one’s paid off, go to the next balance. The sooner your debts are paid off, the sooner you can begin thinking about how to improve credit scores.

Following a bankruptcy, foreclosure or bout of unemployment, improving your credit rating could become an obsession. It never feels good to know you’ve failed at something. If you’re really knee-deep in debt, then you may need a credit counselor or debt relief service to help you sort out the mess. For the long-term, you need to renew your way of thinking about debt. Carefully record your monthly spending, writing down all your bills, incoming assets and expenditures. It can be really eye-opening to see where your money is going! Subtract your fixed expenses, such as rent/mortgage, utilities, auto loans, minimum credit payments from your monthly income and use the leftover cash to spread out to your debt. Make a list of your debts and interest rates, then begin paying the highest interest rate off first, while making minimum monthly payments on the rest. Be sure to take advantage of free credit report services each year at www.AnnualCreditReport.com to keep on top of things.

Popularity: 51% [?]