Archive for the ‘Credit Report’ Category

Working Towards A Better Credit Score

Friday, May 1st, 2009

Raising your FICO credit score is important if you want to get a better rate on future loans, but the process will takes time and there are no quick fixes. In fact, quick fixes are usually detrimental to your score, because they usually backfire eventually. The best advice one could receive is to take your time, and learn the right approach to building credit.

To start improving your credit score, you must make sure you’re paying your bills on time and managing your available credit wisely. The most important item is definitely going to be your mortgage (make sure you pay it on time each and every month). Also note that installment loans (where you borrow a set amount to buy things like new furniture or appliances) are given more weight than credit cards.

A few additional rules to help you boost your score: 1) always keep your borrowing well below your credit limits, because your FICO score will suffer if you are maxed out on your credit cards, 2) never have more than two or three credit cards because a large number of credit cards will also lower your score, and 3) definitely don’t apply for several credit cards at one time; it makes lenders nervous and will lower your FICO score dramatically.

Many other factors will also affect your score, but this is pretty a good start! My advice: do your research and always be prepared — Good Luck!

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Credit Reports After Bankruptcy

Friday, March 13th, 2009

Bankruptcies can be reported on a credit report for 10 years from the filing of the case! And to top this off, if you file a bankruptcy and then voluntarily dismiss it before the discharge, the credit reporting agency must report the dismissal as well as the bankruptcy filing, which means you’ll have to wait even longer to clear things up.

Now after those long years are behind you, and assuming you now have a decent income, you should be much more creditworthy after a bankruptcy than you were before it, since your old debts no longer have a claim on your future income.

The Fair Credit Reporting Act makes it clear that a debt discharged in bankruptcy must be listed as having a 0 balance. FTC OSC section 607, item 6 states: “A consumer report may include an account that was discharged in bankruptcy (as well as the bankruptcy itself) as long as it reports a zero balance due to reflect the fact that the consumer is no longer liable for the discharged debt.”

After the discharge is complete, you will now be entitled, under federal law, to have the balance of each discharged debt reported as “O”. The history of delinquencies can be reported, however, but the balance must now show as zero. If it is not, dispute the debt (you will win in this case).

Important to remember: negative history on your credit report is just that — history. It does not doom you to everlasting credit rejection, but it should, at least, challenge you to strengthen your financial present by saving and using credit carefully now.

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What to Look for in a Credit Card Company

Wednesday, February 25th, 2009

Choose wisely. When selecting a credit card, you should shop around for the best deal. Compare different cards based on your own situation, and try to look for the following benefits:

• A low annual percentage rate (APR). The lower the rate, the less interest you have to pay.
• The interest calculation method. This affects how much interest you pay, even when the APR is identical.
• Low or no annual fees. If the issuer charges an annual fee, ask them to waive it.
• All other charges (i.e., late payment fees, transaction fees, over the limit fees, etc). These can really add to the total cost of your charges.
• A grace period. Some credit cards charge interest from the day that the charges appear on your account. Other cards offer a grace period for you to pay off your balance before interest charges begin to accrue.
• The credit limit. Keep your credit limit low (about $500 or less) to make sure you don’t get in over your head.
• Wide acceptance. A major credit card is convenient, and easier to manage.
• Services and features, such as cash rebates, frequent flyer miles, extended warrantees, etc. Think carefully about the true cost of these programs when you consider interest and other charges.

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What A Debt Collector Can and Cannot Do!

Tuesday, February 17th, 2009

Recently, Congress enacted the Fair Debt Collection Practices Act (FDCPA) to prohibit some actions of “debt collectors” which were considered unfair or abusive. This term includes collection agencies and lawyers who collect debts for their clients, but it doesn’t include the creditor to whom money is owed (keep this in mind). The act applies to the collection of personal, family, and household debts, including car payments, medical bills, and credit card accounts.

Under the Fair Debt Collection Practices Act, debt collectors:

• May contact you only between 8 a.m. and 9 p.m.
• May not contact you at work if they know your employer disapproves.
• May not harass, oppress, or abuse you.
• May not lie when collecting debts, such as falsely implying that you have committed a crime.
• Must identify themselves to you on the phone.
• Must stop contacting you if you ask them to do so in writing.

So keep all this in mind the next time a collector gives you an inappropriate collection call!

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What To Do After Someone Steals Your Identity

Monday, February 16th, 2009

Were you a victim of identity theft? Then read the rest of this article to find out what to do next!

According to the Fair Credit Reporting Act (FCRA) both the consumer reporting agency (the institution responsible for evaluating your credit history and issuing you a credit score) and the business that gave the consumer reporting agency incorrect information about you are responsible for correcting inaccurate information. But it is your job to contact both of those agencies and make sure that they follow through.

Consumer reporting agencies have 30 days to investigate and resolve all claims they consider to be legitimate. Once you file a dispute with them, they must forward it to the business that reported the inaccurate information. But it is still a good idea for you to contact the business yourself. If it is concluded that inaccurate information has, in fact, appeared on your credit report then the consumer reporting agency must inform all three major credit bureaus (Equifax, Experian and Trans Union) in writing on your behalf and your credit report and your credit score will both be adjusted to reflect the changes.

In the rare event that an investigation concludes that the fraudulent information still stands, you can ask that a statement of dispute be included in your credit file so that potential creditors can take that into consideration before denying you credit or charging you higher interest rates. However, your credit will not be repaired and your credit score may still remain low.

Always remember to obtain a copy of your free credit report each year at so that you can catch any suspicious activity before too much harm can be done.

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