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What Is the Right Way of Writing Credit Dispute Letters?

Bad Credit Advice — Fri, 14 Jan 2011 14:55:10 +0000

If you found out something like an unpaid unsecured signature loan on your credit report, make a credit dispute letter. A professional, well-written letter can help you achieve that desired points on your credit score. There are known easy steps that can help you through the hassle of fixing those unwanted mistakes. Here are some easy tips that can guide you through that draft:

Get right to the point. Being clear and upfront is one of the best ways for you to be understood. By making your content straight to the point, you’re making them understand you clearly and having your complaint processed at the soonest possible time.
Use proof of the error. Collect and gather as many information as you can such as court files or documentation of your payments. This will give them a concrete idea on how to solve your problem with ease.
State how it should be. Not all people can read minds, you can’t just show them what the problem is and expect amazing results. You’ve got to tell them exactly how it needs to be changed and what has to be done.
Communicate clearly. Making your creditors understand you clearly is one of the key points through this mistake. Being able to write your credit dispute letter in black and white may help them understand clearly what you’re trying to say. You’ve got to be able to relay that there is a known problem, identify the problem, give them the right solutions and present the collected solid documentation to close it. Being clear and straight to the point will always help you through anything especially in creating a dispute letter.

A well written credit dispute letter should do the trick in making your credit score better so that you don’t have to resort to those high interest personal loans again.

An Easy Way to Establish Credit

Bad Credit Advice — Sat, 01 May 2010 07:23:39 +0000

Let face it, without a credit history reported on a credit report, you are doomed to find any kind of financing anywhere. It seems that these days we are all grouped into a category based on a credit score! Anyway, knowing how important and powerful a credit report and credit score are, in spite of the fact that you don’t have any credit established yet, here are a couple of ways to obtain good credit. Just keep in mind that it takes anywhere from 6 months to one year to get a history established and some banks like to see a two-year history. It does take some time so be patient.

If you have a good stable job and can make payments, have Mom or Dad co-sign for a car loan. Don’t get crazy and buy a fancy expensive one as the promptness of payments will be rated and reported on your credit report. This is a really good way to start. If this is not an option for you, another really good way is to apply for a secured credit card. This is where you put up $500 as security for a $500 credit limit on a Mastercard or Visa.

Remember, your credit rating is based on how timely you make your monthly payments on a debt that is owed, over a period of time. So if you use the secured credit card for a purchase, don’t pay it back all at once. Make payments for more than the minimum payment that is due and pay the balance off over a short period of time. For example, buy a present for someone in the amount of $300. You have the cash in your bank account and would have used it for the present, but you are going to use your credit card instead to establish credit. Over a three month period, pay back $100 each month on or before your monthly payment due date. You will have to pay a small portion of interest on the balance owing, but that’s a small price to pay for the good credit rating you will be getting. This card is relatively easy to get since the lender will take your cash used as collateral if you donít pay the balance. Not all banks offer secured credit cards, so you may have to do some digging, but they are out there.

Once you have made payments on the co-signed car loan for approximately 6 months and you have a short history with a secured credit card, apply for a gasoline credit card or department store credit card. Department stores and gasoline stations want you to buy their products, so typically they will be inclined to start you out with a small credit line. Be careful though and not abuse the credit that has been provided to you.

If you follow these steps and maintain good paying habits you will be on your way.

Four Common Misconceptions Regarding Credit

admin — Sat, 25 Jul 2009 22:10:57 +0000

Having worked in banking and finance for over 15 years, I am always surprised to realize how confused most people are regarding how the credit system works. Here are the top four misconceptions regarding credit I hear most often.

Myth One: Information in my credit file cant be changed.

Truth: Anything that you disputed with the credit bureaus must be verified as being accurate in order to remain in your credit file. According to the Fair Credit Reporting Act, if the lender cant verify that a disputed trade line is correct, the credit bureaus must remove the item from your file.

Myth Two Past due collections should be paid immediately to raise my credit score.

Truth: When you pay off an account, it is true that the lender will report that it is paid. Unfortunately, the late payment will still show up. If the account is very old and has not had activity for quite some time, paying it off may actually hurt your credit score.

When you pay off an account, you renew the date that the account was last active. Because something recent is going to have more impact on your score than something that happened a long time ago, a paid collection with a recent date of last activity can sometimes have a more negative impact on your score than an old unpaid collection.

This doesn’t mean that you shouldn’t pay off your collections. What you will want to do is negotiate with the creditor as to how it will be reported to the bureau BEFORE you pay the account. Be careful here: make sure you get everything in writing!

Myth Three: Bankruptcy is the best solution for starting over.

Truth: There are times that bankruptcy is the only option, but it is a decision that should be weighted heavily. Though new laws now prevent many people from filing, even those that still can should consider the decision very carefully.

A bankruptcy stays on your credit report for ten years. This means that you will pay a higher interest rate for everything ” homes, cars and credit cards. You will also have to wait between two and three years after filing before you can qualify for a mortgage.

Very often, lenders will be willing to re-negotiate when they hear that you are considering bankruptcy. The bottom line: it should be considered a last resort option.

Myth Four: Something accurate can never be removed from my credit file.

Truth: Credit bureaus are required to confirm the accuracy of accounts when they are disputed. The Fair Credit Reporting Act gives lenders only 30 days to verify the account before the credit bureau is required to remove it from your file.

If the lender misses the deadline, the credit bureau must remove the account from your bureau, regardless of if it is accurate or not. It is easiest to take advantage of this on older trade lines as well as those that are currently paid off but were once past due. In both situations, your information can be difficult for the lender to locate, and they don’t have much motivation to do so.

Knowing what to do is half the battle in achieving your ideal credit score.

by Vincent Polisi

About the Author:

Vincent Polisi is President of financethedream.com. financethedream.com is the nations premier Rent to Own and Lease Option program, offering homes throughout America. financethedream.com prides itself on offering a complete home ownership program its clients, including credit reporting and credit repair.

Credit Repair Help – Here’s How To Start Right Now!

admin — Wed, 22 Jul 2009 19:13:20 +0000

It’s hard to live with bad credit. You need credit to lease a house or car. Most loans you apply for will be turned down with bad credit. It can be frustrating to have bad credit. You need credit repair help.

It’s not that hard to get your credit repaired. All it takes is a little time and a little effort on your part. You must be diligent with your spending and take a few simple steps. Repairing your credit will not happen overnight.

First thing to do, must do is create a budget. This will allow you to know how much money each month you can spend on your debts. It’s best if you document for one month your spending habits. You never know how much you spend eating out and buying fancy coffees.

Equifax, Experian, and Trans Union are the three credit reporting agencies that report to FICO. FICO is who keeps your credit score and reports it to the banks. You should get a credit report from all three agencies. Your bank will give you a free report every year if you ask for one; otherwise you can find an online solution.

Contacting the creditors is the next step. You need to speak to them to offer a payment plan. They will be willing to work with you because they want the money owed to them. If you offer to pay off the full balance and settle right then and there, usually they will give you a discount and ask you only pay the principal. Any agreements should be mailed to you in writing.

Now you need to close out and pay your credit card debts. Destroy the cards and start paying them off. The best idea is to close all the accounts you have except your three oldest ones. You see, credit scores are based on the account history as well as other factors. Even if these lines of credit are opened, you don’t need to use them unless it’s an emergency.

It seems simple, but pay the bills on time. This will be the best thing for your credit. The collections and creditors are willing to work with you and understand the situations you may be in. Any payment for the month is good, if you cant afford your full payment, you can still give them a good faith payment of as much as you can afford. This will at least show you attempting to work with the creditors.

by Mark Alison

About the Author:

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Addressing A Negative Credit Score

admin — Mon, 20 Jul 2009 00:27:59 +0000

Credit repair is a hot topic these days. As more and more people understand that they cannot pay their bills, our national credit average is dwindling. However, there are some risks to using credit repair companies to fix a negative credit score that you should know.

Your credit score is the faced the companies put on you. You can’t get out of it that you can change it. The first step is to determine your credit score and decide if changes need to be made.

There are different types of credit that are applied to the credit report. For example, a mortgage or automobile loan appears less risky than a credit card. You want to manage your credit portfolio in such a way that you appear with an optimal amount of risk for credit companies.

If you want to repair your credit, it’s time to learn personal discipline. Taking steps to reduce your expenditures will help you prepare your credit. Learn these techniques now and use them religiously.

Negotiations with credit companies for the purpose of credit repair can sometimes be difficult. The point is to remember that you have legal rights. If you need help dealing with uncooperative companies, you should seek recourse if possible.

The easiest way to help out your credit report initially is to stop applying for credit. If you’re thinking about applying for more credit cards or loans, cancel it. Allow some time to pass between credit applications to reduce adverse affects.

A credit freeze may be beneficial to protect you in case of identity theft. However, it places a big inconvenience on you if you use this credit repair technique. A credit freeze eliminates the ability of creditors to review your report.

Your credit score is comprised of many different factors. Not every factor carries the same weight in determining your credit. If you’re attempting credit repair, it is in your best interest to pursue those activities which give you the best leverage.

Basically, credit companies use the credit report to determine the amount of risk there is involved with lending you money. If you are trying to get money from several different sources in a short period of time, you are risky. This desperation is evident by many recent credit reviews on your credit report.

You are ultimately responsible for all credit that you have. You are also ultimately responsible for repairing your credit. Unless you can change your behavior to reflect responsible credit use, you will be in this situation over and over again.

In conclusion, the loss of credit has made some people desperate to increase their credit score. However, step back and take a look at what you’re doing. Maybe you should take this opportunity to rebuild your credit rather than try to find a quick fix solution.

by Mabel Cooper

About the Author:

This trust stems from your ability to handle a reasonable number of accounts. Running A Credit Check If you need to keep one credit card for emergencies, keep it out of sight and out of mind. If you want to start a credit repair process, the first thing you should do is find your credit report.