Beware of Store Cards
Department stores love to push their credit cards by offering a discount on your purchase if you sign up on the spot. This can be a good deal. But it is handy to know that store cards create triple trouble on your credit report. First, your score will be reduced because of the inquiry. Second, your score will be reduced because of the new account that will soon appear on your report. And third, store cards tend to give a low credit line, often just above your purchase amount. This can be terribly damaging as the FICO credit scoring model puts a lot of weight on the relationship between your balance and your high credit limit.
Watch That High Limit
I run a national credit repair company and speak to people all day long about their credit reports. One of the bits of advice that we like to offer our customers is to pretend they only have half the limit on their credit card that they really have. It takes some discipline to do this but it can make a big difference on your credit score. As soon as your balance exceeds fifty percent of your available limit your credit score will start to suffer. If your credit balances are currently close to your credit limits you might consider calling the credit card companies and asking them to increase your limit. You will be amazed at how fast this can make your score go up!
The Auto Shopping Credit Trap
I can’t tell you the number of times that we have looked at a credit report and seen multiple auto credit inquiries. When we ask our customer they inform us that they only went to two different dealers. Auto dealers will often shop for the best interest rate for you. If they shop with three auto finance companies you will have three credit inquiries. These multiple inquiries can have a significant impact on your score. This is not the auto dealers fault. After all, they are acting your best interest, but it is best to be aware of the possibilities. If you are shopping for a car I would suggest not providing your Social Security number until you are settled on the car you want.
No More Mr. (or Mrs.) Nice Guy
Just about every day in the credit repair business we come across someone that was nice enough to co-sign for someone on a car loan. I’m sorry to say this, but chances are that if they need you to co-sign they will not make their payments on time. And this will kill your credit scores. I know that this is a tough call. It is hard to say “no”. If this situation arises in your life I suggest an alternative approach. Go ahead and co-sign. But when the payment book arrives ask them to give it to you. Have them pay you instead of the auto finance company. You will make the payments on time. And maybe they will feel some extra obligation to make their payments to you on time as opposed to some anonymous auto finance company.
Don’t get complacent
Check your credit from time to time. In December of 2003 Congress passed the Fair and Accurate Credit Transactions Act (FACT Act) which, among other things gives you the right to get a free credit report from each bureau one time per year. This law was passed to protect you from the credit reporting errors that occur far too frequently. Don’t imagine that because you are doing everything right that the credit bureaus are reporting everything correctly. Get your reports and proof read them carefully. It’s your right.
No explanations needed
Are there errors on your report? Whatever you do please don’t write an explanation for the credit bureaus to include on your credit report. No creditor wants to see your story. Sorry! But it’s true. If there is something wrong on your credit report you should dispute it! If you don’t feel up to the challenge of dealing with the credit bureaus hire a reputable credit repair company. They have the experience and knowledge to get the job done for you. A good credit repair company should be affordable and efficient. You should never have to commit for a predetermined period of time. Before you hire someone pick up the phone and talk to them. Make sure you are comfortable. It’s your money
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
Jim Kemish
http://www.articlesbase.com/credit-articles/credit-repair-what-not-to-do-110596.html
#1 by mrdeservn913 on July 30th, 2009
Quote
Credit Repair?
I have no idea where to start to repair my credit. They are always offering free credit reports but I am leary of that. Could someone please tell me where to start?
#2 by Mary G on July 30th, 2009
Quote
Find out what’s on your credit report. Contact the creditors that are trying to get you to pay. I’m sure you received letters in the mail, saying that you are late or they are going to repossess or something. Start paying something. Call the creditors.
References :
#3 by d0nkeypunch4u on July 30th, 2009
Quote
There are a few websites/message boards that you can go to. Here are a few links.
http://www.creditboards.com/mambo/
http://www.creditinfocenter.com/rebuild/
http://forums.creditalignment.com/
http://finance.yahoo.com/banking-budgeting/article/103507/Thirty-Five-Minutes-to-Riches
Hope those help.
References :
#4 by Chapman on July 30th, 2009
Quote
Hi,
Check out http://financeguru.consumerspot.info for some useful info and tips on getting a credit report online for free. Good luck!
References :
#5 by mca on July 30th, 2009
Quote
If you are just starting credit repair, you must start with the basics.
This is a very simple break down of the steps you need to take in the beginning.
1. Order reports directly from ALL 3 CRAs – If you cannot afford to purchase them you can get your free annual report.
*Please keep in mind that disputing with a free annual report gives the CRA more time (45 days). It is not wise to dispute with these because it will lessen your chance for a deletion.
2. Opt out
3. Update/Delete any personal info with the CRAs
*Have as much as possible removed. It would be ideal to only have your current address. No variations of name, addresses or socials. No need for employment information or phone numbers. It is not necessary.
4. Wait until 2 & 3 take effect (give opting out about a week) and READ in the meantime.
*Read up on your state laws, the FCRA, FDCPA and the FCBA
5. Triage your reports.
*Go to Why Chat’s site and find out the SOL for your state. Figure out which accts are out of SOL and start with those. You determine if the acct is out of SOL by the DOFD (date of first delinquency). Please be aware that disputing any accts that are still within SOL could possibly wake up a sleeping giant and you can be sued. So proceed with caution and make sure you understand what you are doing first.
6. Dispute with CRAs
*You can do a blanket dispute (dispute everything). Some have luck with this. OR just dispute 3-4 at a time.
Whatever you decide, you must wait until the investigation is over before disputing any more (30+5 days for regular report disputes/45+5 days for disputing with the free reports)
7. Now you WAIT……….and READ.
References :