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Tip # 1
Anytime you deal with the Bureaus do it by Certified Mail or via the
internet. Federal Regulations require the Bureaus to respond to you within
30 days of admitting to receiving your information. By using
certified mail you have a signed receipt that documents when the 30 day
clock started. The same is true by using Email, you can document when you
sent your dispute.
Tip #2
Use Consumer Counseling Services only when you are in real
trouble. If you have a great credit score but just want to lower
your monthly payments they are not for you. Call the charge card
company and see if they will renegotiate the rate you pay. Remember
it is a negotiation, there are lots of card companies out there,
chance are that the ones you have want to keep your business.
Tip #3
If you have a $5,000.00 limit on your charge card one way to help your
score is never allow the balance to reach 50% of the limit. Keep it just
under the 50% level, make your payments on time and it should increase
your score.
Tip #4
If you are not using a Charge card, don't close the
account. The Bureaus do not consider charge card debt as long term
debt until it is at least 7 years old. If you have paid off the card
and the company isn't charging you an annual fee let it sit. Every 3 to 6
months put a small charge on it and pay it off within 30 days.
Tip #5
If a collection is showing on your report and you feel it is not
yours Dispute it! Don't automatically assume it is yours. If
its not and you pay it off you admit, by paying it, that it was
yours. Remember you have the right to see the original document that
you signed saying you agree to repay the debt. So just because
someone tells you that you owe the money does not necessarily mean
that you do, many people have similar names and occasional typographical
errors do occur when the information is input into the credit system.
Tip #6
If the collection is yours negotiate with the agency, the only way they
get paid is if you agree to pay them. Always ask what will it take
to settle this issue. Never be the first to state a dollar figure.
Don't let the collection agent unsettle you, if you get frustrated
politely end the conversation and agree to call back when you feel you are
in control. The collection agent may not agree to an arranged
settlement but if you don't ask you will never find out. Calling back and
asking to speak to the manager or another agent generally does not
work. So no matter how ugly the agent may get stay calm and
professional, count to 10, smile at the phone, its your money he/she wants
and you have the upper hand.
Tip # 7
If anyone tells you that if you send me a check or pay me today I will
remove this from your credit report, you should be wary. The only
way something may be removed from your credit report is if it is proven to
be an error, so if you are paying someone how can it be an error.
Tip # 8
When you payoff or settle any dispute/collection KEEP the DOCUMENTATION
for 10 YEARS NOT 7 years. Good things fall off of your credit report
generally in 7 years, bad things can come back to haunt you after
that. As long as you have the cancelled check, letter showing paid in full
etc. you have the proof. If you loose it and the information shows
back up on your credit report the only way to get it back off is to PAY IT
AGAIN. It is your responsibility to prove that a collection has been
paid off so keep your documentation for at least 10 years.
Tip # 9
If you are behind on your mortgage payment please contact your lenders
servicing department and let them know your situation. Most lenders
are more willing to work with you if you have kept them informed.
Lenders do not want to take your home back unless there are no other
options.
Tip # 10
If you are facing the possibility of Foreclosure don't let the
"I'm not going to lose my equity" bug bite you. If
have an offer that takes you out of the situation and you cannot afford to
wait for another it may well be better to lose the equity and not have a
foreclosure on your credit report. Remember if the bank forecloses
you still lose your equity and if they sell it for less than what
you owe they may get a deficiency judgment against you for the difference.
A foreclosure may lower your credit score by as much as 280 points while a
short sale may only hit your score for 100.
Tip # 11
If you get a credit item/discrepancy repaired with 1 bureau do
not assume that it has been taken care of with the other bureaus.
Make sure you send your documentation to all 3 bureaus via certified mail.
Get documentation from all 3 bureaus that the item in question has been
corrected. Save the documentation and letters for at least 10 years.
Tip # 12
If you have filed for Bankruptcy and it has been discharged make sure
you send a copy of the Discharge and the list of creditors
to all 3 bureaus. Even if your attorney says they will do it for
you send it yourself by certified mail.
Tip # 13
Getting Divorced? If the divorce decree stipulates you are
to quit claim deed the property over to your soon to be ex spouse, make
sure that it also stipulates that before you complete the quit claim the
spouse receiving the home must first refinance the home into his or her
name. If you quit claim the property you have given up your asset
but you still have the liability of the note and mortgage. Even if the
decree says the ex is to hold you harmless if he/she doesn't make the
payment and he/she has not refinanced the loan into just their name the delinquency
may show up on your credit report.
Tip # 14
Trying to re-establish your credit, try joining a credit union.
Set up a checking and savings account then ask to borrow $500.00 to
$1,000.00 offering the savings account as collateral. Take the loan amount
an place it in the savings account and pay back the loan over the next 6
to 12 months. Installment debt paid on a regular and timely basis
should help to rebuild your credit.
Tip #15
Every time someone, other than yourself, pulls your credit report it
lowers your score, the best guess is 3 to 8 points per bureau. So,
if you fill out one of those credit forms to get a free hat or umbrella,
you guessed it, they are pulling your credit report. If you are car
shopping tell the salesman that they are not authorized to pull your
credit report before you decide on which car you are purchasing. The same
is true if you are mortgage shopping if you do it online with one of those
will get you 4 quotes places they may well be pulling your credit report 4
times, (lowering your score). If you have an honest idea of what
your credit is like any broker can prepare a good faith estimate for you
without pulling your credit just keep in mind that if items do show up and
your scores are less than you thought it will have an effect on the
interest rate and the Good Faith Estimate.
Tip # 16
30 days late on a charge card payment? Considering paying off the
creditor and closing the account all at the same time? DON'T at
least not at the same time. When you pay off an account that is past
due by 30 or more days and close it at the same time the Creditors last
report on you to the bureaus may well reflect an R-2 rating on your
report for 7 years. Bring the account current, wait for the next
bill to come in then pay them off and close the account. This should
leave you with an R-1 rating on the report as when it was closed you
were current.
Tip # 17
When you close a credit card that has a balance, your total available
credit card that has a balance, your total available credit is lowered to
$0. Since you still have a balance on that card with no credit
limit, it looks like you've maxed out. The amount of debt you have is 30%
of your credit score; so a maxed out credit card, or one that appears
maxed out, can have a very negative impact on you credit score.
Tip # 18
If you only have 1 credit card with available credit closing out this
card will decrease total available credit and increase your credit
utilization, which as before is not a desired situation.
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