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Credit Building Without Credit Cards│3 Ways To Build Your Fico

3 ways to build fico

Building Up Your Fico

Understanding and building credit in a positive way takes discipline and some education. Do you recall being taught in school, how to build your credit scores? Did your teachers let you know how big of a role credit would play in your life as you got older? Honestly, it is probably likely that even while going through the process of applying for a credit card or car loan, you were still unsure of what your credit scores really meant.

So what is a credit score made of?  Your FICO is determined by the categories below on the pie chart. Payment history and amounts owed on your credit make up the two largest portions of your scores. What if you do not have credit cards? There are a few other options for you, so that you can still fulfill parts of the FICO scoring model.

Facts on Fico

The Importance Of Credit

Can you imagine not having access to a bank that could lend you money for your home or car? Credit is so important for everyone, whether they have a credit card or not.  A lender or banking institution pulls your credit in order to see how reliable and likely you are to default on your loan. If your payment history is bad or you are lacking credit history, it is hard for them to lend to someone that they cannot be sure of. If you are someone that has no credit score, that is almost as bad as having bad scores. It is hard to justify lending to you when they are not sure how you use your money or pay your bills.

The Typical Way To Build Credit-Credit Cards

If you are opening your first credit card, your bank is usually open to issuing you a credit card with them. This credit card is not to take on your next shopping spree, but small purchases like filling up your vehicle. Many people open up credit card for “emergencies” only, while some use them and live outside of their means. Credit can end up getting you into large amounts of debt if you are not careful and capable of setting limits for yourself. So what are a few other ways to start getting a score, without the card in hand?

Other Options Besides Credit Cards

Become an authorized user

Parents trying to help their children build and establish credit usually allow for them to become an authorized user on a credit card. Prior to adding your kid on the credit card of your choosing, take a look at the length of history and the payments on all of the credit cards you have. If you have an old card, with no late payments and great credit history this is the best one to add your child to.

Young adults trying to establish credit should talk to parents or family members that will allow them to be added to a card as an authorized user. Understand that at no point do they give you access to the credit card but rather, you are just now benefiting from their positive history while having to make no effort or open up new credit lines.

free credit repair consultation

 

Report Monthly Bills

Are you currently renting and paying your bills on time? There are now many companies that will allow for you to have your rent reported. It can be very frustrating to constantly pay bills that are not showing up to show your credit worthiness, so many companies have listened to consumers and now are helping them out in an effort to eventually get a loan.

Join A Credit Union

A starter loan at the credit union works about the same as a secured credit card does. In order to build, the consumer deposits their own money to get started. The funds are not immediate but secured in a savings account until the term is complete. Making payments on this credit building loan are most important as again, positive payment history makes up 35% of the FICO pie chart. These are usually shorter terms (12-36 months) just to begin building credit. Often times, proof of income is required as well.

While it may seem a credit card is the only way to build credit quickly, that is not always the case. There are other avenues to take rather than signing up for the first credit card that is dropped in your mailbox. If you don’t trust yourself to avoid those credit card solicitations visit this site to keep from receiving junk mail and credit cards filling up your mailbox.

 

Do you have questions about your credit report? If you would like to speak with one of our attorneys or credit advisors  and go through a free consultation please give us a call at 1-800-994-3070 we would be happy to help.

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

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Credit Cards With High Balances and Interest Rates│Transfer Options

Balance Transfer Credit Cards

Credit Card Debt & Balance Transfers

Where is your credit card debt currently at? Are you making minimum payments that don’t make a dent once your interest rates kicked in? It may be time to weigh a different option now that you are hoping to make some headway on your current debts.

Your Balances and Interest Rates

While it is always important to take into consideration the best options for you and your financial situation, we have several people that want to know more on the option to do a balance transfer. Here is how in a few short steps:

  1. Check your current credit card balances
  2. Pick a card to transfer to
  3. Read all information and fine print
  4. Apply for the balance transfer cards
  5. Start paying debts

Below are the steps explained in detail. Before making any quick-second decisions, be sure to educate yourself on all of the pros and cons to the balance transfer.

1. Current Credit

When you are thinking about making a balance transfer it is important to figure out what your interest (APR) is on the current credit card. When looking for a balance transfer card, you’ll want to find one that has low (no) fees and will take the actual amount you would be transferring over.

2. What Cards To Transfer To

Researching what credit cards are best to balance transfer to is very important. Depending on the amount of debt you have, you may not be able to transfer all of the debt to the card you choose. Many balance transfer cards offer a 0% introductory period for an allotted time frame.

  • Check the promotional period
  • Check how long the low APR will last

3. Terms and Conditions

The most important part of this transfer is understanding what the fine print states. Although the balance transfer could help you out, many of the cards have balance transfer fees associated with them, and every time you transfer balances over.

Make sure that the transfer is really going to be financially beneficial to you before moving money around. Figure out what the balance transfer fees is and then you will want to calculate the transfer fee cost, how much you could potentially save on interest and go from there.

Some balance transfer cards won’t let you transfer within the same bank, such as Citibank. If your balance is already on one Citibank card, you cannot move it to a balance transfer card.

It is also possible that when the creditor runs your credit and is deciding if you are approved, you may not become approved for the amount you are trying to switch over.

 

free credit repair consultation

4. Application Process

As with any other credit card, you must become approved first. If you have completed the above steps and are ready to make the switch, go ahead and apply for the balance transfer card.

More than likely you can complete a balance transfer online or by phone. You will be giving your account information and the amount of the balances you wish to transfer over to them.

On average, the process takes 7 to 10 business days. Most importantly, it is important to continue to make your payments until you have been given confirmation that the transfer successfully went through.

 

The Pros Of A Balance Transfer
  • Streamlining all credit payments onto one card
  • Start fresh with low APR
  • Get ahead on paying debt
  • Lower interest than previous credit card
The Cons Of A Balance Transfer
  • If you do not conduct research, you may end up with higher interest rates
  • Transfers can be expensive
  • Could drop your credit scores (due to opening a new line of credit)
  • Risk of more debt-likely that your credit limit increases and more credit is available to you if you can’t control spending habits

Your Final Decision

We understand that life happens and the average consumer does own credit cards. In an effort to set our clients up for success, we want them to understand and become more educated about the way the credit world works. As always, continue to educate yourself and always read the fine print! If you are using the balance transfer card for what it is, and in an effort to pay off your debt, not get into more, you will eventually get there. Keep chipping away at the payments you are making and always try to keep your balances low and payments on time.

 

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Do you have questions about your credit report? If you would like to speak with one of our attorneys or credit advisors  and complete a free consultation please give us a call at 1-800-994-3070 we would be happy to help.

 

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

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Credit Scores Dropping Quickly│How Can I Recover?

saving my credit scores

Credit Scores Dropping

Have you noticed a random decrease in your credit scores recently? There are many factors that can cause your credit scores to fluctuate. Many consumers do not understand that a credit score has no memory and can change immediately due to activity or changes that can happen as soon as you make a payment or use a credit card.

Can I recover from a drop?

Do not panic. Your scores really do change so much, so there is no reason to worry unless you have done some significant damage to a report like went late on a payment. A few things to know ahead of time, prior to calling your credit card companies or bank about your report-

  • If you are pulling credit scores on consumer sites like Identity IQ or Credit Karma, you are looking at consumer scores or vantage scores. These are not your FICO scores. These scores are more of a suggestion of what is going on but not always right or exact.
  • If you want to know your true FICO scores, the only place you can get the real FICO score is an actual lender or banking institution.
  • There are 56 different versions of FICO. Your home loan is going to be using a different version of FICO than the dealership that ran your credit. Don’t expect to see the same scores because they will be off.

 

What Do Inquiries Do To My Credit?

Your scores can be decreasing due to one too many inquiries on your credit report. A good rule of thumb is to only inquire about 10 times for every 12 month period.  Once you start shopping around for vehicles or homes and having your credit pulled more than the suggested number, you will start to notice your scores dropping.

 

How Does A Late Payment Hurt My Credit?

Unfortunately, late payments have a dramatic impact on your credit scores. This is the hardest thing to get removed from a credit report but we still try to go after late payments and try to get them removed.

These late pays can potentially drop your score 100 points.

If the creditor sends your card into collection or charge off, we can take a look at your report and discuss what the next options are for your credit report or how you can try to make up for those late pays in other ways  to increase the scores.

 

free credit repair consultation

What If I Don’t Have Any Credit?

Not having any credit cards or installment loans will also keep you at low scores. In order to have good credit scores, FICO has to have something to grade you on. We advise 2 credit cards and 2 installment loans (auto, home or personal). There is a misconception that no credit keeps you from having bad credit. That is not true and in order to qualify for a car loan or auto loan, if you are not showing that you can make payments on time and be trusted with a loan, a lender doesn’t know how trustworthy you are to loan to. If you are hoping to get a loan, it is important to start establishing credit for at least 6 months to a year and build and show positive payment history. If you are in credit repair and have noticed that your scores are dropping but derogatory items are falling off, it may be due to the lack of credit you have established, or that the credit you do have is not being utilized the right way i.e. high card balances above 30% utilization or recent late payments which will keep your scores down.

 Factors Causing A Drop
  1. Late payments
  2. High Balances
  3. Too many Inquiries
  4. Late reporting (possibly your credit cards reporting at different times to the credit bureaus. An easy fix to this is call your credit card and ask them when they report to the bureaus so you know when to make payments so your score reflects better)
  5. Paying an old collection (there is less than a 2% difference whether a collection is paid or unpaid, most weight is given to how recent the activity)
How Can I Start Building Credit?
  • Become an authorized user on family member or spouse’s card
  • Look into a credit builder loan
  • Apply for a secured credit card
  • Invest in credit repair to get derogatory items removed

Above all, be patient. Building and establishing credit takes time. If you are thinking about buying a home or vehicle, start planning ahead and looking at your credit now. Credit impacts many factors like interest rates, your insurance and many other things. Great scores mean more savings in your pocket!

 

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Do you have questions about your credit report? If you would like to speak with one of our attorneys or credit advisors  and complete a free consultation please give us a call at 1-800-994-3070 we would be happy to help.

If you are hoping to dispute and work on your credit report on your own, here is a link that provides you with a few ideas on how to go about DIY Credit Repair.

 

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in Credit Score | Tagged , , , , , , , , | Comments Off on Credit Scores Dropping Quickly│How Can I Recover?

Credit Scores Across States│Where Do You Rank?

Credit Scores across the states

Battle of the States

Have you ever wondered what part of the United States has the best/worst credit scores? It may come as a surprise to you but, the highest scoring state, Minnesota has an average credit score of 709. What may come as even more of a shock is that yes, they do have credit cards! On average, folks in Minnesota have 2.9 credit cards with an average balance of $5,911. You read that right! The take away from these numbers is that yes you can have great credit, while using and maximizing the credit cards you do have to obtain great credit scores.

Credit Scores across the states

We do not condone racking up credit cards by any means but there are several misconceptions out there about how one obtains good credit. Unfortunately, there is no snap of the fingers to make scores jump 100 points over night but we do know several tricks in an effort to get to the point that you may be trying to get to.

If you are looking for

  1. A home loan
  2. An auto loan

There are several factors that come into play with your credit. Many people do not even know or understand how a FICO score is made-

35% of your FICO is your payment history, 30% amount owed, 15% length of credit history, 10% new credit and the credit mix

So what is the trick?

Is there a trick to better credit scores?

Is there at trick to these high scores? One could argue that there are tricks to the trade.

Imperfect credit scores do not happen over night, the same goes for scores like people in Minnesota with 709. In order to obtain great credit scores you need to know what a good credit mix looks like. At Credit Law Center we advise that a consumer should have two great revolving credit cards and two installments. We also advise a few other steps in order to obtain great scores:

  • Authorized user- a spouse or family member with a credit card with a low balance and several  years of history is a great way to get a quick boost in scores
  • Pay for deletion-asking a creditor/collector to remove an item from the report if you pay a certain amount
  • Lower utilization-paying down a card more than the minimum payments will dramatically impact your credit
  • Inquiries on your credit report can bring the score down

Your Next Step

If you have completed the above steps and don’t see a change in scores, you may have negative items on your report that are weighing heavily like collections, too new of credit cards, or something as significant as a bankruptcy, tax lien, or judgment. Have you looked at a credit report lately? We can go through the credit report with you and discuss what steps you may need to take in an attempt to maximize your efforts.

free credit repair consultation

Did you know?

  • It is actually better for our economy for consumers to have lower FICO Scores. The higher the interest rates, the more money circulating through the economy as well as the increase in the value of currency.
  • There is a misconception that you will have better credit if you do not use credit cards. That is inaccurate, as FICO needs you to have/use credit to have the ability to grade you to come up with your FICO score.
  • Having only installment loans (auto, home, personal) and no credit cards, or only having credit cards, and no installment loans keeps your credit score down 10% then what it could be if you had a good credit mix.

Are you hoping to increase your credit scores and get on the track to better credit? Contact us today and one of our credit advisors  will complete a free consultation or please give us a call at 1-800-994-3070 we would be happy to help.

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

 

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

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High Utility Bills & High Temperatures│5 Ideas for Smart Summer Savings

5 ideas for smart summer savings

5 Ideas for Smart Summer Savings

The first day of Summer officially arrived although it seems we have skipped most of Spring this year!  Have you noticed your bills are much higher than the previous Summer? It’s no surprise that while the days are longer and hotter, utility bills are headed on up too. We don’t expect that anyone would choose to sit inside with the air off, so with that, we have a list of some ways to save so you can stay cool while keeping your costs at a minimum.

 

Air Dry Your Clothing

Do you have a place to hang your clothing outside? Cutting back on your electric bill by letting all your laundry air dry is a great way to save this Summer. Although the time it takes to dry your clothes does take longer, it will keep your clothing looking brighter and actually extend the life of the clothing rather than tossing it in the dryer every time.

Find A Pool

Pack a snack and spend the day by the pool. This is a great way to give your AC a much needed break for the day. After you leave the pool, find a spot for a shaved ice or ice cream cone and soak up some of the air and cool off.  For parents, this is a great way to get the kiddos tired and settled down for a quiet movie and bed time!

Here are a few other awesome ideas for your kids to do this Summer that are free!

 

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Unplug

We tend to leave all of our phone chargers, laptops and other devices plugged in at home when we finish using them. Before you lock the front door, walk around your home and unplug any devices that are not being used. One way to eliminate this head ache is plug everything in a power saving strip so that when you are in a rush, you just turn the strip off and can head out the door or invest in an outlet timer.

Clean Up

The refrigerator is one appliance you cannot unplug but you can still cut costs by keeping the back side of the fridge clean! Once you move all the toys, goldfish and crumbs out of the way, you’ll see the coils on the fridge in the back or bottom of the fridge. They need a good cleaning each month which can help you save money as well. Just a quick once over with your vacuum each month can help you save.

Are you a renter?

It can be hard to cut cost on a unit that you can’t fix some of the issues that cause your bills to be higher, like the front door needing to be weatherized so the air does not escape. Here are a few ways you can save without calling up your landlord:

  1. Change air filters on air conditioner/furnace
  2. Thermostat settings-can cut costs 3% each degree over 75
  3. Cold Water-wash your clothes in cold which can save you about 50 cents/per load of laundry you do

Get out and enjoy your Summer to the fullest with your friends and family! Whether you are hoping to save up for a new vacation, a new home or just to put money back into savings, we hope these tips will help you get there this season!

 

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Do you have questions about your credit report? If you would like to speak with one of our attorneys or credit advisors  and complete a free consultation please give us a call at 1-800-994-3070 we would be happy to help.

 

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in savings | Tagged , , , , | Comments Off on High Utility Bills & High Temperatures│5 Ideas for Smart Summer Savings

Constant Calls From Debt Collectors│Illegal Practices vs Scam Callers

debt collectors calling

How To Deal With Debt Collectors

I have recently been receiving strange calls from someone trying to collect money from me, what do I do? As a consumer, it is important to be educated about the process by which an actual collection agency attempts to collect debts as opposed to scam callers asking you to meet them at the nearest CVS with no real explanation and for a large sum of money. It is not uncommon that if you are receiving phone calls, it will continue to happen until you can do something to make them quit.

 

Your Rights Under the FDCPA

The FDCPA (Fair Debt Collection Practices Act) has been put into place for the consumers protection. Though they don’t always follow the rules, harassment is illegal and will not be tolerated. There are many avenues as far a legal actions you can engage in should a debt collector call and harass you. While it is legal for a debt collector to call you and attempt to collect a debt, it is not legal for them to harass or threaten a consumer such as many scam callers and a few debt collectors do. There is a major difference and it is hard to track scam calls down. Many legitimate debt collectors take correct steps when making their phones calls however, should you continue to receive calls this is what you should look for:

They must

  • Identify themselves in every form of communication
  • Address what the call is in regards to “This is an attempt to collect a debt”
  • Verify the name and address of the original collector
  • Advise that you have the right to dispute the debt

If you receive a phone call and the company calling you does not do provide the information above, do not pay them or agree to met them to provide any money. You will want to contact an attorney to see if there are any steps that can be taken.

Taking Legal Action

The FDCPA has set rules in place for the way communication is to be handled by the debt collectors. Should a debt collector or agency not abide by those regulations, you may be able to take legal action moving forward.

  • Collector cannot call outside of the hours of 8am and 9pm on your local timezone
  • Auto dialing or numerous calls in the effort to annoy, abuse or harass the consumer is not prohibited
  • Profane or abusive language is not allowed
  • Calls to family, friends, or place of employment is not allowed
  • A Collector cannot call and threaten to report falsely to credit reporting agencies
  • Once a consumer discloses they are working and represented by an attorney, communication must stop

A few examples of harassing phone calls are on our website, you can access them here.

free credit repair consultation

Suing the Debt Collector

If you feel you have been dealing with harassing collectors, please contact Credit Law Center so we can help you build your case. We have sued all three of the credit bureaus and are constantly helping consumers become more educated about their credit as well as their rights under the FCRA (Fair Credit Reporting Act). This can be a fairly lengthy process, but in the grand scheme of things, having those calls come to an end are worth moving forward and pursuing legal action.

Continued Harassment and Next Steps

The best thing you can do to help yourself in a scenario like this is document and never throw anything away that may help an attorney out. We advise our clients to document everything such as the time and date you spoke, who you spoke with and what company they work for and any of the phone call details that you may be able to remember. Some other things that will help in this process are:

  1. Collection Letters you received
  2. Any voicemails left, save them to a storage device
  3. Telephone Bills
  4. Notes and contact info taken during call
  5. Take screenshots of your caller ID info

 

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Do you have questions about your credit report? If you would like to speak with one of our attorneys or credit advisors  and complete a free consultation please give us a call at 1-800-994-3070 we would be happy to help.

If you are hoping to dispute and work on your credit report on your own, here is a link that provides you with a few ideas on how to go about DIY Credit Repair.

 

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in Debt | Tagged , , , , , , , , | Comments Off on Constant Calls From Debt Collectors│Illegal Practices vs Scam Callers

Lower Interest Rates & Better Credit Scores│Real Results With Credit Law Center

Lower Interest Rates

Increased Credit Scores by 100 Points

At Credit Law Center we love hearing success stories from past clients. One client shares how Credit Law Center helped her family save money and increase their scores.

What brought you to Credit Law Center?

I was online one day and was looking at homes. A lender reached out to me and we started talking about purchasing a home. She pulled my credit scores and we had some past debt that we needed taken care of. I know credit is important. Based off the information we gave the lender, she gave us some options to get where we needed to get approved. She referred us to one of her Credit Advisors at Credit Law Center and so we got in touch. They assured us that we would only pay for the items that actually got deleted and our advisor talked us through the process and the costs.

How did you feel about working with a Credit Repair Company?

I was a little skeptical at first, but I looked into it. I had a really good feeling about my lender referring me to Credit Law Center. My credit advisor, Kim was really good at getting in touch with me. She let me know if an item was not removed, you didn’t pay for it. I let her know I was going to be out of town on a trip and what I could afford. She made it very inexpensive and worked with me on my budget.  I signed all the paperwork and got my report pulled. She went over everything with me, past debts, and gave me advice on the credit I did have. I hadn’t made my first payment yet, and I saw my scores were already jumping and that was back in January. I was receiving updates every month and my scores just kept jumping. My score has improved 100 points since we started the process.

What has the change in credit scores done for you?

The good thing is, back in December I had just got a vehicle. Then in February my husband and I went to get a vehicle for him. My scores had increased so much, my interest dropped 10% from when I got my vehicle back in December. It has just been awesome!

free credit repair consultation

 

Are you purchasing a home now?

Yes, we qualified and based off the information and our credit jumping, we are able to move forward in the loan process.  I have told family about; it was definitely worth it! That’s the good thing with Credit Law Center, any time anything touched my credit they were monitoring it. I was always getting updated and any questions I had to ask, I was able to reach out to my advisor  and could count on her.

Credit Law Center has been awesome and I am happy my lender put me in touch with them. One thing I can say, my husband was very skeptical but after seeing me go through this process with Credit Law Center my husband now wants to go through the repair process and he doesn’t have a bad taste about credit repair anymore.

Do you have questions about your credit report? If you would like to speak with one of our attorneys or credit advisors  and go through a free consultation please give us a call at 1-800-994-3070 we would be happy to help.

If you are hoping to dispute and work on your credit report on your own, here is a link that provides you with a few ideas on how to go about DIY Credit Repair.

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in Credit Score | Tagged , , , , , , | Comments Off on Lower Interest Rates & Better Credit Scores│Real Results With Credit Law Center

Credit Scores Impacted By Timeshares│Buyer Beware

credit scores impacted by timeshares

Impact of Timeshares on Credit Reports

A timeshare can be something that affects your credit scores. When thinking about purchasing a timeshare, consider it to be as vital and possibly as damaging as a mortgage to your credit report.

There are many variables that come into purchasing a timeshare. If your family is tossing around the idea, examine these factors prior to signing:

  • Know the Association Fees
  • What the payments look like
  • What happens if you need/want to sell
  • Review contracts and terms

Credit Scores Dropping

In the credit world, the collection companies and bureaus do not consider what has happened and why you cannot make a payment on a debt. Should something happen where you no longer wish to be connected to the timeshare, they still want to be able to collect your money. It is possible that when you attempt to sell a timeshare, your credit report will state “deed-in-lieu” which can have as negative an impact as a foreclosure on the report. I caution you to really consider the purchase you are making and consider what your other lines of credit look like and if a timeshare is in your best interest. Here are a few other ways the timeshare could potentially drop your credit scores:

 

free credit repair consultation

Timeshare Fees

As with any mortgage, your time share could have HOA fees, special assessments, utilities and taxes to be paid. If you can no longer afford to pay these obligations in the timeshare, a lien can be put on your portion of the home. Not only does this impact your credit, it can keep you from selling out of your portion of the timeshare or making future major purchases.

Payments

If your family decides to mortgage the timeshare, you will have to continue the payments until the entire debt is repaid. Falling behind on the payments? They can foreclose the timeshare as if you stopped paying on a normal mortgage payment for a home. This dramatically impacts your credit scores, and could stay on your credit report for seven years.

Selling

It can be extremely difficult to find someone to sell a timeshare to. Whether you decide to discount the cost to the potential buyer, you still have the potential to end up in a bad financial position. The “deed-in-lieu” can be put on your credit report, regardless if you sell the timeshare outright or not.

Potential for Cancellation

In most states, there is a rescission or “cooling off’ where the buyer has the opportunity to cancel a contract and be given the deposit back. When that time frame is over, most believe that they no longer have the ability to leave the contract.

The best way to legally end the timeshare contract is take it straight to the company you purchased it from. The company you signed the contract with will not be thrilled about taking the timeshare back, and may try to convince you otherwise however, if they feel that there is potential litigation, they will more than likely take back the agreement or release the owner from the contract.

It is not impossible to be relieved of the contract you have on a timeshare but it would be wise to look into other avenues other than this option.

The last thing you need when trying to enjoy a vacation spot, or a summer with your family is the stress of an unwanted timeshare with unrealistic fees and expectations. I urge you to think twice before you purchase a timeshare this summer.

Other fun and convenient ideas for a great vacation that allows for your family to come and go is purchase an Air BnB  while continuing to make money by renting it out when you are absent.

If you have a tax lien, foreclosure or are thinking about trying to get out of a bad financial situation due to a timeshare and would like one of our attorneys or credit advisors to take a look at your report, please give us a call at 1-800-994-3070 we would be happy to help.

If you are hoping to dispute and work on your credit report on your own, here is a link that provides you with a few ideas on how to go about DIY Credit Repair.

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in Credit Score | Tagged , , | Comments Off on Credit Scores Impacted By Timeshares│Buyer Beware

Free Credit Reports For Active Duty Military│Salute To Service

Free credit monitoring active duty

A Step in the Right Direction

Potential new changes in the credit world can seem to be irrelevant and often times have little to no impact (or so it seems) for the consumers. There are many changes on the horizon that will take effect just one year after President Trump signs a new bill.

Congress has passed the Economic Growth, Regulatory Relief, and Consumer Protection Act. This bill has an impact in the credit world because it will be also amending parts of the Fair Credit Reporting Act (FCRA). The Dodd-Frank rollback bill is the most recent part of legislation to go in and amend the FCRA.

The FCRA regulates how the credit bureaus and customers operate and the this bill being passed will start to hone in on several things-

  • Debt Protection (Veteran and Active Duty)
  • Changes in Scoring Models
  • Student Loan Debt
  • Fraudulent Activity

Debt Protection (Veteran  and Active Duty)

Our military personnel sacrifice time away from home, their families and sometimes their lives. An exciting change in this bill means:

  • Medical debt acquired by a veteran may not be reported at the bureau level for at least one year from the date the medical services took place
  • Medical debt acquired by a veteran that has been sent to collection status has to be removed from the credit reports once the debt is paid off or  has been settled (the current rule says after 7 years or immediately after the collection has been paid by  insurance)
  • Medical debts must be removed from the credit reports if the medical debt is or has been assumed by the Department of Veteran Affairs (there is no existing rule on this)
  • A database must be created by the Secretary of Veteran Affairs to verify whether or not the debts reported are actual veteran’s medical debts
  • Free credit monitoring services from the reporting agencies will be given to active duty military personnel

All of these changes will take effect 1 year from the date the bill is signed.

 

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Changes in Scoring Models

  • Fannie Mae and Freddie Mac will be able to use “newer”  generation credit scores for underwriting home loans if the newer score is “reliable and accurate” (how they are going to measure reliable and accurate has not been defined quite yet)
  • Currently Fannie Mae and Freddie Mac are using older generation FICO scores (FICO  4) but have not been able to upgrade to newer scoring models (like FICO 9). This is important for borrowers because using the newer versions could help them receive better rates and terms for a mortgage

These changes are not set in stone, but could be a potential positive spin for consumers.

Student Loan Debt

If a debtor can now show willingness and consistent, timely payments (on a private student loan) they can request that the lender go straight to the credit bureau and remove record of the defaults on the student loan.  This can only be done if the lender offers a loan rehab program.

 

Fraud

Child credit protections: Parents and guardians can freeze a minor’s credit report (children ages 16 and younger). If a minor child has no credit file, the bureau is required to make a credit file and freeze it. All of these services will be free of charge.

Credit Freeze: Before, the bureaus only allowed for credit freezing to be given to consumers, free of charge, if they had been a victim of fraud. Initially, there were fees for setting a freeze and fees to remove that freeze as well. When the credit freeze is set, the bureau then has to confirm it and provide instructions on how to remove it. All of these freezing capabilities (freezing, thawing, re-freezing) will be free to consumers at the national level.

Alerts:After the change, alerts can now last for one year. Victims of fraud can also place their credit reports on alert or be placed on an extended alert that will last 7 years. A fraud alert will notify users pulling credit reports (lenders and banks) that they must take steps to further verify that the person applying for credit it undoubtedly, the person applying.

These changes will begin 120 days after President Trump signs the bill.

 

Credit Law Center partners with Home for Heroes and provides significant discounts on services to all military personnel. If you would like one of our attorneys or credit advisors to take a look at your report, please give us a call at 1-800-994-3070 we would be happy to help.

If you are hoping to dispute and work on your credit report on your own, here is a link that provides you with a few ideas on how to go about DIY Credit Repair.

 

A Note From The Author: The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in Credit Score | Tagged , , , | Comments Off on Free Credit Reports For Active Duty Military│Salute To Service

Change In Credit Scores -June 8th │ What’s Happening Now

All Credit Reports Must Change

All Credit Reports Must Change!

All credit reports must change! In response to the New York Attorney General coming out with a settlement, the Credit Reporting Agencies are going through a laundry list of changes. These phases have been implemented over the last few years and phase three is now taking place. There will be changes again and with more changes and rules, come more mistakes. Continue to stay up to date and educated on your rights as a consumer!

Now, this is not to say that your credit scores will improve immediately or that they will go up or down when you fall asleep but more-so, this article will outline the improvements that are being made in an effort to protect the consumers and their rights when it comes to dealing with the Credit Reporting Agencies. We deal with these institutions every day, so believe me when I say, we hear and see all your frustrations and now, the NY Attorney General has heard the consumers and their frustrations.

If you have not recently checked your credit report, or do not understand what the report has on it, please let someone look at it with you in a free consultation.

Here is what we know about the changes:

The Phases In The Settlement

  1. Phase One started in 2015-retiring Metro One Reporting Tool which is the software tool that allows the bureaus to communicate back and forth. It was very old and outdated!
  2. Phase Two started in 2016-creating new policies so that credit reporting agencies now cannot refuse to dispute even if the consumer has not pulled an annual credit report. There must be education and content on the website about the dispute process and allow consumers with more free copies of their credit reports.
  3. Phase Three happening now-a process will be put in place that identifies and clearly outlines/defines what is being disputed and presented to the consumer.

 

What you need to know about this round of changes:

Phase Three Implemented June 8th, 2018

  1. They are now requiring collection agencies to reconcile collections that have not been paid in full. Meaning, the removal or suppression of all collection accounts that have not been updated within the prior 6 months time frame.
  2. Advised to not report any medical collections that are less than 180 days from the date the debt went delinquent. If a collection is found to be paid by insurance at a later date, it must be deleted.
  3. If a Credit Reporting Agency receives a notice from another bureau that there is a mixed file, an investigation will be conducted and they will have to correct steps in place to fix the mixed file.

After Your Completed Investigation

After an investigation is completed each bureau is required to take the following actions:

  1. Report all actions taken by credit bureau regarding the dispute
  2. Contact information of the creditor/collection involved in the dispute
  3. The results of the dispute, including any modification or deletions of all disputed items
  4. If the consumer is not satisfied, the option to re-dispute the items and include any and all supporting documents is given

 

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When you send proof that the information is inaccurate they must get it in front of someone that has the ability to actually make a change to the error on the report.

For clients that we continue to help dispute items on the credit report, we are seeing improvements based on the first few phases of this process. When we have supporting documents that can be sent in and followed up with the dispute, we are seeing fantastic results and usually the turn around time on those is very fast! If you would like one of our attorneys or credit advisors to take a look at your report, please give us a call at 1-800-994-3070 we would be happy to help.

If you are hoping to dispute and work on your credit report on your own, here is a link that provides you with a few ideas on how to go about DIY Credit Repair.

 

A Note From The Author:The opinions you read here come from our editorial team. Our content is accurate to the best of our knowledge when we initially post it.

Article by Breana Washington

Check out Credit Law Center’s info-graphic on 4 myths of collections reporting on credit reports.
credit collection myths infographic

credit collection myths infographic

 

Posted in Credit Score | Comments Off on Change In Credit Scores -June 8th │ What’s Happening Now
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Questions about credit? Talk with an advisor: 1-800-994-3070
Questions about credit? Talk with an advisor:
1-800-994-3070