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The Roadmap to Better Credit

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How to Establish a Good Credit Score

 

Whether it’s finding a home for your growing family, financing your dream car, entering a career or even attempting to acquire a decent rate on car insurance, everything in our lives revolves around credit. No matter what you do, someone is going to be viewing your past choices to asses if you are a liability in your future endeavors and they could be the deciding factor in whether you are living your life or just surviving.  I’m not saying this to scare everyone or say that without good credit you can’t live the life you are meant to live, but that acquiring good credit could provide opportunities that may seem out of reach!

So, I guess its time to get a credit card and start building my credit! Before we get overzealous with the power we have been given with this seemingly divine piece of plastic, let’s take a look into a few ways to reliably start building and maintain our credit.

 

Good Credit Starts with Good Financial Habits

Many people are trapped in credit purgatory, looking for debt consolidators that can act as magical credit faeries to reset their credit scores after they have fallen behind on payments. If you can’t establish good financial management habits, then the attempt to establish better credit will be futile. When building a house, you must start with a strong foundation and the same goes for credit. Some great financial habits that can help you improve your creditworthiness are:

  1. Record every transaction. I know it seems like a pain to keep everything logged, but in the end, you can observe how much you spend down to the last cent. If you wait to record your transactions, you may lose details along the way.
  2. Round up expenses. Say you go out to eat and your bill comes up to $24.14, you should list the transaction as $25.
  3. Round down income. When recording your transactions, you should round down your income. If you got paid $483.23 for the week, round it down to $483.00. This way you’ll have a few extra bucks when you balance your accounts. If your hard-core round down to $480.00 to save a little more and build the habit!

Start with a Secured Credit Card

Now that you have a good record of your finances, you can show your bank that you have a stable income and can responsibly manage your finances. This puts you in a better position to apply for a secured credit card and shows that you are low risk.

When you acquire your secured card, the bank will require you to deposit the limit of the card into an account. So, if the discussed limit of your card is $500, then you will deposit $500 into the secured account. When you make a purchase with this, the $500 is not touched (unlike a debit card that allows you to withdraw the money in your account). The purpose of the money you deposited in the secured account is to provide collateral if you default on paying off your balance.

 

Pay it Off on Time

Now that you have your secured credit card and you have made a few purchases with it, make sure that you have your balances paid off on time each month. The credit card companies make money from the interest charged for late payments and we are trying to establish and raise our credit!

Since you are beginning to establish credit, your interest rates are going to be pretty high compared to someone with established, good credit. In the end would you rather pay the final $20 that was left on the account, or $200 after the absurd interest rates? Some credit companies could also charge you a late fee or reduce your limit if you fail to pay your balance in full when it’s due!

 

Don’t Use Your Credit for Emergencies

Now, an emergency is classified differently among different people. Some classify an emergency as not having gas left in the car a few days before pay day and they are running on empty. Others classify an emergency as a new plasma screen TV going on sale at their local department store and the sale ends before payday. Learn to use your credit card for when it would be more stressful to pay with cash, don’t have an ATM around and can’t pull out cash or small day to day transactions. If you use your credit card for just “emergencies” you may find yourself slipping into a situation where everything is an emergency and spur of the moment purchases will become more frequent. Not having an 80-inch plasma TV to watch “Stranger Things” on is not an emergency!

 

Strive to be Creditworthy

Credit cards can have quite a lot of perks and pros associated with them; however, it could send you into bankruptcy if you aren’t vigilant in how you handle them. Once you have acquired a good credit score it may be tempting to open many additional cards because it’s easy for banks to lend to you now.  You should strive to be credit worthy and push on till your financial freedom. If you are credit worthy, you’ll have a good credit score and can enjoy your transactions and purchases without having to pull out your journal to log everything. Just like working out to get fit or building your career for a future, establishing and maintain good credit does not happen overnight, but in the end will help you achieve the life you know you are meant to live!

 

Author- Joe Peters

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.

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Fact or Fiction; A Look At Hard Inquiries

 

What's the Difference Between a “Hard” and a “Soft” Credit Inquiry?

Whether you are applying for a new credit card or a home loan, hard inquiries are constantly present when attempting to build credit. Although hard inquires are one of the most common items found on a credit report, there is still much mystery surrounding their effect on a credit score. In todays “Fact or Fiction” we will be taking a deep dive into hard inquiries to shed light on some of the most common misconceptions and answer some of your most asked questions!

 

What Is A Hard Inquiry?

It is a common misconception that in any instance that there is a request to pull your credit, a hard inquiry will be listed on your report. A hard inquiry will only occur when you inquire for financing with a lender directly. This does not apply when you are inquiring for pre approval or pulling your credit for informational purposes and is considered a soft inquiry. Unlike hard inquiries, a soft inquiry will not appear on your report and does not impact your credit score.

   -Soft Inquiries-

Soft inquiries are a little different from hard inquiries; while they do show up on your credit report, they are strictly for your personal reference and have no impact on your credit score. Soft inquiries are not visible to lenders as they are strictly made for informational and pre approval purposes and are only seen by the consumer. Soft inquiries will fall off of your report in anywhere from 12-24 months depending on their type!

How Long Do Hard Inquiries Stay On A Report?

Hard inquiries differ from other items on your report when it comes down to their expiration date. A hard inquiry will usually stay on your report for about 2 years but only affects your score for about 12 months! Hard inquiries are meant to serve as a timeline of when and how often you have applied for credit and can mean different things to different lenders. Multiple hard inquiries can portray a sense desperation to a lender as it shows that you have attempted to apply and were denied by multiple lenders. In some cases, like when inquiring for a home loan, there is a short window where multiple inquiries will count as a one!

 

How Much Do Hard Inquiries Hurt My Score?

There are many misconceptions about just how much a hard inquiry is “worth” when it comes down to affecting your score. It isn’t a case of “One hard inquiry amounts to 5 points and if I have 10 hard inquiries, that means I’ll drop 50 points”. Hard inquiries do not necessarily have a dedicated point value and their potency really falls to how healthy your credit score is prior. Someone with a long positive payment history and multiple open accounts with low credit utilization will not be as heavily affected by hard inquiries as someone who is new to building credit.

Can I Dispute Hard Inquiries?

Unlike other items on your report that can be disputed due to infractions in their listed information, legitimate hard inquiries are difficult to remove. If a hard inquiry  is pulled from your report without your knowledge, you do have the right to request its removal. This also applies in the instance of identity theft as the application is not legitimate to your inquiry.

Do you have hard inquiries on your report that were made without your knowledge? Do you have questions about your credit report or credit questions in general? f you would like to speak with one of our attorneys or credit advisors and complete a free consultation please give Credit Law Center a call at 1-800-994-3070 we would be happy to help.

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       -Disputing Inquiries Made By Car Dealerships-

How to Find the Best Car Dealerships in Los Angeles - Silverback Automotive

 

Disputing multiple inquiries made by an auto dealership is a rough area for many consumers. When submitting a loan application at a dealership, they will often inquire with multiple lenders to attempt to get the best financing opportunity for the consumer. This practice is referred to as shotgunning and is common in every auto dealership and when signing  a car loan application, is essentially giving the dealer permissible purpose to make multiple credit pulls. Depending on the FICO score used, similar to shopping for a home loan, there is often a window where the multiple inquiries will only count as a single inquiry on the report. The FICO score used will depend on which lender is being inquired with.

 

Article by Joe Peters

 

Student Loans and Credit Scores

Student loans seem to be on almost everyone’s credit reports . They can positively impact your credit scores if you are consistent with your payments and aware of what is happening with your loan. As with any bill or loan you take out, it is extremely important to your credit score as well because it can also have a negative impact too. We will discuss some of the positive ways that your loan can impact your credit, as well as a few ways it can do severe damage if you are not careful.

The Positives

1. Payment History

A student loan, when paid correctly, can be a great trade-line for your credit report. If you make the minimum payments, this shows great repayment on your part that you can reliable and make on time payments. This part of the credit report makes 35% of the FICO grading scale. The difference with a student loan as opposed to your other monthly bills such as your car insurance is that they do not report monthly (only when you miss the payment or fall into collection) whereas your loan will report positively when you have positive payments. This is great for your credit!

For some consumers, building credit is hard to do if you do not have an auto loan or any credit cards, but your student loan can help start to establish that payment history.

2. Building A Credit Mix

For a while, there was a myth out that having “diverse” accounts helped your scores and provided for a healthy mix of credit. Only about 20% of your FICO score is made up of new credit and types of credit used. Typically, having two revolving accounts and two loans (home, auto,or personal) are sufficient enough in trying to build on your scores. Your student loan will also help you start to fill out a portion of that percentage of your credit mix while you continue to make positive payments.

 

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The Negatives

 

1. Late Payments on Loans

A good way to completely tank your credit scores quick, fast and in a hurry is to get a late payment. As much as on time payments can help your credit score, they can also harm them, sometimes up to 100 points.

These bad or derogatory remarks can stay on your credit report for up to seven years. If continue to miss your payments and they continue to roll over, your scores will just keep dropping and dropping. The other piece to this puzzle that is not good, is how long it can take for you to rebuild once you have fallen behind. Be aware of what is happening with your bills and other finances and communicate with your institution if you start to fall behind.

2. Defaulting 

If your accounts are sent to collections, this can also really impact your credit scores. Often times, creditors will not lend you any money unless you “correct” it and make it right with the lender of the money. If you go and apply for a home loan and they see collection status, it can be extremely hard for them to justify lending to you with a lot of derogatory marks on the report.

You may hope to open credit cards and start to establish credit but the creditor denies you due to the defaults on your credit report. All in all, if you are seeing collections/charge offs or have been denied financing, you may want to reach out to a credit repair company today.

What Resources Are There?

Having student loans and pursuing a degree is important in this day and age. We see so many student loans every day on credit reports that are doing great things for people and their credit report. Make sure you stay up to date on the payments and work as well on establishing credit.

For more information on student loans and second chance checking, please visit this site. You will find a lot of programs to help you out in regards to student loans if you have not been able to find any resources yet that work.

Saving At Closing Time

Are You Trying To Rent With Poor Credit?

Less Than Perfect Credit Scores and Living Situations.

Many families deal with tough situations when it comes to rentals and the landlords that come with them. According to the Business Insider, more Americans are renting than at any time in the last 50 years.  I can recall a time when I rented a home that had mice so big, that even the neighborhood cats didn’t try to catch them. My roommate and I had to put our fear and phobias aside and get rid of all the mice on our own. Maybe this is your current situation now, and your credit scores are forcing you to rent.

Are you currently living a rental nightmare?

We understand that this is not the ideal living situation.

At some point I lost track of the number of mice we ended up finding and shortly after, we were able to end our lease. Such is not always the case. Breaking a lease can be extremely difficult and some landlords are not as understanding. After many times of reaching out to our landlord with little to no help, we figured out a few things:

  1. Slumlords, as we call them, are only interested in the rent being turned in on time. (No, not all landlords are this ruthless, but you find while renting that few really care about the tenants residing in them).
  2. Quick fixes and patch jobs are ways they are able to make temporary fixes at little to no cost to them.
  3. With the demand and price being very high for a place to live, the quality of homes can be very, very low.
  4. Whether you are renting in a college town or a nice area in the suburbs, you meet less than perfect landlords. It is bound to happen!

 

So why are people renting more now, than they ever have?

These are just a few of the pain points that have been expressed:

  1. Poor/Bad credit-The inability to get approved for a home loan/mortgage.
  2. Lack of excess funds-Unable to make the down payment or fix things in the house once it is purchased.
  3. Lower expenses-Included in rent such as water or electric in most cases.

 

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These are just a few reasons why more people are currently renting. If you are in a position where renting is your only option, here are three things to take into consideration in an effort to make a change:

  1. Look into your state laws and know your rights as a tenant. Is your landlord hard to get in touch with? Do they fail to repair things in a timely manor? Each state has their own requirements when it comes to repairs on a rental. There is such thing as ‘repair and deduct’ which just means if you as the tenant pay for a repair, it can be documented and deducted from the rent. The landlord must know about the problem and it must be proven that the landlord failed to repair it within a reasonable time. If you are dealing with a lazy landlord or one that is hard to get in touch with, this may be something you deal with. Continue to reach out and attempt to communicate with them via email/phone. Document everything that happens and try to keep everything in text and email so there is written communication.
  2. Credit Repair with a Law Firm: A bad rental situation may have you interested in looking into buying a home. With a poor credit score, you may be far off from moving if you don’t take action now. With attorney-based credit repair, you can expect to see results between 30-180 days.  If you are unsure of what your current credit score is, you can pull a credit report here. Talk to a Credit Advisor today about what you can do to get out of your current rental and into your own home soon.

If low credit scores are keeping you from improving your living situation, please contact us today for a free credit consultation. We have helped over 30,000 clients improve their scores. Let us get you back on the path toward financial freedom.

Credit Cards for College Students

What Really Impacts Your Credit Score?

I have clients from all over the country asking me how much particular items on their credit report are affecting their credit and if the item is removed, then will their credit score rise. It is difficult to provide a precise answer because there are many underlying factors that can make or break your credit! Follow Credit Law Center as we delve into the 5 major factors that impact your credit score!

 

#1 Payment History

 

Payment history holds the most weight over your credit score is calculated. Your payment history roughly translates to 35% of your FICO score and could be one of the reasons you aren’t seeing those numbers rise. It is extremely important to establish healthy and beneficial trade lines and to make sure that your debts are monitored and paid in a timely fashion.  Therefore, it is more difficult for beginners to start establishing healthy credit because they have not had the time to acquire a positive credit history.

It goes to show that if you have upheld your credit obligations in the past then you will reap the rewards in the future!

 

#2 Missed Payments

It happens to the best of us, something comes up and we miss a payment! Even a 30-day late payment can hurt your score and if you make frequent late payments then expect your score to start to drop.

Credit scoring models look at:

-Are there late payment appears on your credit report?

– How late are those payments?

-How recent were those late payments?

– How many late payments appear on the report?

 

Automated payments are one of the best ways to ensure that you don’t make a late payment. Most credit card issuers will offer scheduled payments and the option to either pay in full or pay the minimum payment and will allow you to choose whichever fits your financial needs.

 

I use automatic payments on my CareCredit account, and it lifts a lot of stress knowing that I don’t need to remember to log into my account every month to set up a withdrawal. It is smart to check your transaction history to make sure that the payment was made successfully!

#3 Credit Utilization

Credit utilization is almost as important as your payment history in terms of credit health and importance. Your credit utilization rate makes up roughly another 30% of your FICO score!

The lower your credit utilization rate, the lower risk you are to lenders. Say you have a $6000 limit on your credit card, and you are using $2000 worth of credit. You are using a little more than 30% of your credit cap and are seen as a lower risk borrower.

Paying off your statements in full is the best way to keep your credit utilization at a healthy percent and can really bump up your credit score!

 

#4 Length of Credit History

 

Length of credit history and payment history go hand in hand when it comes to establishing your credit score. Length of credit history only takes up about 15% of your credit score but can be a wonderful way to passively grow or stabilize your report!

Fico will consider:

  • Your oldest account held
  • Average account age
  • Usage of accounts

Becoming an authorizes user is a wonderful way to start building credit history if you are just beginning to start building credit. If you have established credit then keeping those older accounts open and in use will be beneficial if done responsibly.

 

# 5 New credit

Studies show that people who apply for a lot of credit in a short period of time are riskier borrowers. In other words, they’re more likely to pay a credit obligation 90 days late in the following 24 months.

Some people apply for many credit cards at once to boost their score quickly. This can have negative implications for your credit score as it makes you seem desperate for credit and you will be seen as a high-risk borrower.

When a financial institution pulls your credit score, a record known as an “inquiry” is added to your credit report. Most inquiries stay on your report for 24 months. Certain inquiries, known as “hard” inquiries, have the potential to damage your credit score for 12 months.

 

Your credit score determines many factors in your life and the more that you understand it, the more fruitful your endeavors will be!

Inquire for free credit review & consultation.

Contact:  1-800-994-3070

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A Guide To Your Credit Mix

Your Fix of the Mix

We all know the importance of having a good credit score.With a high credit score, you can open to door to better interest rates, loans, benefits and more! Good credit can be the deciding factor in whether or not you get approved to rent a home or get a particular  job. Therefore, it’s  is important to  fully understand the various factors that make up your credit, including the credit mix.

To clarify, credit mix is not the most important factor in determining your score. Your payment history carries the majority of the weight, followed by your credit utilization rate and then your credit history and longevity. The good news is, your credit mix comprises  only  10% of your credit score! In the end, your credit mix determines your credit health and can be a beneficial indicator of your credit prowess!

What are the two types of credit accounts?

What exactly is credit mix you might ask? Credit mix refers the different types of accounts associated with your credit report and usually fall into two categories:

  1. Installment loans, in which you borrow a specific amount and have payments due each month for a specific amount of time.
  2. Revolving credit, in which you borrow as much you need and pay it back in either a minimum or full payment until the amount owed is fully paid.

Examples of installment loans are home loans, auto loans, and personal loans. Revolving credit refers  to credit cards; although home equity lines of credit are another example.

 

Understanding Credit Mix - Dollars And Points

What is a healthy credit mix?

If you are looking for a healthy credit mix you will want an even mix of both installment loans and revolving credit .Having a mortgage or auto loan along with a couple of credit cards should set you up with an even credit mix and will reflect positively on your report. On the other hand, if you have only credit cards listed on your report, it can reflect poorly and harm your credit report in the long term.

Now, what happens if you have a few credit cards, but have your vehicle paid off and are all set on your home? Should you take out a personal loan so that you have an installment loan in the mix?

Not necessarily. It is not usually a good idea to borrow money when you don’t need to.Remember, your credit mix makes up only 10% of your credit score.If you are doing well in areas of your credit that hold more weight, such as  credit utilization and payment history then you are more likely to maintain good credit even if your credit mix isn’t as developed as you would like. There is not reason for additional expenses to try and diversify your credit mix!

 

Should I worry about my credit mix?

Every aspect of your credit is important, but don’t fret too much over your credit mix! Not everyone  has that classic mortgage-car loan-credit card mix of accounts. If your score is already high, your credit mix is one of the last things you should worry about! Instead you should focus on keeping your payment history in line and avoiding applying for too many new credit accounts at once.

Inquire for free credit review & consultation.

Contact:  1-800-994-3070

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Author- Joe Peters

Credit Terms

What Is A Mortgage Score

Buying your first home is a daunting milestone in everyones life and can bring both joy and anxiety when beginning the process. One large source of anxiety comes from the ever looming need of an acceptional credit score to aquire acceptable rates. For those that meet this criteria as displayed by your credit monitoring service; you may be surprised to know that everything may not be as it seems!

When Jennifer Bingham began house hunting back in 2019, she felt confident that her 740 credit score would secure her dream home when she came across it with an admirable interest rate. As jennifer began the preapprovla process, she was shaken when her bank disclosed that her mortgage credit score was only 700! This score still situated Jennifer in a good credit range, but was unable to get her the rates that she had origionally imagined.

This exact situation happens to many first time home buyers when they find out that they have a mortgage credit score -often showing to be much lower than their  primary score. Consumers have many different credit scores that they are unaware of with the mortgae credit score being only one of them! The difficulty lies with the the fact that it is difficult to view their mortgage credit score unlike their FICO 9 with help of credit information applications. It is not impossible however to track and build your mortgage credit score, but it is important to first understand why there is a gap between your regular credit score and your mortgage credit score.

 

Why is it Different?

A mortgage score, unlike most other credit scores, is based on a formula that hasn’t changed in over 20 years! This is because Fannie Mae and Freddie Mac state these loans must be underwritten to be underwritten based on the FICO formula. Though there have been efforts to make changes to the mortgae credit score, the process has yet to see reults.

The issue with the old formulacomes down the the way it reports. Unlike the more consumer friendly formulas of other credit scores, the old formula may report lower scores for its consumers. Medical debt is one example of an item that is no longer conted toward newer fico scores, but is still taken into account when it comes to the mortgage formula. The same goes for collection debts that have been paid. These paid debs are not counted in the newer formulas, but hold weight when it falls to the classic FICO formula.

Mortgage credit scores are also more difficult to improve than their FICO 9 counterpart. While other FICO formulas have tools like Experian Boost to help to being building credit or suppliment thin credit profiles, mortgage credit does not take these tools into concideration when reporting. With theses reporting diffences between reports, it is not unlikely that there will be a discrepancy of 20 or so points between the two scores.

Another major difference that can be found within your mortgage credit score is the “shoppinh period allowed. Newer formulas allow for a 45 day window where multiple credit requests made by lenders will only count as one inquiry.  With your mortgage socore, that window is only 14 days, meaning more inquiries that will impact your score.

Recently, the Federal Housing Finance Administration (FHFA) has announced that it would concider alternative credit score formulas when it came to mortgages. Sadly, until the concideration leads to action, the old formula will remain in use.

 

How To Improve Your Mortgage Score

The first step to improving your mortgage score is to know what is listed on it by getting a copy. Sites like myFICO.com, though you will have to pay a monthly fee of about $20, will give you access to up to 28 different FICO scores! Another way to find your mortgage score would be to go to a lender and have them pull an informational credit check for pre approval from one of the bureaus!

The second step is to reguarly review your credit report and identify errors when they arrise. More than 70% of Americans have wrongful information on their credit reports that can be challenged for removal! You are legally entitled to one free copy of your report each year, but due to the pandemic, you can request weekly reports from all three bureaus until April 20, 2022!

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.

 

Are You Wasting Money

Is Your Credit Score Costing You Thousands?

How Your Score Is Costing You Thousands

Back when I graduated high school (a few years after dinosaurs walked the earth) I had absolutely no idea how detrimental my credit score would be to my  future purchases. My brother was sitting pretty with a 750 credit score and financed his new car at an extremely low interest rate!  On the other hand, I was sinking with a 580 credit score and financed an older Honda Civic for almost double the interest rate! No big deal, I saw this coming but what about insurance. My brother is only 3 years older than me, had 2 accidents on record and we had the exact same insurance agency providing our car insurance. Even with a good driver discount, an older vehicle, no accidents and basic liability coverage;  I was paying 40 dollars more a more a month than my brother for my insurance!  Why is it that I had to pay so much more than George and how can I get  the same payments as he does? The answer all comes down to our credit score difference!

Low FICO Scores

Your credit scores play a major role in the financial freedoms you have. There seemed to have been a misconception that if someone made great money, the credit scores didn’t really have too much pull. Credit impacts us all, from the moment we start to take on paying bills, buying cars, cell phones etc.

Your employer might even take a look at your credit report and deny you for a job if they are low.

Contrary to popular belief, FICO impacts us all, across all demographics.

So, how does a low credit score cost you more money?

 Higher Interest Rates

If you were to apply for a 60 month car loan with a credit score between 500-589, one could expect to be quoted around 15.2% interest rate. That means that your poor credit is costing you and holding you back from lower interest rates (home and auto) and you are actually seeing your money be used in a way that is not benefiting you or your credit score.

Denied Financing

If you have low credit scores, you may have been denied a bank account, credit cards, a home loan or worse. While you may feel defeated right now, there are several ways to start improving your score. If you are in a tight spot financially and are thinking of completing credit repair on your own, please visit our DIY blog to learn more. If you would like to speak with a credit advisor about how to improve your credit score quickly, please contact Credit Law Center today.

How Do I Make A Change?

It is a good idea to monitor your credit scores. If you have noticed that you have any the below items on your credit report, you might be in need of credit repair.

  • Collections
  • Charge Offs
  • Repos
  • Bankruptcies
  • Foreclosures
  • Tax Liens

If you are thinking about going and paying these items off in hopes that they will increase your credit scores, rethink that option. Your credit report will change, but not in the way you want. If you have a 10 year old medical collection reporting and you decide to pay that collection off, the last date of activity on your report changes to the day you pay it. FICO is looking at your activity and weighing it heavily. Your score may decrease significantly due to the last date of activity being updated. There is less than a 2% difference whether a collection is paid or unpaid, most weight is given to how recent the activity. This does not mean we are advising you to not pay your bills or let things fall into derogatory status.

 

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The easiest and quickest way to start seeing a change in your credit scores is to start paying down balances you may have on current credit cards in your possession. This will have a direct/immediate impact on the score. If you are planning to start paying down your cards, try to keep the utilization down below 30%. This will help you start to see a swing in a positive direction.

The largest factor on your credit report is your payment history. Late payments are huge when it comes to dropping the credit scores. At any given time, always try to make at least the minimum payment on your loans.

 

Facts on Fico

 

Saving Money Starts Here

Whether you are looking to get into a new home or buy a new car, your credit scores are vital. If you are hoping to make changes for your financial future, you can start taking small steps now to get back on the right path. If you are in need of assistance today, our credit advisors can help educate you on what you can be doing on your end while we work on derogatory items on the credit report that are hindering you from higher scores.

 

 

 

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 Joe Peters

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.

 

Does Unemployment Affect My Credit

Does unemployment affect my credit?

Unfortunately job loss is something many American’s experience in their lifetime. The loss of a job means financial hardships, which directly affects our consumer’s credit. Here is what you need to know about how job loss can affect your credit scores.

Loss of Savings:
Money that was saved for emergency may have to be used. It is hard to replenish those funds but for times like these, this is why that savings is vital!If you did not have a great credit score prior to losing the job, you may look into a secured card. A secured card requires the consumer to open an account with the issuing bank. If you do not have the money to put down the deposit for the card, this will not be a route you can take. Your savings may start to dwindle but hopefully those depleting funds will be able to be replenished after you secure new employment.

Late Pays:
If you experience long term unemployment, unfortunately your credit will be greatly impacted! If you fall behind 90 days late, this is a serious delinquency and will dramatically drop your scores. You may want to read the blog here on late payments. At this point, the last thing folks are worried about is their credit score, especially if they have a family to care for. Does this sound like something you have gone through? Let us take a look at your report to see what we can do.

High Balances:
Making minimum payments on credit cards will start to hurt your scores. You will start to see your credit score decline when the balances and interests start climbing. Once that balance reaches above 30% of the limit, your scores start to reflect it in a negative way.

 

 

 

Ways unemployment does not hinder a credit score

If you are unemployed, rest assured that anyone that is looking at your credit report will not know. There are not any boxes on a report marked that a lender, employer, or insurance company would be able to see. Unemployment claims are not public record and benefits are not debts. You are not obligated to repay those unemployment benefits at all, so thankfully this will not be a dark cloud lingering with the rest of your bills after you are back on your feet.

Change in Income:

Though credit reports used to contain your salary, that is now a thing of the past. The difference in income will not show up, however if you are applying for loans you should expect to have to provide documentation and proof of income.

At Credit Law Center we understand that while financial hardships may fall on a consumer,  often there is more to the story than not paying bills. The credit bureau’s do not care what our consumer’s go through. We want to help you get your buying power back and get you back on your feet! If you are in need of a FREE consultation please visit our website and talk to an advisor!

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.

Poor credit and renting

Renting With Poor Credit

Less Than Perfect Credit Scores and Living Situations.

Many families deal with tough situations when it comes to rentals and the landlords that come with them. According to the Business Insider, more Americans are renting than at any time in the last 50 years.  I can recall a time when I rented a home that had mice so big, that even the neighborhood cats didn’t try to catch them. My roommate and I had to put our fear and phobias aside and get rid of all the mice on our own. Maybe this is your current situation now, and your credit scores are forcing you to rent.

Are you currently living a rental nightmare?

We understand that this is not the ideal living situation.

At some point I lost track of the number of mice we ended up finding and shortly after, we were able to end our lease. Such is not always the case. Breaking a lease can be extremely difficult and some landlords are not as understanding. After many times of reaching out to our landlord with little to no help, we figured out a few things:

  1. Slumlords, as we call them, are only interested in the rent being turned in on time. (No, not all landlords are this ruthless, but you find while renting that few really care about the tenants residing in them).
  2. Quick fixes and patch jobs are ways they are able to make temporary fixes at little to no cost to them.
  3. With the demand and price being very high for a place to live, the quality of homes can be very, very low.
  4. Whether you are renting in a college town or a nice area in the suburbs, you meet less than perfect landlords. It is bound to happen!

 

So why are people renting more now, than they ever have?

These are just a few of the pain points that have been expressed:

  1. Poor/Bad credit-The inability to get approved for a home loan/mortgage.
  2. Lack of excess funds-Unable to make the down payment or fix things in the house once it is purchased.
  3. Lower expenses-Included in rent such as water or electric in most cases.

 

free credit repair consultation

These are just a few reasons why more people are currently renting. If you are in a position where renting is your only option, here are three things to take into consideration in an effort to make a change:

  1. Look into your state laws and know your rights as a tenant. Is your landlord hard to get in touch with? Do they fail to repair things in a timely manor? Each state has their own requirements when it comes to repairs on a rental. There is such thing as ‘repair and deduct’ which just means if you as the tenant pay for a repair, it can be documented and deducted from the rent. The landlord must know about the problem and it must be proven that the landlord failed to repair it within a reasonable time. If you are dealing with a lazy landlord or one that is hard to get in touch with, this may be something you deal with. Continue to reach out and attempt to communicate with them via email/phone. Document everything that happens and try to keep everything in text and email so there is written communication.
  2. Credit Repair with a Law Firm: A bad rental situation may have you interested in looking into buying a home. With a poor credit score, you may be far off from moving if you don’t take action now. With attorney-based credit repair, you can expect to see results between 30-180 days.  If you are unsure of what your current credit score is, you can pull a credit report here. Talk to a Credit Advisor today about what you can do to get out of your current rental and into your own home soon.

If low credit scores are keeping you from improving your living situation, please contact us today for a free credit consultation. We have helped over 30,000 clients improve their scores. Let us get you back on the path toward financial freedom.