saving my credit scores

Credit Scores Dropping Quickly│How Can I Recover?

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

 

Credit Scores across the states

Credit Scores Across States│Where Do You Rank?

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

 

Lower Interest Rates

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

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

 

credit scores impacted by timeshares

Credit Scores Impacted By Timeshares│Buyer Beware

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

 

Free credit monitoring active duty

Free Credit Reports For Active Duty Military│Salute To Service

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.

 

free credit repair consultation

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

 

All Credit Reports Must Change

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

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

 

free credit repair consultation

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

 

Credit and Gambling

When The Chips Fall: Gambling Addiction and Credit Scores

When The Chips Fall: Gambling Addiction and Credit Scores

As luck would have it, gambling and debt go hand in hand! So what if your hand falls short? Nearly 23 millions Americans lose and fall into debt- losing an estimated $55,000. What happens when you’ve run out of cash and all stashes have hit zero? Once you have exhausted all resources you may realize you have run into a real problem-addiction.

Gambling Addiction:
The first step here is taking care of yourself and the addiction. If you do not get a grasp on the addiction first you may never hit the root of the real problem. As cliche as it may sound, admitting you have a problem is where one must start.

But what is next?

  1. Make the decision to say no-While still considered a substance abuse disorder, gambling is still something to take seriously. It is very important to have a great support system around you when making the decision to quit.
  2. Close credit cards funding gambling-Request that your bank require two signatures on withdrawals and have an accountability partner that will not allow you to take that money out to gamble with. This will ensure that you are thinking twice before spending and funding the habit.
  3. Find a support system-Looking to get help for this addiction is hard. Find a support group like GA (Gamblers Anonymous) which is  beneficial and a step in the right direction. Recruit the support of trusted friends and family that can help you work through the issues and will not enable or support the addiction.

 

Paying Gambling Debt:
Hitting rock bottom is scary. What may be even more scary is thinking about your current credit scores.  Pull a credit report here for $1. If your credit report is showing numerous derogatory accounts, debt negotiation may be your best, last “bet.” The attorneys at Credit Law Center have years of experience negotiating debts. Their extensive negotiating experience with banks, collection companies and collection attorneys has helped many of our clients save thousands. Their goal is  to negotiate the debt as low as possible out of court and get the case dismissed.

Bankruptcy:
This is not always the best or only option out there.  There is no guarantee your debt will be discharged. This option needs to be discussed at great length due to the impact it has on your credit score. To determine if you should file for bankruptcy, collect and add up your bills and credit statements. If the value of your assets is less than the amount of debt you owe, filing may be a great option. Again, this step should not be approached lightly.

 

May the odds be in your favor-
Financially speaking, this is a big hole to fall into and few recover from quickly. Embracing a new lifestyle free from addiction is tough, but surrounding yourself with a team that is willing to get you back to financial stability is a must. When gambling debt occurs, more often than not, the debt goes deeper than just money owed to the casinos. If you have run into a turn of bad luck and collection companies are attempting to track you down, please reach out to one of our Credit Advisors today. We would love to help get you back on the right path.  1-800-994-3070

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

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.

Article by Breana Washington

Improve a credit score in the next 24 hours!

Three things you can do in the next 24 hours to improve a credit score. Two of the three options do not cost you any money!

Credit Law Center explains three things to do to improve a credit score in the next 24 hours. First, add a new account or become an authorized user. Second, is to pay down your credit cards or balances. Third, pay for deletion. We have broken these tips down for consumers to understand what will work best or what fits with their current situation.

Add new account/authorized user: Adding a new account will not cost you any money. Becoming an authorized user to an account that is in great standing (spouse, parent, sibling) will immediately impact your own credit report. If you do not have a good mix of credit, this may be a great option. We tell clients two revolving and two installments is a good, healthy mix of credit. If you are working with a lender and trying to become approved for a home loan, check with your Loan Officer on the authorized user as sometimes, if that is your only revolving account, underwriting will not approve you.

Pay down and lower utilization: This step, if you have some money to put towards lowering those balances, your utilization ratio will really help. Often times, people are told to pay their accounts down to zero. Another idea, if extra cash is not on hand, is to ask for a credit limit increase. This is not an excuse to go shopping, however, helps again with that utilization ratio. Good rule of thumb is to look at the report as a grade card. A credit Score is ascending not descending. So, you do not start with an A and lose points, you start at the very bottom or a 350 score and gain points based on the types of accounts you have.

 

 

Pay for deletion: Credit Law Center uses pay for deletion as one of the tactics for our clients. This is a great article on the DIY way to attempt pay to delete on your own.

 

In conclusion:  A lot of people assume your credit score is based on history so it will remember everything, right? Your credit score has no memory.  As that report changes it doesn’t remember past information, it only knows what info is had right then and there. Your scores are only calculated when a current report is ordered. It is all based off of the information that is on the file at the time. If you can change that information or update it each time that score continues to change each time. If you have inaccurate information on a Monday and it is removed Monday evening, by Tuesday it is gone. Those changes have immediate impact on the score. Therefore, if you make changes to your balances and pay cards down and order a new report, the scores will reflect it.

35% of the credit score is based on payment history. Amount owed on your cards makes up 30%. The other 35% is made up of types of credit used, length of history, and new credit. When a consumer has a late payment, it takes a long time to recover. Looking at your report and understanding the credit world is important in order to maximize your scores. If you would like additional information on how to improve your scores, please contact us!

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

Credit 101-What You May Not Know About Your Credit

Credit 101

Janna Fox (Director of Business Development) and Breana Washington (Marketing and Media Manager) chat about common questions consumers ask about credit repair and what myths there are about credit scores.  Credit Law Center educates consumers and encourages them to know their rights, and be more informed about the credit world.   For more information about credit reports or getting in contact with an advisor, please visit our website.