3 Things you can do in the next 24 hours to improve a credit score!
Good morning everybody and welcome to credit law centers three things you can do it in 24 hours to impact your credit score. I'm really excited about today's webinar we're going to be able to give you some tools and tips that you can use today to have a positive impact on your credit score in the next 24 hours. So what we will do is jump right in and get started. So these three things in the next 24 hours I'm going to give you all three of them right here at the very beginning and then we'll go through each one of these tips and tactics one by one in detail so you can apply that to your own credit report or to clients credit reports or just give as good friendly advice. Also there's there's a checkbox that you can ask questions in. We will answer all those questions and you can reply via email if you want a recording of today's webinar. Just email us we'll give you some info here at the end on where to go to to get that information. So a little bit of housecleaning now will get done right here at the beginning so apologize but we'll back to a jump in with the three things in the next 24 hours. First is actually one of the most simple things to do is add a new account.
And again we'll talk more about that also to another obvious one is pay down credit cards or balance out credit reports to lower the utilization ratio. We'll go in detail on that as well and pay for deletion which is my favorite which is something that we do each and every day here. These first two tactics are the two that you can do that actually don't cost any money. So you going to add a new account without costing any money. You can balance out a credit report and a lower utilization ratios which is the ratio of Euro salable credit compared to your current available balance on your revolving accounts. So you can impact that part of the score without spending any money. Won't cost you any money to do those first two. Now the third debt to pay for deletion would impact your credit score or she would impact your wallet because you're going to have to pay some items in order to get them deleted. But these first two are the two that are won't cost you any money to get started. So let's jump in and talk about why these tactics will work and dig into the details of them you've got. First your credit score has no memory. And this is alarming to a lot of people when they first think about it or realize it for the very first time. Most people think well your credit score is based on your history so it's going to remember everything that's there. And in fact your your credit score has no memory so as that report changes it doesn't remember the past information it only knows what information it has right then and there and scores your credit score or scores are only calculated when a credit report ordered a lot of times people don't realize that either they think that your credit score kind of goes up and down based on the information as it comes and goes. And in fact your credit score is only calculated when a report is ordered or really when a credit scores ordered and it's based on the information that's in file at the time that it's ordered. So if you can change that information or updated. Information each time that that score is going to change. So if you've got information on there on a Monday and you get it deleted or updated you pull that report on Tuesday it has an immediate impact. So if you change those balances toward the accounts that are reporting reorder the report it's going to have immediate impact which is why these three tactics work and work immediately and have a very fast reaction to that credit score.
So when we talk about these credit scores I want to get some of the basics down here first and go over those with you. And most people are shocked when you really dig into the details here too two and you look at right here you know that your payment history most everybody thinks you know if I pay my bills on time I'm going to have a really good score or I'm going to have good credit because I've never had a late payment or I've only had a few so I'm going to have a decent credit score. And in fact that's only 35 percent of the pie. Right. So that's not that's you know the biggest piece of the puzzle but the puzzle collectively put together outside of that piece is far bigger. So only 35 percent based on how you pay your bills. The other 65 percent your score is based on 30 percent of the amount owed 10 percent of the new credit 15 percent of your length of credit history and then 10 percent for the types of credit used.
So sixty five percent of your scores what we're talking about today not just about late payments are derogatory. The other 65 that can have immediate impact when you've got late payments it takes a while to recover from those. So you know there's things that you can do to to improve it. Above me on that but today we're talking about that other 65 percent of a score that can be impacted immediately and giving you these tips and tools that you can use to impact a credit score in 24 hours. So understand these basics of the fight go and don't worry I'm going to show you this graph again a couple couple more different times in the presentation to keep it fresh on your mind to help these tactics make more sense. And so you have a really good solid understanding of how to use these tips and tools to impact the credit score So first we'll jump in here and add a new account.
Well you know not to be silly or simple but that's one of the things to do sometimes with great causes. Keep it that simple. So just add a new account if needed but understand if it's needed. You know I'm not saying that just going out and opening up a new account or opening up a new credit cards. Going to have a positive impact on your credit score. Very rarely will it have a big impact negatively and can sometimes have a big impact positively. But understand if you need that score so if you go back to that fine go pie chart and look at that 65 percent if you don't have a mix. So if you don't have installment you don't have revolving then hey let's go look to get an installment or go look to get a revolving so you get that mix the amount owed. If you know you there's two ratios when it comes to your utilization ratio at the bureau level you have your individual and your collectively. So if you've got one credit card with a thousand dollar limit and a five hundred dollar balance you're going to have a 50 percent utilization ratio. If you add another credit card and that credit card has another or an additional thousand dollar limit. Those two combined together and your balances combined together and your utility or race utilization ratio is calculated against C of an individual per account. And then you have a collective. So just by adding this it can have an impact. This is one of those things that doesn't doesn't always cost you money.
So a lot of times you know the best advice is hey pay down your credit cards to zero or pay your credit cards off. Well if you don't have the cash to do that increase the increase the amount of credit that you have and it can have the same impact on the credit score. So adding a new account can just do that when looking at adding those you know one of the popular talk to topics this is authorized user. Well guess what. They work. They still work. They impact the credit score that ninety nine percent of lenders use the fire code version for authorized users do impact the credit score. Now now an authorized user adding an authorized user account might not get you through underwriting because if you've got a thin credit file and the best accounts you've got that authorized user your lenders can look at that differently. But in regards to the credit score which is what you're you're pricing is going to be based off love when getting a mortgage authorized users can and do impact a credit score. So look at adding those in when you add those it's just like any other account. The authorized user you're gonna get all of that account history so your average agent file the types of credit use the amount owed and the new credit is all impacted. Sixty five percent of what makes up your score can be impacted by adding that account or adding an authorized user. Another really common thing that a lot of times people just overlook is add to add to existing cards with the spouse in today's market. A lot of people when they're when they're purchasing mortgages or they're married or they've got a CO borrower on there with them where applicant look at balancing out these credit reports when people get married you don't merge these reports together look at if the 65 percent that makes up that score and make sure you're putting the best foot forward. Add yourself to a spouse's card if it's old and in debt. It has a lot of revolving history and good pay history. And more available credit look at merging these together you can be added to a spouse's card or vice versa. Maybe one spouse isn't a big credit user doesn't have a long lean lengthy history in the bureau and the other spouse does look at trying to marry those two together to maximize that credit score and this can this can be done without spending any money. So which one I just kind of talk about but the last on this one is balance out those credit reports with joint applicants. You can do that by just evaluating looking at what this score is made up of the reasons it is or is not where you want where it needed to be. And look at the other you know talk about taking one account and merging it with another account. When I say merge I mean add one spouse to another account so balance out those credit reports. You can do this without spending any money. So think about that information. Look at that information and evaluate it to see that you're putting the best foot forward to score the best. So again the go factors by adding those accounts. Sixty five percent of that's impacted just by adding adding account sometimes. So we'll jump in here. The second one is paid out of balance on the credit card or balance out the reports we're going to really keep kind of hammering home on these on this particular tactic on these two. You know you have a little bit of overlay of of what to do and how they can be used. But I talk about zero balances as well. You know this is one of those common things is it is as close to zero as possible.
I hear a lot of bad advice given all the time. And I want to try to take the time to kind of correct that or so you guys have the best understanding and the best knowledge out there. I hear people say I will keep your credit cards below 50 percent of the limit. And I always break it down this way. I try to keep it as simple as possible. You know candidly I always say the ABC is of credit cards. You know if you remember back going to school and you get an A B C or D you know it's how you're graded credit cards are really ranked the same way. And when you look at your balances. That's that's a good way to help explain it. If you would be considered an A rating on a credit card that is between 0 and 10 percent. So if you got a 0 percent balance you're in a plus if you've got a 10 percent balance you're an A minus 10 to 30 percent would be that B student. So 11 percent is going to be a B plus twenty nine percent is going to be a B minus 30 to 50 percent which is where the average American that is that C students is 30 to 50 percent of the balance is used on their credit cards and a lot of times people just don't realize that they're they're projecting themselves as a C students just by carrying those balances in and understand that. And remember your credit score is ascending not descending. So as I use this as grading a paper you know you don't start out with an A and start to lose points because you do certain things you actually start out at the very bottom you start at a 350 and start to gain points on your credit based on the types of accounts you have and how you use them. So you have to build it up. You don't start out perfect and go down from there. So keep credit cards as close to zero as possible if zero is zero is the best but keep it as get it as close to zero as can another way again is the authorized users adding an authorized user account when it comes to your credit score. These can be really powerful tools because the the authorized users those accounts do affect the utilization ratio. So adding these accounts can sometimes get you that quick fix or get you that boost to get you up and go. And it's immediate because all of the history of that authorized user account is going to come on and impact your score. And again I want to touch base on this. I am not saying I am not a proponent. I never will be buying train lines if you see or hear of that literally run the other direction. It is illegal and it and it is fraudulent and it's a fraudulent practice. We do not promote that here. When I speak of authorized users I am talking about a friend a friend a family member somebody that you know that actually is going to give you access to that account in order to build that history. A lot of times it's it's far better for somebody that you would look at it this way that somebody you would ask to co-sign than hey that's looking at somebody to ask for an authorized user you know if I've got a parent or grandparent rather than hey we will co-sign on a car loan for me would you co-sign for a 30 year mortgage. Would you rather add me to one of your credit cards. Use this as a tool to get that score where you need it to be. But the authorized users absolutely impact your utilization ratio same thing again adding with existing with it with a spouse.
Look and make sure that you get the best accounts from this spouse. Reporting on the other spouse's report and vice versa. Adding the existing cards and making sure you've got the right balance you can impact 65 percent of what makes up that score just by merging these accounts together and making sure you've got the the best of both worlds on on both reports so again balancing out those reports. We just talked about. But what do you do if you don't have the cash to pay down. That I as one of my favorites. You know the advice given like well pay down your credit card balances. Well you know you know what. If I haven't had the money to pay it off they already would be. So what do you do if you don't have that cash if you don't have that money. Look at it as a different way of understanding it and realize that your utilization ratio is impacted by two things. By paying down the balance or increasing the limit and they work exactly the same. That is a perfect two way street. So increasing the balance is the same thing as lowering the balance. So look at doing these balance transfers. If you've got one spouse that is carrying the majority of the credit card debt and the other spouse not look at doing these balance transfers. Transfer the balance from one spouse to the other can maximize one spouse's score. Contractually they still owe the money there. Nothing's changing there. But if you can take a 680 and make him a 780 by transferring these balances and they can qualify on their own do that. You know it's going to give them better terms. It's going to save them money. So do balance transfers look at doing a balance transfer. You're wanting to try to get out of high interest. Talk to people that you'd look at the same people that you would talk to about cosigning or that authorized user relationship. Talk about doing a zero percent balance transfer to one of their cards that pulled that off of your debt off of your score it has an immediate impact. Your score can go up. You can get yourself into a better place to get better terms or more favorable terms on on financing. But it absolutely can do that. So if you don't have the cash look at doing balance transfers another one is asked for that credit line increase on UN cards. One of a big retailer here locally for us around our corporate office is Nebraska Furniture Mart. They've got their own merchant you know or direct cards.
That's in Nebraska Furniture Mart card. They're loaning out their own money to buy their own products. If you have a good history with them and pick up the phone and call on these department stores a lot of times they will increase your limit just because you're looking at purchasing something in their store. So if you've got marginal credit you don't feel like you can get a credit line increase. Look at the accounts you have see if you've got any department store cards. Pick up the phone and call and talk about some purchases you want to make and ask for a credit line increase. A lot of times they'll bump that without an inquiry and can just increase that limit they increase that limit. That's the same thing as paying down that balance. So a good tool to use if you don't have the cash. Look at asking for a credit line increase once again another point here on the second term is balance out those credit reports with the joint applicants. Make sure you're maximizing the quality accounts that each spouse has. Marry those two together to balance out those reports. So so the first two tips that we went over can be done without spending any money and impact. Sixty five percent of the score we knock out the payment history and the sixty five percent we're talking about today is the types of credit use the length of credit history new credit and the amount owed. So remember these facts can absolutely impact that score immediately and can be done in the next 24 hours. The last year that we're going to talk about is the third paper deletion which is my favorite. And let's talk about some facts about paying for deletion and breakdown what I mean when I say Pay for deletion when I say I am going to pay an account for deletion of that account. It's a negotiation with with the creditor. If I pay you I'm going to ask you to remove that from my credit report. Once that's removed again your credit score has no memory. So let's jump in and talk about some facts about paying for deletion. Call it first of all collection companies do this every day. If you're on the phone with a collection company and they say hey we don't do it don't believe it or they don't let them tell you that it's against the law either because it's not against the law collection companies do it every day it's a big part of our business here at credit Law Center is once a company crosses all their T's and dotting all their eyes. The only leverage we have left if they're complying with the law is that they want the money and we're not willing to pay him unless it's gonna be deleted from the credit report which is the only way you're going to have a positive impact so we'll negotiate that again it's not a violation of the law at all. Nowhere in the FCIC does it say you cannot delete information you can get into an area where the creditors can be against their agreements with the bureaus if they're not going to just delete any information. And in fact one of the largest collection companies in the world actually has it on their Web site and spells out the terms of how to do that.
It's based on how old it is because it's not really even having an impact on the credit score anymore. But if you're willing to pay it there in full they're willing to delete it. So it isn't against the law and collection companies do it every single day. When you do this. Be careful. Make sure you get the offer in writing. You want it in writing because a lot of times these these debt collectors will just tell you what you need to want to hear. In order to get paid that's typically what they're after is is trying to collect money and sometimes they'll do whatever they need to do in order to collect that. But make sure you get it in writing. It's a negotiation and you want to make sure that they're going to back it up and if you have it in writing then they're more likely to follow through with it. So also in this pay for deletion and where I'm going to go into details is used their mistakes as leverage. When you when you're talking to a debt collector first and foremost try to find a mistake that they're making and use that as leverage. You know that's that's that's our secret sauce. You'll see on the web or talk to other companies that you know hey they've got this special tactic it's secret. You don't know. I can't tell you what it is but we have really good success. Well at credit law center we're a 100 percent transparent in our secret sauce. Anybody can do what we could do. And I'll tell you how to do it. And I'm telling you how right now and what it is is use their mistakes as leverage. What we do is we identify mistakes and we use those mistakes as leverage to negotiate a deletion when that leverage doesn't work. It goes to one of our five attorneys. So identify mistakes on the credit report. Use that in the negotiation with the with the question company and negotiate a pay for deletion if if they're willing to. So let's let me jump in and show you how to find these the most common mistakes and the mistakes that you can see that use those. So and talk about the most common mistakes we see the FTC the Federal Trade Commission did a report and showed that 79 percent of credit reports contain errors.
And let's talk about the most common accounts on there are collections over 31 percent of collection or over 31 of all credit reports contain a collection over 67 percent of those collections result from unpaid bills rather than unpaid loans and over half of those are medical.
So the most common accounts that had mistakes and are derogatory are unpaid bills not unpaid loans meaning these aren't a lot of debts that people are just deciding not to pay. They ran up a credit card and they stopped paying on a car loan. They simply give him unpaid bills and over half of those unpaid bills or medical collections. So it's not bad choices by these consumers. No one chooses to go to the emergency room and rack up thousands of dollars. And that's the most common that have the most common collection. The average of the ever median nonmedical question is 366 bucks the average medicals just a little over two hundred and the people that are reporting this information over 5 percent sample of the people in the report that they did. There they're over fourteen hundred different collection agencies identified to this is important because it speaks to how rampant in accuracies and the violations that we find because it's really easy to become a debt collector in most states you're not even licensed if you can open up an Excel spreadsheet you can more than likely become a debt collector tomorrow in your state. And because of that the barrier of entry is so low the noncompliance and the violations are huge that 79 percent of credit reports that contain errors. You know if you look at a mortgage lender a real estate agent if if the average mortgage lender had 79 percent of the applications have mistakes or the realtor was 79 percent of their contracts at mistakes they would not be employed. But in this industry it's unfortunately tolerated based on how the system's built in the amount of bad players out there is the reason to get out of this debt. This is a separate study but I brought this in because it shows by the Medical Billing Advocates of America that over 80 percent of medical bills contain errors.
So a lot of these accounts already contain errors before they even make it to the credit report which is just a really alarming number. So let's look at mistakes on credit reports. I'm going to show you a few credit reports and show you some mistakes that are easily identifiable to know that hey I've got mistakes so it's impacting the score in a way that it shouldn't. And I've got some leverage to be able to do the paper deletion or get the correction on these accounts. So first we'll jump in and look at Millennium Financial here in this first red circle. They're coded themselves as a collection company in between these two dots you've got first savings credit card so it originally as a credit card. First thing that jumps out at me is the data last activities blank so incomplete information is an accurate information. So you got mistake there you've got a mistake you're coded as an installment loan. It's a collection therefore it's not actually past due in the payment status. Another mistake. So for mistakes one account another one set up the exact same way you've got primary financial collection services. The debt was originally from ADT. The data last activities blank. It's misquoted as an installment loan. It should be coded and the collection shouldn't be reporting that past due balance. So common mistakes that we see every day.
We'll go through one here too. What do we have we have a collections on this credit report seven out of the eight are misreported this last one right here in the middle is green.
Elena actually is quoted correctly. Every other collection on this report if you look at this column here all are coded. I 9 9 9 installment loan. Here you've got one coded 0 9 which is a collection. You'll notice that the past two at zero balance they do owe one hundred and twenty four dollars. The original debt was a medical collection medical collection right above it misreported but seven out of eight of these are misreported. I can tell you every single one of these accounts on here. I use this project's specific slide on purpose. Is every one of these debt collectors will do a Pay for deletion with our company. If our clients are willing to pay it they're willing to delete it so that can have an immediate impact on that credit score right now. Today's Tuesday if we do this today and we get the credit report updated pull that report tomorrow. It's as if this information was never there. So I can have an immediate impact but this is a cruel factual data report. I'll show you the other reports. They're all structured relatively the same but the mistakes are concurrent throughout all of them. You're going to see these mistakes each and every day on most these credit reports. So dig into the details look for the mistakes used those mistakes as leverage to gain deletions this can have an immediate impact. You can impact credit scores by working on that. Sixty five percent right out of the gate. These things can be done in 24 hours. If you can get the credit reports updated so you'll have an immediate impact. This doesn't take months and years to improve but use these tactics to impact these credit scores and your credit scores in a positive way and get a good boost and make sure you're putting the best foot forward. These tips and tools we use each and every day we've been able to help over 30000 satisfied clients since 2011. We're using the law to help people improve their credit reports in a quick and affordable way that's my webinar for today. If you guys have any questions or would like a recording in this webinar to share I hope you found the information helpful. The impulse here on the screen just email us at info at credit loss center dot com and we can shoot you out this recording. Hope you have a great prosperous day and thanks for attending our webinar.