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The Roadmap to Better Credit

Time to Pass Go: 

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.

Check out Credit Law Center Reviews:
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This entry was posted in Credit Repair Blogs and tagged credit law, Credit Repair Companies, kansas city, Kansas City Credit Repair, National Credit Repair. Bookmark the permalink. Follow any comments here with the RSS feed for this post. Both comments and trackbacks are currently closed.
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Opting Out: Scams, Junkmail and Marketing Offers

Inboxes full of spam and junk mail, texts coming from unknown numbers alerting you to new investing opportunities, “urgent” mail with pre approved credit and loan offers, and new marketing practices are just some of the annoyances the average consumer must face on the daily. In todays blog, we will go over how to opt out of several of these annoying inquiry services and get your inbox cleaned up for good! 

Pre Approval Credit Offers 

Best Credit Cards for Free Travel | April 2022 | Travel Freely

 

With your information readily available to creditors and  insurers from lists provided by the main three reporting bureaus, credit offers can flood your mailbox at any time without warning. Even though these offers are screened and sent to you due to the fact that you meet their criteria, you may not always be looking for a new line of credit or just don’t need one in general. Luckily the FCRA allows for consumers to opt out of these offers easily with just a few simple steps. To opt out, all you have to do is either; call  888-5-OPTOUT (888-567-8688) or submit  the request online at OptOutPrescreen.com. All you have to do is enter some personal information (SSN, birthdate and name) and you are on your way to opting out! The next step is to follow the prompt and either request a temporary or permanent opt out. Note that you will only be able to use the permanent opt out option if done through the website, but you can do the temporary option through the website prompt or over the phone. 

  

Direct Marketing Offers/ Junk Mail 

Stop junk mail | Metro

 

Even if you have opted out of the credit offers, your information will still be listed on mailing lists. To opt out of these lists, there are a few things you are going to have to do. 

1- Visit DMAchoice.org and set up an account with the Direct Marketing Association (DMA) and decide which mail you want to receive from DMA members. There will be a  $2 processing fee, which will cover you for the next 10 years. 

2-Visit the DMA website and set your email preferences to stop email marketing. 

3-Send a request by mail to the DMA Mail Preference Service, P.O. Box 643, Carmel, NY 10512 

Keep in mind, even when following the procedures listed above, there is no way to completely eliminate direct marketing offers, but it will drastically limit the amount that you receive. 

  

Telemarketers 

Know Your Legal Rights Against Telemarketers | Puff & Cockerill

All you need to do to stop unwanted telemarketing calls is to put your number on the national do not call registry. To do so, just call 1-888-382-1222 or visit www.donotcall.gov to register. Take in mind that the Do Not Call rules will not apply to every telemarketer. Non-profits,  many charities,  polling companies, and recent business endeavors are just a few unaffected by Do Not Call rules . The Do Not Call Registry will also not stop scammers who are operating illegally or committing fraud. To file a complaint against someone who violates the Do Not Call list, call 1-888-225-5322 (888-CALL-FCC). You can also complain online at https://consumercomplaints.fcc.gov/hc/en-us. If you are unsure if whoever is calling you is a debt collector or scammer, take a quick look at our blog to learn the difference Here 

  

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. 

 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. 

 

 

 

 

 

 

 

Is It Possible For Your Score To Drop After Credit Repair?

When beginning credit repair, many consumers hold high hopes of ending their  repair process with a clean report and a high credit score. Removing a few items here and there can really make your positive credit shine through and can give you the push you need to acquire financing; but that may not always be the case. The topic of todays blog goes over how and why it is possible that your credit score can actually drop after removing negative items from your report.

Don’t Panic!

So what does it mean when your score is lower than it started after finishing your credit repair process? There are several reasons that can lead to a drop in your score, but remember, a lower score is not always a bad thing!

What to Know About Buying Credit Tradelines - Self. Credit Builder.

1- You Do Not Have Enough Active Tradelines

One reason that your score can drop after credit repair could be that you do not have enough open lines of credit reporting to  help establish your score. Each open account is meant to show how well you are able to manage your borrowed money and the more accounts you have that are reporting positively (low balance/ low credit utilization rate) the better your score will reflect your responsible actions. If you only have one or no active tradelines reporting after credit repair, there is a good chance you will see a dip in your scores.

2- You Have High Amounts Of Debt

High amounts of debt listed on your account and high credit utilization is another reason your score could drop after credit repair. With fewer accounts reporting, just like positive accounts, negative accounts can hold more weight with a clean account. Paying down your cards and keeping them below a 15% utilization rate will help negate a score drop and can greatly improve your final credit score. It is imperative that you monitor total utilization because it impacts 30 percent of your credit score! Experts frequently recommend consumers to keep their credit utilization rate below 20% to positively effect your credit. It is a good habit to keep your ratio as low as possible since high utilization is very off-putting  to lenders. A high utilization ratio tells lenders that you’re having a hard time managing your money and they are at risk to losing their investment.

3- You Have Nothing Left Reporting On Your Account

This situation is a little more rare but is entirely possible after credit repair. In some cases, a clean sweep of a credit report can drop the score due to the fact that there are no accounts left to report. When you first start building your credit, you technically start out at a credit score of zero. When a “clean sweep” occurs and you have a 100% removal, you are essentially back at square one. This is actually beneficial to you when it comes to building credit  as it means that any positive credit you accrue will impact your score much more than new tradelines and positive payment history would on an account with multiple derogatory items.

4- You Applied For New Credit Cards or Loans

During the credit repair process, it is imperative that you practice good credit habits to maximize the results after items are removed. One common mistake consumers make is applying for new lines of credit with the belief that opening a fresh tradeline will add positive credit to the account immediately. When you apply for a new card or a loan, you trigger a hard inquiry. Hard inquiries one their own are not terribly impactful on their own but multiple hard inquiries while repairing your credit can be detrimental to your score.

Credit Counseling & Credit Repair: What's the Difference?

Navigating through the Do’s and Don’ts of credit repair can seem overwhelming at first but avoiding a score drop after credit repair is not as hard as you might think. Our seasoned credit advisers will always audit your report prior to starting the program and provide instructions to maximize your return for your credit report specifically. A drop in your is avoidable as long as you follow the direction of your repair specialist and stay away from poor credit habits during the program.

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.

Check out Credit Law Center Reviews:
Google Reviews, Facebook Reviews
This entry was posted in Credit Repair Blogs and tagged credit law, Credit Repair Companies, kansas city, Kansas City Credit Repair, National Credit Repair. Bookmark the permalink. Follow any comments here with the RSS feed for this post. Both comments and trackbacks are currently closed.
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This entry was posted in Building Credit and tagged . Bookmark the permalink. Follow any comments here with the RSS feed for this post. Both comments and trackbacks are currently closed. Edit

 

5 Common Mistakes Consumers Make With Their Credit

How Could You Be Hurting Your Credit?

The more you know about how credit works, the better your score will be. This is because, without a lot of background knowledge, your own logic and reasoning will oftentimes fail you. There are a lot of factors that go into creating your credit score, so trying to make decisions when it comes to your credit without studying up first can be tricky. There are five big mistakes a lot of consumers often make because, without any background knowledge, they all sound perfectly reasonable.

1. Close A Credit Card

Just because you don’t really use your card does not mean you should close it. Closing a credit card will stop any subsequent reporting of positive credit and payment history and positive credit utilization. Keeping a card open, even if you rarely use it, can be beneficial. Be sure to use your card every once in a while, be it for a cup of coffee or a drive through sandwich. This will keep activity on the account and keep the card holder from deactivating the account.

2.Believing that Paying on Time is All You Need for A Good Credit Score

Yes, paying off all your credit card debt on time is good for your credit score, but that is not all it takes to have what is considered a quality credit score. If you are using a huge portion of your credit limit every month, even paying it off completely and on time will not be as beneficial as lowering your credit utilization ratio would be. Your credit utilization ratio is one of the biggest factors that goes into creating your credit score, and the lower is it, the better your credit will be. So, keeping your utilization ratio under 30 percent per credit limit will benefit you even more when it comes to your credit.

3. Pay Off A Loan Early

It definitely can benefit your finances to pay a loan off early, especially if you are paying a very high interest rate on the loan, but this can also hurt your credit score. It would be very easy to think that paying a loan off early would help your credit, but in reality, it lowers your credit mix and therefore lowers your credit score. So, if the interest rate on your loan is not burdening you financially, then you will actually benefit from not paying a loan off early.

4. Reject Higher Credit Limits

The only reason you should reject a higher credit limit is if you know you will not be able to stop yourself from overspending because of it. Otherwise, keeping your spending at a consistent rate while also increasing your credit limit will raise your credit score because your credit utilization ratio would then be lower. So, accepting a higher credit limit will in most cases raise your credit score if you can keep yourself from overspending.
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5. Send in Partial Payments

Paying off a debt partially does not put you in better standing with the debt collectors or the credit bureaus. You will still be reported as paying late and are at risk for a delinquency on your credit report. So, if you are struggling to pay your minimums every payment cycle, talk to a credit counselor before trying to appease the creditor by only paying partially.
Other 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)
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.
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.

 

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.

Debt Collectors

Decreasing Credit Card Limits II A Major Score Impact

How Does A Decrease In Credit Limit Effect Me? 

Your credit utilization rate is one of the most important factors when it comes to your credit score. Depending on how much of the available balance you use will reflect what kind of borrower you are and can be the deciding factor in a substantial credit boost. The lower your credit utilization rate, the better impact the account will have on your credit report. 

It can be frustrating to hold a lower credit utilization rate of 15% on an open trade line, but find that with a drop to your allotted limit, you have almost doubled your original rate. This can lead to lower credit scores and curbs one’s buying power substantially! A sudden change in your credit habits can also portray you as a risky borrower and can spur other lenders to reconsider limits as well.

Can They Do That?!

Just as a card issuer can raise your credit limit as a reward for your continued loyalty or due to your personal request, they can also lower the amount you can access when borrowing from them. This can happen for a multitude of reasons but primarily is due to the cardholder being seen to have a higher risk of default.  An example can be seen with holders that have added an authorized user onto the account; if one has a substantially lower credit score, the lender may see the account as being at risk. Another example comes with the recent dealings of the Covid 19 epidemic. With many borrowers experiencing financial difficulties in the last year, lenders have had to take protective actions with the exponential rise of credit utilization from their borrowers. 

Though federal laws provide some protections related to credit limit decreases, banks usually have free rein to edit your credit limit as they see needed. This can be seen as an unfavorable or even shady tactic, but as they are the ones lending the money, the ball rests in their court. 

What Are My Rights? 

If the credit changes do not breach your cardholder agreement or federal credit regulations, issuers can make changes to your card’s terms as they see fit. Currently, there are no laws that can protect consumers from a credit limit decrease or the damage that will potentially occur with the change. 

The Fair Credit Reporting Act does require the issuer to send an adverse action notice to the consumer when they take an action based on your credit report. This does protect you from misinformation if another person’s poor account history is added to your report; you will receive notice of that change and can take appropriate action to correct it! 

The good news is that it is extremely rare for an issuer to reduce your credit limit lower than the amount you have already charged to your card (IE: if you have a credit utilization rate of $2000 and you have charged $1500 to the account, it is extremely unlikely for the issuer to lower the limit below that $1500). If there is a rare case of the issuer decreasing the amount below the current borrowed amount, there are CARD Act provisions that can protect you from any fees that may come from maxing out the account. With this law in place, your issuer is unable to charge the “over the limit” fee within 45 days from the credit limits change.

Has your credit score dropped because of a recent cut to your credit limits? 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 Credit Law Center a call at 1-800-994-3070 we would be happy to help.

CREDIT REPAIR CONSULTATION

 

How Can I Get My Old Limit Restored? 

Now that your limit has been cut, what are some steps you can take to begin restoring it? If you have had your credit limit lowered, the first thing you need to do is verify with your card issuer and ask a representative for an explanation for the credit limit drop. Depending on the reason for the limit cut, there are a few things you can do!

If the cutback was caused by a financial setback that prevented you from making your payments or keeping your balance in good standings, just explaining the situation can make all the difference.  This could be going over what exactly happened that threw off your standing or an explanation of what steps you are going to take to get everything back in order! Many issuers would be more than happy to work with you to restore your credit limit if certain criteria are met! This can be anything from making on-time payments over an extended period of time or paying down your balance to a certain number.

Another way you can potentially help your situation would be to write a goodwill letter to the issuer! A goodwill letter can also prompt the issuer to remove a late payment from the report depending on your credit history. This option can take substantially longer to take effect and is only valid if you held prior positive payment history.

Your issuer is not required by law to make changes to restore your previous credit limit and these prior attempts may not show results. If you are denied and you believe that the card company is neglecting to assist you in any way, you can file a complaint with the Consumer Financial Protection Bureau to attempt to provide urgency to the situation.

 

Don’t Put Yourself At Risk

It is not common for card issuers to make changes to your credit limit, but there many cases where it does happen. There are a few ways that can help ensure you are never the target of a credit limit cut. Be sure to monitor your credit report for any changes, errors, and fraudulent accounts that could lead to a credit limit cut. You are entitled by law to one free credit report per year from each of the major credit bureaus, and it can be obtained at AnnualCreditReport.com. There are many other monitoring services out there like Credit Armor that take a deep dive into your credit report and provide helpful tools to help dispute and correct misinformation on your report.

The best way to prevent a decreased credit limit and keep your credit in good standings is to make sure to keep your credit utilization as low as possible, pay your balances on time and monitor your report for any inconsistencies that may pop up!

 

who looks at credit

Debt Collector or Scam Caller? How Can You Tell?

How To Deal With Debt Collectors

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

 

Your Rights Under the FDCPA

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

They must

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

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

Taking Legal Action

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

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

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

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Suing the Debt Collector

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

Continued Harassment and Next Steps

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

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

 

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

 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.

experian boost and ultra fico

Why Should You Hire A Law Firm For Credit Repair?

Why Consumers Hire a Law Firm For Credit Repair

There is a major difference between what a credit repair company can do versus what a law firm specializing in credit repair can.  What you may find even more interesting is that a consumer can actually do more than what a credit repair company will. A Law Firm however, trumps all. We have been using the law since 2011 to help consumers every day and this is what makes us far superior to other “repair” companies.

Here is how we help our consumers and fight for their rights!

Harassing Phone Calls:

If you are constantly receiving phones calls and are tired of trying to dodge collectors, we can get these calls to stop. At Credit Law Center   we notify all your creditors that you are now a client of our law firm. We also send out correspondence to them indicating that all communication to you should go through us. They must comply with this request! If they do not, it is a violation of the Fair Debt Collection Practices Act and they are liable to you and to us. If they continue calling after you’ve informed them you are represented by Credit Law Center, this could mean money in your pocket!

Violations with FCRA
The Fair Credit Reporting Act    mandates that everything on a report must be verifiable, accurate and timely. A recent study indicated that 79% of credit reports contain errors! Many of these errors are easy for us to spot and we can give our consumers a great idea of what to expect on certain items that may in fact fall off due to a FCRA violation. At Credit Law Center we sue for those inaccuracies.
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Debt Negotiation:
As a law firm we have the ability and power to negotiate judgments, repossessions, charge off, or any sort of debt that is still reporting on a report.  We use the power of the law and our attorneys to negotiate these items in a way that’s favorable to you. While not Debt Consolidation or Bankruptcy, we do have significant tools available to us that help negotiate these debts and save you significant amounts of money! We have four attorneys in house that you can lean on for advice and guidance while working on negotiation. Their extensive negotiating experience with banks, collection companies, and collection attorneys has helped our clients save thousands.  Our goal is to negotiate the debt as low as possible out of court and get your case dismissed.

We Win!
At Credit Law Center we use federal statutes to assist our consumers. The first one is the FDCPA or the Fair Debt Collection Practices Act.  This  statute lays out a specific way in which debts can be collected both legal methods and illegal methods. The second is the FCRA or the Fair Credit Reporting Act.   Lastly is TCPA (Telephone Consumer Protection Act)  This act is specifically designed for text message, fax machine violations, pre recorded voicemails.  Three of these federal guidelines provide for attorney’s fees if we are successful. What that means is if we take your case and pursue it and are successful, the other side pays our fees and as our client you would owe us nothing! Please contact us today if you think you might have a case in any of these areas of the law, we would happy to speak with you further 1-800-994-3070!

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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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.