Irena Bocheva asked:




Is your credit far from perfect? Are you having troubles getting approved for a mortgage or auto loan? Do you want to get rid of debt and start with a “clean credit slate”? In the current economic crisis more and more Americans are facing the same bad credit problems. Contrary to the general myth, fixing credit doesn’t have to be that hard. You can clean credit history in a short period of time if you arm yourself with credit knowledge and a healthy dose of perseverance.

Here are 3 simple tips that will help you understand how fast credit repair works:

1. Time is not always the solution.

A lot of credit experts think that time is the only solution for serious credit problems. Bankruptcies stay on your record for 10 years. Negative items like collections, tax liens, judgments, late payments, past due payments etc usually fall off your record after 7 years. Credit inquiries appear on your report for a period of 2 years. You can pay off collections, liens, judgments etc, but they still stay on your credit report( albeit now paid) and affect your score negatively. The only thing you can do, according to the mainstream credit advisers, is pay the negative items off and wait until they fall off from your record completely. Contrary to that myth, there are so many things you can do in order to remove a negative item from your report. The only requirement is not time, but credit knowledge and thinking outside the credit box.

2. Pay more or pay less.

The traditional way of credit repair preaches financial discipline and paying your debt off. In reality paying your debt in full will not necessarily raise your score. For example, paying off an old collection might actually hurt your credit score. The reason is that the account is now updated to “current”. The negative item (although paid) will have bigger impact on your credit score and will stay on your record as an adverse account for another 7 years. In this case-paying your debt in full doesn’t really help. Instead of trying to pay debt in full, concentrate on negotiation with collection agencies. In reality debt collectors still make a pretty handsome profit even if you pay them 25 % or less of the amount owed. Your ultimate goal is to pay as little as possible and still convince debt collectors to remove the item from your credit report. In other words-don’t go for the “hard” way, when you can do it the “smart” way.

3. Always aim for complete deletion.

Deletion of negative items is the ultimate goal of fast credit repair. A paid off negative item might not benefit your score. A deleted negative item, on the other hand, will boost your score immediately. In order to delete an item from your report, you have to master the art of “dispute” and ” negotiation” with credit bureaus and collection agencies.

There are many ways to clean credit history. Knowledge about the inner workings of the system and the various loopholes in it, however, seems like the shortest route. Once you start thinking outside the box, you’ll be surprised to find how easy credit repair actually is.

Thomas

Irena Bocheva asked:




Are you planning to apply for an auto or mortgage loan, but fear being turned down by creditors? Do you want to raise your FICO because a potential employer is conducting a mandatory credit check? Do you simply want to get rid of debt and start with a clean credit slate? Whatever your specific situation is, fixing credit score is always a good idea.

Here are 3 possible routes that will take you to the land of “better credit”.

1 The hard way.

This is the most popular and most laborious way to raise credit score. According to the mainstream credit advisers credit repair can only be achieved through careful budget planning, financial discipline and patience. In order to succeed you have to take a look at your income, track monthly expenditures, curb any unnecessary spending and and start paying off your debt. Slowly but surely you’ll work your way up to a better credit. There are various caveats associated with this long term approach to a better credit. For example, most of the people that need better credit score can’t wait years to see the positive results. They need that house or brand new car NOW, not later. Besides, people with outstanding credit debt have to spend literally decades of their lives paying off what they owe. Last, but not least-paying off your debt in full can sometimes harm your report and lower your score. For example, paying off a collection that is more than 2 years old will upgrade the account status to current. The bad debt (although now paid) will continue to influence your score adversely and will stay on your report for additional 7 years.

2 The expensive way.

A lot of people feel helpless and overwhelmed when it comes to credit repair. They turn to credit repair services and pay exorbitant fees hoping to see their score skyrocket soon. What are the problems associated with this type of credit repair? First, there are many scam services out there which prey on the huge crowd of misinformed people. Typical tell-tale signs that you are dealing with scam services is when they ask for the money upfront or when they don’t inform you of your legal rights. The second problem is that these companies simply do the things you can do yourself IF you had enough credit knowledge.

3 The smart way.

This is the fastest and most painless way to a better credit. The only requirement-knowledge about the credit system and the various loopholes in it. Do you know what’s the formula behind your FICO score? Which 2 credit factors account for more than 30% of your final credit score? How many points does each type of negative item take away from your credit report (bankruptcy, foreclosure, loan default, collection, legal judgment, late payment, credit inquiry etc)? Do you know how to get credit bureaus, collection agencies and original creditors to delete items from your record? Do you know how to file Rapid Rescore and remove mistakes on your report within 48 hours? Do you know how to bring your credit card balances to the “healthy zone” (30% balance to limit ratio) without paying off your balances? How to settle with collection agencies for less than 20 % of what you actually owe? In a nutshell-the more you know about the credit system, the faster you will see positive credit results.

Fixing credit score is not than hard. Knowledge about the credit system and the little known secrets in it will boost your credit in no time. Once you start thinking outside the credit box, you’ll be surprised to find how easy credit repair actually is.

Jose