Posted by admin on October 20, 2010
When it comes to re-building credit history here’s a very unfair truth:
Paying your rent, utilities and phone bill late will be recorded on your credit report, but paying them on time is not recorded. You could still be turned down for a loan due to a lack of credit history or be blacklisted as having a poor one.
If you are just starting out it is important to establish a credit history before you actually need that car or home loan and it is easier than you might think. One of the simplest ways to establish a good credit history is through credit cards. I know you think I’m nuts but humor me!
If you have had credit for awhile but it got screwed up let me show you how to fix that. And again, it’s easier than you might think!
Let’s start with problem #1
No credit history – The best way is with a Secured Credit card. What’s that? It’s a credit card where you start by depositing a certain amount of money with the bank issuing the card. For arguments sake let’s say that you apply for the secured card and give the bank $500 deposit. The bank issues the card for that amount and some banks will give you a small amount (say $200 – it varies) in additional credit. Prove your ability to manage money by not overcharging and by making your payments on time. Never make the minimum payment, pay over and try to pay the amount down to zero every 2 months. You will be surprised at how fast your credit score will go up. Then after a year apply for an unsecured credit card. You will very likely be approved. It may be for a small amount but by exercising patience that will increase.
Someone once gave me the best definition of a responsible person; someone that can carry a credit card or even cash in their wallet without using it.
Problem #2 Rebuilding credit – Here you have some leeway. The steps mentioned above will work. However if you have a steady income you can apply for a Pre-approved auto loan. We have lenders that specialize in bad credit or no credit auto loans. You will be surprised at how easy it is. Once approved you take the approval notice to your nearest car dealer and select the car of your choice and drive out.
A word of caution: the dealer will do their best to get you into a higher priced car loan than you are approved for. They may even offer to finance it themselves. Don’t fall for this, it’s one of the oldest tricks since there have been car dealers. They will find a way to pack more than you can afford into the package and charge you an exorbitant rate of interest.
It’s better to start with a car that’s a couple of years old and work up. The auto lending company will already know what you can comfortably repay so don’t be flattered into biting off more than you can chew.
If you follow these steps your credit score will rise by a significant amount every month.
Go ahead and apply for that auto loan. What does it take to qualify? You need an income of at least $1500 per month to qualify but you will get a newer car and rebuild your credit score in the process. Approximately 95% of people who apply through our site qualify. Do it today!
Posted by admin on August 11, 2010
By EILEEN AJ CONNELLY
The Associated Press
Monday, July 12, 2010; 11:08 AM
NEW YORK — The credit scores of millions more Americans are sinking to new lows.
Figures provided by FICO Inc. show that 25.5 percent of consumers – nearly 43.4 million people – now have a credit score of 599 or below, marking them as poor risks for lenders. It’s unlikely they will be able to get credit cards, auto loans or mortgages under the tighter lending standards banks now use.
Because consumers relied so heavily on debt to fuel their spending in recent years, their restricted access to credit is one reason for the slow economic recovery.
“I don’t get paid for loan applications, I get paid for closings,” said Ritch Workman, a Melbourne, Fla., mortgage broker. “I have plenty of business, but I’m struggling to stay open.”
FICO’s latest analysis is based on consumer credit reports as of April. Its findings represent an increase of about 2.4 million people in the lowest credit score categories in the past two years. Before the Great Recession, scores on FICO’s 300-to-850 scale weren’t as volatile, said Andrew Jennings, chief research officer for FICO in Minneapolis. Historically, just 15 percent of the 170 million consumers with active credit accounts, or 25.5 million people, fell below 599, according to data posted on Myfico.com.
More are likely to join their ranks. It can take several months before payment missteps actually drive down a credit score. The Labor Department says about 26 million people are out of work or underemployed, and millions more face foreclosure, which alone can chop 150 points off an individual’s score. Once the damage is done, it could be years before this group can restore their scores, even if they had strong credit histories in the past.
On the positive side, the number of consumers who have a top score of 800 or above has increased in recent years. At least in part, this reflects that more individuals have cut spending and paid down debt in response to the recession. Their ranks now stand at 17.9 percent, which is notably above the historical average of 13 percent, though down from 18.7 percent in April 2008 before the market meltdown.
There’s also been a notable shift in the important range of people with moderate credit, those with scores between 650 and 699. The new data shows that this group comprised 11.9 percent of scores. This is down only marginally from 12 percent in 2008, but reflects a drop of roughly 5.3 million people from its historical average of 15 percent.
This group is significant because it may feel the effects of lenders’ tighter credit standards the most, said FICO’s Jennings. Consumers on the lowest end of the scale are less likely to try to borrow. However, people with mid-range scores that had been eligible for credit before the meltdown are looking to buy homes or cars but finding it hard to qualify for affordable loans.
Workman has seen this firsthand.
A customer with a score of 679 recently walked away from buying a house because he could not get the best interest rate on a $100,000 mortgage. Had his score been 680, the rate he was offered would have been a half-percent lower. The difference was only about $31 per month, but over a 30-year mortgage would have added up to more than $11,000.
“There was nothing derogatory on his credit report,” Workman said of the customer. He had, however, recently gotten an auto loan, which likely lowered his score.
Studies have shown FICO scores are generally reliable predictions of consumer payment behavior, but Workman’s experience points to one drawback of credit scoring: the automated underwriting programs lenders use can’t always differentiate between two people with the same score. Another consumer might have a 679 score because of several late payments, which could indicate he or she is a bigger repayment risk. But a computer program that depends just on score won’t consider those details.
On a broader scale, some of the spike in foreclosures came about because homeowners were financially irresponsible, while others lost their jobs and could no longer pay their mortgages. Yet both reasons for foreclosures have the same impact on a borrower’s FICO score.
In the past too much credit was handed out based on scores alone, without considering how much debt consumers could pay back, said Edmund Tribue, a senior vice president in the credit risk practice at MasterCard Advisors. Now the ability to repay the debt is a critical part of the lending decision.
Workman still thinks credit scores alone play too big a role. “The pendulum has swung too far,” he said. “We absolutely swung way too far in the liberal lending, but did we have to swing so far back the other way?”
Webmasters Note: If you need credit help we offer solutions from Bankruptcy help, credit cards, bad credit Auto Loans (approximately 85% approval) and more including Legal Credit Repair attorneys and our 1-800BadCredit website has more.
Posted by admin on June 11, 2010
By Leslie Kearney
I have two friends who tried to do “self service” bad credit repair and ended up getting nowhere. One friend I wrote about in another article. Her original bankruptcy appeared on her credit report, then after it was discharged another bankruptcy appeared as opened and discharged and then later again yet another bankruptcy was posted. This was obviously a mistake but it ruined her credit. Through a lot of effort she finally got the New York courts to remove one of the wrong entries, but one of them remains there still.
My other friend had a series of minor errors from various creditors (hospital bills that were paid and another person’s information on her report). She wrote letters to the credit bureaus contesting the errors and demanding removal. After she had worked and worked on the “do it yourself method” and seemed to be getting nowhere I thought I would bring up the subject again.
Sue, (not her real name) I started; “The law states clearly that if a credit bureau can’t verify the accuracy of a disputed listing, then it must be removed from your credit report”. The Fair Credit Reporting Act (FCRA) gives you the right to accurate credit reporting. “I know that you’ve been exercising that right by requesting that the questionable items be removed from your credit report”.
She replied, “I know, but I don’t understand why I am having such a hard a time correcting things! I’ve done everything by the book to repair my bad credit and I don’t seem to be getting anywhere!” I explained that due to the size of the credit industry even though technically the creditor(s) you listed have 30 days to respond there is no way for you as an individual to check up to see if they responded. For that matter, if they refused to respond you would probably never know it. You are just lost in the maze.
“This credit repair law firm I have been telling you about has been in this bad credit repair business since 1991. They guarantee results or you owe nothing. While the process of credit repair should be easy to do on your own, getting results can be difficult, time consuming, and frustrating (as she found)”. That’s where Lexington Law comes in.
When it comes to matters of trust, there is no better place to turn than a credit repair law firm. Attorneys are bound by rules of ethics that require them to act with absolute integrity. Attorneys are responsible for looking after their clients’ best interest and are required to call upon every means possible to obtain positive results for those clients.
I went on to explain the other benefits I knew to be true about Lexington Law, that they have helped over 300,000 clients with bad credit repair and removed well over 1 million negative items from their credit reports. And they have a 24/7 customer service line.
One final comment; the above story is 100% true. We checked out several of the major credit repair law firms and our recommendation is Lexington Law . Last year alone they legally removed 665,515 negative items from their clients credit reports. Isn’t that the kind of people you want working for you? Don’t mess around when it comes to your credit report. Click the link above and let them get started. Oh by the way, did I tell you they offer a money-back-guarantee?
