Category Archives: Credit Repair

Getting Bad Credit Help Today

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More Americans are in need of bad credit help than ever before. With high balances on credit cards, many card holders are watching helplessly as the credit card companies hike interest rates and cut available credit. Making the minimum payment is harder than ever for some families, Plus, the impact of lower limits on credit scores means fewer Americans qualify for credit.

Even if you’re not delinquent with your bills, or facing bankruptcy or foreclosure, you still may want to get some credit help to figure out how to reduce the burden of high balances and high payments. Credit help can come from many sources, including do it yourself.

Since so many people are having trouble, the ads on television have blossomed with offers to help you with your debt burden. Many of these credit companies simply negotiate with your credit card issuer to reduce your balance or lower your monthly payments. Some horror stories are out there too, as some of these companies can be scammers. For example, one debtor had a company tell her she just had to sit and wait for seven months, not making payments, and ten the credit card companies would work with her to reduce balances. This bad advice was after she’d paid them a hefty fee! To follow this type of advice would destroy your credit score even more than it already might be.

There are some legitimate credit repair companies though. Many of these are not for profit companies, and don’t charge you high fees. They work with credit card companies to reduce your monthly payments to make them easier to afford, but generally your balances will remain the same. It’s important to note that some of these nonprofits are funded by the credit card companies! And the fact that you are working with them will appear on your credit report – a fact that some lenders will consider as bad as filing for personal bankruptcy. So, be sure to ask if that’s the case with any company you work with.

Another point is that these companies will focus on your credit card debt, which is unsecured, and would be discharged in a Chapter 7 bankruptcy. They are not as focused on working with your secured lenders, your landlord or mortgage company, and so on. They want to see if you have the money to keep paying your credit card bills.

It’s not altogether necessary for you to work with a credit agency though. Many lenders know that many Americans are having financial trouble, and they take the approach that the sooner they get an agreement in place with you, the better, before you decide to stop paying them altogether. Not all companies will work with you though to extend credit help. For some reason, there are banks out there who insist still on playing hard ball and threatening you to keep paying as agreed.

How would you go about doing a credit repair program on your own then? You can do just what the credit counseling agencies will do. First, you should have a budget. You should know how much money is coming in each month or week, and what your necessary living expenses are. Make sure that you are meeting the costs of living first – your food, rent, and utilities – before you start negotiating with your credit card companies. You probably want to work with your secured lenders too, to see if they will renegotiate your loan terms, or give you a couple months off so you can get back on your financial feet. Remember thought that secured lenders can simply repossess your car, or house, or whatever goods are securing your loan.

After you have a good picture of what money you have each month to pay unsecured bills, talk to your lenders. Let them know you can’t make payments based on their new terms, and that you want to work out a plan. If any of them refuse to work with you, then work with the ones who will. Make the others sit and wait for a payment.

Ideally you’ll want to keep your payments current, otherwise your credit score will suffer. So some of the tips here are for those of you who can’t make the minimum payments each month. If you are able to pay your minimum monthly payments, that’s great, but then you want to take steps to start chipping away at your overall debt to be able to have an emergency fund, or retirement fund, or save your money to build wealth, not just keep paying creditors.

Whether you are able to make your minimum payments or not, you should take action to earn some extra income to pay your debts off faster. Once you have all your debts current, you can start finding ways to put more than the minimum payment toward your bills. And if you’re having trouble making monthly payments, then you definitely need to find a way to make some extra cash to pay your bills.

Try selling household items you don’t need any more, using eBay or Craigslist. You might also consider selling items that are really too expensive for your lifestyle – the expensive tee vee, the expensive car, the expensive jewelry. These are items that you have traded your financial security for – and they are not worth losing everything. Selling things to raise cash is quite popular these days, and be sure to put all the extra cash you earn toward your monthly payments.

Another route is to get a second job. This economy is tough, as many people are losing their full time jobs, and part time jobs are competitive. But it’s not going to get better in the short run, so even if you have to deliver pizzas or bag groceries, you should try to earn some extra money each month.

Finding ways to make money on the internet is also an alternative. This method can be inexpensive, but does take time to build an online business. There are many websites that should you how to do this, but don’t spend a lot of money on anything until you have a chance to check it out thoroughly. There are scammers, there are “courses” which charge thousands of dollars – and none of these will help you as much as the more modest sites that really want to teach you how to build an online business. (We recommend The Keyword Academy, which has information about how to make money online with a one month trial for just $1. Worth checking out at that price!)

The bottom line is that if you are going to seek credit help, be sure to educate yourself about all the options available to you. don’t sign up with the first credit counseling agency you come across, or don’t believe what you see on television. You can find great resources on the Web for low or no cost, and can get started on your own, for free.

Instant Credit Repair A Scam?

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You might have heard about something called instant credit repair. There are companies that claim to be able to improve your credit instantly, with a completely clean credit report. Unfortunately, in this tough economy, there are many people who would want to take advantage of such a service, but be warned that this is just a scam.

The scam runs a couple different ways, but mainly these services just get you to obtain an Employer Identification Number, or EIN, which is a form of tax ID meant for businesses. If you were a sole proprietor for example, and have an employee or other tax reason to file your for your business separately, you need to get an EIN. These credit scam companies however will tell you to get an EIN and start using that as your social security number.

This is not only not going to work, but it’s technically illegal. You can’t have more than one social security number, and to only list a new EIN on a credit form, instead of your social security number, is a form of fraud. If you are granted credit using a new number, but have bad credit under a social security number you haven’t given them, they can pull your credit away from you at any time. And using such a number to qualify for a mortgage or secured loan is against the law and can subject you to penalties.

Obviously instant credit repair is a really great fantasy, but it does not exist. There really is no way around your bad credit report by hiding it, getting a new number, signing up under someone else’s credit (hopefully no one else is dumb enough to let your credit ruin theirs too!). Credit repair takes time, and you can get there legally by following the right steps, not chasing after instant credit repair that doesn’t exist.

Credit Repair Secrets

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Think there are some kind of credit repair secrets that will get your credit fixed fast? It sounds good on television ads, but if you want to be legal, there isn’t a fast method to getting better credit. the “secrets” that you might hear about are really more about patience than anything!

That might not be what you want to hear, yet the truth is that’s good news. Since you can repair your credit without spending a lot of money or hiring someone else to do it, you can take advantage of what are actually just a few so-called secrets to credit repair and get started right away fixing your credit.

One secret of credit repair you might not know about is to review your credit report for errors. Errors appear on a huge percentage of credit reports, and every mistake has the potential to be lowering your credit score. Read your credit report to see if everything there is your own, legitimate credit.

Another credit repair secret is that you can start calling creditors on your own to negotiate reduced monthly fees, lower interest rates, or other ways to be able to pay them back. This is what credit counseling agencies do – why pay them if you can do it yourself?

A third secret you might not know about is that there really are no secrets. Most important will be to bring your debts current, and after that to pay everything on time. If you can get rid of some debt, so that you can reduce the number of payments you owe each month, so much the better. But before you spend the money you used to put toward a debt, add that amount to the next debt on your list. This is what’s known as a “debt snowball” and it will help you pay off debt in record time, and pay less interest in the process.

When you see someone say they are offering the secrets to credit repair revealed, you can look at them with more skepticism now. The steps listed above are really the only credit repair secrets you need to know – once you get started, just keep going and in a few months you’ll see there really isn’t any secret to getting your credit back in good shape.

How To Repair Your Credit – Fast!

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Figuring out how to repair your credit is always a good idea if you currently have a bad credit score. Without bad credit, having to wait a year or more before you see credit improvement can seem like it’s taking forever. But learning how to repair your credit score is actually pretty easy – just a few steps can repair your credit quickly, so that can begin to see improvement in only a couple months. When you know how to repair your own credit, you an continue taking steps and see your scores improve without spending a lot of money, and even for free.

To start any program for repairing your credit history, you have to start by knowing what your credit looks like today. You can get a free credit report, and review it from there, but you also might want to see your credit report plus credit scores, which you usually have to pay for. When you subscribe to a service that gives you credit scores, it’s an easy way to keep track of the improvement you’ll see in your credit score as you start learning more about how to repair your credit yourself. Usually basic credit score services are as little as under $10 per month and you can often cancel at any time. But you don’t need your scores to start fixing credit, you probably already know you have a low score if you are past due or have a lot of unpaid debt. Maybe you’ll want to check your credit score at the beginning of your credit repair program, but then not get another credit score report for a few months, after you’ve taken some action.

Where is the best place to start to fix credit? The absolute most important item thing you must do now is bring your bills current, and start paying them all bills on time. Even if you debt is large, and bringing everything current is a lot of money, do everything you can to raise a few extra bucks and pay up. Sell some things online, get a part time job, stop buying fast food, and put the extra money toward your overdue bills. Once you bring your debt current, then start paying every bill on time. If you can’t afford your monthly payments we’ll discuss more on that below. But even if you have had a bad payment history in the past, just by doing these two things you could start to see improvements in your credit score within just a couple months.

Another thing you should consider is to close out some of the credit card accounts you have open. Some people say that closing accounts can hurt your FICO score. But if you have too many credit cards available to you, that can hurt your score too. It’ better to have a few accounts with balances that re under 50% of the total debt limit, instead of multiple accounts sitting there. Close some and that will also remove temptation from you possibly running up ore debt.

Most credit reporting agencies will say that once you take some steps to clean up your credit, it can take 60-90 days to show up on your credit report, since some update at the end of the month. If you are diligent about fixing your past due accounts, and reducing debt, then you will see improvement in 3-6 months. It’s hard to get around that unless you use means that are illegal or illegitimate – don’t fall for credit scams that say they can get you clean credit immediately. Sometimes you just have to be patient for three months until a change shows up that will positively affect your credit score.

What about people who have such bad credit that there is over a year or more of negative credit history? If this sounds like you, you might want to consider more serious steps. If you just can’t make your credit payments, then it’s possibly you should consider bankruptcy. A rule of thumb is: If your debt if more than your annual gross salary or wages, then it will take you a very long time to dig out of the debt hole especially as credit card companies now are raising interest rates and fees. This is when you might consider bankruptcy.

Once your credit has been negative for a year or more, filing for bankruptcy will not affect your credit history or credit score much for the worse. Lenders already see the past seven years of your credit history when making a decision, and your bad credit history will already cause problems even without a bankruptcy. One you file for bankruptcy, it may help you get back on your feet and have a chance to start over. (Remember, however that certain debts cannot be wiped out by bankruptcy, such as child support payments or student loans.)

It can be expensive however to file for bankruptcy. While many bankruptcy lawyers will give you a free consultation for a half hour or an hour, you will have to pay a retainer fee of $2,000 or more before they will file your paperwork. They should also talk with you to see if in fact bankruptcy is the right path for you to take. Just be wary of any lawyer that tries to rush you into filing bankruptcy – you always have options.

Will a credit counseling agency help you with how to repair your credit rating? It’s debatable. First, watch out for credit services that claim to improve your credit score by 100 or more points in just a month or two. This is virtually impossible to do legally. Also, they may charge you high fees, or a big percentage of the monthly payments you’re making. that said, some non-profit counseling agencies will help you for free. But be aware that many of these agencies are financially supported by the credit card industry, and will encourage you not to file bankruptcy but to pay your debts, even if that isn’t the right option for you. They will also be mainly concerned with getting you to pay your credit card debt but won’t help so much with late car or house payments or rent.

Another little known fact is that while they are telling you how to repair your credit score, they wont’ tell you that just using their service will hurt your credit score! That’s right – registration with their credit counseling agency, and entering into a repayment plan, will show up on your credit report, and many lenders treat this just like a bad credit mark and will not give you credit! So it doesn’t really help you if your goal is just to improve your credit report.

The bottom line is that if you are trying to learn how to repair your credit, there is plenty of information available to you to do it yourself. You don’t need to pay high fees, or hire a lawyer right away. You can take steps for how to repair your credit quickly once you see improvement you’ll be motivated to stick with your credit repair program.