Credit Repair Blog - The Credit Repair Resource

Prepare for Success

Credit repair is capable of cleaning up your credit reports, raising your scores, and turning your financial life around. But you need to be an active participant. To get life changing results you must be prepared to work. Credit repair requires a new mindset about the credit bureaus, persistence, a willingness to confront collectors, the readiness to build and manage new credit, and the determination to organize your financial life. It’s a job! But if you start now you will find that success is yours, sooner than you imagined. Just take the first step.

Finding Every Error

Your credit repair project starts with your credit reports. It’s time to get a new mindset about the credit bureaus. They are not the enemy, but they do make mistakes. Your job is to find and correct them. Or hire a credit repair service to analyze your reports for you. You need to develop a critical attitude. A cursory review of your reports is not enough, you need to go line by line and hunt down every error. Keep an eye out for duplicate accounts, accounts reporting with balances that have been closed and paid, underreported credit card limits, and any derogatory items that you are not completely sure about. When in doubt, dispute.

Persistence Pays Off

Once you start the dispute phase of your credit repair project you need to be persistent. If a dispute is not processed to your satisfaction you should not give up. If you are convinced that there is a reporting error you need to fight back. Respond to the bureau’s verification letter with a firm insistence that they have the creditor research the questionable item. A good credit repair service will always customize follow up letters to maximize the probability of success. Stick to your guns.

Managing Collection Accounts

If you have active collections you need to develop a proactive approach to dealing with them. Once your credit repair project is underway you should never ignore a collection letter as it presents a great opportunity. The Fair Debt Collection Practices Act requires that collectors provide documentation verifying their ownership of the debt on request. But you need to do it within 30 days. If they cannot provide documentation they must cease collection efforts. This process is called debt validation. If you are a member of a credit repair service, make sure to send your collection letter to them promptly so they may contact the collector in a timely manner.

The Importance of Good Credit

Your credit repair effort may eliminate derogatory information on your credit reports, but unless you have open and active credit your FICO scores are likely to be disappointing. The elimination of derogatory information will remove the dead weight holding down your scores, but without the buoyancy provided by positive credit your scores will not rise. Secured credit cards are the best option for most people in credit repair programs. Don’t underestimate the power of a couple of small secured credit cards; they can be worth over 100 points within 6 months.

Solidify Your Foundation

You are making an effort to turn your life around, and you are succeeding! Now is the time to insure that you don’t lose any of your hard won credit repair progress. Create a budget and start a savings account. Don’t think of a budget as an austerity program, it is a way of gathering information about your expenses. Good financial decisions should always be made thoughtfully, and that cannot be done without understanding your own financial abilities. And a savings account will provide a buffer for unexpected expenses so you will not fall behind when an emergency comes up. The best way to build a saving account is slowly but surely. Contribute a small amount from each paycheck. The key is to commit. Your account will grow gradually, and your credit repair success will be assured. Good luck!

Copyright © 2008 Sky Blue Credit Repair. All Content. All Rights Reserved.

Introduction

Credit repair can produce dramatic results, potentially transforming the appearance of your credit reports and boosting your credit scores. Credit repair may even deliver major results in a reasonably short period of time. But it is not a magic cure for your credit woes; you will need to do some work. It is important at the outset of a credit repair effort to have a realistic perspective. But don’t lower your expectations; just make the effort needed to produce genuinely awesome results.

Organizing Your Effort

There are three things you must do to insure that you credit repair project yields the best possible results. You must get control of your existing obligations by building a realistic and practical budget. You must learn how to manage your account balances properly to fully optimize your credit scores. And you must learn the effect each type of credit can have on your credit scores. And there is more to this than meets the eye. Mastering the subtle details can make a world of difference in your credit scores, so let’s get to work.

Making a Budget Work for You

Don’t be afraid of creating a budget. Having a budget does not mean that you must embrace a self-imposed austerity plan. Creating a budget is an information gathering process. The more you know about your finances the better off you will be. When the time comes to make a decision that will affect your monthly cash flow it should be made in the context of good information. Too many financial errors have occurred simply because of a lack of information. You are going to be work hard on your credit repair project. You can’t afford to fly blind.

Get a pad of paper and list everything that you spend money on. Take your time and make sure that you have included everything from the big monthly obligations to your daily incidentals. Don’t forget an item because it occurs only occasionally, like an annual vacation. Just estimate the total amount you will need and divide it by twelve to determine the amount you should set aside each month. The goal of this exercise is to get a complete picture of your expenses. For your long term credit repair success you must be able to live within your means.

Your Balances and Your Credit Scores

There was a time when you would have great credit if you paid your bills on time. This is not longer enough. You can make your payments on time for years and still have terrible credit scores if you don’t manage your revolving balances properly. For credit repair results you must understand the relationship between your balances and your credit scores. The FICO scoring model grades you on the amount of available credit that you use. The relationship between an account balance and its limit is called the balance to limit ratio.

For the best possible credit score you should reduce your balances so that you are using less than 20 percent of the available credit line. Specifically, the FICO model recognizes balance to limit ratios in 20 percent increments; 20, 40, 60, 80, and 100 percent. The lower the balance, the higher your score will be. Don’t underestimate this. You could lose over 100 points by running up a revolving balance to the limit.

Using the Right Kind of Credit

When it comes to credit repair there are big differences in the type of credit you use. The FICO scoring model likes some credit types, but will penalize you for others. If you want to improve your credit scores you should use mainstream credit cards like MasterCard, Visa, American Express, and Discover. And you must avoid consumer credit, including store cards and the type of financing offered by furniture and electronics stores.

This type of debt is useless for credit repair success, and can even drag your scores down. There are a variety of reasons for the way FICO treats consumer debt; it typically comes with poor terms and high rates. It may also come with an attractive, but dangerous no-payment option which will mature into an unwieldy repayment plan. Still, this type of debt can be convenient, so use it if you wish, but pay it off when you need your credit scores to be at their best. Good luck with your credit repair!

Copyright © 2008 Sky Blue Credit Repair. All Content. All Rights Reserved.

Introduction

Debt validation is a powerful credit repair tool, but like many credit repair techniques it must be approached properly to get the optimal outcome. When done right debt validation can provide wonderful results including proof that the collector has the legal right to collect and an accounting of the amount due. And there are many cases when the collector, unable to provide the documentation required, will quietly vanish from your life.

Respond to Collection Letters Quickly

Collection letters must include, or be closely followed by, a written notice including your right to dispute the debt within 30 days. It is important to know that collectors do not like to validate debt or process credit repair demands. From a collectors perspective they are playing a numbers game; they want to send out collections letters and collect money. They would rather not tangle with debtors over the details. If you do not dispute the debt within the 30 day period allowed the collector is likely to ignore your request.

Credit Repair Options

Once you have a collection notice in hand there are a couple of credit repair strategies you should consider right away. If you don’t recognize the debt you have the right to request the name and phone number of the original creditor. Collection notices are supposed to include the name of the creditor to whom the debt is owned, however in the case that the debt has been sold and resold the original creditors name may not be indicated. But if you do recognize the debt you should research the statute of limitation before going any further.

Statutes of Limitation

The statute of limitation (SOL) for the collection of a debt is the maximum period of time that a collector can file a lawsuit. To be precise, a collector can file a lawsuit after the SOL has passed, but should they do so you can have the suit dismissed on this basis. It is important to your credit repair effort to know that the SOL clock starts on the day that you first become delinquent. This means that you need to count from the first time you missed a payment in the sequence that led to the chargeoff or collection status. SOLs are state and debt type specific and are easily found on the Internet.

Negotiation Opportunities

If the subject collection is beyond the SOL you are pretty much in the clear. You can choose to contact the collector to negotiate the debt if you wish. Those looking for the best credit repair outcome may want to take the opportunity to negotiate for complete account deletion. Once a collector knows that you are aware of the SOL they should be extremely willing to settle. You also have the option of ignoring the debt. The reporting period limit will roll around and the debt will fall off your credit report. If you decide to ignore the debt and the collector continues to contact you, you may opt to send them a cease communication letter, another useful credit repair tool. Once they receive this they will stop all communications.

Validate the Debt

Assuming that you decide to validate the debt you must do so in writing. Keep your request as simple and clear as possible. As with all credit repair communications, do not go into a story or explanation. Just ask for validation of the debt. I strongly recommend that you specifically list the documents and information you want them to send you. Ask them for proof they have the legal right to collect the debt, a detailed calculation of the amount claimed owed, and a copy of your original signed contract or account agreement.

Right and Wrong Results

If a collector cannot validate the debt they should stop collecting and not report to the credit bureaus. This happy credit repair outcome occurs quite often. But it does occasionally happen that they send nothing more than an internal printout or some such thing, and then continue their collection efforts. This can make your credit repair project difficult. There is ample case precedent to support the argument that a collector must provide the documentation listed above, but you may have to go to court to get satisfaction. If you reach the point where you are ready to get into a legal battle you should consider consulting an attorney so you are fully prepared when you get in front of the judge.

Credit Repair Help

If you begin your debt validation journey on your own and find that you are confused you should reach out to a credit repair service where a professional will review your entire case, research the SOL, prepare and send the letters as needed to get the best possible results. You do not have to do it alone. Reputable credit repair services are extremely affordable and will insure that the job is done properly. Good luck!

Copyright © 2008 Sky Blue Credit Repair. All Content. All Rights Reserved.

FICO is Not a Report Card

Your credit score is not a report card meant to grade you on your past payment history. Are you surprised to hear this? If you are in a credit repair program and are hoping for truly meaningful progress you should understand the true intent of the FICO scoring model; you must learn to think like the engineers that developed the algorithm.

Measuring Risk of Default

The FICO credit score is designed to measure the likelihood that you will default on your obligations. There are many subtle factors that FICO considers in its calculation. Each of these factors is utilized as a predictor of future behavior. Some of these factors make perfect sense, but others, less logical, are likely to take you by surprise and hinder your credit repair progress, so don’t let them catch you unawares.

Inquiries

When you apply for a new credit card, auto loan, or any new debt your scores will dip slightly. The reason that FICO lowers your scores for each inquiry is that it sees your shopping as a potential threat to your budget. Each inquiry will impact your scores by between 1 and 5 points depending on the extensiveness of your credit. The more established your credit the less impact an inquiry will have because you have demonstrated skill in opening and managing new accounts.

New Accounts

New accounts will put a significant, but temporary, dent in your credit repair progress. The reason is simple; FICO recognizes the new account as a threat to your budget. The impact on your credit repair progress will fade quickly as your demonstrate the ability to manage the new debt responsibly. And, as with inquiries, the impact of a new account will depend on the extensiveness of your credit. The more established your credit the less of an impact on your scores.

Revolving Balances and Credit Repair

Revolving balances are a big factor in any credit repair program. If you want to improve your scores you must reduce your balances. Buy why is this? The FICO engineers are aware that high revolving balances are likely to occur when money is tight. Conversely low balances occur when money is plentiful. FICO sees a tight budget as a forerunner of potential default and will lower your scores to warn potential lenders that it may not be the right time to lend you money.

Consumer Debt

Consumer debt is a contentious issue among those who are caught unawares by this little wrinkle in the credit scoring formula. FICO carries an automatic bias against this type of debt regardless of any of the potential benefits that may be built-in. Consumer debt includes store cards and store financing most commonly used for the purchase of furniture and electronics. This type of debt is usually pricey and frequently comes with no-payment deals that mature into precarious repayment plans after a fixed term. If you are in a credit repair program you should avoid this type of debt.

Active vs. Inactive Accounts

You know that it is important to keep your credit card balances low to optimize your credit repair results. But did you know that if you pay those cards off and let them sit unused the credit score value of that account will start to fade away? FICO recognizes that many credit cards get retired, both by consumers and creditors, and yet continue to report. Logically, an inactive card should not count towards your credit worthiness if it is not currently in use.

Credit Repair

If you would like your credit scores to reach their full potential and you don’t feel up to the task of evaluating every possible option, just contact a credit repair professional. You don’t have to manage the job alone. A credit repair professional will be happy examine your credit reports and identify all of the opportunities to boost your score. Good luck!

Copyright © 2008 Sky Blue Credit Repair. All Content. All Rights Reserved.

Introduction

The credit repair stories you are about to read are true. They are meant to entertain as well as educate. Credit repair is not difficult. But it takes some thought. For those who approach credit repair cautiously success will be certain and satisfying. For those who act hastily the outcome can be less than happy. The good news is that mistakes can be corrected, and with any luck the lessons learned will lead to great success, as you will read below.

Don’t Forget to Rebuild

Jason started out his credit repair program with a lot of enthusiasm. He was thrilled to see the derogatory items come off his report month by month. After almost six months of credit repair he went to MyFICO.com to check out his scores and was disappointed to see that they had risen only marginally. He consulted an expert about the situation. The credit repair professional explained to him that derogatory information had been depressing his scores, but without positive information his scores would not rise satisfactorily. So Jason opened two secured credit cards, making sure to pay on time and keep the balances low. It took some patience, but six months later, Jason checked his scores and was astounded to see that they had risen 150 points. It was a wonderful outcome.

Watch Those Balances

Becky had been in a credit repair program for a few months and her credit scores had risen dramatically. Her goal was to buy a house and she felt that she was almost ready. Several weeks before she was going to apply for her mortgage she bought a new television and paid for it with her credit card. She thought it would be great in her new home. When Becky applied for her mortgage she was shocked that her scores were 100 points lower than they had been only 45 days prior. Her credit repair consultant looked at her report and saw that the purchase of the television had pushed her credit card balance to the limit. At his advice she reduced the balance and a month later she re-applied for her mortgage, this time there was no problem. Her scores were higher than ever and she was approved for a great low rate mortgage.

Check the Statue of Limitation

Ethan was contacted by a collector who offered him a tempting deal of twenty-five percent off the original balance owned. The deal seemed fair, but because it was a significant amount of money Ethan decided to consult a credit repair expert first. The credit repair expert researched the statute of limitation (SOL) and calculated the amount of time that had passed since the original default date. It turned out that the debt was two years beyond the expiration of the SOL and only one year short of the reporting period limit. The credit repair expert explained to Ethan that because the debt was past the SOL the collector did not have legal recourse, which usually makes a debt very negotiable, and because it was only one year short of the reporting period limit he could even opt to ignore it as it would fall off soon enough. Ethan decided to call the collector and make a reduced offer. Once the collector understood that Ethan knew the law he settled for far less than his original offer. The little bit of credit repair homework saved Ethan thousands of dollars.

The Moral of the Story

Jason, Becky, and Ethan ran into obstacles in their path. But the solutions were easy and delivered terrific results. There is never a cause for worry. If you have taken a wrong turn just correct your course and before you know it you will be enjoying the positive results you deserve. Credit repair is not difficult, but it is essential to pay attention to the details. There is nothing wrong with undertaking the task of credit repair on your own, but if any time you feel that you need help, you should reach out and consult a professional. Your credit is important and every detail matters. Good luck, you can do it!

Copyright © 2009 Sky Blue Credit Repair. All Content. All Rights Reserved.

Credit Repair Works

Credit repair works. And the results will have a dramatic impact on your financial life. Lenders everywhere have tightened their credit requirements. Every single point on your credit score matters. Credit blemishes can quickly translate into higher interest rates and even loan denials. You cannot afford to ignore the potential of credit repair. Do it yourself, or for a small investment you can hire a professional credit repair service to manage the process for you. Either way, now is the time to take action.

The Great Liberation

Free yourself from the illusion of authority. Many people make the mistake of giving too much credibility to the content of their credit reports. The power of the credit bureaus can be intimidating; we might believe our eyes against our better judgment. The credit bureaus play an important role in our world, but they are not without flaw. Over half of all credit reports include errors that are significant enough for the victims to pay premium interest rates, and, in many cases, to face loan denial. The credit bureaus maintain files on over 200 million Americans. That means that over 100 million Americans are victims of credit reporting errors.

The Credit Repair Plot Thickens

There is an unfortunate and unjust credit reporting anomaly that is virtually guaranteed to handicap those who can afford it the least. If you have had legitimate credit problems in the past you are more than twice as likely to be a victim of reporting errors as someone who has not had issues. There are two primary reasons for this; when you default on a debt the creditor is apt to move your account into another reporting category increasing the likelihood of duplicates and errors, and secondly, if an account is sent to a collector the lax reporting conformity of the collection industry can harm your credit needlessly for years to come.

And There is More

An informed examination of your credit report by a credit repair professional may turn up errors in many categories. Some of these errors are pure compliance violations that you are not likely to spot without training. If you are going to manage your own credit repair project make sure to do your homework before getting started. Educate yourself about reporting period limits for all categories of credit, make sure you understand the operation of statute of limitations, and peruse the Fair Credit Reporting Act and the Fair Debt Collection Practices Act. The little details can make the difference between success and failure.

The Credit Repair Solution

Understanding your rights and the compliance requirements of the credit bureaus will give you the legal leverage you need for your credit repair effort to succeed. Your credit bureau disputes are the cornerstone of your credit repair project, but there is more. True credit repair success should be measured by the improvement in your FICO credit scores. You must carry out your credit bureau disputes with an understanding of the impact every change in your credit report will have on your FICO scores. When you put it all together you will be thrilled with the results.

Help is Near

You are not alone. Many people don’t have the time to manage their credit repair project as carefully as necessary. If you feel that you can’t give it the attention it deserves, hire a credit repair professional. A professional will insure that every issue is identified, and will address your problems in an informed and careful manner designed to produce the best results. In addition, truly effective credit repair services will assist you in rebuilding and reshaping your credit to meet future lenders guidelines so that you will be left with genuinely useable credit. Whichever route you take, I urge you to act now. It’s your credit, and it matters.

Copyright © 2009 Sky Blue Credit Repair. All Content. All Rights Reserved.

Identity Theft Concerns

There are a number of reasons you might have a concern about the illicit use of your identity. A lost wallet, unexplained accounts on your credit report, mysterious transactions on a credit card; these can all give rise to very reasonable worries about fraudulent activity. These events may be of little consequence, or they may be quite serious. Either way, there are a variety of credit repair solutions that you should implement immediately. Credit repair solutions include investigative, preventative, and curative, and all three should be employed.

Investigate the Issue

If you discover activity on your credit report that is not yours it may be the result of a file merger error. This means that someone else’s credit data has been merged with yours. As awful as this may sound, it is pretty innocent and has an easy credit repair cure. So, before you jump to conclusions about identity theft take a few minutes to investigate. Get copies of all three credit reports, circle the unknown accounts, call the creditors, and ask them if they have an account in your name. If they tell you that they have no record of the suspect account you are a victim of a file merger error. This is easily cured with a bit of credit repair. Just write to the credit bureaus telling them that someone else’s credit is showing on your report, and ask them to correct the error. Be sure to provide your identification. File merger errors are surprisingly common and the credit bureaus will most likely resolve the problem for you right away.

Cure the Problem

If on the other hand, the creditor acknowledges that the questionable account is yours, you may have been a victim of identity theft and should implement a more serious credit repair cure right away. The Fair Credit Reporting Act provides a very powerful solution for identity theft victims. You need to go the police station with a copy of your credit report and ask them to provide you with an Identity Theft Report. You will need to send this to the credit bureaus along with your identification and a signed statement affirming that the accounts in question have nothing to do with any transaction of yours. The credit bureaus will block the suspect accounts with a few days and initiate an investigation.

Prevention of Identity Theft

If you have been a victim of identity theft, or are just concerned about preventing the problem from occurring there are two easy and effective credit repair solutions. The credit bureaus offer a simple warning system called a Fraud Alert. A Fraud Alert is a statement inserted into your credit report requesting that prospective lenders contact you before extending credit. All you need to do is ask the credit bureaus to include this statement on your report, provide them with a contact phone number, and you are all set. There is no charge and the alert will remain on your credit report for 90 days. After 90 days you may extend it if wish. You may also cancel it at any time if you feel that the threat has passed. Fraud Alerts, however, are not foolproof, and some lenders may ignore the alert and extend credit regardless. An excellent ancillary credit repair solution you should implement simultaneously with your Fraud Alert is credit monitoring. Credit monitoring is a service offered by the credit bureaus which will alert you to any activity on your credit including inquiries. You can expect to pay less than $20 per month for this service. If someone attempts to use your identity you will be contact in time to avert the issue.

Consult a Professional

If you have concerns about fraudulent use of your identity you should consult a credit repair professional. Most credit repair services offer a free consultation which you should take advantage of. There may be considerations other than have been mentioned in this article, and every situation is unique. As important as your credit is your should always make informed choices.

Copyright © 2009 Sky Blue Credit Repair. All Content. All Rights Reserved.

The Foundation of Credit Repair

Credit repair can eliminate reporting errors, tidy up your report, and improve your credit scores, but the real potential of credit repair is best realized when combined with a lifestyle change. Now is the time to work towards genuine financial stability. You must make financial decisions in the context of a reasonable and well developed budget. You must also allow for regular, disciplined savings. This may seem like a tall order, but it can be done. Once you get started you will discover that the rewards are far greater than the costs involved.

Getting Organized

Getting a budget organized can be a stressful project. It can be difficult to examine the realities of one’s financial life, but there is nothing more important, and once you take the big step you are bound to experience a newfound feeling of empowerment and personal control. Clear a couple of hours in your schedule, get a new pad of legal paper and a pen, clean off the kitchen table, and prepare to build a budget.

Gather Information

Write down every expense that you can think of. Start with the big items like housing and auto payments and work down to the daily incidental expenses like lunch and gas. Don’t forget utilities, phone, cable, and all of those little monthly operating costs. Everything counts, and little items add up. Do you take an annual vacation? Estimate the amount of money you need and write it down. It’s important to include annual and occasional expenses in your budget; estimate the amount and divide by twelve to arrive at the amount you must set aside each month.

Pay Yourself Too

There is one more category of expense that you need to add to your list. When it comes to credit repair, this is the one that counts the most. Add a monthly amount for you. This is the amount that you should put into a savings account each and every month. There is nothing as important as setting aside money. In the long run this habit will pay you back many times over; a savings account will give you a buffer in case of unexpected expenses, protect your hard won credit repair results, and be a first step in building solid personal wealth. You might consider ten percent of your income as an appropriate amount.

Evaluate the Results

Once you have listed your expenses (including the amount you decided to contribute to a savings account) it’s time to add them up and calculate a monthly total. How does it compare with your after tax income? If you can cover all of your costs and still have elbow room you are in great shape. If this exercise has revealed the unfortunate reality that you are spending more money than you make, it’s time to make some decisions. This is not always easy, but a little creative thinking might make the process more manageable than you think.

Cutting Costs

If you need to cut costs you should think outside of the box. Get a little creative. You might want to consider that everything is fair game. This can be a big step, but give it a try. Are you paying a lot in rent? The market has changed so much in the last few years that you might find a great new place for even less money. How about your car? Is your payment killing you? Car dealers are hungry and auto finance managers are brilliant at structuring deals; you might be able to trade in your big payment for a little one and still drive off the lot in a nice set of wheels.

Credit Repair Refinances

As your credit repair program starts to yield results you may find yourself in a position to refinance your higher rate debt and to reduce your payments on existing accounts. This is true of everything from mortgages, to auto loans, to credit cards. Over time credit repair will improve your credit scores and allow infinitely more flexibility than you had before. The key to success is to approach the project from all angles. Make your foundation strong and put careful thought into managing and preserving your financial health each and every day. You can succeed!

Copyright © 2009 Sky Blue Credit Repair. All Content. All Rights Reserved.

You Can Achieve Real Credit Repair Success

There are several important issues to consider before starting your credit repair effort. The time you invest in preparation will save you time and effort, and more importantly, insure that you get the results you deserve from your credit repair project. Take a moment, plan your approach, and proceed thoughtfully. You will succeed!

Make Your Payments on Time

If you are currently not able to keep up with your existing obligations, credit repair is not the right option for you. Before starting a credit repair effort your finances should be stabilized and you should be able to pay your bills on time. There is no point in cleaning up your credit report while derogatory events continue to occur. If you are having trouble paying your bills you should investigate other options, including consumer credit counseling and debt negotiation. You should also consider consulting a bankruptcy attorney.

Get Your Credit Reports

You will need all three reports from the major CRAs (credit reporting agencies) for your credit repair project; they are Experian, Equifax, and TransUnion. You can get them for free at AnnualCreditReport.com, but I am sorry to say that I advise against this option, as it is difficult and frustrating. And in the end, should you succeed, you will have three credit reports in different formats, and all about as clear to the layman as reading Chinese. I suggest purchasing a nice tri-merged report. They are easily available on the Internet and should cost less than $20. A good investment in your credit repair success.

Get Your Credit Scores, Maybe

It seems like a nice idea to obtain your credit scores at the outset of your credit repair project so you can track the progress of this important number. Should you choose to do this, you need to be aware of a controversial battle between the credit bureaus and Fair Isaac Corp, the developer of the FICO scoring model. Lenders purchase FICO scores from the credit bureaus to make loan decisions. The credit bureaus, however, will not sell these genuine FICO scores to consumers. Instead they have created their own scores which are meant to mimic the behavior of FICO scores. Unfortunately, they often differ by as much as 100 points. At the moment consumers can purchase genuine FICO scores for their Equifax and TransUnion reports directly from Fair Isaac at MyFICO.com. A single Equifax FICO score is available at Equifax.com. Experian FICO scores are not available to the public.

Read the Fair Credit Reporting Act

You cannot hope to succeed at credit repair without knowing the compliance requirements imposed on the credit bureaus. These requirements are codified in the Fair Credit Reporting Act (FCRA). Many people starting a credit repair program assume that it is only necessary to spot and dispute the obvious derogatory errors. If you make this mistake you are likely to leave half of your potential improvement untapped. If you take the time to grasp the essential reporting guidelines of the FCRA you will gain the legal leverage you need to get the credit repair results you deserve.

Read the Fair Debt Collection Practices Act

If you have any collection issues at all you will need a working knowledge of the Fair Debt Collection Practices Act (FDCPA). This is not a difficult read and will give you a significant advantage in dealing with both active collections as well as dormant collection accounts on your credit report. Armed with your legal rights you will be able to stop collectors from bothering you, force them to validate their legitimacy, provide you with an accounting of the debt, and force them to remove erroneous and outdated entries from your credit report.

Learn Your Statutes of Limitation

Statutes of limitation define the time limit for collectors to enforce collection of a debt through the court system and are an essential tool in your credit repair arsenal. A statute of limitation (SOL) has no bearing on the reporting period limits that the CRAs are required to enforce. Reporting period limits are generally seven years for derogatory events, whereas SOLs are often as short as three years. When an SOL has expired, a collector has no way to enforce the collection of a debt. This gives you a powerful credit repair advantage; you may opt to ignore the debt with no fear of being sued, or you may choose to negotiate a very favorable payoff.

Consider Professional Help

If you are going to manage your own credit repair effort you must invest the time in understanding your rights and the compliance requirements of all parties involved in the reporting process. But if you decide that you cannot manage the effort it takes to manage the credit repair task properly you should hire a professional. Should you decide on this path I suggest that you write down a list of questions relevant to your case and call several reputable credit repair services and interview them. Choose the company that you are comfortable with and put them to work. Good luck!

Copyright © 2009 Sky Blue Credit Repair. All Content. All Rights Reserved.

Credit Repair in Changing Times

Credit repair has the power to transform your financial life and help you meet creditor guidelines. We are in a period of hard economic times. For the last three years lenders have tightened their requirements. Consumers everywhere are finding it difficult to get home loans, automobile financing, and even credit cards. Millions of credit cards holders have been contacted by their creditors and told that their credit limits have been reduced, and in many cases even informed that their cards have been cancelled.

Meeting the Challenge Head On

Yesterday, the Wall Street Journal noted that credit card issuers will be cutting credit card lines by two trillion dollars in 2009. Credit repair provides a means of restoring, rebuilding, and optimizing your credit reports and credit scores. An intelligent round of credit repair is exactly what these hard times call for. You do not have to sit back and watch passively while the availability of credit becomes a distant memory. Start your credit repair program today and regain the favor of lenders and access to the low cost financing you need.

A Complete Approach is Needed

There are three aspects to successful credit repair that you must address simultaneously. You must clean up the content of your credit report, rectify any credit deficiencies you have, and fine-tune your credit for credit score optimization. If you neglect any of these tasks your credit repair effort will struggle, or even fail in spite of your otherwise capable and hard work. Many credit repair programs focus on credit bureau disputes to the exclusion of everything else. And as exciting as it is to see derogatory information corrected, you are likely to face disappointment when the time comes to apply for a loan and you find that your credit scores have not improved and that the content of your report does not meet the lenders requirements. Here is an overview of the three pronged approach that will insure you end up with truly usable credit.

The Credit Repair Clean Up

Cleaning up your credit report with credit repair requires patience and a proper understanding of all of your legal rights under the Fair Credit Reporting Act. And if you have accounts reported by collectors on your report you must have a working knowledge of the Fair Debt Collection Practices Act and all relevant state statutes of limitation. With the proper tools your job will be easy and rewarding. If you fail to learn the rules you may trigger unanticipated trouble in the form of new collection activity and lawsuits. If you don’t have the time to invest in the learning process don’t worry, just contact a legitimate credit repair service. They will insure that all of the necessary precautions are taken before sending dispute letters to the credit bureaus.

Removing Credit Deficiencies

Rectifying credit deficiencies as part of your credit repair program is every bit as important as cleaning up your credit report. This is necessary for anyone who does not have any open mainstream revolving accounts. Credit cards are the most powerful way of jumpstarting your credit scores. You should have a minimum of two credit cards. Given the state of the credit markets today there is a good chance that you will have to apply for secured credit cards. Secured credit cards are every bit as good for credit rebuilding as unsecured cards. Once you have your two credit cards you need to follow three simple rules to optimize your credit scores. Make your payments on time, don’t pay your balance down to zero, and keep your balance under twenty percent of the total credit line available on the card. As an example, if you have a card with a five hundred dollar limit, you should keep the balance under two hundred dollars.

Fine-Tune and Optimize

Fine-tuning the content of your credit report for credit score optimization requires some understanding of the FICO scoring model. There are certain types of debt that are favorable for your score and others that should be avoided at all costs. In addition, there is an optimal balance between different types of debt that you should work towards. You may need to open accounts, close others, pay down balances, and understand the pace at which these changes should take place depending on your own credit needs.

Picking Your Path

Do you need help? You can succeed at credit repair on your own, or you can hire a reputable credit repair service to manage the process for you. Credit repair is a unique task that requires a fair amount of knowledge if you want to produce the best possible results. If you are going to go it alone please take the time to educate yourself. If you are going to hire a credit repair service, pick up the phone and interview a few. Make a list of questions to ask and pick the company that you feel comfortable with. Good luck!

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