Credit Repair Blog - The Credit Repair Resource

Introduction

Successful credit repair involves a broad approach to cleaning up your credit report and restructuring your credit. Everything matters. But some aspects of credit repair are more potent than others. Among all of the techniques you can use to boost your scores, the proper management of credit cards is the most powerful. Proper use of your credit cards can easily yield a 100 point improvement in your scores. Put these powerful techniques to work today.

Getting New Cards

If you do not have credit cards, now is the time to get them. If you want your credit repair results to really shine you cannot overlook the power of properly managed plastic. If you have had credit issues in the past you may be concerned about being approved. If you are unable to get approved for regular credit cards try secured cards. Secured credit cards are the ideal credit repair tool. If you have no open credit cards right now, two new secured cards will be adequate to get your scores moving up!

The Right Cards

Not all credit cards will benefit your credit repair effort equally. In fact, some credit cards can hinder your progress and may even be harmful. Department store credit cards and consumer credit cards, such as gas cards, are of no value for your credit repair and should be avoided. For score building purposes you should stick with mainstream cards like MasterCard and Visa. Small limits are fine! The key to success is keeping the right balances.

The Right Balances

The credit scoring model used by most lenders is called the FICO model. FICO places a significant amount of weight on the relationship between your account balance, as reported to the credit bureaus, and your limit. For credit repair success it is imperative that you keep your balances low. The FICO model recognizes card limit capacity utilization in 20 percent increments. If you run your balance over 80 of your limit your scores will tumble. But use less than 20 percent of the cards capacity and you will be richly rewarded with higher scores.

The Right Timing

Managing your credit card balances for credit repair success is an art. In theory there is no harm in using your cards to their limit as long as you manage to reduce the balance before the date that the creditor reports the card balance to the credit bureaus. This is not as easy as it seems. Many people pay their balances in full when they receive their monthly bill, only to be shocked to see that their credit report shows that their cards are maxed out. It is unlikely that the billing cycle and the creditors schedule for reporting to the credit bureaus will coincide. For credit repair purposes you may want to reduce your balances and keep them low.

Putting it All Together

Would you like to give your credit scores a powerful boost? Now is the time. Employ these credit repair techniques to harness the power of your credit cards. If you do not have any open credit card accounts, open two new accounts today. If you do cannot get regular cards, get a couple of secured cards. Stick with MasterCard and Visa, and avoid store cards and consumer accounts. And keep those balances low if you want your credit repair effort to pay off. You can do it!

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

Credit Repair Really Matters

Never before has your credit score been so important. And never has credit repair offered such dramatic financial benefits. There was a time, not long ago, when it was enough to pay your bills on time. Lenders would glance at your credit report, and if it looked okay you would be approved. And the interest rate you would receive would be the same as all of the other candidates that were approved.

Changing Times

Credit repair may have made your report look good, but unless there were dramatic problems with your reports you may have gotten little, if any financial benefit. This is no longer the case. Even a small credit repair tune up will pay noticeable financial dividends. The credit markets have changed dramatically, largely as a result of the stress of the post-2006 real estate and mortgage market failures. Lenders now consider every single point on your credit score when evaluating your loan application.

Optimizing Your Scores

To make a credit repair tune up all the more important, the credit scoring model is trickier and less logical that you might think. Once upon a time you would have great credit simply by making your payments on time. This is now far from the truth. You can make all of your payments right on time and still have dismal credit scores. A credit repair tune up will insure that all of the components of your credit report are in proper balance.

Subtle Issues Can Add Up

Your credit repair tune up will include a thorough examination of all three credit bureau reports. Given the importance of each and every point on your credit score not a single item can be ignored. There are a number of reporting issues that many people miss when they proofread their reports. These are compliance issues which should not be on your report as a matter of law, and which can have a significant influence on your scores. All of these subtle little items must be spotted and removed. Included in this category are revolving accounts with underreported account limits, paid accounts reporting a balance, closed accounts reporting as open, and duplicate accounts.

Dispute For Success

The next step in your credit repair tune up is the dispute process. In addition to the tricky compliance issues already mentioned, all questionable issues should be examined. If they cannot be made sense of, they should be disputed. It is important to keep in mind as you continue the project that the credit reporting system is error prone. And it is not self-correcting. Unchallenged errors can easily linger on your report for years pulling your valuable scores down and costing you money. The credit bureaus do an important job, but given the volume of data, and the number of participants in the process, errors are to be expected. If you do not take action, no one else will. Credit repair is about looking out for you.

Persistence Pays!

The final and essential ingredient in a successful credit repair tune up is persistence. The credit bureaus are large cumbersome bureaucracies. They are not the enemy, but it is helpful to see them just as they are, potentially difficult. You may not get a satisfactory response the first time you send a dispute letter. This does not means that you should give up. Credit repair requires a can-do attitude. If you believe there is a mistake on your report do not take no for an answer. Be organized, remain focused, and you will succeed.

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

Credit Repair is Not Hard

Credit repair can be shockingly effective. And it is not difficult. In fact the biggest barrier people face is not in the technical detail of credit repair, it is in their attitude. A small attitude adjustment can make the difference between mediocre results and a life changing outcome. You must approach your credit repair project with an attitude that combines a skeptical view of the accuracy of credit reporting with faith in your own ability to prevail against the corporate machinery of the credit bureaus.

The Shocking Truth

More than three quarters of all credit reports contain errors. This may not make much of an impression, but combined with the following fact you may start to perceive the importance of credit repair in a new light. Errors are not only tolerated by regulators, they are overtly accepted. A close reading of the Fair Credit Reporting Act will reveal that Congress values the viability and the ongoing profitability of the credit bureaus over the absolute accuracy of the reporting system.

The Scope of the Problem

This means that the credit bureaus will only go so far in their quest to eliminate the errors that appear on the credit reports of over one hundred and fifty million Americans. In other words, you must look out for yourself. Credit repair is the answer. Without active intervention on your part the mistakes on your reports are most likely to linger for years, and depending on the severity of the error, this may cost you both money and opportunity.

The Necessity for Credit Repair

Once your attitude about the power, and even necessity, of credit repair in your own life is aligned with reality it is time to confront your credit reports. Let your new perspective light your way. As you examine your reports you should expect to find mistakes. Give yourself the benefit of the doubt. If something does not ring true you should make plans to dispute it. The importance of this cannot be overstated. Every error may be causing you harm.

It is Your Money!

Do not overlook anything, regardless of size or age. Credit repair should be employed liberally. Most lenders utilize some form of score based pricing when determining what interest rate you will pay on any loan you apply for. Even a small difference in your score can make a difference in the cost of the money you borrow. To ignore even a small innocuous looking item today may translate onto an increase in the monthly payments you will make tomorrow. A little attention to detail in your credit repair effort will pay dividends for years to come.

Success is Yours

Lastly, it is essential that you embark on your credit repair project with self-confidence. You can do it! The importance of a can-do attitude will become clear as the process continues. You will find that the credit bureaus are stubborn and cantankerous in their handling of your disputes. You cannot let this stop you. Be resolute in your determination and you will prevail. Expect resistance and do not take it personally. The credit bureaus do not get paid to read your credit repair letters, much less to act on them. But stick with it and you will find that you have more control over your credit life than you ever thought possible.

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

Credit Repair, the Big Picture

There was a time when the credit repair industry was focused exclusively on sending dispute letters to the credit bureaus. Those days are over. There is no question that intelligent and well structured dispute letters are very effective in cleaning up erroneous derogatory information, and it is a thrill to see these bad accounts removed or corrected. But, as important as credit bureau disputes are, unless you put equal emphasis on building new positive credit you are missing the vast majority of benefit that is available from the credit repair process.

Money in Your Pocket

It is no exaggeration to say that well over fifty percent of the benefit of a smart credit repair program will come from careful building and management of positive credit. Why would you ever settle for a one hundred point increase in your score if you could get a two hundred point increase? The right approach to credit repair can easily mean a difference between loan approval and denial, or the difference between a low interest rate and one that will strain your budget. Over the last few years credit markets have shifted almost entirely credit score based pricing. Your credit score translates directly into dollars and cents, your dollars and cents.

Getting Secured Credit Cards

If hard times have left you with no open accounts you should get back on your feet with two new secured credit cards. Secured cards are the perfect credit repair tool. They will require a small savings deposit, usually two or three hundred dollars. This money is used as collateral to secure the limit on the card and will be returned to you when you close the account. Because these cards are collateralized you will not be denied unless you have previous unresolved issues with the card issuer. They are easy and cheap, and for credit repair purposes, they are every bit as good as a larger unsecured card.

Consider Authorized User Accounts

If you are interested in giving your credit repair program a little extra boost there is another credit building strategy you may consider. If you have a family member with excellent credit that would like to help your endeavor you can ask them to add you to one of their credit card accounts as an authorized user. Once they do this the account should appear on your credit report within sixty days and your credit score will inherit the full benefit of the account as if it were your own. On a cautionary note, you should not consider purchasing authorized user accounts as the software used to calculate your score has a way of blocking these brokered accounts.

Cautionary Notes

If you were choosing between secured cards and authorized user accounts, secured cards are the best long term credit repair option for the simple reason that they belong to you. Authorized user accounts come with notable risks. If your card donor runs his balance up your score will tumble due to no fault of yours. And if for any reason the account goes bad you are likely to have trouble removing yourself, as card issuers usually will refuse to make any changes to the account until it is healthy again. But, if you have the ability to include both secured cards and trusted authorized user accounts in your credit repair program, by all means do it.

Picking the Right Type of Credit

When it comes to credit repair you should build credit with mainstream credit cards such as MasterCard and Visa. There are certain forms of credit that can harm your credit more than helping it. The credit scoring software that calculates your score has a built-in bias against consumer debt including store cards and furniture store loans. So do not assume that because you have a store card that you have the credit profile that you need. This type of credit can be convenient and may have certain benefits, but while you are in a credit repair program it should be avoided. Stick with the basics.

Managing for Credit Repair Results

Once you have your credit cards open it is crucial that you manage them properly. This is where you credit repair effort can really shine. The credit scoring model places great weight on the balances that you keep on your credit cards and the newer the card the more important the balance becomes. For the best score benefit use less than twenty percent of the total credit line on the card. If you let your balances run up to the limit your scores will fall, as much as one hundred points depending on the overall content of your credit report, so spend carefully. If you have this problem, do not worry. Just pay those cards down and your score will pop right back up. Good luck!

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

The Full Potential of Credit Repair

Credit repair can eliminate many of the bothersome errors on your credit report. This is an exciting and wonderful thing, but it is only half the benefit that a properly implemented strategy is capable of delivering, and to neglect the true potential of credit repair is to sell yourself short. Go the extra mile and you will see your scores reach unexpected heights and your credit report become so attractive to lenders that you will be able to secure the best, low cost financing available. Your credit is far too important to settle for anything less than the best.

The Power of New Credit

Everyone loves to watch negative items get deleted from their credit reports. It is liberating and exciting, but by itself it may not do much to raise your credit scores. Your credit scores do not have natural resilience. In other words, the absence of derogatory information on your report may eliminate the dead weight that was holding your scores down, but without positive credit to create loft, they will remain dormant like a deflated balloon awaiting inflation. You must have positive open accounts to provide this loft. Without positive credit your credit repair endeavor, and scores, are sure to disappoint.

The Right Type of Credit

If you do not have open accounts that are reporting in a positive manner you should remedy that state of affairs immediately. Building new credit is essential to your credit repair success, but not all forms of credit will benefit your scores, and some will be downright harmful. For the right outcome, stick with MasterCard and Visa. American Express and Discover are also fine, but harder to get and less widely accepted, so choose wisely. If you cannot get approved for standard cards, you should apply for secured cards. They are inexpensive, every bit as valuable and you will not get denied. Avoid store cards and consumer debt, like furniture store loans catalog credit lines. The FICO scoring model carries a bias against this type of debt and your scores will suffer.

The Importance of Balance Management

For the right credit repair results you must keep a close eye on your revolving balances. This cannot be stressed enough. Your scores will swing wildly based on your balances. Many people make the mistake of getting a couple of new secured credit cards and running them up to their limit. The intention in getting the card was right, but letting the balances run up can cost over 100 points. This is an easy error to make, especially if the limits on the secured cards are low. Credit repair requires diligence. Watch those balances!

Patience and Victory

Once you start your credit repair process you must be patient. The credit bureaus are required to process your disputes, but they do not do so willingly. The systems they have set up to manage the voluminous number of dispute letters they receive are designed to move the letters through the system with little emphasis on accuracy. Do not get flustered if your initial complaint gets ignored or denied. Remain calm and keep sending your request until you are satisfied. Statistically, the odds are that they will eventually process your credit repair request properly.

The Strength of Savings

In our experience those that start a credit repair program simultaneously with a small savings plan are most like to succeed. Unexpected events will arise. And with these events often come expenses. If your budget is too tight you will find that these occurrences stress your ability to make your payments on time, and suddenly you will find another new late payment on your credit report. Do not put your credit at risk. Find a way to start a savings plan. Budget for it. It will provide a buffer in hard times and insure that your credit repair results are safe.

Credit Repair Resources

Confused or overwhelmed by the prospects of investing the time needed to launch your credit repair effort properly? Do not be discouraged and do not give up. Nothing is more important. If you cannot handle it on your own, find a reputable credit repair service to take up the cause on your behalf. Do a little homework, check out the options, interview your top choices and make your decision. A professional credit repair company will insure that the job is done right. You will succeed!

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