Credit Repair – How To Fix Your Credit

Fix Your Credit With Credit Repair Tactics That Work

Typically we Americans don’t search out credit repair options until we are in a desperate need and are looking for ways to fix your credit in a hurry. For many, the need to fix your credit is in emergencies like when your car dies and you need a loan or when the time comes to buy a new home. There are plenty of slow and proactive steps to take to fix your credit like using credit cards and maintaining a low balance, or paying your bills on time. But, what we are discussing here is the desperate need for credit repair when you have a collection of negative credit Items on your credit report that are holding you back. There are two ways to dispute and repair your credit 1) do it yourself or, 2) pay someone to do it for you. Regardless, make sure you look closely at your credit report. The following are commonly overlooked negative items:

  • closed accounts reported as open
  • duplicate accounts
  • overstated revolving balances
  • collections

If any of the above are unfamiliar ground, a special hot line to review your credit report is a wise choice and should be taken advantage of at 1-800-594-5266.  Make sure to get the full credit summary and a copy of your credit report.

Credit Repair Dispute Letters to Fix Your Credit

Most lending institutions use credit reports that are provided by the credit bureaus. The credit bureaus are for profit organizations that compile and distribute your financial information to lenders. Writing credit repair dispute letters to the bureaus requesting that they fix your credit can be a tricky situation. For one, they respond only via snail mail and that can be painfully slow if you are in need of a loan right away. The credit bureaus are experts at stone waling folks who are striving for quick credit repair so a clear and good strategy must be in play. This disputing process is your legal right and can be done personally or by a professional credit repair company or law firm. If you are going to take on this task personally, it is wise to brush up on tactics and current laws to beat the bureaus at their own game. If you chose to purchase and/or retain a professional, make sure they have a good track record and ask plenty of questions to make sure they are a good fit for your case.

Fix Your Credit

Your credit is like a nest egg folks! No one will fix it for you!

Remain Patient and Stay Proactive

Weather you choose to fix your credit score yourself or hire a professional credit repair service, keep this in mind – your bad credit situation was likely the result of miss steps over a prolonged time and will take some time to mend. If you attempt to fix your credit and are aggressive, the credit bureaus will become agitated, however, if you are too passive, then it could take years to repair your credit. Try to keep a balance between the two.  Most importantly, do your homework and get a clear understanding of your battle plan. Remember using credit repair to fix your credit is your right and must be done with caution.

Charge off Trouble

So you dropped the ball and now you have a charge off on your credit report.  Now you’re wondering just how much it will effect your credit score and if you will ever qualify for a loan.  First of all, a charge off is one of the most damaging things you can have happen to your credit score.  The reason the lender charges you of is to receive a tax exemption.  After you have been charged off you are still responsible for the debt and can still have negative marks on your credit report even if the debt was settled for less.  There are tactics to remove the charge off from your credit report, but ill get into that soon.

How Much Damage Will A Charge Off Cause?

Unfortunately, there is no solid answer to how much a charge off effects your credit score. Exactly how much one negative item will affect your credit score is somewhat of a mystery and has been the subject of much criticism with the three main credit bureaus (Equifax, Experian and TransUnion).  The bean counters at the credit bureaus use top-secret algorithms to calculate your credit score and they keep that information under lock and key.  The bureaus don’t want you to know how a charge off on your report affects your credit score and to be honest, the credit bureaus only care about one thing – MAKING MONEY!  One thing is for sure, the effects of a charge off will differ from one person to the next.

So how much will a charge off wreck your credit score?  Depends on your payment history.

Charge Off On Credit Report

First thing check your credit report and make sure the charge off is showing.  Sometimes the dirt bags at the credit bureaus can foul up and not post it (slim chance though)

Your Payment History

Your payment history is similar to criminal history.  Odds are if you have several prior convictions you will be dragging a ball and chain.  Same holds true with your charge off.  Let’s say you lost your job and decided food and shelter was more important than your cell phone bill.  Your cell phone service provider will go through a collection process that will likely result in a 30, 60 and 90 day late payment and after 120-180 days you will get the charge off.  Once you get the charge off your account will be pimped out to a collection agency.  If this process is a first offense then the lingering damage wont be as bad.  This can also be weighted by the size of the account.  In other words a 40K credit card charge off will hurt worse then a cell phone charge off.  In most situations a charge off of more than $1,500 could result in court action.

Other factors that effect the weight of a charge off

How much money you owe your creditors and how much you owe in relation to the credit limits on your accounts factors into the weight of a charge off.  If your credit cards are to the max then you are not looking so good, however, if you have plenty of cushion then you are in good shape!

How many accounts do you have that show unpaid balances?  Even if you’re paying your bills on time, if you have a large number of bills they could be affecting your credit score negatively and lenders see you as a risk.

Length of credit history is a HUGE factor!  How long you have been responsible (or irresponsible as the case may be) with credit? If you’re 18 years old or somebody who refuses to use credit cards, then don’t expect to have a good credit score.

Does your credit report show you as being a trust worthy borrower?  How about new credit? Have you been applying for lots of credit recently?  Having a number of hard inquiries flags lenders that you might be looking to make a number of large purchases or maybe you are short on cash and need to open credit to make ends meet in the short term.

Here’s the bottom line: No one can tell you exactly how much one charge off will lower your credit score so the best thing to do is first check your credit score.

A Silver Lining

Okay, now that you are feeling hopeless let me explain a couple of options.  Many folks have great success removing a charge off from their credit report.  The federal government put laws in place that give you the right to dispute negative items on your credit report and request to have them removed.  With that said you have two basic options: the do it yourself credit repair option and the pay a professional option.  Personally I’m not much for doing things myself that are of this nature.  Lucky for you I keep up on who and what the best credit repair professionals are and I feel John Heath’s credit repair law firm is hands down the best.  His rates are reasonable (about $100 to start and $60 a month).

For folks with things as serious as a charge off I always send them to John and he takes good care of them.  They are available to advocate from 5 am to 9 pm west coast time, so give them a call.  The call is absolutely FREE (1-800-594-5266) so make a list and check it twice so you are prepared to ask about your charge off!

Credit Problems

What Do Credit Problems Mean To You? Having a truck load of credit problems can cost you fortune in inflated interest rates and can even be embarrassing.  In todays world our credit scores are as important as having a retirement plan or solid portfolio.  Here are a few handy steps to take that can help […] Read more »