CREDIT REPAIR FAQs

1. How do I get my credit report?

You can contact the three main credit bureaus and ask
them to send you your credit report. The
three credit bureaus are: 
TransUnion (800) 851-2674,
Experian (800-392-1122), and 
Equifax (1-800-997-2493). 
The cost is $3 to $8. If you have been
recently turned for credit, you can get a
copy of your credit report free from the credit
bureaus.


2. What information do I need to give to the credit
bureaus to get a copy of my credit report?

You have to provide the following: Your full name,
your current address, your previous address
(if you moved in the last 5 years), social security
number, date of birth, a copy of your valid
driver's license, billing statement or utility bill
with your address clearly marked, and your
signature.

3. Can I get a copy of my credit report online?

Yes, you can. Go to http://www.creditreport411.com


4. What do credit bureaus do?

Credit bureaus have huge databases on the credit
histories of consumers. This information is
gathered and given to the credit bureaus from
creditors that have extended you credit in the past
(for example, landlords, credit card companies, the
IRS, department stores and banks). Your
credit history contains information that creditors use
to evaluate and determine your ability and
willingness to repay credit. Typically, credit bureaus
give the following information: Your open
accounts, credit limits, current balances, number of
late payments, collection actions, tax liens,
and whether you own your own home or not.

5. What are the worst things that can appear on my credit
report?

There are basically ten things that look the worst on
your credit report. Here they are, listed from
the best to the worst: Credit inquiries, credit
rejections, late payments, past due and unpaid
payments, court judgments, collections, loan defaults,
repossession, foreclosure, and bankruptcy.


6. How long does information stay on my credit report?

All negative information stays on your credit file for
anywhere from 3 to 7 years. However, if you
are applying for life insurance for over $50,000, or
for a job that pays over $20,000, a credit
bureau may provide information that is over 10 years
old.

7. I have bad credit now. Do I have to wait 7 to 10 years
before I can get a loan?

On the practical level you can have an A-rated credit
report within 2 years of even bankruptcy.
Why? Because lenders are much more interested in your
present circumstances than what
happened to you 3 to 10 years ago. Rebuilding your
credit can be done rather quickly through a
systematic plan, and a little perseverance. Keep in
mind that positive credit information stays on
your credit report forever.

8. I got my credit report. What do I do now?

Go through it and look for negative items, such as:
Past due history, collections and profit and
loss, inquiries, and public records (bankruptcies,
liens, court judgments). If any of these are
inaccurate, dispute them directly with the credit
bureau.

9. I found errors on my credit report. What should I do?

The Fair Credit Reporting Act states that all
erroneous or unfair credit information has to be
eliminated from your file. All consumers have the
right to challenge the accuracy of their credit
report. Once you challenge the accuracy of a
particular item, the credit bureau must investigate
that item within 30 days. If the credit bureau finds
the item erroneous, or cannot confirm or deny
it, it must be removed immediately from your credit
file.

10. But I found more than one errors?

You should challenge each error separately, in writing
only. Don't pick up the phone and call the
credit bureau. Wait until one item is resolved before
challenging another. If you challenge a whole
bunch of items, the credit bureau will send you a
letter saying that your disputes are irrelevant or
frivolous, and they will do nothing further. You have
to patient when dealing with the credit
bureaus. Deal with each item one at a time.

11. How do I correct negative information on my credit
report?

Challenging the accuracy or completeness of an item is
the best way to have a negative item
removed. It is best if you can include documentation
that supports your challenge. If negative
information is outdated, you again need to bring this
to the attention of the credit bureau in
writing. If the credit bureau fails to verify the
items you challenged within a reasonable time
(defined as 30 business days) from the date your
challenge was received, the Fair Credit
Reporting Act gives you the right to have the
challenged item removed from your report.

12. Why is challenging a credit entry effective?

There are three reasons for this. First, the credit
bureaus were too busy during a particular period
that they could not reverify the item you challenged
within the time limit, and therefore they
removed it. Second, because of human error correct
information was inadvertently deleted. Third,
after two or three years a closed or inactive file is
often stored offsite by your old lenders, and so
they cannot access it, and as a result they do not
respond to the credit bureau because it is too
much work.

13. The negative item I challenged has been confirmed by
the lender. What should I do now?

It is normal that some of your challenged items will
be confirmed by the lender, and they will not
be removed from your credit file. Wait 1 to 6 months
and try again, with a written challenge.

14. All my repeated attempts to have an erroneous item removed have failed,
because the creditor keeps verifying them. What should I do next?

If this is the case, you need to talk directly to the
lender and see if you can convince him to come
to a settlement. If you agree to pay him off, make
sure you get in writing that he will remove any
negative information from your credit file. Once you
have this in writing, only then pay him.
Otherwise, he may take your money and do nothing.

15. How does a lender decide that I am credit-worthy?

When you apply for credit by filling out an
application, you normally give permission to the
lender to get your credit report from a credit bureau.
Lenders use this credit report to work a short-term
debt-to-income ratio, where they calculate your
present short-term debt payments (excluding your
mortgage), and divide the total by your total annual
income. Lenders will refuse you credit if your
short-term debt is more than 20% of your annual
income. The second method lenders use is to
add up your monthly bills (not including rent or
mortgage and utilities) and divide the total by
your gross income (before taxes). With this method,
lenders are looking for a ratio of under 35%. 


16. How does a lender qualify me for credit?

Most lenders look at the number of years you have
worked at your present job, the kind of work
you do (the worst to best being: manual work,
clerical, self-employed, managerial, professional),
the number and nature of negative entries in your
credit report, the amount of credit you currently
have, savings and or checking accounts with the
lender, length of time at your present address, is
the telephone in your own name, do you own your home.

17. Should I apply for as many credit cards as possible?

No, you should not, because it greatly decreases your
chances of getting approved. Most lenders
will look at your total unused credit on all your
cards. If you were to max out all your cards,
would you be able to pay it all off on the income you
presently make? Lenders normally assume
that you would not be able to.

18. What do I do if I am turned down for credit?

By law the lender must provide you the specific
reasons why you were rejected, and the name and
address of the credit bureau that provided your credit
report. You can appeal your rejection by
sending a letter to the lender explaining why you are
a better credit risk than your credit report
indicates. But it is best to rebuild your credit
before applying for credit again.


19. What can lenders do if I don't pay them?

As you well know, we got rid of debtor's prison. This
means that not paying your bills is not a
crime (except for the IRS, of course). In the case of
a secured loan, the lender can foreclose on
the property that secures the loan. Unsecured lenders
can get a court judgment and attach your
property and become secured creditors. But if you have
no property of any real value, there is
very little a lender can do. A lender can try to have
your wages garnished, if you work. But if you
don't have a job and no real assets, there is
virtually nothing that a lender can do. And if your
debt
is small, it may be more expensive for the lender to
attempt to collect. In most cases, a lender will
stop short of legal action, and write off your debt.

20. How do I get collectors off my back?

There is a limit to what collectors can do. If
collectors are being deceptive or harassing you, you
can sue them in civil court. By law, collectors can
only call you between 8AM and 9PM. A
collector cannot contact you at your place of
employment. A collector must not make false or
misleading statements, or make abusive remarks, or
harass you. Nor can a collector call your
family or friends to collect your debt. If collectors
are harassing you, you should immediately
write a "Cease and Desist Letter", telling them to
stop calling you, and to stop any further
communication with you. Send this letter by certified
mail, return receipt requested. By federal
law, they must stop contacting you with the exception
of a letter stating that their collection
efforts have ended, or the collection agency intends
to take specific action against you (that is, sue
you). Generally, collection agencies do not sue, so
don't loose sleep over it.

21. Should I use a credit repair agency to fix my credit?

Maybe. You should take caution in picking an agency.  They often use many illegal methods that will make things worse for you. Be wary especially
of agencies that tell you that they will create a new
credit identity for you. This is fraud, and is a
criminal offense.   We recommend a reputable law firm to hand your credit repair. We have located a highly experience and reliable firm that will provide you with a free consultation click here.

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