Now is the Time for Credit Repair

This is an excellent article by James W. Kemish. It inspires excellence in the credit repair professional. With CRA, you can be assured that you will have professionals of the highest level working for you. Call today for more information 1-800-671-1454 or go right to the website by clicking HERE:


The quality of your credit has never been as important as it is today. Lenders have tightened their guidelines and interest rates are now determined by new Risk-Based Pricing models; the lower your credit score, the higher your rate, and every single point can make a difference. People everywhere are turning to credit repair professionals to help them clean up their credit reports and optimize their credit scores.

The Importance of Professional Help

There is a good reason that so many people are reaching out for credit repair help. There was a time when it was enough if you paid your bills on schedule. Those days are over. The advent of the complicated FICO credit scoring model has made a science of credit score optimization, while the complexity of the credit reporting system has made it more difficult than ever to identify and correct errors.

How to Find the True Credit Repair Pro

Credit repair is no longer a simple matter of spotting an error on your credit report and disputing it with the offending credit bureau. A working knowledge of the Fair Credit Reporting Act is a bare minimum requirement, while your credit score is dependent on many subtle factors, most of which have nothing to do with your ability to make your payments on time. It’s a new world and the right help can make all the difference. Here are the essential qualifications to look for in a credit repair professional.

Knowledge of the Laws

A credit repair professional has an intimate knowledge of the laws that govern all of the participants in the credit reporting system. The credit bureaus are bound by the Fair Credit Reporting Act, collectors are governed by the Fair Debt Collection Practices Act, and state statutes of limitation will contribute significantly to the negotiability of collections.

Familiarity with Lender Remedies

Truly effective credit repair often must look beyond the credit bureaus and include lender cures and rehabilitation opportunities. Many lenders offer attractive programs that can get you back on track and even eliminate bad marks from your credit report. The credit repair professional will be able to guide you through the process of approaching creditors about these opportunities as appropriate. This multi-dimensional approach will insure that you get the best possible results.

An Understanding of the FICO Scoring Model

There are many variables involved in the process of credit score optimization, and everything matters; payment history, account balances and usage, age of accounts, account types and even the mix of accounts. A credit repair professional has in-depth knowledge of the FICO scoring model and will provide you with everything you need to know to manage the content of your credit report, strike the proper balance, and get the most out of your credit score.

Help With Rebuilding Credit

It is not unusual, after a period of financial stress, to have little or no open credit. Your credit scores are based on both the positive and the negative information on your credit reports. Effective credit repair must address both parts of the equation simultaneously. To focus only on removing erroneous derogatory information from your credit report will leave half of your credit repair potential untapped. A credit repair professional will help you rebuild your credit and manage your new debt for the best possible credit score results.

Putting it All Together

The genuine credit repair professional will address all aspects of your credit to insure that you get the best possible results. Everything necessary will be done to clean up your credit reports, improve your credit scores, rebuild your credit, and make you as lender-ready as you can be. In selecting a credit repair service make sure that their program covers every base. And trust yourself. Pick up the phone and interview your prospective choices before signing up. Write down a list of questions and ask away. Your credit is too important not to take the time to make the right choice. Good luck!

Copyright © 2008 James W. Kemish. All Content. All Rights Reserved.


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Protecting Your Credit Score During the Holidays

With the holiday shopping season about to kick off, it’s important to understand your financial situation before heading to the stores so that you can create a sensible budget. By shopping smartly, you can take steps to make sure your credit score doesn’t suffer for the sake of the season. That way you can remain merry long after the holidays are over.

Shop Smart

There are a number of steps you can take while shopping this season to protect your credit score during the holiday rush. First, it’s a good idea to set boundaries. If your score is lower than you would like — or even if you want to maintain it — it’s important not to spend outside your means. A good rule of thumb is to try to keep your credit card balances well below 35% of your total credit limits. If you know it’s hard for you to resist buying just "one more thing," try paying with cash. That way, you’ll be more likely to stay within the budget you set. And, as appealing as it can be to save 15% on your holiday purchases, it’s best to avoid retail credit card offers. Opening too many lines of credit can negatively impact your credit score and could ultimately cost you more than you’d save.


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What bad credit really costs you Part 1

It's not just a number

Failing to take steps to improve your credit score could cost you hundreds or thousands of extra dollars on a home loan, a car payment or a credit card or insurance bill.

Sure, you know your credit score can affect everything from whether you qualify for a mortgage to whether an employer hires you, but have you ever made a plan to consciously improve your score? If not, it can be costing you dearly.

"When it comes to mortgages, auto lending and credit cards, the higher your score, the lower the interest rate you're going to pay," says Barry Paperno, manager of customer service for credit-scoring company Fair Isaac, which created the widely used FICO credit score. So the time and effort it takes to improve your credit score could save you hundreds of thousands of dollars over the course of your lifetime.

Loans and scores

For most people, a mortgage loan is where they'll reap the greatest rewards from an improved credit score.

"For the past two or three years, mortgages have been the lowest in 30 or 40 years, but that doesn't apply to everybody," says Janette E. Jones, mortgage consultant for American Home Mortgage in Bethesda, Md. "That applies to people who have excellent credit. Someone who has excellent credit can actually get a fixed-rate loan for 5.5%. However, for people who have less-than-excellent credit -- and I would say that's anything below 650 (on the FICO scale of 300 to 850) -- they're looking at an interest rate that's 1% higher, at the bare minimum."

By Tamara E. Holmes, Bankrate.com


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What bad credit really costs you Part 2

While the median FICO score in the United States is 723, which would yield favorable loan conditions, for those whose score falls way below that mark, the ramifications are costly.

A median of 723 means half the people fall below that score and half have scores higher. More specifically, here's a breakdown of how scores are distributed across the population, according to MyFICO:


Breaking down the numbers: % of population and their score:

2% - 300-499

15% - 650-699

5% - 500-549

18% - 700-749

8% - 550-599

27% - 750-799

12% - 600-649

13% - over 800


According to MyFICO, a division of Fair Isaac, a consumer with a FICO score between 720 and 850 might get a 5.922% rate on a $200,000 30-year fixed mortgage rate. That would give him a payment of $1,189 a month and $228,072 in interest over the life of the loan. A consumer with a FICO score between 675 and 699 might get a 6.584% on the same loan, which would cost him $1,275 a month, with $259,074 in interest over the life of the loan, or $31,002 more.

The consumer with a FICO score between 620 and 674 might get a 7.734% rate and pay $1,431 per month, costing him $315,021 in interest over the life of the loan. That's $55,947 more than the middle-score borrower and $86,949 more than the borrower with excellent credit.

Worse yet, a consumer with a score between 560 and 619 might get an 8.531% rate, pay $1,542 per month and pay $355,200 in interest over the life of the loan. The difference in interest paid over the life of the loan between the first and last example is more than $127,000.

If at first you don't succeed

While the dollar amounts are most striking when it comes to primary mortgages, the effects of lower credit scores are not limited to your purchase of a home. If you want to refinance and pull out some cash to finish your basement or pay off some credit-card bills, your credit score can not only determine your interest rate, but it can also dictate how much of your equity you can cash out. The higher your credit score, the higher the amount you'll be able to pull out. "Someone with a credit score of 580 might only be able to receive 70% of the equity in their home while someone with a 600 might be able to take out more," says Jones.

Likewise, if you want to take out a home-equity loan of $20,000, your credit score could cost you thousands of dollars. According to MyFICO, a consumer with a score between 720 and 850 might qualify for a rate of 7.911% and pay $190 a month and $14,219 over the course of the loan. For that same $20,000, a consumer with a credit score between 640 and 659 might qualify for a rate of 9.486% and pay $209 per month and $17,562 over the course of the loan.

Auto loans can be just as costly for people with lower credit scores. For a $20,000, 48-month auto loan, MyFICO calculates that a consumer with a score between 720 and 850 might qualify for a 6.282% rate and pay $472 per month. That same consumer would pay $2,670 in interest over the four years of the loan. A consumer with a FICO score between 660 and 689 might qualify for an 8.844% rate and pay $496 per month and $3,819 in interest over the course of the loan. That same car cost the second borrower an extra $1,149 -- $23.94 a month -- just because of a lower credit score.

By Tamara E. Holmes, Bankrate.com


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What bad credit really costs you Part 3

The insurance factor

A low credit score can also cost you more when it comes to your auto and home insurance.

Someone with a credit score of approximately 650 or higher could receive a discount of anywhere from "a few percent to 15% or even more" says Robert Hartwig, chief economist for the Insurance Information Institute.

Insurers use credit scores as one of the factors in determining what's known as an insurance score.

"We're not looking to see whether you're worthy for credit; we're trying to find the elements in the credit profile that correlate with loss behavior for insurance," says Hartwig.

Numerous studies have found that people with lower credit ratings file more claims. There are some theories as to why this is so. "Individuals who have credit problems may well be more likely to defer important maintenance on their cars and their homes," Hartwig suggests. "So those bald tires don't get replaced, the brakes don't get fixed, the leaky roof doesn't get repaired and so on and so forth."

The impact of credit scores on insurance scores varies from insurer to insurer and state to state. Some insurers only use insurance scores for screening new customers, while others routinely check the credit of existing policyholders when it's time to renew their policies. But consumers can improve their chances of qualifying for a lower premium rate by keeping their credit score in the mid-600s or above, Hartwig says.

No one wants to throw away money. But by failing to take steps to improve your credit score, you could be giving up thousands of dollars a year. The best way to improve a blemished credit rating is to pay your bills on time and keep debt to a minimum, says Paperno.

"Everyone should work hard to maintain a strong credit rating," says Hartwig. "If you work hard, you build a good credit rating and if you maintain it over time it has many, many benefits."

By Tamara E. Holmes, Bankrate.com


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Mistakes Do Happen: Credit Report Errors Mean Consumers Lose

U.S. PIRG Reports

Executive Summary:

The most valuable thing we have is our good name. As consumers, the most common reflection of our reputation as someone who pays bills on time, is trustworthy and financially sound is our credit report. Unfortunately, the information contained in our credit reports, which are bought and sold daily to nearly anyone who requests and pays for them, does not always tell a true story.

Credit bureaus collect and compile information about consumer creditworthiness from banks and other creditors and from public record sources such as lawsuits, tax liens and legal judgements. The three major credit bureaus -- Experian (formerly TRW), Equifax, and Trans Union -- maintain files on nearly 90 percent of all American adults. Those files are routinely sold to credit grantors, landlords, employers, insurance companies, and many others interested in the credit record of a consumer, often (legally) without the consumer's knowledge or permission.

Conversely, consumers rarely check their credit record until after they've been denied or otherwise encountered a problem. Throughout the 1990s, credit report errors have been a serious problem that several states and Congress have addressed.

This is the PIRGs' sixth study on credit report accuracy and privacy issues since 1991. The PIRGs have also participated in state and federal legislative battles to improve credit reporting laws. This report is our first investigation of credit report accuracy since 1996 Congressional changes to the federal Fair Credit Reporting Act (FCRA), designed to improve the accuracy and ease of access to reports, took effect in September 1997.

The findings of Mistakes Can Happen are troubling. An alarming number of credit reports contain serious errors that could cause the denial of credit, a loan, or even a job. Further, some consumers never even received their reports, even after repeated calls.

Among the major credit report accuracy findings of the survey:

Twenty-nine percent (29%) of the credit reports contained serious errors - false delinquencies or accounts that did not belong to the consumer - that could result in the denial of credit;

Forty-one percent (41%) of the credit reports contained personal demographic identifying information that was misspelled, long-outdated, belonged to a stranger, or was otherwise incorrect;

Twenty percent (20%) of the credit reports were missing major credit, loan, mortgage, or other consumer accounts that demonstrate the creditworthiness of the consumer;

Twenty-six percent (26%) of the credit reports contained credit accounts that had been closed by the consumer but incorrectly remained listed as open;

Altogether, 70% of the credit reports contained either serious errors or other mistakes of some kind.

Among the survey's major access to credit report findings:

Of the consumers that did obtain their credit reports, at least 14% of them were forced to call back 3 or more times after receiving busy signals or had to write a letter in order to receive their report; And 12% of the consumers waited two weeks or longer to receive their report once they finished requesting it. It took more than a month for one California man to receive his report.

Overall, 15% of consumers who attempted to participate in the survey either made at least 3 phone calls and never got through or requested their reports but never received them.

Although credit reports contain vitally important information about most consumers, the accuracy of those reports is far from guaranteed. While credit bureaus and creditors have gone to great lengths to ensure that they have the right to collect and compile monstrous lists of information about most of us, mistakes in credit reports do happen, and more often than credit bureaus and, also, banks and department stores (who are often responsible for the mistakes) would like us to think.

Until policymakers and credit bureaus do what it takes to allow consumers to have free and easy access to their credit reports and set tougher standards to prevent and clean-up mistakes, too many credit reports will remain a ticking timebomb of dangerously inaccurate information. And our good names will continue to be at risk, as we pay the price for mistakes made by credit bureaus and other data dealers.

Despite major improvements to the law made by Congress and several states in the last several years, PIRG recommends the following actions:

Improved access to credit reports be granted to consumers. Each national credit bureau should annually and automatically mail a copy of each consumer's report.

Increased duties to ensure accuracy and avoid errors be imposed on banks, department stores and other firms that furnish information to credit bureaus, and that immunity restrictions on consumers' ability to sue these furnishers be repealed.

That the Federal Trade Commission investigate credit bureau compliance with new provisions requiring easier access to credit bureau personnel, especially during normal business hours.

About U.S.PIRG (Public Interest Research Groups):


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Credit Repair Tip - Secured Credit Cards For Overnight Results

Credit repair companies are spread throughout the country – filled with ideas, tips and techniques about how the consumer can rebuild their credit, and repair bad credit history. Yet, one of the most powerful tools that can be used in credit repair is in the hands of the consumer.

Secured credit card are the easy way to create positive credit history. A secured credit card requires - at the beginning of the account - a deposit that will be deposited into a trust. After a specific period of time such as when the credit rating of the consumer improves, or when the account is closed and unsecured credit is opened this amount is given to the consumer or applied to the debt. This deposit which is given to the company is often equal to, or less than the credit limit desired upon the card. Throughout the time in which the deposit is held, consumer get rewarded by the interest gaining and benefits the credit card company as it acts as security for the credit line.

Secured credit cards have many benefits, such as being reported to major credit bureaus on a monthly basis, this way credit fixing can begin immediately, within a month of signing up for the card! This is only one of the reasons - among others - that a credit card is beneficial. Secured credit cards come with all of the conveniences enjoyed with traditional credit cards. As long as monthly payments are maintained, they can increase credit ratings substantially.

Credit fixing is essential to anyone who has had bad credit in the past. Credit is essential to obtain financing on a home or a vehicle, for example, and many other purchases that make life easier. Is not it time that you signed up for a secured credit card and took the road to better credit?

In conclusion, by repairing your credit you get just benefits if you do it right, specialized advise it is always recommendable, just make sure you are dealing with the best credit repair company you can find: Check out Credit Restoration Associates at http://www.CreditRA.com