Tag: credit score

How to Remove Credit Inquiries – 4 Easy Steps

How to Remove Credit Inquiries – 4 Easy Steps

When you apply for loans, lenders will ask you for an up-to-date copy of your credit report given by a credit bureau. If you have applied for various credit cards, then a number of inquiries could appear on your credit report. A new credit is always associated with the higher risk, but the score is mostly not affected by the inquiries from short-term mortgage, auto, or student loan. Generally, these are considered a single inquiry and have a little impact on your scores.

Types of Credit Inquiries:

  • Hard pull inquiries: It generally happens when the financial institutions, like credit card issuers or lenders, check your credit report before lending you any amount. It commonly takes place when you apply for the home, auto loans, or credit cards. The hard inquiries could possibly affect your credit score by a few points. The damage caused to your credit score basically decreases or disappears with the passing time.
  • Soft pull inquiries: It occurs due to the existing creditor who pulls your credit report to verify your credit situation. It might happen without your permission, but these have no adverse effect on your credit scores.

How to remove the inquiries?

All the credit inquiries might disappear from your credit report after two or more years. But, if you do not want to wait for so long, then you might follow these steps:

  • Step 1: The first thing you need to do is to find out the credit inquiries that are creating troublesome situations for you by ordering all of the three credit reports. When you get those reports, just look to the end of your credit report in order to find out the inquiries. Some of them are only promotional and never shown to the lenders. So, you don’t need to worry about it at all. Only identify the ones that supposed to be shown to the lenders. You could recognize some of them, but the others might be a mystery for you.
  • Step 2: Do find the address of each credit inquirer. The Experian report would list the addresses for each. Match the reports of the Experian with the reports given by the TransUnion and Equifax by using the same address list of the Experian. If you find some of the inquirers that doesn’t appear on the Experian, but appears on either Equifax, or Trans Union, then you should call the credit bureau for their address. Once you are done with this, you could move to the next step.
  • Step 3: Send letters to each creditor inquirer asking them to remove their inquiry. As according to the law, only the authorized inquiries could appear on your credit report and you could challenge them, if they don’t have the proper authority to pull your credit file.
  • Step 4: Some of them might show you the documents signed by you that give them the authorization for your credit inquiry. So, read the authorization form carefully, if you find any complications, you could write back and put an argument regarding its removal. You could also threaten them to take the help of the State Banking Commission for such a deceitful and vague authorization form.

Summary: How to Remove Credit Inquiries

So, before you apply for any loan, take time to check and, if necessary, build up your credit score. A good score improves your chances for loan approvals at the best terms and rates.

Judgment on your Credit Report? Top 4 Ways to Resolve Them

Judgment on your Credit Report? Top 5 Ways to Resolve Them

Owing money that you cannot pay back is scary thing. This can cast a shadow over many parts of life, from finding a job to applying for a car loan. But, what may be even worse is finding out that you have already been sued for debt and didn’t even know about it. If a creditor or collection agency has sued you then that results in a money judgment. This means that a court has ruled against you and your debt is a matter of public record.

A Judgment on your Credit History with loan defaults and repossessions is one of the biggest negative hits to your credit score. FICO score considers these judgments as negative, whether it is paid or unpaid. And, once the judgment is satisfied the status will be updated on your report to show that it has been satisfied or settled, but it will not be deleted immediately. So, you could easily judge why removal of judgment from credit history is pretty big deal.

Here are five ways to deal with a judgment:

  1. Fight back the decision: Most debt judgment are not available to consumers. Often these one-sided default judgment can be erased, giving the debtor another chance to fight the charges. The creditors case may even crumble in court, if it lacks document. However, trying to handle it yourself is bit tricky. Get in touch with experts, if you believe that you are victim of improper service.
  2. Pay it off or settle it: One of the main things people will do to get a judgment taken off from their credit report is pay it. Either full or partial, pay your debt to owe a part of negotiated settlement. A settlement in ready funds is a bird in the hand. Make sure the creditor agrees with “Satisfaction of Judgment” when you pay or settle down the agreed amount.
  3. Remove the judgment from credit score: Remove a judgment from credit report and watch a significant increment in credit score. File a motion to have judgment vacated based on technicality errors in the complaint or the judgment moved to another state, or the collection agency did not validate the debt. You could also file motion judgment vacated on the basis of discrepancies in the notice.
  4. Stay judgment proof: All legal protections exempt collection charges on people with fewer assets and least income. However, it does not mean ignorance of judgment. It’s your job to check that property, your belongings and wages completely protected from seizure by a complex web of state and federal exemptions. You need to take culinary steps to head off wrongful collection attempts, before it takes away everything.

Summary:  Top 5 Ways to Resolve a Judgment on your Credit Report

Deal with the judgment in an effective manner. As judgment could almost have negative effect on your FICO score. Reach out a company that works on judgment settlement and see if there is an alternative that might work.

Garnishments on Your Credit Report – 4 Ways to Resolve Them

Garnishments on Your Credit Report – 4 Ways to Resolve Them

Ignoring your contractual debt obligations can have a very serious impact on your financial status.  Garnishment, a creditor’s last-chance attempt at debt collection, hits debt holders where it hurts; their ability to fill the gas tank, pay the bills, and feed their families. It is something that you should try to avoid at all costs.

When facing debt that can’t really be paid, the best plan of action is to act early and speak to your creditors to see if you can negotiate a payment plan or achieve some sort of payment arrangement. If debt goes unpaid and overlooked, the court may interfere by issuing a judgment requiring your employer to “garnish” or withhold a bit of your wages or financial balances to pay back the debt.

The road to wage garnishment can be long and winding. Here are four things you can do to deal with wage garnishment on your credit report:

  • Stay in touch with your creditor: Wage garnishment is typically a final effort by creditors to squeeze some cash out of you when they cannot seem to get you to pay your debt with a certain time frame. If you ignore them or refuse to talk to them, you put yourself in a weaker position. Try your level best to stay in contact with the creditor and work on building up a reasonable payment plan. Showing the creditor you have every motive of paying back your debt may urge them to back off for now.  A creditor is much more willing to work directly with a consumer to avoid court and attorney’s costs associated with obtaining a judgement and ultimately a wage garnishment.
  • File an appeal: If the wage garnishment gets approved by the court, you have all the rights to file a “claim of exemption” which shows that you cannot avail this type of pay cut as your paycheck covers all your basic living costs, including insurance, grocery bill and housing. You will need to show to the court that you would basically get behind on your consistent bills if your wages were garnished. If the court gets convinced that the garnishment will worsen your financial condition even more, they may prevent the creditor from garnishing your wages or ask the creditor to reduce the amount that is to be garnished.
  • Pay the judgment amount: If you do have some funds available to pay off the full debt within ten days of the judgment, the court can put a stop on the garnishment process altogether. Before that, make sure you are aware of the judgment amount and pay it off in full as soon as you can.

Summary: Resolving Garnishments on Your Credit Report

Being aggressive when creditors are coming after you can help prevent this drastic step altogether. Try your best to work out a repayment deal with your creditors so that they stay confident that you will pay the debt within a particular time frame. This is the best way to keep creditors off your back and stop garnishments on your credit report.

Length of Credit History – Does it matter?

Length of Credit History – Does it matter?

A credit history is an assimilation of number of accounts in your credit reports, payment history, your amount of debts, and the score that is obtained after analyzing all these details. This information is used by lenders while giving loans or selling expensive products. Lenders will be basically interested in the “length of credit history” when they evaluate the paying capacity of borrowers. By length of the credit history, it means how long you have had taken credits and where does your credit score stands currently.

What is Length of Credit History

It simply means how long you have had credit; the age of the information in your credit history. Your credit report also has an age like every other tangible asset you possess. And, that age of the credit report has a 15% impact on your overall credit score. Hence, a positive or a negative credit history may influence your credit score likewise. In the world of FICO score, the Length of Credit History has a significant impact on your total credit score. This is one area where you have very little control and it is highly imperative that you develop a thorough understanding of this concept.

How is it calculated?

By knowing how Length of Credit History is calculated, you might be able to control it at some point. Credit specialists have suggested various ways and points from time to time to calculate this in the most appropriate manner. Of all the information obtained, here is the summary of factors that play a role in the calculation of the age of credit history:

1. There of customer’s oldest credit account
2. The average age of all the credit accounts opened to date
3. The age of customer’s newest credit account
4. Length of different types of credit accounts that has been established
5. Length of different types of credit accounts that has been consistently used

Out of all these, the age of the oldest account and the average age of all the accounts used to date play a crucial role.

How you can use your length of credit history to improve your FICO score?

It all comes down to your current FICO score. In general, active and current accounts have a larger influence on your current FICO score than the older accounts. The most recent activity has a greater impact on the overall credit score. However, if you have an older account that is debt-less and still active, it will fetch you a very good score than a recently opened credit account. Having old account can be, therefore, highly beneficial when it comes to improving your credit score.

Summary:  Length of Credit History

Hold on to your older accounts and think twice before closing them. With older accounts active, you can easily score high in this category.

Life after Bankruptcy – 10 Strategies to Rebuild Your Credit Score

Life after Bankruptcy – 10 Strategies to Rebuild your Credit Score

Bankruptcy inflicts financial misery on more than a million Americans every year. This is most damaging thing that can happen related to credit reports. A bankruptcy may be listed on your credit report for up to 10 years and there is a good chance your credit score will be rather low until you take the necessary steps to rebuild your credit. Rebuilding your credit score after bankruptcies is the real way to get back on a better financial path.

Take necessary steps to rebuild your credit score. But before that, it is important to understand why it is effective for creating a great financial future. While applying for car loans, credit card, the financial agency or say banks first looks at FICO score and credit history to determine the liability of applicant. If the FICO scores are amidst 700 or more, means you have good score, but if lies below, it needs rebuilding. Here are some suggestions for rebuilding FICO score after bankruptcy. Adopt these strategies to rebuild the score that all work, to some effect.

  1. Rebuild your credit score with a secured credit card: You may need to apply for secured credit card once come out from bankruptcy so you have the convenience of not carrying cash. With secured credit card, you make a deposit into its account and you can make charges out of it like a regular debit card.
  2. Keep paying non-bankruptcy accounts on time: All loans are never included in bankruptcy. Keep paying on non-bankruptcy accounts on time, as positive payments will improve your credit score. Also, keep up payments on accounts that aren’t on credit report because this could be reported later and cause downfall in credit score.
  3. Review the credit report: If there’s bankruptcy on your credit report, it does not mean you ignore reviewing it. Review the credit report annually and obtain a copy for any erroneous information or inconsistencies.
  4. Pay bills on time: Prioritize on time payment of bills and due to prevent non- essential spending. Set up reminder on calender to pay bills every month on due date.
  5. Do not close accounts: Closing account and swearing off all credit card is not the right action to build credit score. Rather, it reduces the amount of credit available. Therefore, it is better to keep the credit lines open.
  6. Avoid utilizing a large amount on your credit available: Utilization of high credit during bankruptcy signals to financial trouble. Keep your debt balance to 20% or less than the credit limit all the time, even pay of the balance in full each month.
  7. Make a budget and limit your expenses: Figure out what you can afford to pay every month on your debts. Your budget will help manage cash flow and prevent from racking up unnecessary debt. Know the limits on your credit card to keep your balances below them.
  8. Add a loan down the road: Credit loans are like secured cards, which are often small amounts and are reported as positive account as long as payment are made. Buy a vehicle that is affordable and you can pay off successfully. Your credit scores will climb without any fail.
  9. Paying of debt: Paying of debt on time is No.1 method for improving credit score.  If you have debts then bankruptcy could not wipe out. The credit score may fall and you would not get a new credit. You could erase a bad credit history and stay under a healthy credit limit.
  10. Go out of guilt and shame: Many Americans battling the lingering effect of great recession. Let of the shame to go and don’t dwell on negative thoughts. Adopt the right attitude, become more disciplined and educated, not to repeat the mistake again.

Summary:  Rebuild your Credit Score

These 10 suggestions will surely work to build credit after a bankruptcy. However, the most important lesson is to be patient and follow the guidelines, uninterruptedly.

Understanding Your Credit Report

Understanding Your Credit Report

Ever wondered why you were denied that car loan you applied for last month or the house loan that was not approved? The reason could be a ‘bad credit score’. It is not difficult to lose your credit points and a small delay in bill payment or untimely settlement of debts can have grave effects on your overall credit score. Even if you had a good credit score a few months ago, the figures will plummet before you know it. It is, therefore, highly crucial to understand the key aspects of your credit report.

Understanding your credit and what influences it is the key to having a better credit score. Once you gain complete knowledge about the subject, maintaining it will just be a cakewalk.

What is a CIR (credit information report)

While a credit report is the numeric summary of your credit history, a CIR or Credit Information Report is an account of the entire payment history of the individual. This has been calculated from the time you first received your Cibil TransUnion Score, another name for credit score.

What constitutes your CIR

Your CIR is the assortment of the Cibil TransUnion Score, and other important details of employment, bank accounts, credit cards, etc. Below are the key sections in detail.

  • Cibil TransUnion Score – A credit score ranges between 300-900. A score above 700 is considered good
  • Personal details – Contains complete and authentic personal information, address and telephone details
  • Employment details – Income details that have been earned by you as an employee
  • Account Information – Details of all the credit facilities and banking transactions related to your account such as account numbers, ownership details, date of last payment, loan amount, loan details, current balance, and so on.Every time you are applying for a loan, the respective lender or institution accesses your CIR. Understand your credit report and make sure that these elements are always up-to-date.

Know about Credit Bureaus

One important thing to know when developing an understanding of your credit report is the Credit Bureaus.  Credit Bureaus are the bodies that keep a track of your entire financial history, along with the credit report to date. Three major credit bureaus are involved in the process – Equifax, TransUnion, and Experian.

FICO Score

FICO or the Fair Issac Corporates creates a credit score for every individual that is used by top lenders while they consider offering credits.

Summary:  Understanding Your Credit Report

Each lender has its own strategy to assess that helps them decide whether the concerned candidate is suitable to receive a credit. If you identify the areas that these lenders use in order to assess your credibility, you can easily sort them and work towards their improvement. Once you get a better hold of these key aspects, you can easily create a good credit score.

What is a credit bureau? Experian, TransUnion, Equifax

What is a credit bureau? There are 3:  Experian, TransUnion, & Equifax

When you opt to buy something on credit or take a loan, the lenders don’t just decide to give you the facility right away. They try to collect information on your credit behavior, both past and present, track record, and various other data to ensure that you have the potential to fulfill the liabilities you obligate yourself with. This is where the Credit Bureau comes into the picture.

Ok, so what is a credit Bureau?

A credit bureau is a company that collects and maintains credit information of individuals and supplies it to the interested organizations and bodies such as lenders, creditors, etc. As a consumer, you can also have your own credit report from the bureau. The credit information is basically a summary of your credit behavior and includes the following details:

  • How much of credit you have
  • How much of the credit is left
  • How much credit are you using
  • How often do you make your payments

Credit information also contains rental repayment reports if you own a property. Other details mentionable in a credit report are liens, judgments, and other details that expresses your current financial position.

There are 3 major national credit bureaus in the United States:

  • Experian – This global information service group operates in almost 40 countries and employs a total of 17k people. The agency was founded in 1996, the headquarter of which is in Dublin, Republic of Ireland.
  • Equifax – Another consumer credit reporting agency and one among the three largest credit bureaus, Equifax records and maintains information of over 400 million credit holders in the world. Based in Atlanta, Georgia, the company employees 7000 plus employees and operates in 14 countries. Equifiax is also one of the oldest credit report gathering agency that has its operations ongoing since 1899.
  • TransUnion – The third largest credit bureau in the United States, TransUnion is an American credit information management agency. The company has information of approximately 500 million customers worldwide and over 45,000 business houses. It works closely with Callcredit, a UK based credit reference agency.

Based on the information on your credit report provided by any of the three aforementioned credit bureaus, the lender assesses whether they can offer you the credit or not. Whether your credit scores pose a risk and put you in a bad standing or has a high score that easily help you in obtaining the loan. This will also help them in deciding what interest rates they can offer you.

Summary:  What is a credit bureau?

There are agencies that can help you in getting out of a bad credit report. They will help in reestablishing your reputation as a credit holder and will solve all your credit issues. Search on the Internet to find such providers and take their help to get back on your feet.

How to Improve Your Credit Rating – 5 Easy Steps

How to Improve Your Credit Rating – Follow Just 5 Easy Steps

Credit scores are like report cards for grown-ups. This is a three-digit grade which signifies a person’s creditworthiness towards banks, insurance companies, landlords, lenders and even to some car loaners. These are mostly used by loan companies to help them determine whether or not you are a good risk and if you are likely to repay any loan taken out. Whether you are buying a car, renting an apartment or taking a loan, you need to make sure that your credit score is at its best. One has to build a great credit history to pass for a good credit. Unfortunately, there is no magic trick that can pump up your score by a certain number of points. Building a good credit takes time and good habits. However, there are few things that can do raise the score of your credit. These are:

Step 1: Check your credit report

Check your credit report to see exactly which place needs improvement. Do your debt utilizations too high or did you missed payments? Tackle your dues first, request a free copy of your credit report and check the errors. Check the reports for errors and fraudulent accounts as well. If something is incorrect, dispute with credit bureau. This could helps increase your credit report a bump higher.

Step 2: Pay Off Debt

Reducing the overall debt is an effective way to jack up your credit score. Reducing the amount that you owe is going to be a far more satisfying achievement than improving your credit score. Stop use of your credit cards, ask for funds from friends or relatives and clear your debts. Check your recent credit card statement to make a list of your debt and interest rated on that. Secondly, you must give prime focus to credit utilization, as it will help you measure the amount of debt. Create a plan, evaluate your expenses and reduce your debt to improve your credit utilization portion.

Step 3: Fix your collection accounts

Collection stays for a long time on the credit bureau, and even you forgot about their first position! This is the very aspect that can have a harsh effect on your credit score. So, check it, fix it and get rid as soon as possible. Get in touch with credit bureau and the party to resolve the issues and have a fair report. This will eventually increase your credit score and prove you to be liable for any loan.

Step 4: Build good credit by following guideline

Moneylenders or bankers check the credit score to find out your financial faithfulness Therefore, maintain good credit habit to improve your score and prove credible.

  • Make your payments on time.
  • Keep your old account open.
  • Lower your balance on credit card.
  • Set-up payment reminders.
  • Use your card regularly
  • Annually check your credit reports.
  • Avoid applying for new credit cards

Step 5: Get a secured credit card

Get a secured credit card to quickly build a payment history. These cards are backed by cash depositing that is parallel to the limit of credit. You could easily get the approval, as money already their in your account. Double-check to ensure that the card is truly a credit card. Although, unsecured card carries more positive weight than a secured one. You could easily upgrade the secured card into an unsecured one after few months. This would sincerely give a boost to your credit score.

Summary:  How to improve your credit rating

Follow the steps listed above, and build a credit score which you were missing. These 5 tips will give this impression to financial institution, and therefore increase your chance of borrowing. But, you have to keep patience, as it cannot be achieved overnight.

Why Do I Have a Bad Credit? And, How do I fix it.

Why Do I Have a Bad Credit?

You work hard to make sure that your credit score remain high, right! Unfortunately, all your hard work could be hurt by seemingly small things that could give a big impact on your credit history. From parking ticket to auto loans, irresponsibility could take down your credit score. Credit score is a tricky thing and some harmful action or behaviors can terribly impact your credit. Having a blemished credit history is likely to mean you are turned down when you apply for car loans or borrowing money, giving rise to think that your credit is blacklisted or bad credit rating. By understanding the biggest mistake determine or reduce problems that might affect your credit. Here are some of them:

Making late payments

Your credit history accounts 35% of your credit score. Late payments records hamper your ability to finance major purchases such as a car as much as a personal credit history full of mistakes. So, if you fail to make debt repayments on time, it will show a red flag to credit agencies.

Closing card account

Closing credit accounts is a bad idea to boost credit scores. A closed credit account will fall of your credit report sooner than later. The positive history associated with a account is removed from the credit report, if the account is closed. Credit history counts for 15% of FICO score. So, the one with younger credit are more risky then consumers with older history.

Over utilization of your available credit card limit

If you wish to establish a bad credit, charge your credit upto their limit and keep them there. Apparently not, because high balance on your credit cards takes your credit score down. The credit score is based on ratio of total, debt to total available credit. Your credit balance goes up, your credit score goes down. So, try your best reduce the percentage and pay them down as much as possible.

Error in credit report

Mistake on your credit report, which lenders check is an important part of credit score process. If there is some error in credit report related to debt or dues that does not apply on you then report the reference agency immediately. If you spot some case of fraud in your name without your acknowledgement then report to get investigated and removed.

Filling bankruptcy

Last but not the least, Bankruptcy is an undisputed champion in destroying an excellent credit rating. This undeniable one of the worst thing, which can cause a lose of 200points in credit score. It may take 10 years to fall from your report, but the impact will lessen over the time. Filling bankruptcy is like pushing a financial reset button. This is an important decision and needs precise concern and information. Take helpful suggestion before filling one.

If you see anything on the list you know you’re guilty of? Start taking necessary steps to properly address the problem as soon as possible. Be consistent in paying down bills and debt on-time and create a clean bill of credit.

What is a Good Credit Score?

What is a Good Credit Score?

You may not fully understand your credit score. When trying to get a loan, you may think, “What is a Good Credit Score?” You want to know what type of score you need to qualify for loans. You want to make sure that you are on the right track or that you know when there is a problem. If you do not know what a good credit score is, though, you cannot do this. Thankfully, it is not that hard to understand. While there are several sources for a credit score, it is all easy to understand and is quite similar.

There are several sources for a credit score, as mentioned above. One source is not the same as another source. A lender will look at these scores to determine where you stand. An important part of these scores is that their range differs, too, so the lenders are not looking for a single specific number. They all start from the low hundreds and go up to the high hundreds, but the exact starting point and ending point changes. Since it changes, what makes a good score or the line drawn for a good score is not the same for all of them.

What makes a good score is not the same for all lenders, either. Looking at a single score, the line drawn will change from lender to lender. Some have higher standards or expectations while others are more lenient when looking at credit scores. A 700 may be the minimum score required for one lender, but 600 or 650 may be the minimum for others. Since there are so many differences between lenders, you should not aim for a single number. You should attempt to make your score as good as possible so that you can gain from a high credit score. By aiming for as high of a credit score as possible, you can try to qualify for all lenders.

When thinking, “What is a Good Credit Score?” there is not a lot to consider. A good credit score is a high score. As long as the number is as high up there as possible, you will have a good score. The line drawn and the minimum and maximum scores change, but there is one constant: You should aim high. If you already have a good score, try to improve it and keep up the good work. If not, work on improving it so that your score can actually benefit you.

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