Question: What can I do to rebuild my credit and get the financing needed for a car and home mortgage?

Answer: The credit repair industry is a multi-million dollar market and is filled with scams artist and companies.

Loans are tougher to come by in today’s tight financial market – poor or bad credit making getting a loan more difficult but also raises the interest you will pay over the term of the loan. Cleaning up your credit rating and raising your credit score can save hundred’s and even thousands of dollars in interest.

Your credit report is you “electronic reputation” and we strongly urge you to educate yourself and take the steps
needed to repair and clean up your credit legally. This will allow you to take advantage of lower interest loans and lower
rates on credit cards.

Debt consolidation and debt settlement may be one option to help get your finances in better standing however, do not be fooled, much of what these companies do you can do on your own. All that is required is organization and discipline.

The first step in any debt recovery and credit rating improvement begins with a plan. This plan should include paying on time, paying back overdue payments, reducing current debt and learning to manage money. This will help improve your ability to borrow money in the future if that is required or finance a car or home mortgage loan. Without a solid plan (we call it a budget) to take control of your use and need for credit financial bondage will again be right around the corner.

Two options exist for repairing credit…

• Educate and do it yourself (preferred method – you will gain much more education along the way)
• Hire a person, company or an attorney that knows the laws pertaining to credit.

Tips and Items to Look Out For:

• Know your rights when dealing with collection agencies and companies you owe money to.
• Read the Fair Credit Reporting Act for your rights
• Never make statements or threats you cannot backup or follow through on.
• Do Not Be bullied! Never let someone else set your agenda!
• Get organized with paper work and where you are in the process
• Know the fees if you hire someone or a company. make sure you can cancel at anytime.
• Always tell the true and present the facts when dealing with collection agencies and creditors.
• Always get settlements in writing.
• Never give a collection agency or creditor access to your bank account!
• Never create a “new” credit file – It is a scam and credit fraud!

Hiring a company to handle your credit mess or doing it on your own will come down to your ability and willingness to
get organized, work and follow through on each step or the process.

Hiring a company will simply “force” you to do the things you do not want to face financially. They may handle the paper work, “force” you to budget and charge you a fee to do it all but you will need to provide all the information to them.

Before hiring any credit repair firm do the work of checking them out with the Better Business Bureau and speak to some of their clients. Some of these companies change their name on a regular basis because of the scams and fraudulant practices they employee.

The key to improving your credit is getting finances organized which includes pulling your credit report, correcting any errors and paying your bills on time.

The best way to establish a good credit rating is to promptly meet your financial obligations and commitments.

Always determine that you can meet the credit commitments before considering taking on any debt – It does not hurt to check your credit report and check score as well for better financing rates on major purchases. Then, comply with your agreement. Otherwise you should not sign such an agreement. Never sign a credit contract and later decide you cannot afford it.

A note or contract for payment on time may be transferred by the seller another finance company or party, whether specifically mentioned or not, and then, you are obligated to that agency for payments specified in your contract. There is a difference between your contract with a contractor or other seller and your financial obligation to a bank or finance company regarding the same transaction. Failure of the contractor or seller to fulfill his obligation to you does not release you from your obligation to the bank or finance company. (The only exception would be in a case when the finance company had been directly involved in and responsible for the original transaction, or where special statute provides that a finance company takes a consumer contract subject to defenses of the consumer against the original contractor.)

Similarly, for fulfillment of a guarantee or warranty, you must look to the manufacturer, or seller, or contractor or whoever gives it, not to the bank or finance agency. Your responsibility for payment to it continues.

Failure to make payments or failure otherwise to meet the terms of your contract or agreement makes you liable to lawful collection procedures. The law provides effective methods to enforce credit contracts. Accordingly, one whose record is bad, may expect close follow-up in the event of delinquency. Those who loan money or finance consumer contracts depend upon prompt payments to operate successfully.

If you make a valid contract for credit and then fail or refuse to go through with it, it is for the creditor to decide whether to release you fom the debt, or attempt to enforce the contract or collect damages. many people are facing this when settling the large credit card balances. Whether or not a deposit is refunded is dependent on the policy or willingness of the creditor. The reason for a deposit or down payment is to validate a contract and as assurance that you really mean to go through with it. You may feel justified in refusing to go through with a contract, but if you do so without adequate legal cause, or without agreement by the other party, you are liable.

In any transaction, as in home repairs and remodeling, where a completion certificate is required, do not sign such certificate unless, in fact, the work is completed and up to the agreed upon standards. Do not sign for any other reason.

Do not sign as a co-signer (this includes your kids and family members) in any transaction, nor buy in your name for somebody else not eligible for credit, unless you are ready, willing, and able to assume the obligation of the contract. A friendly gesture in signing as a co-maker or co-signer may become a serious obligation if the principal maker or signer becomes disabled or dies, loses his job or moves away, or for other reasons, is unable to pay.

Question: Credit history never seemed an issue with my parents. In today’s world focused so heavy on the use of credit cards and credit in general… any ideas on the best way use credit on a daily basis? Katy, Boston, Mass

Answer: Mass production throughout the world, the American standard of living along with our taste for consuming would not have been as easy for Americans to acquire without consumer credit.

However…

The government and as individuals, we have lost our way in the use of credit and managing money.

From an individual viewpoint, credit should be used only when coupled with intention and a definite plan. A plan of eliminating the debt as soon as possible and not always living in debt – debt free is possible! Most people do not think of themselves as slaves, which they are when they owe someone a debt. Our parents did not want to be put in that position or “owing someone.”

Consumers need to gain more knowledge and understand the proper use of credit. You do not have to understand every law and detail that applies to using credit. Actually, when you deal with reliable companies, you do not have to be a lawyer nor carry a law book.

The key is to use “credit” wisely and when it is to your advantage – not when you “need” something to fill a void. Credit should not be used unwisely or when its convenience makes you “overload”, put pressure on, or places you in a position your are unable to meet your financial obligations. Or places you in a situation where you must deal with unreliable concerns whose charges and practices are unfair or illegal.

Good Credit a Personal Asset

Good “credit” is a personal asset. You create and maintain your credit history and standing. It can be improved by your trustworthiness and character, by your performance of payment, and by your total capacity to pay.

In general, you may choose your method of financing, credit card, writing a check from a home equity line of credit, conditional sales contract, or similar contract, cash loan from bank, small loan company, finance agency, credit union, by mortgage loan, borrowing on collateral, on insurance, etc. Satisfactory credit terms can be obtained by any person who has a good credit rating. It is those people who do not have a bad credit record or who do not know and understand the basic facts, terms, and obligations, who usually are usually the ones who become trapped in unfair or illegal credit transactions.

Doing business on a cash basis has advantages also. It saves credit costs, for example. Most people, however, cannot do all their business on a cash basis. In fact, wise use of credit helps you to build and protect a savings account. In turn, a savings account enables you to buy for cash or to obtain most favorable credit terms.

Many consumers today find that they have had trouble at one time or another with their credit history. Most families experience the pressure of having 2 incomes in order to make ends meet. Many people live literally from paycheck to paycheck. By cutting things so close where money is concerned, many people discover themselves with unwanted bad credit history.

All it takes is one late payment to mark your credit history. Imagine if you’ve had some financial downfall, where you’ve been out of work sick and are unable to pay your bills as normal. That illness alone, can ruin your credit history.

How do you go about repairing your credit report? There are many things a person can do on their own to repair their credit report without the aid of someone else. There are three main credit reporting agencies.

One of the first things you would need to do is contact each of them and acquire a copy of your credit report. Each of these credit bureaus offers a free copy of your credit report once a year but will not include your credit score. You will want to keep up with this each year to know exactly where your credit stands. You can request your free copies right on the internet or call them each directly.

Once you receive the reports of your credit history, you’ll want to look over each of them to see if there are any duplicate entries, items that should have been removed such as paying off a debt, paid credit card balances or anything else that looks as if it is not right.

It can also be very helpful to obtain a free credit repair kit, to help you clean things up. You can obtain free credit repair kit from various places on the Internet as well as the credit reporting agencies or credit bureaus. The kit gives you specific details on things to look for when checking for discrepancies on your credit report. The kit also offers sample letters that you can send to each credit bureau or to each creditor listed on your credit report to get certain items removed.

While the task of cleaning up your credit can be tedious, it pays off well in the end as your credit score is improved. Many times a debt has been paid in full but the creditor neglects to remove it from your credit report. By sending these types of letters, you can be sure to push things along, getting those derogatory items removed from your credit report.

There are also companies out on the market today, that will help you with every step of cleaning up or fixing your credit report. They’ll help you dispute charges on your reports and help to get your credit score higher. Keep in mind it you can do all of this on your own but by using companies that deal with this on regular basis, it can help to speed the process along. No matter whether you choose to fix your credit report on your own or go with the help of outside company, be sure to get a copy of your credit report from all credit bureaus so you know exactly what areas you need to work on.

Having a strong credit score has never been more important than right now. The current economic situation has made the money available to borrow for things like mortgages or new credit cards very difficult if your credit score is less than perfect. Unfortunately many consumers are unaware of the fact that a weak credit rating on their credit report not only affects your ability to borrow money but it also effects many other aspects of your life.

A great example of what other areas your credit worthiness effects is your insurance rates. For example many homeowners’ insurance companies are no longer even writing policies for people considered to be a high risk of defaulting.

Another great example of how a low rating or score can affect you is if you are applying for a job. Many employers, whether it is fair or not, are now running your credit reports and are denying employment for those who have bad credit.

Their rational is that if you cannot keep up with your responsibilities you are probably going to be the type of employee that does not value your job and you will not work to their standards.

How Can I Improve or Fix My Credit Score?

One positive to a credit score is that it can always be improved upon and increased. One of the first steps that you will need to do is to actually find out what is on your credit reports. There are three major credit bureaus that your lenders report all your credit habits to. The type of information they collect include the date you open the accounts, the credit limit of each account, what type of account it is and how you pay your account. This collected data is how your FICO score is generated.

How Do I Get A Copy of My Credit Report?

There is a great new tool that you can use to quickly get a copy of your credit report from all three agencies at the same time. The federal government has a program that allows you to once a year get a copy of what is on your report for no charge. You can quickly print out each report and then check it for any inaccuracies. If you find anything that does not look right you will need to notify each credit bureau in writing and have them look into the matter. If everything checks out they will remove the mistake from your report which will raise your overall score.

Avoid the Common Mistakes

Oftentimes when consumers are trying to improve their credit score they inadvertently make it lower. A good example of this is when you look at one of your reports and see a credit card that you no longer use so you close the account. Big mistake! If it is an account in good standing then the longer the account has been opened the higher it helps your score go. Another common mistake is having high balances on your credit lines. You should not have over 40% of your credit line outstanding at one time, anything over that will adversely affect your credit score.

When you are attempting to improve your credit score there are many avenues to take to do just that. We have only covered a few here. Having a strong credit rating will open many doors for you.

Millions of Americans carry some small negative reporting on their credit report. There is a wide range of choices to establish, maintain and even rebuild your credit report.

Once your credit carries many negative entries the journey and learning all the insider tips for credit repair and credit management can take a long time when you go it alone.

There are many companies ready to provide a solution to the ever-increasing problem of debt and credit repair. Along the way consumers can find many one-stop sources for everything related to their credit. Obtaining more or getting out of debt.

The first thing to get on the road to credit recovery is and improve your credit score is to start paying your bills on time. No matter what you may have heard the only items on your credit report that can be removed is inaccurate or outdated data. If it had been reported that your are really $7,200 past due with your local department store, and the information is correct, that information will stay on your credit report for at least seven years.

Repairing your credit is not a 5 minute exercise or a “quick fix” the process can drag on for months and even years before you’ll be able to see the benefits of a great credit rating. Now identity theft throws a whole new curve at maintaining a clean credit record.

Much of the work can be do-it-yourself by reading everything you can find on credit an then take those ways to speed up the process and save some money while going through the steps. While going through the steps take some time to get familiar with the laws in place to protect your consumer rights.

The first place to start is by understanding the basic rules, guidelines and laws which effect the rating of your credit. The Fair Credit Reporting Act (FCRA) clearly states that any information negative in nature may only be included in your credit report or file for no more than a maximum of seven years. This being from the last activity date on the account. Good credit or positive items can remain on your report for 10 years.

As a consumer you have the right to request and “investigation” of any information in your credit report. Once contacted the credit bureau usually “investigates” by contacting the creditor to verify the information on file. If the information cannot be verified the item is then deleted from your file.

Inaccurate information like balance due or late payments must be corrected by the credit bureau. Finding inaccurate information and paying your bills on time are the best ways to start cleaning up your credit. Consolidating debt and paying off open accounts can also help in the long run.

Your credit history use to be something you would look at to make sure there were no errors or misreported entries. Today protecting your credit history and credit rating has come much more into focus with the threat of identity theft.

You can protect yourself with these simple tips for protecting yourself against identity theft along with picking up a copy of your credit reports for free each year.

Nothing influences your financial well being more than your credit history. Those numbers and track record speak volumes to a financial institution about your reliability as a potential future customer and even an employee.

So what is hiding in your money use report card?

The Credit Report

Your personal credit report holds information containing both your personal along with your financial status. This information is all compiled together for what is called a FICO score. The goal for those planning to borrow should be to build a high FICO score, which translates into a very positive credit rating.

When you request credit the lender usually contacts one of the three major credit reporting bureaus Equifax, Experian, or TransUnion questing a credit report of your credit history based on information collected over time and reported to them.

It may sound complicated especially when you consider all the financial transactions you’ve done over the years. Everything from buying a house, opening a credit card to buying your dining room set over time gets reported. All of that debt and payment history plays a part in your financial life. It’s for this reason you need to keep an eye on your credit score. Regularly reviewing your score, payment and credit entries you can spot and correct potential mistakes and errors.

What Your Credit Score Means in Day to Day Life

For some a below average credit score can mean the difference between a applying for a loan with an excellent interest rate and terms or one which over the term of the loan will cost your much more money. A low score makes rejection much easier for lending institutions.

Companies are now looking at credit histories before hiring new employees. Insurance companies are also using credit reports when basing insurance premiums for policy owners.

What Influences Your Credit Score

How well you pay your bills probably plays the biggest influence in your credit rating. Paying bills on time affects your score in a positive way.

Along with timely bill paying your outstanding debt also draws some consideration. The current outstanding debt of the outstanding balances owed on accounts measured against credit limits on credit cards accounts you have.

For example, despite your intentions keeping a credit card with credit limit open with a zero balance can negatively impact your credit report. Why you may ask? Creditors view that zero balance as a place for some potential spending to occur real soon.

Lenders can also have a difficult time with borrowers who have none or little credit history as this make it difficult for them to evaluate any future payment trends.

Identity Theft The New Credit Score Threat

Identity theft is the new epidemic to hit credit reporting. Be careful with your handling of personal papers, financial documents, mail, mortgage and loan papers, etc. If they come up are missing you could be a victim of identity theft. Thieves go to great lengths to steal people’s identity. They will go through garbage cans to find the right and just enough information to become the new you on paper.

If you believe your identity has been compromised consider freezing your credit report. A credit monitoring service can keep you abreast of any potential identity theft. Be prepared for a lot of changes such as changing bank accounts, credit cards, etc.

If you discover invalid action or activity on your credit report contact the bureau issuing the report and dispute each invalid entry. It may be necessary to contact local authorities to file a report. Do not be shy – take the steps to protect yourself!

Obtaining Your Free Credit Report

New laws now obligate credit bureaus to provide a copy of your credit report each year for free. Now the credit report may not cost you but to find out your FICO score will most likely involve some cost. You can get free credit report from Equifax, Experian, and TransUnion once every 12 months by simply requesting it. The Government has made the process of requesting your credit report very easy. Visit Annualcreditreport.com to get your report and start watching out for identity theft today.

Building good credit is so important if you plan on buying a home, looking for way to finance higher eduction and even securing a better job. You credit plays a part in everyday life.

Our education system does a terrible job of teaching young people about the impact of credit. All starting with that first credit card you begin to define your history of credit. The credit limit is not what defines your , using credit responsibly does.

Do you use your credit responsibility or does credit control you? If you want to build a good credit history follow these few credit tips.

Only Use Credit If You Can Afford To

When you plan your purchases and build a track record of not over spending you are communicating to lenders and creditors that you understand and know how manage money. This will make borrowing later if needed easier and making back easier as well. Buying only what you can afford will also keep you a safe distance from debt.

Only Tap Into a Small Amount of Credit You Have Access To

Hitting your credit limit or coming close telegraphs your lenders of how irresponsible you are with credit. What does maxing out a credit card tell lenders? It tells them you may have some or are heading for financial difficulty. As a rule say below 50% of your credit limit, better yet stay below 30%.

Stay Away From Collecting Credit Cards

Credit cards can be a real temptation. The more credit you can touch the more you’ll often spend. Most people need no more than one card. I have a business credit card and a personal credit card. What more do I need. I manage those cards and only those cards. They provide me enough of a credit limit to purchase anything I need.

Pay Your Balance in Full

Pay off the credit balance every month. If you follow the step above and only buy what you have planned and can afford, paying the balance off every month should not be a problem. Remember a part of your and credit history is you timeliness of payments. Pay your balance off and on time and your credit will improve.

I know paying the balance off each month can be difficult once you’ve fallen behind – I’ve been there. Start this month paying off all you’ve purchased, plus the interest and then anything else you can afford. If you cannot do this then stop charging! Always pay more than the minimum payment.

If you use credit wisely and be smart you can enjoy the use of money and credit cards, if not they can be your downfall and slave.

Credit scores and ratings are not for only personal credit but business as well as small business owners are finding out.

Entrepreneurs need know of the credit rating of their company before seeking loans, contracts or purchasing materials even without loans and self financing their start up.

Small business owners may be surprised with the fact of doing it all right:

• Forming a company
• Incorporating
• Protecting Personal Assets and Credit
• Acquiring insurance

The "deal" or contract could come down to the credit history of the company.

A "commercial credit score" works like a personal credit score. Small business owners may be surprised to discover that their spending habits are being watched by the credit reporting companies.

Tracking small business spending is a growing area in the world of financial health.

When you open a business a new Visa card may arive so why check a small business credit score? Larger companies what to know when placing an order or signing a contract the company will be around and not be gone next week.

No longer is the Dun and Bradstreet report good enough. The Major credit reporting companies like Experian and Equifax have jumped into the small-business credit arena.

Experian, got into business credit arena in the 1970s. However, technology has made the collection of data so much easier to put together the credit history of a small business.

Face it, small business is a giant market. In fact, Experian launched a site – http://www.businesscreditfacts.com – dedicated to teach and info small business about the topic of credit reports and scores.

A study released by Experian showed how the credit reporting took into account their small business owners credit history as a part of determining the financial strength of the company. I guess the figure spending habits on a personal level will translate to the business.

This "new" market for credit reporting sends a signal to small business to keep their financial house in order.