Credit Repair For Real Estate Investors Archives

Do I Need To Hire A Credit Repair Expert?

Tuesday, December 9th, 2008 at 9:50 am  
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   I hope everyone’s Holiday Season is going well and not frustrating you too much! I have been attending several holiday parties and various functions the past few weeks and one question that I keep getting over and over when people find out what I do is…”Hey Mark, I have things in my credit that I want to get removed, do I really need to hire a credit repair expert, or can I do it myself?”

   I always answer the question with “It Depends.” You see, every credit report is different. And every person’s situation is different. Some need credit repair RIGHT NOW due to a probable real estate transaction and others can wait a bit. I also ask the question of how organized and disciplined a person is with mundane tasks such as repetitive phone calls and letters. While there is no easy answer, allow me to shed some light on the subject:

   If you have been having credit problems and your score has been lowered due to these struggles, you may want to check with a credit repair expert to get the help you need.  Credit problems can affect all areas of your life.  Unfortunately, for most americans, more and more companies are now wanting to pull people’s credit reports for every reason imaginable. 

   With the economy in the shape that it is, more and more lenders, credit card companies, and banks do not want to lend to people any longer or give out good loans, unless you have perfect credit.  Not only that, but many companies that you may not even think about want to pull credit reports now as well.  Companies like car insurance agents, health insurance companies, and even jobs as well. 

   The idea that if you have a negative credit score that will mean you will not pay your premiums or be reliable at your job.  Many times you can lose job opportunities or receive poor health and car insurance costs.  These are not the only companies that want to do this, more and more companies are looking for reasons to pull consumer credit reports.  With this happening, repairing your credit report becomes even more vital than ever.  Consulting with a credit repair expert means you will have a better chance of fixing your credit and eliminating these problems from your life forever.  There are few things that a credit repair expert can do for you, they are:

  • Help you get your credit reports from all three credit bureaus.
  • Go over your reports and make sure that all information is correct and accurately reflect your credit score.
  • Help you to remove negative marks and incorrect information.
  • Help with the letters and phone calls that will need to be made to make these corrections happen.
  • They know all the credit rules and procedures to make sure that the information is corrected in a timely manner.
  • Help with negotiations between you and the credit card companies and banks and lenders.
  • Help you to lower your payment, remove the interest, remove late fees and over limit fees as well.
  • If the credit repair expert you went to is a lawyer, they can also help to reduce the balances that you to pennies on the dollar.  Meaning you will end up only about half of what the original balances were.
  • Many times all payments can be made to the credit repair expert for them to disperse out on your behalf.  They will make the payments to the credit card companies and banks for you, further eliminating some of the hassles for you.

   Going to a credit repair expert means you will be getting the advice and help you need.  You will be on your way to eliminating credit problems and on track for financial success and security again.  These experts specifically deal in these situations and problems, they know how to make sure the job gets done correctly and the way it is supposed to.  Achieving the raised credit score that you are looking for.

  Remember, there is nothing a credit repair company or credit repair expert can do for your credit that you can’t do for yourself. Usually, as with most things in life it comes down to two choices…money or time.

   Which one do you want to spend in getting your bad credit repaired and increase your FICO Credit Scores?

 

Talk Soon,

Mark

Robert Kiyosaki – Rich Dad|Poor Dad Real Estate Training Today

Saturday, December 6th, 2008 at 6:55 pm  
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Hello All,

  I am attending a 3 day real estate training here in San Antonio. I will post more info and some very relevant informational nuggets that have been shared about credit repair for real estate investors. It’s comforting to know that his philosophies fit almost exactly with what I have been teaching to my students and clients all along. 

Stay Tuned!

 

Mark

Ten Common Credit Repair Mistakes

Sunday, November 30th, 2008 at 10:55 am  
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“The Ten Most Dangerous Mistakes YOU Probably Make With Your Credit Scores And What To Do About It…”

   After coaching hundreds of students and clients, I have noticed that many people make the same mistakes over and over when it comes to dealing with credit, credit scores, and the credit bureaus.

   Since you are a subscriber to this blog, you will learn what these common credit repair myths are and how to never fall victim to them again. My friends in Austin, San Antonio,  Dallas, and Houston will have the benefit of me presenting these tips and more live to the different real estate investing groups in your city.

   I will discuss texas credit repair and how it relates to the current real estate investing marketplace.

   Here are the Top Ten Reasons Why Most People Fail To Repair Their Credit Properly And How To Make Sure YOU Avoid Every One Of These Deadly Common Mistakes

 

MISTAKE #1: Not Disputing Accuracy of Accounts That Have Late Payments Listed

   A recent 30 day late payment is much worse than an old Chapter 7 Bankruptcy. To dispute late payments you need to write a letter that states three things:

   First, the name of the creditor and number of the account you are disputing

   Second, the reason for the dispute

   Third, what you want the credit bureau to do

That’s It – How Simple Can It Be??

   Have you ever noticed that the most, if not all of the credit repair advice out there tells you to just dispute the account as “Not Mine”?  Of course you have. Just like most of the population, I’m sure you think that this is good advice.

   According to the “experts” the credit bureaus only have 30 days to verify the account or they have to delete the negative information. Ok, so is anyone surprised to know that the Credit Bureaus will ignore this type of consumer dispute ALL DAY LONG!

   What’s going on here? It’s actually very simple…The Credit Bureaus don’t delete negative account  information when you dispute like this. Why? Because these types of disputes are the easiest to verify! 

   If they can match four pieces of information (which you supply by the way when you dispute something with the credit bureaus) such as your date of birth, Social Security number, address and name, then the account is yours and they will not re-investigate.

   And guess what?

   Most everyone is still teaching this same worthless tactic. The better way is for you to force the credit bureau to confirm data in your credit report and in the account itself. Dispute the current balance, date of late payment, or date the account was opened. 

   The credit bureaus probably won’t do this correctly within the 30 day period required by law and then you can demand removal. Quit quoting the FCRA act and trying to sound like a lawyer. If you get the bureaus to try and verify account details instead of correct reporting you will never get these items deleted.

   I realize that this doesn’t make a lot of logical sense, and it’s hard to ACCEPT… but GET OVER IT.

   Until you accept this FACT and begin to act on it, you’ll NEVER have the success with repairing your credit like most of my students.

 

MISTAKE #2: Not Disputing Bankruptcies and Other Public Records From Your Credit Report  

   What do most people believe to be true about having a bankruptcy or public record listed in their credit report? Right! They believe that those items stay in your credit report for 10 years or something, maybe even forever!

   Well, I have news for you… YOU CAN REMOVE ANY NEGATIVE INFORMATION IN YOUR CREDIT REPORT THAT IS OUTDATED OR INACCURATE. NOT ONLY CAN YOU, IT IS YOUR RIGHT

   To remove these items from a credit report, many people write letters to the credit bureaus disputing specific information on the record that is displayed in their report. 

   Why is this strategy successful? Because there is a question of who is the “source” of the verification. Courthouses do NOT report to the credit bureaus. The bureaus get their information from third parties or they have people on their payroll go down and get the information.

   That is a CLEAR violation of law.

 

MISTAKE #3: Not Reducing Credit Card Balances to the Correct Percentage the FICO Scoring Algorithm prefers.

   In our quest to manage credit and keep some sort of balance on our credit cards as the “experts” tell us to do, we utilize too much of our available credit on our credit cards

   Another HORRIBLE idea.

   There are many schools of thought on how much debt you should carry on your revolving credit card balances. Some experts say to keep your balance to 50% of your available credit limit. Others recommend a 40% or 30% ratio. While it is always good to keep your credit card  balances low, you also want to utilize your credit cards since the issuing banks make money when you use their cards

   Remember though, the FICO Credit Scoring Model lowers your score when you use too much of your credit limit. When you use 40% of the credit limit on a card you lose points with the credit bureaus. As you use more of your available credit limit…50%, 60%, 80%, 100% your credit score goes down. 

   Speaking from personal experience and the experience of my students and clients, the “magic percentage” that will yield you the biggest bump in your FICO credit scores is 5% to 7% of available credit limit. 

   Always try and keep the balance around 5%. 

 

MISTAKE #4: Not Having Credit Accounts From Major Lending Institutions

   You want to have major institutions like Bank Of America,Chase, Wachovia, etc on your credit reports. Companies like Capital One, CitiFinancial, Providian – those that you see advertised on late night TV and those that have teaser rates will suppress your credit score. 

Why? 

   Because the Credit Bureaus know that people with these accounts are more risky. These banks are not premium tiered lending institutions. They aren’t sub-prime, but pretty close.

   If these types of accounts are on your credit report, your credit score will suffer and you’ll pay higher interest rates for everything. Only get accounts with big, well known, and reputable financial institutions. Make sure to pay them in full every month, on time and only use about 5% to 30% of the credit limit. That’s a great way to increase your credit score. 

 

MISTAKE #5: Not Suing Creditors Who Report Incorrect or Negative Information

   Creditors generally have the same responsibility under the law to maintain accurate information….and just like the Credit Bureaus, they often fail to do just that. So first, go ahead and dispute the negative line items on your credit score with the Credit Bureaus. Just because they send you a letter saying that the credit report account is accurate, doesn’t mean that the creditor has actually provided proof of this to the Credit Bureau.

   By law the Creditor and Credit Bureau can only prove the account is accurate with a signed written contract by you or other original documentation. If the Creditor has not followed the law ….you may be able to file a legal Action against them. 

   Many people simply sue in Small Claims Court which costs between $35 and $100 depending where you live.  Don’t worry, it’s easy. 

   Provide proof to the court – including the letters you sent – how the creditors have not proved or removed the account. Write about how their actions have hurt you financially and created mental anguish and hardship.  You don’t even have to ask for money unless this is required and then ask for $1,000. 

   Just make sure you ask for complete deletion of the negative account on your credit report with all Credit Bureaus. 

   Do you think they’ll want to send the President of their company to your county to appear in court. 

Nope. If they just ignore you and don’t show up in court that’s ok too. Either way, you win-and the account gets deleted-permanently. 

 

MISTAKE #6: Not Adding Good Credit Accounts To Your Credit File

   Get added as an “authorized user” on an account of someone like your husband or wife who has a great credit history with a company. (Note that the Credit Bureaus often mix up negative information from other people on your account.) Often, that account will be reported to the Bureaus as yours too! 

   Now, the Credit Bureaus claim they are cracking down to prevent people from improving their scores this way. However, remember that Credit Scores are created “on the fly” by the credit bureaus and what your credit score is – depends on the scoring model used. 

   So, this positive history from someone else is probably only NOT counted when you are applying for a mortgage if your lender is using the FICO NextGen Model.

   Make sure your lender is using the FICO Classic scoring model. More than 80% of lenders DO use the FICO Classic so you’ll probably be in luck! 

 

MISTAKE #7: Not Disputing, Correcting, Removing ”Aliases” or “AKA’s” from your Credit Report

   Many different names tend to make you look like a higher credit risk and will lower your FICO credit scores. If you have too many names in your credit file, it will also make it more likely that someone else’s name will match a few letters of your name and their negative info may accidentally be reported in your credit report.

   A simple letter stating that these are NOT your names and requesting deletion should do just fine. Make sure to include your full name, address, and social security number in the letter so the credit bureaucan identify you properly. 

 

MISTAKE #8: Not Disputing, Correcting, or Removing Old Addresses From Your Credit Report

   Different addresses indicate less stability and lower your score. If you have too many different addresses in your credit file, the FICO Credit Scoring algorithm will lower your scores. 

   Why you ask? Well, for a couple of reasons:

   One, too many different addresses indicates less stability and a higher credit risk. 

   Two, if the profile of people in your neighborhood have lower scores or economic profiles, your score will 

be lowered as well. That’s especially bad news for people in low income areas and who live in Senior citizen communities. Isn’t that discriminatory? Do you think that is fair? What if you are in the Military? 

   What if you’re a salesman or get promoted a lot and have to move around the country? You can challenge the addresses on your report as not accurate…for lots of different reasons. 

 

MISTAKE #9: Using A P.O. Box or Mail Box Service When Applying For Credit  

   Using PO Boxes and Mail Drop boxes indicate higher credit risk. You look less stable and will have a lower credit score with the credit bureaus if you have a PO box rather than a physical street address. 

   Of course, people who are NOT credit risks have PO Boxes and Mail Drop boxes for legitimate reasons like protecting their privacy and themselves from identity theft…but the credit bureaus don’t care. 

   If you think getting a box at Mail Boxes Etc which has a physical address…can get around this, you’d be wrong.

   The Bureaus have a list of almost every single Mail box drop location in the country. They will flag you as more credit risky and your credit score will be lower on all three credit reports from the major credit bureaus! 

 

MISTAKE #10: Identifying Yourself As “CEO” or Owner Of Your Business

   If you own a Business and/or have CEO or Owner in your title, the Credit Bureaus view you as a more credit risky entrepreneur. Making yourself CEO or President is a perk of owning your own company, but you should change your title to General Manager or Chief Financial Officer and report this to the credit bureaus. 

   Salaried positions are viewed more favorably. So to improve your credit score, change your job title and dispute the accuracy of any title or employment position that isn’t yours. 

   When people find issues with their credit and try to act to make repairs, they can often make the situation worse by not understanding what variables go into their credit score.

   Here is a bonus tip for you – DON’T CANCEL OLD CREDIT CARDS OR LINES OF CREDIT!

  This one seem counter productive, but keep those older cards and lines of credit open after you have paid the balance down to zero.  15% of your credit score comes from the length of your credit history. Canceling your oldest credit card can impact this portion of your credit score.

   Also, if you have balances on other cards, cancelling an old credit card can also worsen your debt ratio, which makes up 30% of your score. If you don’t have other sources of credit that are older than seven years, you should not cancel your oldest credit card.  Also, 30% of your score comes from the ratio of your credit card debt and your credit limits.

   Thus, if all of your cards are maxed out, your credit score is suffering even if you’re keeping up with the payments. Focus on paying down the cards with extra payments.  To sum this one up, keep your older lines of credit open even if they are paid off.  This will help you both in your length of credit history and on your debit ratio.

Stay Tuned!

 

Your Credit Score Insider,

 

Mark