Five Myths of Credit Repair
2008 August 18
Most people we come across either have negative view of credit repair, or they listen to the large media outlets that basically tell you that you can’t do anything about your credit report or credit score. This is totally wrong. In fact, a recent study shows that 79% of all credit reports have factual errors. In reality, you can repair your credit. Below are the 5 biggest myths we have come across about credit repair in general:
- There is nothing you can do to improve you credit score; you just need to wait for it to get better. There is nothing further from the truth. By understanding how credit scores really work and by making sure your credit report accurately shows your past history, you can improve your credit score. Anybody who tells you something different probably has an incentive to keep your credit scores low.
- Negative items have to legally stay on your credit report for at least 7 years. Collection agencies and other companies have been saying this for years, but nothing could be further from the truth. These companies can remove any information they want, whenever they want. There is nothing legally stopping these companies from removing inaccurate information at any point of time. They do have to remove it after 7 years, but it could possibly be sooner with your intervention.
- Credit repair is ethically wrong because you are trying to fix your past mistakes – you should have to answer for those mistakes with your bad credit. Again, most people assume credit repair is used by irresponsible folks who have taken on too much debt and then just stopped paying their bills. In reality, most cases we come across involve people who have had bad circumstances happen to them (divorce, medical issues, job loss, etc.) and are not simply irresponsible people who are trying to get around the system. Additionally, oftentimes the issues are not black and white, and there is fault on both sides of the issue. For example, were you really late on payment if you never got a timely bill from the company that says you were late? Technically yes, but in reality we say it’s not exclusively your fault because you never had a chance to get it right.
- Filing a statement on your credit report will help you explain your side of the story. Although it might feel good to get your side of the story on your credit report, this is probably not a good thing to do. First, most companies just look at your credit score without looking at the details of your credit report, so they won’t ever see this statement. Another issue is that by giving a statement you might be legally admitting to things that you may not want to. Since there is very little positive benefit to adding a statement, we don’t recommend you do it.
- My good credit history will offset my previous bad credit history so in the end everything will be fine. This is again a myth because negative credit history has a huge impact on your credit score, while positive history has a much smaller effect. By removing inaccurate negative history, you can rapidly raise you credit score. If you simply wait, it will take much longer. We tell our customers that negative items are at least 10x more powerful than positive items.
By understanding how credit scores work and taking a proactive approach you can keep your credit scores high. This does not have to take a lot of time or intricate knowledge — just a small amount of time on your part can save you hundreds of thousands of dollars over your lifetime!
The article stated that the companies and collection agency do have to remove negative items after 7 years, but it could possibly be sooner with your intervention. What will I have to do to get negative items off if they have been there for seven years?
Tina,
Simply write a letter stated you would like this item to be removed to each credit agency. You can also try calling them. However, after 7 years the negative effect of this item might be very small, so it might not be worth you time and effort. Also, depending on how much credit history you have, it might actually hurt your score because it will lower the amount of history your account has. Again, I am not sure of your exact situation, but I would recommend trying to fix recent negative items first.
MY HUSBAND AND I HAVE TO RAISE OUR CREDIT SCORE ALMOST 200 POINTS TO GET US OUR LOAN AMOUNT WE WANT, WE NEED TO KNOW IF WE PAY OUR CREDIT CARDS OFF AND SOME PAST BILLS, WILL THAT BE ENOUGH TO RAISE OUR SCORE THAT MUCH? AND ALSO HOW LONG DO YOU THINK IT WOULD TAKE TO RAISE IT THAT MUCH. IT IS A RATHER HIGH NUMBER TO ACHIEVE.
I found something called a cpn number that will
give you a new credit profile within 30 days.
the website is
http://www.creditmenow.info
Tina- You need to dispute the negatives with the credit bureau first and if it doesn’t get deleted then with the creditors.
Basically your may dispute anything related to the reporting but disputing your liability on the debt may be the best way to go on a first dispute. The burden of proof is on the furnisher, if they cannot verify and prove with hard evidence every bit of info reported the account must be deleted. See FCRA
http:http://bcrconsulting.us/html/LAW/fair-credit-reporting-act.html#623a8
Carllue- That cpn number or whatever they call it now constitute fraud under US laws. If you use that scheme to get new credit and then find yourself unable to keep up with the payments the creditor will file criminal charges against you. Don’t do it.
The website you are promoting is against the law and it’s been reported to the FTC
Linda- Pay down your open credit cards but do not pay collections accounts or defaulted loans just yet.
Make them validate all reporting first, you’ll be surprise of how often hey cannot validate anything.
Actually a paid collection or charge off is not much better for your credit score than a unpaid one. If you decide to pay those make first a “pay per deletion” agreement with the creditors and collector, only if they agree in writing to delete the derogatory listing after payment is received will be worth the money.