Credit repair...any suggestions? (1 Viewer)

Well just got back from the mortgage place we are pre-approved for a FHA loan 30 year fixed with a 5.50% interest rate! Again thank you guys so much for all the info.
 
2 things -

1. Pay down your balances but do not cancel the cards
2. Call your CC companies and ask for a better percentage rate

One other thing -

Congrats on the approval
 
http://www.daveramsey.com

I wish I would have known about him years ago. I am completely debt free except for my home which is for sale and under contract. I will be downsizing my home(building a smaller new steel building home) and will be completely debt free in another few weeks. Trust me, there is nothing that feels as good as being debt free.

His seven baby steps...

1. $1,000 to start an Emergency Fund
2. Pay off all debt using the Debt Snowball
3. 3 to 6 months of expenses in savings
4. Invest 15% of household income into Roth IRAs and pre-tax retirement
5. College funding for children
6. Pay off home early
7. Build wealth and give!

It is simple logic. Have an emergency fund so you do not have to charge that new refrigerator when it goes out unexpected. Pya off all those pesky debts smallest to largest. Have 6 months of expenses saved up(great for when you get layed off.) Now you are in a position to not get stuck with credit card debt when things go bad. One of the biggest mistakes I made and many people make is that they do not plan for bad times or bad things. We get a good job and we go get a new home and a new car and everything is fine until something bad happens. Transmission goes out. One spouse gets layed off and we get stuck using credit cards to get through. Next thing you know, you have five cards all maxed out and every penny you make is going just to cover the minimum payments.

Not trying to scare you, just do not want people to make the same mistake I made. Five years of my life were the longest most misearble time of my life when i was in debt.
 
So are all the 'credit repair' outfits just scams?

I'd like to sign my wife and myself up for such a thing, but want to make sure we get our money's worth.

Yes, I know I could dispute various items myself. I could also replace my own brake pads, but I'd rather find an honest, competent mechanic to do it.
 
So are all the 'credit repair' outfits just scams?

I'd like to sign my wife and myself up for such a thing, but want to make sure we get our money's worth.

Yes, I know I could dispute various items myself. I could also replace my own brake pads, but I'd rather find an honest, competent mechanic to do it.

Yes, yes they are. You can do anything and everything that they can do, except that you can do it much cheaper. You can actually do a better job by hand-writing the letters to the credit bureaus disputing the items (do not use the interwebz form). The credit repair places just send form letters to the credit bureaus and the bureaus many times refuse the letters right off the bat because they are cookie-cutter. Hand-written letters hold much more weight and will at least be investigated.

Send the letters certified mail with return receipt to the bureaus. The bureaus will then contact the creditor and ask them to provide proof of the disputed item. If they cannot or the company doesn't respond within 30 days (I think they may have 60 for the free credit reports now available from all three bureaus once a year), then the disputed item must be removed from your credit report.

Oh, one more thing...be careful of the credit repair places too, especially the ones that will negotiate with the credit companies directly on your behalf. Many of them have to (or do) report to the bureaus that you are under a payment consolidation plan which will negatively impact your credit score even more than before you went to them. Just do it yourself and save the heartburn and the points on the credit report.
 
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Yes, yes they are. You can do anything and everything that they can do, except that you can do it much cheaper. You can actually do a better job by hand-writing the letters to the credit bureaus disputing the items (do not use the interwebz form). The credit repair places just send form letters to the credit bureaus and the bureaus many times refuse the letters right off the bat because they are cookie-cutter. Hand-written letters hold much more weight and will at least be investigated.

Send the letters certified mail with return receipt to the bureaus. The bureaus will then contact the creditor and ask them to provide proof of the disputed item. If they cannot or the company doesn't respond within 30 days (I think they may have 60 for the free credit reports now available from all three bureaus once a year), then the disputed item must be removed from your credit report.

Oh, one more thing...be careful of the credit repair places too, especially the ones that will negotiate with the credit companies directly on your behalf. Many of them have to (or do) report to the bureaus that you are under a payment consolidation plan which will negatively impact your credit score even more than before you went to them. Just do it yourself and save the heartburn and the points on the credit report.

Thanks.

I know I can do it cheaper, but don't want the hassle.

Can I just hire a legit attorney to write some letters for me?
 
Yes, yes they are. You can do anything and everything that they can do, except that you can do it much cheaper. You can actually do a better job by hand-writing the letters to the credit bureaus disputing the items (do not use the interwebz form). The credit repair places just send form letters to the credit bureaus and the bureaus many times refuse the letters right off the bat because they are cookie-cutter. Hand-written letters hold much more weight and will at least be investigated.

Send the letters certified mail with return receipt to the bureaus. The bureaus will then contact the creditor and ask them to provide proof of the disputed item. If they cannot or the company doesn't respond within 30 days (I think they may have 60 for the free credit reports now available from all three bureaus once a year), then the disputed item must be removed from your credit report.

Oh, one more thing...be careful of the credit repair places too, especially the ones that will negotiate with the credit companies directly on your behalf. Many of them have to (or do) report to the bureaus that you are under a payment consolidation plan which will negatively impact your credit score even more than before you went to them. Just do it yourself and save the heartburn and the points on the credit report.

Ahhh yes, the credit consolidation loan. Spreading the pain over a longer period.
 
Thanks.

I know I can do it cheaper, but don't want the hassle.

Can I just hire a legit attorney to write some letters for me?

Sure, but believe it or not, the letters carry more weight if they are hand-written on plain white paper from you. No letter head and not typed. You don't need legalese to get the bureaus to investigate your dispute...they are required by law to do it, but they have an out if they feel the dispute is frivolous (which is why they can (and do) disregard the form letters from the credit repair agencies). If you want to hire someone to do it, have them hand-write the letters as you in the first person. You definitely don't need a lawyer.
 
Don't be a slave to the FICO god. Get out of debt as fast as you can. Do not hire someone for something that you can do yourself.
Make a written budget at the first of the month. Every dollar has a name.
Tear up your credit cards.
 
So are all the 'credit repair' outfits just scams?

I'd like to sign my wife and myself up for such a thing, but want to make sure we get our money's worth.

Yes, I know I could dispute various items myself. I could also replace my own brake pads, but I'd rather find an honest, competent mechanic to do it.

Not all of them are scams, but many of them are.

Here's the thing though - they don't do anything you can't do yourself. Yes, it takes commitment to educate yourself on how to do it, but once you learn the rules of the road and how to go about it, it's relatively easy and you'll have that skill for a lifetime.

But if you do get a service, definitely do your homework on what you're getting and whether they're reputable.

Tear up your credit cards.

Responsible credit card use can benefit your cash flow, provide valuable rewards and is key to keeping perfect credit - and you never know when you may need credit (buy a house, car, start a business, etc). If you tear up your credit cards you will lose your credit rating.

BUT! If responsible credit card use is beyond your ability, tear them up.
 
Send the letters certified mail with return receipt to the bureaus. The bureaus will then contact the creditor and ask them to provide proof of the disputed item. If they cannot or the company doesn't respond within 30 days (I think they may have 60 for the free credit reports now available from all three bureaus once a year), then the disputed item must be removed from your credit report.

A note about this. They aren't going to ask for any proof of the disputed item. They are simply going to say, "Jon Doe says he doesn't owe you $2,000. Does he?" If they say "Yes, he does." It will stay on your report.

Oh, one more thing...be careful of the credit repair places too, especially the ones that will negotiate with the credit companies directly on your behalf. Many of them have to (or do) report to the bureaus that you are under a payment consolidation plan which will negatively impact your credit score even more than before you went to them. Just do it yourself and save the heartburn and the points on the credit report.

Also, on this. It's not the credit repair company that reports that you are in a program. It's the creditor who may choose to do this. They are required to remove that from your report if you leave the program.
 
Thanks to all of the contributers. This is great information. I do have a question though. What is the best way to get old marks, such as over 30 days late, off of your credit report? My wife and I have some things from when we were students back in 1999-2001. These are all at least 8 years old.

Thanks in advance.
 
Thanks to all of the contributers. This is great information. I do have a question though. What is the best way to get old marks, such as over 30 days late, off of your credit report? My wife and I have some things from when we were students back in 1999-2001. These are all at least 8 years old.

Thanks in advance.

That's a pretty easy thing to do. Make sure you have the right address for their credit department, then you write a letter, certified mail/return receipt, and you advise them that negative information remains on your credit report even though it is older than 7 years - which is contrary to fair credit laws. Specifically request that they remove it. Tell them that if they believe that is should remain on your report, you would like an explanation in writing.

They will probably delete it. If they don't, you may have to get more aggressive, but information that is older than 7 years shouldn't be on the report.

Learn more at www.creditboards.com , go to the newbies section.
 
That's a pretty easy thing to do. Make sure you have the right address for their credit department, then you write a letter, certified mail/return receipt, and you advise them that negative information remains on your credit report even though it is older than 7 years - which is contrary to fair credit laws. Specifically request that they remove it. Tell them that if they believe that is should remain on your report, you would like an explanation in writing.

Easier....

Contact the credit bureaus that are reporting it. They are required to remove negative information (in most cases) after 7 years has elapsed.
 
Can't believe nobody has posted this

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