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How To Deal With Financial Stress

Financial StressDo you want to de-tress your financial life? Try drawing yourself a bubble bath or just kick up your heels and relax. Whatever you do, if you really want to cut the amount of stress in your life, you might need to do a bit more work to get the truly long-lasting effects.

Money is one of life’s biggest stressers. From college kids to senior citizens, finances are a common cause of anxiety, whether it’s concerns about savings, bad credit reports or just not enough in the checking account.

Here are a few things you can do to cut down on your financial stress, now and for the long term.

Get the lay of your financial land. If you don’t know where your money is, you won’t be able to deal with it properly. To do this, get your bank statements in order and get copies of your credit report, as well as any investment information and retirement plan paperwork. Assess what you really have, after taking into account the debt you owe and how long you’ll be paying it off.

Get automated. If sitting down to sort through and pay your bills is a stressful activity for you, cut it out of your schedule. Of course, those bills will still need to get paid, but you can do it without even thinking about it by signing up for automated bill payment. The money is simply deducted from your account, so you’ll always be on time, and no late payments will mar your credit report.

Look for new ways to save. Having more money in the bank is always a comfort. Even if you already have a savings account started, look for new ways to add to it. Try estimating the amount you spend on a guilty pleasure every month, and deposit that into savings – but follow through and cut out the habit, too. Or, gather up all the change in your house and have it deposited into your account. There are plenty of little ways to put a little more padding on your savings – just keep in mind that little additions can really add up in the end.

Renew your budget. If you have a budget plan and you’re still finding yourself stressed about money, it’s time to revamp it. Identify your fixed costs, and then get creative with your discretionary money. Perhaps you need to re-route it toward something better for you – yoga classes instead of Friday and Saturday nights at the bar. Or, use more of your discretionary money to pay down debt faster – you’ll be eliminating the stress of debt and cleaning up your credit report at the same time.

The ultimate stress reducer when it comes to money is knowing that your money is being well-spent. Wise use of credit and good financial management can help you secure better loan terms and interest rates, and provide a sense of security for you and your family. Make sure that you’re making smart decisions that will pay off in the long term, and you’ll be less stressed about your finances.

Credit Management Advice Every Parent Should Give

Family When parents send their kids to college, they’re hoping Johnny or Susie graduate with a degree and a shot at the good life that comes with that piece of paper. But a growing number of college seniors are also graduating with something else that could affect their future – credit card debt.

College seniors graduate with an average credit card debt of more than $4,100, according to a 2009 study by Sallie Mae. And the ave
rage balance for all college kids (and 84 percent of them have at least one credit card) is $3,173, the study showed. From tuition and books to food and gas, college students are using credit cards to pay for everything.

Parents may wonder how all that debt will look on a credit report, when the individual being reported on doesn’t even have a steady source of income yet. How will starting their professional and personal lives already in debt affect their long-term financial health?

It’s never too late – or too early – for parents to start giving kids guidance on how to manage credit. Before your college-aged child gets her first credit card, make sure she understands how credit actually works and how her credit report affects her ability to get loans – and possibly even a job – in the future.

You can try several different tactics to help guide your child toward a better understanding of credit, including:

  1. Introduce her to her credit report. As an adult, she may choose to review her credit report on a regular basis. As a young person who’s just starting to use credit, she should also look at her report. Not only will it help her understand the basics of her credit score and what factors determine it, checking her credit can help catch any fraud. Identity thieves have been known to target people with very little credit history, such as children.
  2. Help her open a checking account. With a joint account, you can monitor how she uses her debit card. It’s also an opportunity to teach an important basic financial skill – how to balance a checkbook.
  3. Lead by example. If you’ve been able to avoid high credit card debt, help your child understand the steps you took to do so. Clue her in to how smart credit use has helped your credit report, and how in turn, your good credit has helped you make purchases that have enriched your life – like the home you share. If you’ve made mistakes, let her see the consequences you face; she may be able to learn from your mistakes without having to repeat them.
  4. Permit her to have a credit card, one that you’ve co-signed for, early on. As the responsible adult on the account, it’s up to you to show her how to responsibly use credit. Make sure she gets the bill – and pays it off – every month.
  5. Make sure she understands the importance of reading the fine print on credit card offers. Penalties and fees can run up the balance on a teen’s credit card almost as quickly as imprudent spending.Finally, don’t despair if your college student already has a credit card (or more than one) with a balance on it. Help her view this as an opportunity to improve her credit score. Sit down together and create a plan for paying off the debt. Think how good it will look on her credit report if she demonstrates her ability to manage debt before she even graduates from college.

How Long do Hard Inquiries Stay on Your Credit Report?

Whether you’re actively working to repair your credit, just establishing a credit history, or working toward a major purchase like a home or vehicle, you’re rightfully concerned about improving your credit score. You may have even done research on the subject, learning that a number of different factors go into your cumulative credit score and some have a greater impact than others.
The question that heads this article is a perfect example: Some consumers may ask, “how long do hard inquiries stay on your credit report?” while others aren’t even aware of what a “hard inquiry” is, much less how or why it would have any impact on their credit reports.
The whole subject can be complex and confusing, and there are a lot of sources of information out there that disagree with each other. As you know, here at, we’re all about the unbiased, unvarnished truth. In that vein, we’re going to provide the answer to the question that brought you here, in case that’s all you truly need. But, then we’ll look into some of the important factors that affect your credit score so you have a thorough understanding of “hard inquiries” and what their impact is.

How long do hard inquiries stay on your credit report?

Hard inquiries will appear on your credit report for up to two years from the date of the inquiry, however they will only have a negative impact on your credit score for one year. The number of hard inquiries on your credit report accounts for approximately 10 percent of your total credit score.
Contrast this with more serious impacts, such as a bankruptcy: these issues account for about 35 percent of your score, and they remain on your credit history for a minimum of seven years.
If the two previous paragraphs made perfect sense to you, feel free to stop reading now and check out other recent articles for more informative content. If not, read on for some more depth on what hard inquiries are and why they matter.

What are “hard” and “soft” inquiries?

In financial terms, an “inquiry” occurs any time a company, store, or individual looks into your credit report. But, the credit bureaus separate these inquiries out into “hard” and “soft” types to offer a more realistic and fair view of what you’re actually trying to do while working with these companies or people.
A “soft inquiry” occurs when your credit report is accessed, but not for the purpose of obtaining new or more credit. For example:
       You check your own credit report (or authorize a third party to do so) to check its accuracy
       A lender “pre-approves” you for a credit card or loan you didn’t ask for
       An employer carries out a pre-employment background check
       A utility checks your credit report as part of the installation/new account process
In all these cases, you and others have legitimate (usually limited) access to your credit report for confirming your identity and other purposes. But, no soft inquiry is going to result in you being approved or denied for credit on its own. Therefore, soft inquiries don’t impact your credit score at all.
A “hard inquiry,” on the other hand, will impact your credit score. That’s because a hard inquiry only occurs when a lender accesses your credit report for the purpose of approving or denying a request for credit that you’ve initiated. This would include:
       Any credit card (including retail store credit cards) you apply for
       Any personal or business loans you apply for (unless your business is a corporation)
       A mortgage
       A vehicle loan
       Student loans
In all these cases, approval means you’re being handed more potential debt to use, so these hard inquiries will appear on your credit report and impact your score. That way lenders get an accurate picture of the amount of credit you already possess and they can make an informed decision on offering more.

Does that mean hard inquiries are always bad?

No, a hard inquiry is not inherently bad.
Each hard inquiry will likely result in a drop of just a few points in your credit score, but (as noted above) that effect only lasts a short time. Its purpose is to differentiate those inquiries that can result in additional credit from those that cannot. As such, they serve an important role, and can be strategically managed to make sure your credit report remains clear and accurate.
However, there are definitely circumstances in which hard inquiries can become a negative thing, pulling down your credit score dramatically and even getting in the way of important purchases.

When are hard inquiries bad?

If you pile up multiple hard inquiries in a short amount of time, the combination of small subtractions can really hurt your credit score. Losing a few points from your credit score each time isn’t the worst of it, though. Numerous hard inquiries in a short time can cause the credit bureaus to take notice, doing more damage.
For example, assume you’re just innocently shopping around for a good offer on a credit card, but while you’re gathering information you go ahead and apply for five different cards in a three-week period. You may not even have any intention of accepting or keeping all those card accounts open. But, since you’re initiating them, every credit card application you submit will result in a hard inquiry. Too many applications for new credit can send up a red flag for the bureaus: it seems to indicate you’re facing financial problems, or you’re spending recklessly.
If that’s the impression the credit bureaus get, your score can go down even more. While the bureaus tend to overlook large purchase inquiries that come in clumps (like 3-5 mortgage inquiries, for instance) — because they recognize you’re shopping around for the best interest rates — smaller credit applications can’t be overlooked that way.
The better option for smart consumers is to strategically space out any applications for new credit to give time for the hard inquiries to fade from your credit report.

The Importance of Having Good Credit

Having a good credit score can affect many aspects of your life. Listed below are just some of those:

  • Qualifying for a Mortgage or Refinance
  • The Monthly Payment on your Mortgage
  • The Interest Rate that you Pay on Credit Cards
  • The Interest Rate that you Pay on Auto Loans
  • The Interest Rate that you Pay on Personal Loans
  • The Rate that you are charged for Insurance
  • Whether or Not you are approved to Rent
  • Being approved for Phone, Electricity or Cable
  • Whether or Not you get that Job that you want
  • To qualify for or maintain a Security Clearance
  • Guarantor of a Business that you want to start

If you have children that want to go to College and you want to help them by co-signing for student loans, renting an apartment for them while away at school, or help them with their living expenses, your credit as a guarantor or co-signer will be important in helping them.

Never before has your credit been as important as it is today.

Your Credit Score Affects Your Insurance Rates

Your insurance rates can be effected by your credit score. Many insurance companies, such as your auto insurance company, may use credit scores to determine the risk involved in insuring you. You may have never had an accident, filed a claim or even had any traffic tickets but your insurance rate can be higher if you have poor credit and a lower credit score. Insurance companies may also review your credit information when renewing your policy and raise your rates if your credit score is lower than the score that they obtained in your previous renewal or when you first initiated the policy. The reasoning is that consumers with poorer credit and lower scores statistically make more claims (as a risk group) and will result in the insurance companies paying out more in claims.

No Courses Offered in Credit Education

Growing up and going to school we all saw courses offered in math, history, social studies, economics, etc. I do not recall seeing courses offered in how to understand and manage your credit. In today’s society, almost everything that you want to do, rent an apartment, buy a home, finance a car, get a good job requires someone reviewing your credit. Your credit and your credit score have never been more important or a more intricate part of your life than it is today.

Credit Education is the Key

This blog teaches you more than just Credit Repair - It is a course in “Credit Education” that you can use throughout your life to live a better life.

Knowledge is Power

There is an old saying: “Knowledge is Power.” This is especially true when it comes to managing your credit. To have total control over your credit you must know exactly how the credit bureaus and creditors work and “think". The credit bureaus are, in reality, repositories of information provided to them by several different sources. Credit Bureaus collect information provided to them by the creditors that report to them on your accounts, by gathering information from public record sources such as the courts, from other local, state, and federal databases, and by information that you provide to them either directly or obtained from applications that you make to creditors. Many times, this information may be recorded or reported incorrectly, and this is why as consumers we are allowed to challenge or dispute these items as is allowed by provisions of the FCRA (Fair Credit Reporting Act.)

Cyber Threats and Privacy

Identity theft and hacking are growing at super exponential rates. It won’t stop and will only get worse. The fact is that most Americans are already compromised and they don’t even know it. It is estimated that over 80% of all residential households in America do not even have their WiFi router secured properly.

Wireless Card Scanners
Cyber Threats and Privacy

These are hackers that will scan your credit card in your pocket at coffee shops or other unassuming public places. They have special devices or programs that can “see” the RF chips embedded in your credit card on their laptops. This happened to me once but since I was set up on banking text alerts I was able to stop it and get my money back. I now use radio frequency shield card slots and wallets to prevent this from happening again, which you can buy on Amazon.

Online Banking

Make sure your network is secure and the browser is set to HTTPS when logging into your banking account. One small compromise and someone can steal your info, and ruin your credit. In fact any website you submit personal info you should start with HTTPS (Secure) URL.

In addition, over 80% of all U.S. homes do not secure their WiFI router. Most people never change their factory default router login and password. Any hacker that scans your neighborhood (and yes they still do this) can generally determine what kind of router model you have from the SSID default broadcast, and then check to see if they can login using the default pass and username. If a hacker is able to break into your home network, you can have some serious compromises. This often leads to cases of identity theft and fraud. Most often you will not know about it until well after the comprise has occurred and someone has used your information to steal money or your identity.

The cyber threats are VERY real and much worse than you think; they are only getting more complex everyday as hackers develop new technologies and methods to scan for weaknesses and infiltrate unassuming homes, people and businesses.

Shred your mail, bills or paperwork that may have sensitive personal info on them. You would be surprised to know that people still rummage through garbage to find data to sell or use for gain.

Use Secured Email

Almost everyone sends sensitive info via email and text not even thinking that someone can scan that data in “cyberspace” if they are looking for it. Since most people are now using Gmail, Yahoo Hotmail, etc. There aren’t very many secure options for email if you are not using Thunderbird or Outlook. However, there is one company in Switzerland that has a service called

It a browser email account with mobile phone apps that send and received encrypted mail and is very easy to use. They have a free account version and a paid account version, which is approximately $6 per month. If you send personal data via email such as tax returns, social security
numbers, credit card numbers.

Commercial Mailbox

Use a commercial mail box, such as the UPS store mail box, for receiving your postal mail instead of receiving it at home. UPS Stores are very flexible and can even forward your mail wherever you are. Many thieves still steal mail in an attempt to find social security numbers, checks, or anything they can use to extract money or credit from a victim.

Fraud and Identity Theft Prevention

Once you have established a quality credit score, you need to do your best to protect it by taking extra steps to prevent identity theft and other types of fraud. The following tips will help you do so:

Respond to to voicemail intelligently: If you receive a voicemail from someone claiming to be from your credit card company or bank, only respond by calling back the number that is printed on your card. This is the only number you can guarantee won’t lead to a fraud scenario. The same goes for emails, even if they appear to be legitimate, you should only ever contact your bank or credit card company through obviously official channels that you instigate to ensure they are legitimate.

Take extra care with signatures: Not many people are aware, but you can actually sign your credit and debit cards with the phrase “see identification”. While this will force you to show your ID much more frequently, it will also prevent anyone who is attempting to use it illegally from being able to do so. Unless they have a fake ID with your name and accurate signature they will be out of luck.

Be frugal with your credit card number: Ninety percent of the time any website that asks for your credit or debit card number “for identification purposes” has only dubious intentions in mind. Unless you are planning on buying something from the site you are going to want to avoid providing this information. The fever places that your personal details are available online the less risk you run of falling victim to fraud.

Be diligent about your privacy: Even if you have already set them to the max settings, it is important to check both your browser and social media settings on a regular basis to ensure they are as you left them. You never know when an update could have come along and reset them or changed something else that affected them in some way. It only takes one slip to allow someone with intent through, which is why it pays to stay vigilant. Likewise, every time you visit a secure website, take an extra moment to clear your browser’s cache and history to prevent anyone from tracking down personal information that way.

Unsubscribe sparingly: If you receive an email newsletter and you aren’t sure where it came from, never click the unsubscribe button. This will let the spammer know that they have a live email address and they will redouble their efforts, at best, or initiate additional tactics to procure your private data now that they have your email address, at worst. Even if the spammer has no ulterior
motives than to get you to read their newsletter you are always better off just hitting the spam button and forgetting about it.

Be aware of online store security: When you are shopping online be sure to make a point of never entering sensitive information if the website isn’t secure. You can determine if a site is using a secure connection if the web address starts with https or if it features a padlock icon in the top right corner. Either of these are an indicator that the website is encrypted which will make it much more difficult for fraud to occur based on the transaction. Entering your details via a standard http connection is
little more than asking for trouble.

Have varying passwords: In addition to the obvious, such as not using birthdays or loved ones’ names as passwords, it is important to have varying levels of password security for the most secure results. You are going to want to have at least one password for low-security sites that you aren’t terribly worried about being hacked, a more secure password for online stores and the like and a separate password entirely when it comes to banks or credit card websites that are more complicated
still. You should never store your passwords anywhere on your computer or anywhere in real life where other people, with potentially malicious intent, are likely to have access to and, if you must write them down, don’t keep them near your computer.

Understanding Your Credit Utilization Ratio

Credit Utilization RatioHave you ever heard the phrase, too much of a good thing , when something went wrong? Well, this adage definitely applies to your use of credit cards. Specifically, spending too much on your credit cards can be too much of a good thing when it comes to your credit score. Whether you have one credit card or five, whether your credit limit is $500 or $5,000; lenders expect you to spend responsibly. Part of that means not using too much of your available credit.

In fact, this notion of limited spending is one of the primary factors contributing to your credit score. Commonly referred to as a credit utilization ratio, its the amount of outstanding debt you carry on your credit cards, when compared to your overall credit limit. A utilization rate of more than 30 percent may you to lose several points. On the other hand, using less than 30 percent will earn you points.

Calculating Your Credit Utilization Ratio

Its a good idea for you to calculate your rate, so you know where you stand and can make any needed adjustments. To do so, divide the total amount of your credit card balances by your total credit limits.

For example:

  1. Lets assume you have two credit cards, each with a credit limit of $10,000. Your total credit limit would be $20,000.
  2. Now, lets say you are carrying a balance of $4,000 on one card and $6,000 on the other. Your total balances add up to $10,000.
  3. To calculate your rate you divide your total credit balance of $10,000 by your total credit limit of $20,000, to get a credit utilization rate of 50 percent.

How High Should My Credit Utilization Be?

A credit utilization rate less than 30 percent is most beneficial to your credit score. If that's easy for you, try to get it less than 20 percent! For those who are already using more than whats recommended, it wont necessarily be easy, but focus on paying down your debt. While its challenging to pay off debt, it will definitely be worth it! A low utilization rate is so significant to your score, you will be glad you got rid of some of that debt.

Manage your credit utilization rate by following a few suggestions below:

  • Know what you spend on your credit cards each month. If you are already exceeding the recommendation utilization rate: stop spending and start paying it off!
  • Know what your total credit limit is, so you can spend accordingly.
  • Never max out your credit cards, even if you pay your bills off completely, it could still be reported to the credit bureaus.
  • Utilize cash and debit cards to round out your spending.

For as significant a factor to your credit score as this is, it is a fairly easy one to control. Check your limits and then be sure to keep your spending in check. If you've got any balances, work to reduce them to a recommended level.

3 Common Debt Collection Myths

If you worry about how you are going to pay down large sums of debt, you are not alone. Millions of Americans are unsure how their debt impacts their overall finances, their credit report, and their future. Don't let it get to you. The key to overcoming debt is to drill down and put a debt management plan in place.

A big part of putting your worries to rest is taking action. Order a copy of your credit report, so you can analyze your complete debt load. Take a look at your current debts: credit cards, mortgages, student loans, auto loans and any others. While all debts must be repaid, debts secured by an asset, such as your home or car, are considered more favorably than credit card debt, for instance. Keep this in mind when focusing on your repayment plan.

Once you know exactly how much you owe, create a monthly budget that factors in your debt repayments. Start thinking about how you will prioritize your debt repayment. Perhaps you want to first pay off credit cards with the highest interest rate.

Next, find areas you can afford to cut down on, such as unnecessary cable or cell phone packages, and work to optimize the amount you put toward paying down your balances. Making more than the minimum payment on credit card bills is essential. You will have to decide if you want to spread the wealth or focus strictly on getting rid of one debt as quickly as possible. As your debt balances decline, lenders will view your credit report more favorably and your credit score will likely improve.

At some point along the way it may feel like you're going at a slow pace. Keep in mind that paying down debt takes a long time, but your efforts are important. If you are seeking to track your progress, try credit monitoring. You will  receive updates to your email or mobile device upon changes to your credit score.

Dealing with debt collection agencies can be an unsettling experience, largely because it is unfamiliar territory. People may feel ashamed or humiliated for their mistakes and misunderstand the way debt collection works.

Debunking some common debt collection myths may help you make informed decisions while you get your credit score back on track.

Myth #1: When I pay off a debt in collections it is removed from my credit report

Debts that are sent to collections remain on your report for a period of seven years, regardless of whether they are paid or unpaid. The history on your account payment is also recorded, including any delinquencies over the years.

When you pay the total balance owed, the status of the collection account will be updated to paid status, however, both the original and collection accounts will remain on your credit report until seven years since the date of the original delinquency.

Myth #2: Only large balances are sent to debt collectors

There is no minimum amount for a debt to be passed on to collections.  Even an unpaid parking ticket for twenty dollars can be escalated, so no matter how small the bill, it’s best to pay it.

Myth #3: The collection amount will be the same as the original balance

When lenders sell your debt to a collection agency the balance listed on your credit report may increase, because the debt continues to accrue interest and other fees. As a result, the total amount listed on a collections account may be greater than that on the original account.

Unpaid debts that are sent to collection agencies can lower your credit score, making it more difficult or costly to obtain financing. If you are trying to repay a debt that’s been sent to a collection agency, the important thing is to improve your behavior over time.

Lenders will not only look to see that you have repaid your debt and made good on the account, but that you have sustained a good payment record – indicating that you have overcome any past financial hardships and are equipped to manage your debts responsibly.

What is the Credit Card Accountability Responsibility and Disclosure Act of 2009?

The Credit Card Accountability Responsibility and Disclosure Act of 2009 (otherwise known as the CARD act) was enacted by Congress to protect consumers from unfair lending practices, but some say the measure is falling short on the promises it made, according to Smart Money.

The most recent complaint voiced by consumer advocates relates to a rule that dictates how issuers must allocate payments to credit cards. The initial payment allocation proposal would have mandated that lenders apply all payments to the balance with the highest interest first. However, this proposal was altered to a weaker rule that requires issuers to apply any payment over the minimum monthly bill to the highest rate first.

For example, one credit card may charge a higher interest rate for different types of transactions, meaning that the rate for a standard purchase may be lower than the rate for a cash advance. If a borrower’s required minimum payment is $50 and they send in $75, the issuer must only apply $25 to the transaction with the highest rate. The issuer will have discretion over where to apply the required $50 payment, forcing the borrower to carry a balance for a longer period of time.

Despite the current allocation method, the CARD Act has been successful in two of its promised provisions, according to the National Foundation of Credit Counseling. One disclosure rule forces issuers to provide a breakdown to consumers on how long it will take to pay off their balance if they only make the minimum payment. An NFCC survey shows that the rule, in addition to another law that forces lenders to provide a toll-free number to a credit counseling service on a consumer’s statement, has been beneficial to individuals.

“This disclosure aspect of the CARD Act appears to have had the intended result, in that 25 percent of more than 2,000 respondents said it inspired them to pay more each month, while 12 percent indicated that it prompted them to reach out for help to the credit counseling agency listed on their credit card statement,” NFCC spokesperson Gail Cunningham said.

Consumers who carry credit card debt should obtain a copy of their credit report to examine their debt-to-credit ratio and how it may be impacting their credit score. Though it may be difficult financially, consumers should try to make more than the minimum payment each month to pay off their balance and slowly improve their financial standing.

By changing the information available on their monthly bills, the new credit card law may also inspire customers to seek credit counseling before their debt gets out of control, according to a release by Accelerated Debt Consolidation, Inc.

The Credit Card Accountability, Responsibility and Disclosure Act of 2009 currently requires that lenders include a toll-free phone number for credit counseling and debt management services on monthly bills. They must also include a timetable showing how long it would take a consumer to pay off their debt if they only made minimum payments.

“This creates several advantages for the consumer,” Young said. “If credit consumers begin contacting credit counseling and debt management agencies when they are only up to 30 percent of their credit limits for example, their options for reducing their debt will be greatly improved.”

Cardholders with high rates on their balances would be able to transfer the debt to accounts with smaller balances in the debt management program. Or they can transfer money to accounts with better rates, allowing them to reduce debt faster. Carrying low credit card balances and paying on time can positively contribute to a consumer’s credit history.

Other provisions within the Credit CARD Act prohibit lenders from raising interest rates, fees or terms unless they give customers 45 days’ advance notice.

Top 7 Reasons Your Credit Score Could Drop

From carrying large balances to having your credit limit cut, discover 7 reasons your credit score could drop.
Credit Score Drop

Reason #1: Large Balances

The closer you are to reaching your credit limit and maxing out your credit cards, the higher your credit utilization ratio will be. Ideally, you would pay the balance on credit cards in full every month, but that’s not always doable. Your goal should be to keep your balance at around a third of your credit limit to avoid risking a dip in your credit score.

Reason #2: New Credit Applications

Inquiries may not make a big splash with your credit score, but multiple inquiries, like applying for credit cards or even signing a cell phone contract can impact your score. If the credit line application was declined for any reason, checking your credit score wont hurt you and may be a good idea if you plan to apply for additional lines of credit.

Reason #3: A Public Record was added to Your Credit Report

From judgments to bankruptcies, public records can curtail your credit score. Depending on the notation, these negative entries can stay on your credit report from 7 to 10 years, causing your credit score to drop. Past due on child support or haven't paid your taxes? Even these types of financial responsibilities might become public records if they aren’t addressed timely and appropriately.

Reason #4: Inaccurate Information on Your Credit Report

Because lenders report information to the national credit bureaus, its good to check the data is correct across reports from all the bureaus. Lending companies do not have to report their information to each bureau. Sometimes this causes credit reports to differ from bureau to bureau.

Be sure lenders have accurately reported timely payments, closed accounts and other information. If you find inaccurate information on your credit report, there are steps you can take to have the data corrected.

Reason #5: Late Payment

Missed payments are a no-no, especially when it comes to your credit report. Past due marks in your credit history can lower your credit score, especially as the length of time theyre late increases.

Reason #6: Past due account sent to collections

When your bills go unpaid, your lender may send your past due account to a collections agency to help collect whats owed to them. This means double-trouble for your credit score, as the missed payments and collections notation both make it extremely likely that your credit score will drop.

Reason #7: Closed Credit Card Account

Your oldest accounts are more valuable than you may think! If you’ve paid off a balance on a credit card, wait before closing your account. Once you close an account with a long solid history, you are ditching the positive aspect of length of time you’ve held credit, thus potentially lowering your score when it cycles off of your credit report.

Once you’ve checked your credit report and pinpoint the cause of your lowered credit score, don't be afraid to contact your lenders to work out an agreement that may help get your credit score in better shape.

But, despite these things that can make your credit score drop, the good news is that consistent, positive money management habits can often eclipse the credit score-sinking factors over time, so don't give up!

How To Stop Debt Collector Calls

Stop Debt Collectors CallsWhile it is always going to be a better choice to deal with creditors directly rather than waiting for a debt to reach collections, if it does reach this point it is important to keep in mind that you still have options thanks to what is known as the Fair Debt Collection Practices act.

Ask for details in writing: Within 5 days of making contact, a debt collector is obligated to send you a written notice outlining the amount of money you owe, who you owe it to and how to dispute the claim. Most debt collectors won’t do this automatically, however which means the first contact you have with them should include asking for this information and nothing else. The goal of the debt collector is to force you to confirm that you will pay the debt or make a payment, and not having all of the details in front of you can make it easy to say the wrong thing and wave many of your rights without even realizing it. What’s more, asking for a copy of the details will prevent them from contacting you again until you have received them, giving you some time to get your defenses together if you have been caught off guard.

Dispute the claim: Once you have received the details of the claim in writing, the next thing you are going to want to do is to dispute the claim using the methods discussed in previous chapters, regardless of whether or not you believe you owe the money in question. This will put the onus on the collection agency to verify the debt, which is far from a sure thing even on debts that you do
owe. You have 30 days to send this letter from the date you received the details which means that using certified mail is key. Be sure to ask for a delivery receipt as nine times out of ten the collections agency will deny they received your request. Once you send this letter and notify the collection agency of this fact, they cannot contact you again until the debt has been verified. They also have to stop all reporting activity, make sure you demand this in the letter.

Keep track of everything: As discussed previously, debt collectors are limited in how they can approach you but, in most cases, will try and skirt these restrictions as much as possible in an effort to get you to agree to pay the debt or set up a payment plan. As such, it is in your best interest to take detailed notes every time you speak with them and keep anything they send you so you can look it
over for violations at a later date.

Illegal activities not previously covered include speaking to anyone but you or your representation about the debt, using abusive language, misrepresenting the amount of the debt of making false claims about legal action, seizing property or garnishing wages if they don’t intend to actually follow through. If they do any of these things, then the issue of the amount of debt you owe will essentially become moot as you will be able to take legal action against them and even the threat of doing so will often be enough for them to forgive some or all of your debt entirely. Be sure not to mention that you are keeping track of your conversations as this will cause them to be on their best behavior and decrease your potential for leverage.

Speak as little as possible: Everything that a debt collector says is for the purpose of collecting on the debt which means that the less you say, the less they have to use against you. Remember, regardless of what they may say up front, they are never really your friend, nor do they have your best interests at heart. They work on commission which means the more they get from you the more they will make. Never commit to anything, never agree that you owe the amount in question, always mention that you are considering bankruptcy and discuss payment options only if you intend to follow through. If they determine that you are unlikely to pay, and the amount owed is less than $2,500, they may give up and consider you more trouble than you are worth. While the debt will remain on your credit report for the next seven years, it might be worth it, depending on your current financial situation.

Be aware of time limits: Once you receive the details from the collection agency, you will need to look into the time-frame which they have to collect on the debt based on where you live (between three and six years in most cases). Once this period of time has passed they can no longer take legal action against you. It is important to be aware of these limits as if you make a payment after this period of time, some states will allow the clock to be reset, the same can be said for acknowledging you owe the debt or for signing up for a repayment plan.

How To Negotiate and Settle Large Debts

Debt SettlementWhile creditors would like you to think otherwise, the fact of the matter is that any debt that you have is negotiable. What’s more, regardless of the amount, 90 percent of creditors are going to be willing to take a lump sum now over a promise to pay at a later date. When it comes to negotiating large amounts, the following tips may make it easier to come out ahead.

Have a story mid stick with it: The person you are dealing with isn’t going to be interested in your life story, but they will need to know who you are unable to pay in full right now. This means you are going to want to have a story that outlines your hardships and explains what you are doing to get back on track. You will want to distill that story down to the most important points and never waver from it throughout the negotiation process.

One particularly useful strategy is mentioning that, due to financial hardship, you will soon be meeting with a lawyer who specializes in bankruptcy. This will almost always make creditors more willing to strike a deal as if you file for bankruptcy there is a chance that they will get nothing.

Stay calm: It is important to keep in mind that, no matter what the creditor says, you have the upper hand as the debt you have is leverage over them. Stick to this fact and, no matter what they say, do your best to avoid losing your temper. If you make a scene or cause drama then the creditor will know they are getting to you and will be less willing to make a deal. If you feel yourself losing it, simply tell them that you will call them back and end the call as quickly as possible. If you find the creditor’s behavior hard to stomach, simply tell them you are recording the conversation which will put them on their best, and most professional, behavior.

Always ask questions: If the creditor threatens you with a lawsuit or with the loss of property, above all else it is important that you don’t let these threats frighten you into making a poor decision. Instead, it is important to ask questions as this will often reveal if the creditor is bluffing or not. For example, if they threaten you with a lawsuit, simply ask when you can expect to be notified of it. Keep notes of these threats as they are often times illegal as creditors are strictly limited as to how they can approach debt, specifically to protect consumers.

Likewise, you are going to want to take notes every time you speak with a creditor including the name of the person you spoke with, the date and the things that were discussed, especially threats. There is typically a statute of limitations as to how long the creditor has to collect on a debt, which varies by region, and they will likely become irritated as that time period approaches.

Avoid agreeing to a payment plan: If you agree to a payment plan you will always end up paying more in the long run then if you manage to scrape together a lump sum payment. Depending on the amount you owe, even as little as 30 percent might be enough to satisfy the creditor assuming it is getting close to the end of the time-frame they have to collect on the debt and you have stuck to your
story about financial hardship and bankruptcy. Never be afraid to offer a low-ball number, the worst that can happen is that they refuse to take it. If you do end up agreeing to a payment plan make sure you go over your expenses with a fine-tooth comb and ensure you can afford to make the payment every month to avoid finding yourself back in the same situation.

Try and deal with creditors: If you know you are going to be unable to make payments on a debt you have accrued, do your best to come to an agreement with the creditor directly, before the debt is sent to collections. The creditor is always going to be easier to negotiate with than a third-party debt collection service.

How To Maintain a Good Credit Score

Maintaining CreditOnce you have done the work of repairing your damaged credit score you are going to want to do everything in your power in order to ensure that you don’t find yourself back where you started. You have worked diligently to repair the mistakes of the past; don’t use it as an excuse to start making new ones. To help keep you on the straight and narrow, consider the following tips to maintain good credit.

Always pay your bills on time, all of them: While not every bill that you have will end tip on your credit report if you are a few days late when it comes to paying it, you can never know for certain which bills are mission critical and which can be safely ignored until your next pay check. Even a small fine from the local library could ultimately end tip on your credit report, dinging your hard—won credit score in the process. Don't take that chance and always remain vigilant when it comes to paying your bills on time.

Avoid using credit cards: While having credit cards improves your credit utilization and credit history, using them too often is a surefire way to start back-sliding, especially if your budget is on the lean side. If you must use your credit cards, take special care to ensure that you never exceed a credit utilization of 30 percent as that’s when your credit score will start to take a hit. While going over this limit slightly will only affect your score by a few points, if you are just on the edge of an acceptable score, that might be all it takes to start seeing higher rates as a result.

Pay down your loans: Once you have righted your financial ship, the best way you can keep it on course is to make it a point of paying down your loans as quickly as possible; don’t forget, approximately 30 percent of your credit score is influenced by the amount of debt you have which makes it one of the easiest ways to continue improving your score once you are moving in the right

In order to make more money available to pay down your debt, the first thing you are going to want to do is to stop living paycheck to paycheck which means establishing an emergency fund. A solid emergency fund will allow you to live for three months, and pay all your bills, if the worst happens and you find yourself out of the job. Establishing this fund will give you the wiggle room you need to
prioritize your debt without worrying about every minor pitfall that comes your way.

Monitor spending: Approximately 40 percent of individuals who find themselves with credit score issues got there simply by not keeping track of their week-to-week spending as well as they should. With the prevalence of online banking, there is no reason why you shouldn’t be aware of exactly what your checking account balance is,every minute of every day. Get in the habit of monitoring
your spending and you will never be surprised when your bank statement shows up at the end of the month. This doesn’t mean you won’t want to peruse the statement when it does come in, however, as you never know when a mistake might be made, you never know when a little extra diligence could pay off in a big way.

Remain glued to your credit report: Just because you are out of the woods doesn’t mean that nothing new is going to show up on your credit report, whether it is your fault or not. Something new from your past might show up, or one of the bureaus may make a mistake or fail to note tile positive changes you have made in a timely manner. The previous blog posts have given you tools for dealing with these issues, but you will only be able to put them into action if you are aware of them in the first place. Don’t let all your hard work go to waste, continue taking advantage of your free credit report every year.

How To Build Business Credit Fast

Business CreditApproximately 45 percent of all small businesses who are turned down for a loan have bad credit to blame, according to the Federal Reserve Banks of Philadelphia, Cleveland, Atlanta and New York. A robust credit profile for your business doesn't just make it easier to get a loan, it will also make it easier for your business to attract new customers. This is because, unlike with your personal credit report, anyone including potential suppliers, partners and customers can all see the credit report of your business at any time. With this fact in mind, it should be clear that if you own a small business, you will want to do everything in your power to improve its credit as quickly as possible and keep it clean as well.

Know your current score: While you are already familiar with Equifax and Experian when it comes to keeping tabs on your business credit score you are also going to need to familiarize yourself with the Dun & Bradstreet credit bureau. Unfortunately, while determining your personal credit score is relatively straightforward all three bureaus use a different means of determining business credit scores as well as asking various lenders for differing types of data. This will sometimes work to
your advantage, however as Dun & Bradstreet lets business owners update their basic business details and also upload financial data. Even better complete portfolios actually improving overall credit scores.

Set up trade lines: Assuming you purchase materials from third-party vendors, doing so in the right way can help you to improve your business' credit. Assuming you have been working with a given vendor for some time, it is likely that they would be willing to extend you trade credit for the things you purchase most often. Trade credit simply means that you will be able to pay a predetermined number of weeks, or even just days, after you have received the latest shipment of inventory. Once you set up this type of relationship it is then easy to ask the supplier to report your
payments to the relevant credit bureaus.

You will want to try your hardest to establish at least three of these types of relationships as doing so will allow you to get what is known as a Paydex score through Dun & Bradstreet which is a measure of your successful payment history. Even if you form relationships with smaller vendors who don't typically report details, by listing them on your account as trade references the bureau will then follow up with them to generate your score.

Be prompt with payments: Just like with your personal finances, paying creditors on time is a crucial part of building your business credit successfully. If you are looking to get the best Paydex score from Dun & Bradstreet you are going to need to go above and beyond and make all your payments early, no exceptions. Additionally, the longer your credit history the better so the sooner you can start forming these relationships the better it will be for your score.

Borrow from the right lenders: While having a loan and paying it on time can help to boost your business' credit score, this will only be the case if the lender you choose reports to the bureaus which is far from guaranteed. Do your homework and make sure that your fiscal responsibility is helping you out as much as possible when you do get a loan. Most banks will report to the bureaus as do the online lenders including BlueVine, Kabbage, Funding Circle Fundation, Lending Club and OnDeck. Fundbox, Lighter Captial, SmarBiz and most merchant cash advance companies do not. If you are using business credit cards strive to keep your credit utilization under 20 percent for the best results.

Be aware of your public records: Just like your business credit report, your public records can also be seen by anyone which means you are going to want to do your best to stay on the right side the law. Not only will negative public records affect your business credit score, they will affect the way the public perceives your business as well.

Fast Credit Repair After Medical Judgments

Fast Credit RepairUnexpected medical expenses can sneak up on anyone at any time with no warning. If a medical judgement is issued against you for costs associated with this type of scenario, the first thing you are going to want to do is to try and fight it using the tactics discussed here. If that doesn’t work, however, then you are going to have a black mark on your credit report for the next seven years.
The most important thing to do in this instance is to not lose hope and to instead do everything you can to repair your credit as quickly as possible.

Negotiate your debt: As previously noted, just because a judgement is filed against you doesn’t mean the plaintiff is going to get paid. Medical establishments are aware of this fact which means you can likely negotiate a more reasonable fee as opposed to simply paying what a judge says you owe.

In order to do this, the first thing you are going to need to do is to organize and review your medical bills to ensure they are free of errors including double charges or overcharges. Billing items you can contest include things like full-day charges for the day you were released from the hospital, medication charges and secondary charges for standard supplies such as sheets and gowns as these should be factored into the daily fees. Additionally, if you have insurance you should see a deduction for what they paid on your bill as well.

Once you know exactly what you have to pay, you will then want to compare that amount to your monthly bills and determine how much you can afford to pay of the bill in question. If you only have a small percentage of the total available currently, the best bet is to wait until you have at least fifty percent of the total saved and then reach out to the plaintiff and offer to settle. You can either call the
other party or send out the pay for delete letter from here. Regardless, if you come to an agreement make sure you get it in writing.

Play catch-up: If you spent time recuperating from a major illness or accident then it is likely that your medical expenses aren’t the only thing you have to deal with, which means the first step to rebuilding your credit is to get your other payments back on track. To do so, you are going to want to contact each of your creditors and explain the situation and ask if you can work out some type of payment plan to get back On track. Generally, you will be able to come to an agreement that you can both live with that won’t leave you completely broke. Getting back into the habit of paying all of your bills on time is a crucial step towards rebuilding your credit.

Installment accounts: In addition to opening a secured credit card as described in this blog post, you are going to want to go about building positive credit by obtaining an installment loan. This is a loan for a set amount with a set term and a set repayment. Installment loans are easier to get that rotating loans (such as standard credit cards) as the risk to the lender is lessened.

Even still, depending on your current level of credit you may need to get someone who trusts you to cosign on the loan. A cosigner is someone with good credit who essentially gives their word that you are going to pay back the loan, otherwise the failure hurts their credit as well. A good place to look for a starter installment loan is from an independent automotive dealership. These dealers are going to have less stringent requirements than major chains and are often more accustomed to dealing with individuals with less than stellar credit. You may not even need a cosigner after all. If you do get a loan in this fashion, make it a point of always paying the bill on time as this fact will be reported to the credit bureaus (read more) on the monthly basis. 

How To Get Something Removed From Your Credit Report

Credit Report Dispute FormHow To Remove Negative Items Fast

While most issues will be removed from your credit report in seven years, (ten for bankruptcies) you may not have to wait that long if you do your due diligence. It doesn't matter if it is a foreclosure, charge off, bill in collections or late payments, they all have the potential to be removed early.

Check for errors: Studies show that more than fifty percent of all credit reports contain errors of some kind. These errors might not be major, such as including details from someone else's report, they may be smaller, and thus easier to miss. This means you are going to want to check the specifics of every entry and ensure it matches up with your personal records. You are going to want to check every credit limit balance, payment status, account status, open and close date and account
number and note any errors.

Once the errors are noted, you will then want to send a letter to each credit bureau outlining the mistakes and requesting that they are removed. You can use the letter outlined in the previous chapter and substitute in the errors you have found for the part about credit inquiries. The good part about this is that if the bureau can't determine the accuracy of the information it will simply be removed.

Goodwill letter: If you can't find any inaccuracies, or the bureau verified the ones you pointed out as correct, you can instead try sending what is know as a goodwill letter. You will send this letter to the collection agency or to the creditor and ask that they remove the negative entry based on goodwill. This will be most effective if you are looking to have charge offs, collections or late payments removed. In this letter, you will want to explain your situation to the agency in question and ask that they essentially help you out by removing the offending information. While this may seem like a long shot, it works a surprising amount of the time, especially with regards to late payments. This method is especially  effective if you are a current customer and the organization has a reason to want to hold on to your business. A sample goodwill letter is below:


(Creditor/Collection Agency Name) 
(Creditor/Collection Agency Address) 

Re: Account number provided 

To whom it may concern: 

I am writing regarding an issue I recently came across in my credit report (list specifics) that I was hoping you could help me to rectify. I understand that making payments on time is very important and that failing to do so causes issues for your company. If you look at my file you will see that I have done so a majority of the time I have been a client of your company and that my (late/missing) payment is an exception, not a rule. I missed the payment in question do to an (unavoidable emergency real or imagined, the more detail the better) and while I tried to make the payment on time I was unable to do so. 

I can guarantee that the issue won't happen again as my (financial, physical, emotional) state has improved dramatically since (issue) and it is no longer a factor when it comes to making payments. As a courtesy, I am requesting that you make this goodwill adjustment to my record in light of 
my history of on time payments. This will allow me to improve my credit score and boost my confidence in being a (company name) customer. 

I appreciate your time 


Pay for delete: If you are dealing with charge offs or unpaid collections, the most effective way to have them removed from your account is to negotiate with the creditor directly and offer to pay a portion of what you owe in exchange for having the negative entry DELETED from your report. If you go down this path it is important that you get the agreement in writing prior to making the payment as once the payment is made you lose all of your leverage. A sample letter outlining this process can be found below.

Collection Agency/Creditor Name 
Account number: 
Amount owed: 

To whom it may concern,

I am writing to you in reference to the above account number in an  effort to settle the amount due in a way that will benefit us both. This letter should not be seen as an acknowledgement of liability to the debt in question and I shall still retain the right to request verification of the debt from your company if the terms outlined below aren't acceptable to you. With that being said, however, I am willing to pay off (percentage of amount) of the debt as a sign of good faith based on the following 

  • Your company will put forth the effort to successfully remove all references to this issue from the (credit bureaus that list the issue). 
  • Moving forward your company will not list the debt as a settled account. 
  • The payment made will be considered payment in full of the debt in question. 
  • The debt will not be transferred or sold to a different creditor. 
  • This agreement will not be made public in any way, shape or form. 

In exchange for these written assurances I will pay (amount about fifty percent for new accounts and thirty percent for older accounts) as soon as I receive an appropriate response. This should not be taken as a promise to pay, rather it is a restricted settlement offer based solely on your agreement to the terms outlined above. Prior to making any payments I will need a written acceptance of these terms on your company letterhead that is signed by an authorized representative of your company. 

This offer will expire in 30 days, I look forward to a prompt response. 

(Typed Name) 

Secret Removal Strategies 

Not recommended for the reader — seek advice from a professional credit repair company. 

I once had 3 credit cards that were charged off and unpaid. I sent strong letters to the credit card company and they agreed to settle but not delete the accounts. 

I wanted them deleted. 

I decided to look into filing a federal lawsuit pro se. I reasoned that if I can show them how serious I was and that my basis was provable in court (Credit Billing Act violations), then they would yield to my demand. 

I did some research and discovered that I could file a claim in the nearest US court under Federal Question, since the Fair Credit acts are under the federal; jurisdiction. I typed up my own docket using previous cases as a template, mailed it to the Credit Card Company and credit 
bureaus and demanded damages of $1,000,000. 

At the time I had NO CLUE what I was doing but it worked; I was so inexperienced that instead of actually filing the claim, I simply sent it to the credit card company s legal department and the credit bureau's dispute department but with one extra step. 

I also searched out the OWNER and the Statutory Agent of the credit card company by searching through the corporate records of the state they were headquartered in, and included their names in my self-created docket. Anyone can find this information by searching for the respective states' Secretary of State Office, corporate division. 

In about 10 days I received a call from the Credit Card Company's legal firm representative. He was very calm on the phone and basically said that he tried looking my docket-case up in the Clerk online for the Ohio Northern US Court District and found nothing. 

He then proceeded to state to me that he could file a suit back against my for malicious attempt, but then ended the sentence that his client wants this done and over with now, so 
they are prepared to delete all charged off credit card accounts if I agree to not sue them or follow through with the claim! 

Obviously I signed their letter stating this and in about 30 days the bureaus refreshed their data and the accounts were gone and my score INCREASED 202 Points! 

My original goal was never to go to court but merely to settle before that. 

I do not recommend you do extreme tactics like this unless you feel it really is justified and even then be sure to seek legal advice. There are a lot of details that would go into this, let alone acting pro se. 

Credit repair is very personal and unique to each person, each case is different. I was willing to do extreme measures to get what I wanted so that I could get a mortgage loan at the time and buy a house. 

Fast Credit Repair After Foreclosure

Foreclosure While rebuilding your credit after a foreclosure is difficult it is doable if you go about it in the right way and stick to your guns in the process. It is not going to be an overnight process but slow and steady wins the race.

Credit cards: After a foreclosure, many credit card companies will contact you in an attempt to either cancel your account or to raise your rates. Despite what they may say, this is only an automatic adjustment that was triggered based on your foreclosure and is in no way a sure thing.
As long as you have been paying your bill on time and are not using the credit card for major purchases, there is no reason you cannot negotiate with the representative that you speak with to both keep your card and keep your rate at the level it was at prior to the foreclosure. Be steadfast in your commitment and don't let them bully you around and you can come out on top.

It is important to keep your credit cards if at all possible as using them is a great way to start reestablishing your credit. You are going to want to use them for household expenses and to pay the charges off in full each month. Maintaining consistency and keeping a clean record of on-time
payments is the first step to rebuilding credit.

Secured credit: If you have already lost your credit cards then the easiest way to go about rebuilding your credit is to start with a secured credit card. A secured credit card works like a regular credit card except your limit is tied to the amount of money you deposit with the credit card company up front. You will not be able to access that money directly while the account is open which means the lender doesn't have to worry about losing out on any credit loans that are made in your name.

A secured credit card is different than a debit card in that the company providing it to you will go ahead and make monthly reports to the credit bureaus, helping to build your credit as long as you use it in a conscientious fashion. The card also has all of the fees and penalties of a regular credit card so it is important to shop around for one offers the best rates.

Avoid new debt: When rebuilding your credit, it is important that you don't take on any new debt until your credit score has started to right itself as your debt to income ratio will affect your credit score and, at the moment, you will need all the help you can get. Likewise, starting several new credit streams at once will only shorten the average length of your credit history which can send you back in the other direction. Rather than open new avenues for credit, and debt, focus on paying off any other debts you may current have and save money for when you score gets above 650 so that you can take on new debt with better rates.

Try Low Balance Credit Credits: These credit cards usually have extremely high interest rates but your goal is to charge only 10% of the balance to build a credit score fast. Getting 3-4 of these can achieve excellent results fast if you charge and keep a low (10%) balances on them with no changes. I still have some of my low balance cards that I got just for the purpose of credit repair years ago. For instance I have a $2,000 and $1,000 card. On the $1,000 card I hold a balance of $155 and on the
$2,000 card I keep a balance of $180.

Consider credit unions: A credit union is essentially a nonprofit bank that operates only to benefit its members. As such, when you are ready to apply for a new loan or a credit card it is recommended that you join a credit union to do so as the rates that you are eligible for are going to typically be much more in your favor than through a traditional bank. They will also be more likely to overlook your financial mishap as their requirements for loans and credit cards won't be as strict as well.

FCRA Section 609 Credit Repair Method

FCRA Section 609 Credit Repair Letter
To understand how the FCRA Section 609 credit repair method works, it is important to understand that the FCRA was written before the advent of the internet. As such, they require the credit reporting agencies to have physical copies of all documentation to support each account that is being reported on. This is a problem for these agencies as virtually all credit items added to your credit report these days are submitted electronically. This in turn, means that it is rare for any documents to be reviewed prior  to changes being made to your credit report.

Essentially, the credit reporting agencies just give all creditors the benefit of the doubt when new information IS added to your file. You can use this to your advantage by asking for hard-copy verification via Section 609 of the FCRA for virtually anything negative that is listed on your credit report. You simply need to use the following letter and not be deterred by any scare tactics that the credit reporting agencies will use to cover their tracks as they will try everything in their power to avoid having to tell you that they do
n't have the physical documentation.

Good CreditWith the following "609 letter", you will need to be sure to always include a copy of a photo identification as well as a copy of your social security card (also include your past residences for 5 years). This is due to the fact that the FCRA only requires the credit reporting agencies to respond to individuals in writing if they provide these details. Without it, your letters will simply be ignored. When disputing accounts, it is also important to never dispute more than 22 at one time. This is the magic number, anything more than that will cause you dispute to be considered frivolous. Additionally, you will want to ensure you hand label your envelopes as type envelopes will be opened far less often.

Section 609 Dispute Letter Template



(Credit Bureau Name) 


To Whom It May Concern: 

This letter is a formal complaint that you are reporting inaccurate and incomplete credit information. I am distressed that you have included the below information in my credit profile and have failed to maintain reasonable procedures in your operations to assure maximum possible accuracy in the credit reports you publish. 

Credit reporting laws ensure that bureaus report only 100% accurate credit information. Every step must be taken to assure the information reported is completely accurate and correct. The following information therefore needs to be re-investigated. I respectfully request to be provided proof that these inquiries were in fact authorized With an instrument bearing my signature, and for legitimate business purposes. Failing that the unauthorized inquiry must be deleted from the report as soon as 

(Accounts you wish to have removed from your report) 

Please delete this misleading information, and supply a corrected credit profile to all creditors who have received a copy within the last 6 months or the last 2 years for employment purposes. 

Additionally, please provide the name, address, and telephone number of each credit grantor or other subscriber. 

Under federal law, you have 30 days to complete your re- investigation. Be advised that the description of the procedure used to determine the accuracy and completeness of the information is hereby requested as well, to be provided within 15 days of the completion of your re-investigation.