Google Analytics Alternative Credit Zeal - Repair & Improve Your Credit Score With Confidence: February 2017


So You Screwed Up, How Long Does Negative Information Stay On Your Report?

This may remind you of your school records in elementary or high school when your history seemed t be passed along from teacher to teacher.  Negative information stays in your credit report for years and there is little you can do about it.  Like a reputation, good credit is fragile.
How Long Does Negative Information Stay On Your Report
The key to derogatory credit accounts or negative information is how quickly it can be removed from your credit report.  Depending on the type of bad credit account and what happened with it, negative information will stick around on your credit report for seven to as many as fifteen years.  Even credit inquiries stay on your record for two years.  In general, negative information that is more than 7 years old from date of last activity on the account, 10 years for bankruptcies, must be removed from your credit file.  Credit accounts that are paid as agreed generally remain on your credit file for up to 10 years from the date of last activity.

Derogatory credit accounts remain in credit histories beyond the required time frame mostly because the credit reporting company is merely a repository and that the negative information in your credit report does not come directly from the credit reporting agency.  The negative information is reported to the credit reporting company by others that have granted the credit or may be included in public record information or reported by collection agencies.  This is one of the primary reasons why checking your credit to make sure the inaccurate or outdated derogatory credit is removed.

The following information pertains to more specific credit report information for delinquent accounts or derogatory credit items in a credit report.
The common rule for delinquent accounts is that late payment histories generally remain on your credit file for 7 years.  These delinquent accounts that have not paid as agreed will remain on your credit file for 7 years from the date the account first became past due leading to the current not paid status.
Collection accounts follow the same rule and will generally remain on your credit file for seven years from the date the account first became past due that led to the account becoming placed with a collection agency.
For a bankruptcy that is file as a Chapter 13, a discharged chapter 13 bankruptcy generally remains on your credit file for 7 years from the date filed.
For a bankruptcy that is a Chapter 7, Chapter 11, or a non-discharged or dismissed Chapter 13 bankruptcy, the record will remain in the credit report for 10 years from the filing date.
Charged-off credit accounts will remain for 7 years from the date of original delinquency.
Unpaid bills sent to collection will also remain for 7 years from date of original delinquency.
Judgments are on a credit report for 7 years from date it was reported or until the statute of limitations runs out, whichever is longer.  The amount of time the judgment remains on in a credit history will be the same whether the judgment is satisfied (paid) or not.
Paid tax liens are in a credit history for 7 years from date paid they are paid or released.
Unpaid tax lien can remain for up to 15 years.
There is no time limit on reporting information about criminal convictions or information reported in response to your application for a job that pays more than $75,000 a year or and information reported because of an application for more than $150,000 worth of credit or life insurance.
The rules for collection account are that they are to be removed after 7 years from the time it became a collection account.  Once a consumer pays off the debt in collection or a charged off account, it cannot stay on your report past 7 years.  It will be indicated as paid on the credit report.  If the account is not paid in full but has partial payments or periodic payments, collection agencies my try to keep the account active and reset the 7 year clock.  Consumes have your rights to write to the collection agency and credit reporting agency and ask that they remove the collection account or charged off account by the original date.
The three main credit reporting agencies collect and report information in roughly the same manner but are different identities that do not operate identically.  For consumers who do have negative information in their report it is a good idea to perform a credit check and either obtain credit reports from all three of the national credit reporting agencies or obtain a merged report so you can see if one agency’s reporting methods is lowering your overall credit score.

What is the Meaning of Credit

What is the Meaning of CreditCredit is an instrument in which you are using someone else’s money to pay for things.  Credit means having the resources and ability to go into debt so that you can buy now and pay later.  Credit also means you are making a promise to repay the money or loans to the person or company that loaned you the money.  You borrow money from a bank or other lender or creditor, and agree to pay it back over a period of time.  No matter what method or type of credit you use to pay for the item whether it using a credit card, a car loan, a home mortgagee it is all credit for you to use.  And you are required pay that money back, usually with interest, for the convenience of borrowing those funds.
Credit provides a lot of advantages and conveniences.  Unfortunately credit isn't free and there are the costs that may include interest rates, finance charges, and annual fees.  A loan usually includes both principal, the amount of money borrowed, and interest which is the charge or cost for the use of the money.  A loan or credit agreement spells out the terms for repayment of the loan or money borrowed and will include the cost and interest charges as well conditions regarding failure to make timely payments.
Today, banks and other lenders make it simple to use credit to buy just about anything.  With so much access to credit, getting and abusing it can be easy.  How much credit you have available will depend on your ability to be responsible with your debts and repay your creditors within the time frame established.  The more responsible you are, the more credit you will have in the future.  Because of that, it is important for you to build a strong credit history and work at keeping it that way.
Unfortunately credit can have potentially costly pitfalls and if you don't use it wisely it gets to be really expensive.  Establishing and maintaining good credit is the key to ensuring strong long-term financial health.  Good credit means that you make your loan payments on time and you repay your debts as promised.  When you have a good credit record, lenders feel more confident that you will be willing and able to pay back the new loan.
Good credit is important because it makes it more likely that you can a new loan in the future when you want to make a major purchase, such as a car or a home.  It is important to think of credit as a tool that will help you in the long run, not just the short-term.
Credit is a valuable resource if it is used in a responsible and limited manner.  In fact, it can be a very helpful financial tool that will help you when making important financial decisions and investments in your life. Credit can help you to purchase a house or a car.  It can help you have revolving funds to help pay for emergency or frivolous expenses.  It can also help you establish a financial status that will be a benefit when you really need it to be.
Your credit history affects your credit and your financial future.  Your credit history is an ongoing record of much of your financial life.  Your credit history tracks the debt you have incurred with creditors including banks, stores, student loans, mortgages, car loans, and also includes things like your employment history and past addresses.  Creditors look at your financial history using your credit report to determine how much money they are willing to lend you, and at what interest rate and terms.
Credit isn't just about getting a loan.  Credit is confirmation of an individual’s financial responsibility.  It is an indication of how trustworthy you will be with someone else's money.  It is also one of just a few things that will either make your life really good or really bad.  If you want to have financial power and trustworthiness that is manifested through a good credit score and long, positive credit history, you need to be wise in your financial decisions.
Credit history is being used for a variety of issues today.  When someone wants to rent an apartment their credit will most likely be reviewed or checked.  Employers are starting to use the process of credit checks for employee candidates.  Insurance agencies check credit to evaluate the risk of customers not making the monthly payments.  Of course, credit histories and credit reports are used for credit card approvals, home loans, car loans and many more conduits for borrowing money.
Credit eventually is broken down to a simple measure of financial responsibility.  It is an indication of how dependable individuals will be with someone else's money.  It is also one of just a few things that will either make your life a little easier or possibly hinder financial security.  For those consumers who don’t have good credit right now, they don’t have to be discouraged. Bad credit can be fixed.  Fortunately, even if you've made some unhealthy financial decisions in the past, there are many things you can do to improve your credit.  It may take some time, but you will be far better off if you start to improve your credit sooner rather than later.

Credit Score Help and Non Profit Debt Consolidation Programs

For some individuals, trying to improve their credit score and credit history can be a difficult task.  Often the problem of improving a credit score is that the cause of the problem or low credit score has not be fixed.  For these individuals, fixing the cause of the delinquent debt and bills, which is the predominant factor used to calculate a credit score is the number one issue to address. 
The delinquent debt payments are often the result of a mismatched budget.  One of the best solutions is to get the monthly budget back in order.  Unfortunately, solving budget problems is no easy matter. 
A starting point for individuals that have too many monthly payments and not enough income to handle these payments is to seek the help of a non profit credit counseling company and consolidate the debt payments.
It is important to realize, the term non profit does not mean free.  Non profit simply means that the entity is not established for a pure profit motive but generates revenue to pay for its expenses and may use donations to further their business.  Being non profit does not make them a better choice when it comes to helping you consolidate your debts.  You should always do your homework and find the company and program that is right for you.  Get a few quotes before you decide.
The idea of a non profit debt consolidation program should be to help the consumer become educated about how credit works and provide counseling to help them handle their finances.  They also provide services to lower the existing debt and work with creditors to lower your monthly payments.  In many cases, you will pay one monthly sum to them and they will disburse payments to your creditors.  There will be a fee for this service which will be added to your payment to them each month.
We all know how easy it can be to get off track and spend a bit more than we can afford to have a decently comfortable life.  There are times when we dont realize just how much credit card companies charge in interest and late fees.  A non profit debt consolidation program will work with your creditors to reduce or eliminate late payment charges and delinquent fees.  If our credit becomes damaged we are really in a financial pickle. Without good credit and a good credit score most consumers will be unable to get a mortgage to purchase a home, get any type of loan for that new vehicle, borrow money for their childs education, or possibly have trouble with a new job interview..
Non profit debt consolidation programs may help you get out of debt and become more educated about debt and how it affects your life, and teach you how to stay debt free.  This will hopefully show you how to avoid financial problems in the future.  You will receive one-on-one advice from a certified credit counselor who will work with you and your budget to design a payment plan that is unique to your situation.  Credit counselors know the particulars of creditors rules and policies.  This gives them an inside track when it comes to negotiating with your creditors.
Do your research to make sure you are using the right counseling agency and have everything explained up front before committing your self to the process.  Debt counseling and consolidations are not easy escapes from responsibility.
The credit counseling agency combined with a debt consolidation may very well provide relief from burdensome debt payments that hurt your credit profile, your credit score and your well being.  If you find that you are in debt up to your ears, there had to have been a reason you find yourself in this situation.  Perhaps you had a medical emergency and you were unable to meet most of your bills because of the high cost of health care or were not able to work for several months.  Maybe the fault wasn't yours entirely, a spouse or child ran up the credit cards beyond what you could reasonably pay and the fees and interest just kept adding up.  These are grounds to seek help sooner rather than later to fix you payment problems, improve your credit report and start down a road to a good credit history and credit score.
Improving a credit score starts with being able to make timely debt payments.  Whatever the reason for falling behind in payments, a non profit debt consolidation program may be your best bet.  Although it will cost a fee each month for this service, you will see a vast improvement within just a few months and before you know it you will have your outstanding debt paid off.  From this point, fixing your credit history and credit score will be far easier.
Do your homework and do not take a non profit debt consolidation program at face value.  Whether the debt consolidation company is non profit or for profit, there are unscrupulous people who will steer you in the wrong direction no matter where they work.  If you need debt consolidation help to improve your credit, get references before you hand your money over to anyone.

Handling Credit and Credit Score Problems

Credit has become an almost indispensable tool in our society.  Almost everyone uses some form of credit whether it is in the form of credit cards, car loans or mortgages.  Credit allows us to purchase goods and services by paying for them later which can be very convenient to buy big ticket items or stretch our monthly budget.  But credit can cause money problems if not managed wisely. 
Money problems are often the immediate result of too much debt with unmanageable monthly payments.  But money problems can also be compounded because of credit issues as result of unmanageable debt payments.  The debt payment burden can be enough to worry about and try to manage but future money problems are sure to come as a result of a declining credit score and deteriorating credit history. 
The first approach to help curtail future credit problems is to understand you have a credit and debt predicament.  As simple as this sounds, far too many consumers ignore the warning signs and don’t handle their credit problems in their infancy but rather wait until the burden of bad credit and delinquent payments devastate their lives and relationships. 
Some of the early warning signs of credit problems include:
  • You pay only the lowest amount due each month on your credit cards or other revolving credit lines.
  • You use your savings to pay bills.
  • You often get past due notices that include late fees.
  • You pay bills after the due date or skip payments.
  • You take out new loans or charge on credit cards to pay for basic living expenses.
  • You often use more debt to cover expenses or pay bills.
  • Collection agencies frequently call regarding past due obligations.
  • You are turned down for credit because of a poor credit history and low credit score.

The best advice to avoid the path of too much debt and a deteriorating credit report is to know in advance how much you can afford to commit to monthly credit payments.  Monthly credit payments should not consume more than 15% of an individual or family income excluding the housing payment.  Once debt payments pass this threshold, it is time to assess how severe your credit and debt issues have become and start a remedial course of action.
Before you approach monthly debt payments that are too hard to handle, credit should be limited to use for necessary purchases where the use of credit might have added attributes or for the purchase of assets.  For example, credit can be used for purchase with a credit card where the protection afforded by a credit card service can be valuable or credit could be used for the purchase of an asset like a home.  Credit for everyday consumption and shopping will always lay the ground work for future debt problems and credit score problems.
Once the debt amount and monthly payments grow out of control, getting out of that debt becomes harder and harder.  With a plan of action and some discipline almost any debt problem and credit score can be fixed.  The days of a debtor prison no longer exist.  A good budget with some curtailed spending is the number one tool to getting debt under control and starting a path of a good credit score.  But other options are available such as bankruptcy, debt consolidation loans and credit counseling. 
The goal should be to understand the problem including the amount of debt, your income and expense position and set up a plan that can work for you.  Begin by making a budget.  Determine what you owe and what your monthly expenses are.  This will help determine whether a good budget and a thrifty lifestyle can remedy the problem or more drastic action needs to be taken.
If the budget process is not enough, calculate out how much you can realistically afford to pay each creditor and approach the creditors to see if they will accept a lower amount or reduce the interest rate on the debts.
A debt consolidation may be another alternative.  Be careful not to obtain a debt consolidation that only places you in a worse financial position.  A debt consolidation loan used to pay off credit cards and other loans may be a possible solution but it may cost more in the long run.
The possibility of bankruptcy either with a Chapter 13 repayment plan or Chapter 7 should not be ignored when the debt levels are quite high.  This decision should not be taken lightly but the stigma of bankruptcy really no longer exists so this option should also not be ignored.
Credit counseling is another option to consider.  A good non profit credit counseling company can help work with your creditors to reduce the interest rates and possibly the amount owed and make a plan to get out of debt. 
The two important considerations are to avoid using debt for transactions they should not involve the extension of credit and once credit trouble starts, nip it in the bud early no matter what method is used.  No matter where you stand now, a good credit history and good credit score should be a goal to improve your lifestyle.
Repairing bad credit and a bad credit score is easier than most consumers believe.  Disputing inaccuracies frequently removes more than just the inaccuracy, which often leads to an improved credit score.  Secured credit cards and prepaid credit cards are quick and easy tools that can be used to rebuild credit.  Prepaid credit cards generally do not require a credit report check and the credit card payment history will be reported to the credit reporting agencies to build a history and improve your credit score.
Fixing a bad credit score and high debt payments may not be easy but it is easier than those confronted with this condition often believe.  Ignoring the problem will certainly not help; get debt help and credit score help now to start a path for a better lifestyle. We would recommend enlisting the help of Sky Blue Credit to help you on your journey towards improving your score. 

How Your Credit History May Affect Your Auto Insurance Rates

Auto insurance companies often consider your credit report when they are determining the proper rate to charge you for your auto insurance.  If you are shopping around for auto insurance, be aware that potential insurers may be looking at your credit report.  There is a statistical correlation between consumers credit history and possible auto insurance claims.  Insurers assume that customers with better credit records are also more likely to be good risks for auto insurance policies.
Not all companies use credit history as their primary determination for your rate, so if you have a poor or nonexistent credit score, shop around for one that uses traditional methods -age, driving record, type of vehicle, etc. to determine your auto insurance rate.  Different methods vary from company to company, so if you are in doubt about how a potential insurer makes its decision, be sure to ask.
According to The Federal Fair Credit Reporting Act, auto insurance companies are well within their rights to use your credit report in this manner.  Found at  The act states that companies can use this information for Reasonable procedures”.  It is the purpose of this Act to require that consumer reporting agencies adopt reasonable procedures for meeting the needs of commerce for consumer credit, personnel, insurance, and other information in a manner which is fair and equitable to the consumer, with regard to the confidentiality, accuracy, relevancy, and proper utilization of such information in accordance with the requirements of this title.
In order to be sure that your insurer finds the correct information on you, be sure to provide them with the necessary information promptly.  Most likely, they will need your full legal name, current address, social security number, and date of birth.  This will enable them to get your insurance credit score, which helps insurance companies assess the information in your credit report quickly to determine if you are a good candidate for auto insurance.
This credit score may vary from one insurance company to the next, as each may use a different method to calculate your insurance risk and premium.  The insurance score is an all-encompassing method that takes into account many risk factors, including credit.  Since each company uses slightly different methods, it is difficult to even give a range for what a good insurance credit score might be.  In fact, the program the insurance company uses may not even tell them the specific score you receive, only if you are a qualifying candidate or not, and what tier your rates fall into.
If you feel that there are errors or incorrect information on your credit report that is affecting your insurance credit score, you should contact the credit bureau issuing the report.  Unfortunately, there is nothing your insurance company can do to help you with this problem until it is resolved by the credit bureau.  Once you have corrected it, you can resubmit updated information to your insurance company, and have them reassess your rate.
The key concept is that credit scores are a growing element in many business decisions.  Fix your credit score before it becomes too late and the costs of having a low credit score become very real costs.  The sooner you start on the path of credit score help the faster the credit score will improve and the simpler transactions will become that are dependent on this number.

Severe Negative Information in a Credit Report

One of the four main components of credit data in a credit report includes public record information.  Public records include items such as bankruptcies, tax liens, legal judgments and other legal proceedings recorded by a court.  These records are often the biggest drags on a credit score.  Some of these accounts may be able to be cleared up or removed from the credit history or credit report with a little bit of work. 
Most of these public records unfortunately, can not be altered or ameliorated.  For example; on bankruptcies credit reports simply record the time of the bankruptcy filing and the time of the bankruptcy discharge, there is very little that can be done to improve a credit score based on new or updated information on a bankruptcy.  Other accounts may have the possibility of being removed or have the damaging impact on the credit score lessened.  A key element in lessening the negative impact of these accounts is removing the record altogether or having the account reflected as being paid in full and satisfied.  Understanding how and why the public record is on someone’s credit history in the first place is the key to handling these accounts and clearing up a bad credit report and low credit score.


Judgments on a credit report are the result of lawsuit that has been lost and the courts have awarded a judgment against the defending party.  The lawsuit could come from a creditor such as credit card that is in default or car loan or private party in which there is a debt of money owed and the payment arrangement is in default with collection continuing to court and the end result being a judgment awarded to the party in which the funds are owed.
If you still owe money on an account that is being reported negatively and if your payment troubles are the result of unexpected job loss, illness or some other event beyond your control rather than overspending or just a casual attitude toward paying the debt, the creditor may be approachable about working with you to improve your credit record as long as it involves some sort of payment.
Generally, creditors will not seek a judgment against a consumer unless they have tried every way possible to get their money.  To get a court awarded judgment the defendant must be served notice of the court date and either lose the defense or simply not defend the matter in which case the judgment is referred to as a default judgment.  Judgments are time consuming and costly for the creditor to pursue and they are frequently the last cause of action and are generally not pursued on small dollar amounts.
When a judgment is awarded in the creditors favor, such as the credit card company or auto loan, the creditor will often not be very eager to work out a deal with you since they have already won the lawsuit against you.  The only way to resolve these situations is to pay the amount owed.  It is always best to try and settle the debt, hopefully for a lower amount, before the judgment is awarded even if that means settling right up to the court date.  If a creditor has a judgment against you can still try and negotiate a lesser amount to pay. 
Creditors may be receptive to this offer because it provides them with money that they have probably given up on, and it helps them recoup some of what they spent trying to collect on the account and getting a judgment. In other words, it is found money for them.
To explore this option, contact the creditor’s account manager and explain the reasons for the problem with your account and offer to resume payments if you had made them in the past, increase the amount of your payments or if possible pay the debt off altogether.  Obviously, it is easier to negotiate a lower amount if the account is to be paid all at once.
Find out if the credit account manager or debt collector might be willing to settle for less than the full amount owed.  Indicate that in exchange for your offer you would like the creditor to stop reporting all negative information on your account to credit bureaus or credit reporting agencies and have a release prepared for the judgment.
If your creditor agrees to vacate the judgment in exchange for payment, be sure to get that agreement committed to paper and signed.  Find out if the credit manager is willing to update your credit report to show that the adverse account information is no longer verifiable.  Also, ask that a notice be sent to each of the credit reporting agencies the creditor reports to asking that they delete the adverse information from your record.  This approach will not work with every creditor but like all debt negotiations, it is certainly worth a try. 

Tax Liens

Negotiating a deal with a taxing entity that has placed a lien on your property can be difficult.  This is because the taxing entity knows that all it has to do is wait to collect the debt, when the time comes for you to sell your property they will get the money.  Government workers also do not have the same incentives as private sector debt collectors for collecting delinquent bills.  However it still may be worth the effort to at least attempt to negotiate a deal when there is a lien on your credit record and property.
To initiate negotiations with a taxing entity, contact the appropriate office in your area, tell them what you want to accomplish, explain the cause of the problem and there is nothing wrong with being emotional, then find out whom you need to talk with as well as the paper work you need to complete a settlement request.  Should you be denied a compromise, appeal to the next level of decision making within the organizational structure of the taxing authority.  Unfortunately, you will be working with a bureaucracy, so answers and assistance may be slow and difficult to obtain.

One final note if you decide to seek a negotiated compromise with a taxing entity, you may want to get the assistance of a lawyer or a firm familiar with IRS or state/local tax negotiations and the tax code.  These people will know whether your tax liability is likely to be compromised, how best to approach the negotiations and which laws forms etc apply.
During the negotiations, you should try to work out a compromise for the amount of money you owe as well as a payment schedule you can meet.  You also should try to have waived all or part of the interest and penalties that will have been accruing on the back taxes that created the lien.
An integral part of the settlement agreement you negotiate there should be a letter from the taxing entity to the credit bureaus recording the tax lien has been paid and satisfied. 

IRS Liens

If the IRS has a lien in your credit report and on your property, it is important to review the possibility of an Offer in Compromise.  The IRS tax code says that the IRS may compromise a tax liability.
An offer in compromise (OIC) is an agreement between a taxpayer and the Internal Revenue Service that settles the taxpayer’s tax liabilities for less than the full amount owed.  Absent special circumstances, an offer will not be accepted if the IRS believes that the liability can be paid in full as a lump sum or through a payment agreement.
The IRS may accept an offer in compromise based on three grounds that doubt exists on whether the taxpayer could ever pay the full amount of tax liability owed within the remainder of the statutory period for collection, a legitimate doubt exists that the assessed tax liability is correct or there is no doubt that the tax is correct and there is potential to collect the full amount of the tax owed, but an exceptional circumstance exists that would allow the IRS to consider an OIC.
Settling and removing an IRS lien can give a tremendous boost to a credit score.  Of course, working with the IRS requires a fair amount of paperwork, patience and persistence. 
Public records generally contain the most severe form of negative information regarding an individual’s credit history and therefore have the greatest impact on pushing a credit score lower.  It is possible to have a good credit score even with public records, the length of time since the public record was recorded will factor in as well as the amount of the debt recorded and the overall credit profile.  Individuals that reestablish good credit records or maintain some good credit records while they endure the hardship of a public record may in fact have a fair to good credit score.  It is always best to assess your whole financial picture; debts, assets and income before deciding which accounts to try and clear up and which method of clearing up these debts will work best for you. Sky Blue Credit Repair will be able to assist with all of the above tasks.

Improve Your Credit Score by Identifying Errors in Your Credit Report

One of the first steps to improving your credit score is locate the problem areas.  To identify the problems in your credit report you first have to review a current report and find the individual trade-lines, accounts or other data that poses a problem.  This requires more than just obtaining your credit report and highlighting the inaccurate data.  Inaccurate data that is not causing your credit score to fall is of little importance unless you simply want your credit report to reflect the accurate data.
Credit Report Errors

It’s estimated that well over 25% of credit reports contain information that is wrong.  However, some of the information will not be impacting your credit score.  So the first step is to obtain a new credit report and find the problems that are pulling your credit score lower.

In order to find discrepancies in your credit report you will need to know what information should be in your credit report.  A credit report will contain your personal identifying information including your full name, social security number, birth date, previous addresses, and, possibly, your previous employers.  The report will then cover your credit accounts and history with items such as mortgage loans, car loans, credit cards and collection accounts. 

Following this data is any public records such as bankruptcy filings, liens or judgments.  A list of credit inquiries that covers any individual, business, or agency that has requested to see your credit report usually concludes the report basics.

Checking personal information is important but fixing those errors should have little to no impact on your credit score.  Finding errors in your credit history may be a little more difficult but this data is the primary driver of your credit score and by repairing or removing these items you will see the biggest improvement in your credit score.

Errors that should be reviewed and subsequently disputed with the credit reporting agency include:  all credit accounts listed that do not belong to you or are otherwise incorrect in their reporting, closed lines of credit that do not appear as closed, all balances should be accurate which includes the recording of current payments and balances, negative listings that are past the statue of limitations.

Inspecting your credit report for problem areas and errors is the first step to improving your credit and credit score.  By investigating and disputing questionable negative items on your report, or working with creditors, you may be able to improve your credit score significantly. A good credit repair firm will do this for you.

Judgments, Bankruptcies, Public Records and Credit Scores

Judgments, Bankruptcies, Public Records and Credit ScoresBad credit comes in a number of different flavors.  Late payments on a credit a card, collection accounts or a charged off medical debt can all fall under the heading of bad credit leading to a bad credit score.  While these accounts and trade lines are all contributing factors to bad credit, there are some items in your credit report that are more damaging than others.  The biggest contributors to poor credit and a low credit score are judgments, bankruptcies and other public records.

A public record is identified in as separate section of your credit report identified as simply Public Records. This section of your credit report identifies derogatory credit items that are a matter of public record through court filings and county records.  Common public records include bankruptcy filing information, tax liens and judgments.

Bankruptcy information entails the date and type of bankruptcy a consumer filed for as well as the disposition of the bankruptcy.  Tax liens that are reported on credit report can include any state, local or federal tax liens but generally involves state and federal unpaid income taxes that have become past due and the municipality has subsequently issued a lien against the tax payer’s property.  A judgment is the action resulting from an unfavorable court verdict against a consumer, ordering them to pay an outstanding debt.  Judgments on credit cards and other debts along with bankruptcy filings, tax liens and other records will be especially damaging to your credit score.

Many consumers are aware of the impact that bankruptcy can have on their credit profile and credit score, but many consumers are not aware that other public records and judgments can have a similar long lasting impact and adversely affect their credit score and credit report.  According to the credit score companies, credit score model research has found that a bankruptcy filing, a judgment, or any other public record is a good barometer for assessing future creditworthiness of an individual.

Judgments, bankruptcies and public records are strong indications of an unstable borrower and are a clear credit risk for lenders and potential creditors. Since these items are considered strong indicators of credit risk, the credit scoring models give a significant amount of weight to these items.  Unfortunately that weight leads to a much lower credit score.

Some public records can remain on your credit report for up to 10 years and therefore are some of the most damaging credit events in your credit report.  Fortunately, as with most all bad credit items in your credit report, adverse public records will have less impact on your credit score over time.

Needless to say, while the judgments, bankruptcies and public records are recorded in your credit report they can have a unfavorable effect on your chances of getting a new loan, new mortgage, rental unit or possibly even a new job.  This is why it is importance to check your credit report regularly to look for adverse credit situation that may get worse as well as any potential credit reporting errors.

If you do find a lien, judgment or other public record on your credit report that may be incorrect, you can dispute the credit report to have the information removed.  Any inaccurate or questionable negative information can legally be disputed and deleted from your credit report and this includes public records.  The Fair Credit Reporting Act gives consumers the right to challenge any negative information in their credit report including any judgments, liens, bankruptcy information or other public records. One option you have is to utilize the services of a reputable credit repair company.