There are several blogs online that say that repairing your own credit report is possible. That’s absolutely true. However, what some of these pro-DIY articles fail to mention are the drawbacks involved. So, let’s discuss the benefits of getting a credit restoration company to rebuild your credit score.
Top Credit Myths Re-Examined ((You’ll be Amazed!!))
Credit myths are a huge source of misinformation
Everyone wants to know how to fix their credit. But few really take the time to do their homework and instead rely heavily on rumors. Misinformation is rampant and unfortunately, this leads to frustration. In this article, we will reexamine these so-called credit myths.
Credit Reporting Myth: When I pay off a past-due account, such as a charge off or a collection account, it will show “paid” and will no longer be negative.
This is one of the most common credit myths. It is quite difficult to restore your credit without somehow satisfying your outstanding debts. However, paying an outstanding, delinquent debt you will change the account status to “paid collection,” “paid was late,” or “paid was charged off” – which will still stand out as a very negative listing. When you have outstanding debt, it is almost always prudent to seek professional help so that you may settle your debts while creating a reasonable possibility of removal of the negative listing at the same time.
Credit Reporting Myth: If I succeed in removing a negative item, it will just come right back on my credit report.
The credit bureaus have cleverly spread this myth through the news media and government agencies. In truth, the credit bureaus will often temporarily remove a negative listing if they haven’t heard from the credit grantor after approximately thirty days. If the credit grantor reports late, say after six weeks, and then verifies the negative listing, the credit bureau will often reinsert the negative listing on the credit report. This is often known as a “soft removal.” Usually, though, the creditor simply fails to respond and the negative listing is permanently removed. If the item is verified by the credit grantor, either before thirty days or after, the account may still be challenged again at some future time.
Credit Reporting Myth: This is one of the huge credit myths. There are negative listings, such as bankruptcies and foreclosures, that are impossible to remove from the credit report.
This is another of the credit myths. Flare Credit has the capability of removing any type of negative listing using our proprietary technique. This includes bankruptcy or unpaid debts which are traditionally more difficult to remove from the credit report. For example, judgments and tax liens are severely negative listings, yet are easier to remove.
Credit Repair Myth: Challenging the credit report is easy and any consumer can do it themselves for the price of a few postage stamps.
Another prevalent credit myth: Challenging the credit report is easy. You can hop online today and press a few buttons. However, getting results from creditors and having the credit bureaus update their records accordingly can be difficult, complex, and somewhat infuriating. Restoring your own credit report is like repairing your own transmission or representing yourself in court; it is possible, but you must decide if you are willing to take the time and assume the risks of doing it yourself.
Bankruptcy Myth: If I declare bankruptcy, I can begin my credit report all over with a clean slate.
This is yet another huge credit myth that has caused considerable harm. Many bankruptcy professionals do not adequately understand or explain the effects of bankruptcy to their clients. Stated simply, bankruptcy is to the credit rating what the nuclear bomb is to war. When you file for bankruptcy, every credit account that you decide to include in bankruptcy will become an “included in bankruptcy” account. Additionally, a bankruptcy filing and bankruptcy discharge listing will appear in the court records section of your credit report. Because so many negative items are attached to the bankruptcy, it becomes difficult to remove all traces of the bad credit. If at all possible, you should avoid bankruptcy.
Credit Report Myth: If you are not satisfied with the results of your credit bureau challenge, you may file a “100-word statement” on your credit report explaining your side of the story.
Creditors will read your statement and will take it into consideration. To our knowledge, no known creditor considers information given in a 100-word statement. The statement only serves to verify some of the negative listings on the credit report. Make 100-word statements the first things you remove from your credit file.
Credit Myths: By changing numbers in my social security number or by using an EIN tax number, I can fool the credit bureaus into creating a completely clean, new credit file under my name.
This scheme has proven to be complex, difficult, and illegal. Lying about any personal information on a credit application is usually a criminal offense. Using these “file segregation” schemes requires an enormous amount of coordination, not to mention personal risk.
Credit Report Myth: If I build enough good credit, it will offset my bad credit and make me creditworthy.
Talk about another common credit myths. After all, I was only late a couple of times. Any amount of bad credit is devastating to your chances of being approved by a credit grantor. Most credit grantors never actually look at your credit report. A computer pulls your credit report, rates your credit standing, indebtedness, and stability, then spits out an acceptance or denial. Even one or two slow pays will usually trigger a credit card or personal loan denial. The slightest amount of negative credit will cause the interest on an auto loan to skyrocket. You will probably find that even a little bad credit, regardless of how much good credit you have, is an unacceptable barrier to credit approval.
Credit Score Myth: I can improve my credit score by closing down some credit cards.
For starters, this is also another one of the top circulating credit myths. Closing down credit cards usually leads to a significant decrease in the credit score. What’s more, consumers focus far too much on positive credit while negative credit still appears on the credit report. Negative credit effectively wipes out any amount of positive credit when the score is calculated.
Credit Report Myth: It is illegal for creditors to take a negative, accurate listing off my credit report.
Another of the top credit myths: The law requires that these items remain on the credit report for at least seven years. When you speak with creditors and collection agencies their typically unhelpful staff may tell you all manner of such pseudo-legal nonsense. The law demands that negative listings appear on your credit report for no longer than seven years. Creditors can choose to remove the negative credit listing whenever they see fit.
How Your Payment History Improves Your Credit Score
Your Payment History and your credit
There is a huge demand for information that can boost credit scores. It’s common knowledge that one thing that really tilts the scales in your favor or against you is your payment history. Put simply, your credit payment history is one of the most important pieces of information considered in a FICO® Score. A missed payment, collection, bankruptcy, foreclosure, charged off account and other derogatory information on a credit report can have a substantial impact on your FICO®Scores.
Your payment history is pivotal to your reaching your credit goals. Sometimes, this may require more than just challenging items on your credit report. To address that, you need to begin by accessing your FICO® Score. Then you need to review an improvement analysis which is specifically designed to evaluate your credit report in accordance with the five main categories known to significantly impact a FICO® Score.
We recommend a personalized analysis of each predictive category, including targeted tips that may help you raise your FICO® Scores. This includes your overall payment history. Consumers are often shocked to discover how many factors in their credit report – aside from obvious credit report negatives – can impact their scores.
A FICO® Score considers late or missed payments, collections, and public records (e.g. bankruptcy, tax liens, etc.) in several ways – how recently they occurred, how late they were, how much was owed, and how many there are. The more recent, severe, and frequent the late or missed payments, the greater the impact on a FICO® Score.
However, as negative information on your credit reportages and your more recent credit activity is positive, the older negative information has less of an impact on a FICO® Score.
When considering whether or not to lend you money, the primary goal of a potential lender is to determine what the odds are that you will not repay a debt. Your credit payment history is one of the primary categories of information they have to assess whether or not you’ll repay your debt in the future.
Statistical data continually shows that previous credit payment behavior may predict future credit risk.
You have no positive accounts
Below is a comprehensive list of all of your negative items. These items are listed in order of severity – based on your credit report information. A detailed explanation of the negative listing and how it may impact your score can be obtained by clicking on each individual account.
When evaluating missed payments, a FICO® Score considers the severity of delinquency (was the missed payment 30 days late or 90 days late for example), how recent the missed payment was, and the frequency of accounts with missed payment indicators being reported. The more recent, severe and frequent the greater the impact on the score.
More Approvals, Better Rates
Your FICO® Score is comprised solely of the information found in your credit report. In other words, if you want to improve your score, a good place to start is making improvements to your credit reports.
Bad Credit Mortgages | Bad Credit Mortgage Brocker Toronto
How does it feel to be able to purchase things without worrying about cash? Imagine yourself strolling inside the mall then suddenly a dress caught your eyes. You want to buy it but your pocket is empty. Perhaps, your only choice is to borrow and what can be done using your credit card. Your credit card can be used to pay for your purchases and other items. Isn’t it rewarding? You do not need cash on hand to settle your bill.
But what if you don’t have a credit card? Then you plan to obtain one. However, your bad credit hinders you from getting a credit card. So, what should you do? Are there credit cards for bad credit? To tell you exactly, you are not alone in this kind of dilemma. A lot of people are in the same shoes as you. Some of them were able to successfully get a credit card while some have been trying countless times.
People with bad credit especially those with a score below 580 are not prohibited to get a credit card. They do have ways to acquire one yet with the fewest options as possible. That’s because only a few card issuers want to take risk of raising the credit limit they may not get paid for. As Canadian credit conditions get tighter, the harder it becomes to secure a credit card when you have poor credit. Nevertheless, do not lose hope.
Regardless of how “poor” your credit was, still there are credit cards available for you. They come in two forms: secured and unsecured. The difference between the two is that there is no need for unsecured cards to have a deposit to open a line of credit, while secured cards do. The amount of the deposit may vary but it is usually equal to the amount of the credit issued.
How to get a credit card with bad credit?
Having bad credit makes it difficult for you to secure a credit card but it is not impossible. It’s just that the process to get one is a daunting task because most issuers are likely to deny the credit application. The lower your credit score, the harder the approval is but not completely hopeless. There are necessary steps to help people with bad credit. Here are a few:
Know Your Credit Score
When applying for a credit card, you must know exactly what your credit score it This is for you to see exactly where you stand. You may request a report of your credit from a credit reporting company such as Experian, Transunion or Equifax. Canada’s Federal Law obliges each of these companies to provide you a free credit report once every twelve months. But you need to ask for it. Once you know your credit score, you will have an idea of whether you are getting high chances of approval or not. Higher credit score means big chances to get approved. If you’ve got bad credit, then you can work on the credit card application aligned with your poor credit score.
Look for the Best Credit Cards for Bad Credit
It is important to look for the credit card best suitable for your bad credit. There are two forms of credit cards for bad credit: unsecured and secured. You may choose either of the two. Choose a credit card that helps you rebuild your credit score, lesser fees, and other favorable items for you.
Fill out an application
Once you’ve done the first two steps, you may now proceed with your credit card application. Fill out the form with your necessary details. You will be asked to choose the credit card you want. Select that card which you think is best for you. Submit your application after filling everything out.
Approval for a credit card application usually doesn’t take long. But for those with poor credit, it may take a while as issuers are stricter than those who have good credit. So wait for the results of your application. If you are denied, do not lose hope. There can be other ways you can do to get approved. The issuers will typically advise you what to do and you just need to comply with whatever those things are.
Can credit cards help to rebuild credit?
Credit cards are a useful tool to help rebuild your credit. As long as you do not make any late payments, and you can pay your other financial obligations, then you’re good. Missed or late payments contribute to your poor credit score. That’s why you must be responsible enough and use your credit card wisely. If you fail to responsibly use your credit card, you might get an accumulated amount of credit that you may not be able to pay. It will then result in a much lower credit score. So, avoid doing things that will have a bad impact on your credit.
Types of credit cards for bad credit
Credit cards for people with bad credit come in two forms: unsecured and secured. You may choose either of these two:
Unsecured credit cards
These cards do not require any security deposit to get approved or get an increased credit limit once approved. These cards are the most common type of credit cards as they are not secured by collateral. The lenders do not have direct hold to the property once the cardholder fails to pay.
The drawback here is that unsecured credit cards come with higher interest rates and fees. But if used wisely, it can help rebuild your credit score. Your credit history, financial strength and earning potential will be viewed by issuers to know whether you qualify for unsecured credit cards.
Secured credit cards
These cards require security deposit unlike with unsecured credit cards. On the other hand, since the deposit serves as collateral, the credit card issuer has direct hold to the deposit to cover any defaulted payments. Because the card applicant is considered a credit risk, the deposit was a necessity.
Getting a secured credit card also usually get faster approval than unsecured ones. The reason is that there is no risk from financial establishments. Only when the default happens, the lenders will not return the deposit. The issuers of secured credit cards report to the three major credit bureaus, so the responsible use of the credit card greatly helps in rebuilding and improving credit scores.
Where to find a trusted credit repair company in town?
There are numerous credit repair companies in Canada, especially in Toronto. But, if you want to fix your poor credit, you may choose to contact Credit Repair Now. We have a team of expert brokers who are willing to assist you with your credit concerns. We can also help you secure a credit card suitable for your current status. Just set an appointment with us so we can work on rebuilding your credit.
You may contact us through our contact number +1 647-373-9651 or send us an email at [email protected].
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