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How To Clean Up Your Credit Rating

Become An Authorized User

How To Clean Up Your Credit Rating Report: 5 Top Tips

Finally, if none of the above suggestions helps you, dont despair. There is one final option, and that is to be added as an authorized user on someone elses credit card account.

For this to work, youll need to find someone who loves you very much and who manages his or her money very well. Once you find this special person who is going to do you a huge favor, explain you have no intention of using the credit card. You just want to be added to their account as a way to build credit.

You see, when youre an authorized user, the account will show up on your credit report. Then, your credit report will reflect the primary cardholders on-time payments and credit utilization rate. As a result, your credit score gets a boost, too.

While these strategies can raise your credit score fast, keep in mind that fast is a relative term. You wont see results overnight; give it three months or so for the changes to begin affecting your score positively.

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Remove A Collection: Pay For Delete

A pay for delete is as uncommon as the goodwill deletion but worth a try. If you can pay the debt in full, negotiate with the collection agency asking them to remove the debt from your credit report in exchange for payment. It sounds a bit like a bribe, and in some cases, it may be.

Many creditors wont do this because they feel its unethical. Youll have the most power if you have other collections with the same collection agency.

If you promise to pay the other debts in full in exchange for deletion of the current collection, they may do it for the sake of receiving further payment.

Like the goodwill deletion, make your request in writing and keep it polite. If the creditor agrees, get the agreement in writing so you can hold them to it when its all said and done.

Understand Your Risk Factors

When you request your free credit reports from AnnualCreditReport.com, you only receive the report. You dont see your actual credit scores. But for those who want to significantly increase their scores, purchasing a full credit report with scores can be beneficial.

Experian, TransUnion and Equifax include a list of risk factors along with purchased scores. Your credit score takes into consideration as many as 300 risk factors;and knowing what your risk factors are will let you know where you can make improvements.

Your risk factors might list a specific account that is hurting your score or too many credit card applications in a short period. Even not having a mortgage can show up as a risk factor. You wont be able to fix everythingdont buy a house to increase your credit scorebut you might spot some factors you can change.

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Ways To Clean Up Your Credit Rating

Ways To Clean Up Your Credit Rating ;By: Leslee Mason

;;; You went on a spending spree that lasted two years. Now your credit rating is so bad even the public library turned you down for a card. Whatever the reason for your debt; a student loan, you lost your job or over used your credit cards- Youre not alone. Its a situation thousands of Canadians, from all income brackets, experience each year. You cant erase the past, but you can put those debts behind you and get on the road to credit recovery in as little as three years.

Heres How

1.;Stop ducking your creditors.

Dont wait for a creditor to come to you. Always take the offensive position. Advises Barb Godin, senior vice-president of consumer lending with The Bank of Nova Scotia.

2.;;Go For Credit Counselling;

People come to us because theyre falling further into debt and do not see any logical way out of the situation, says Laurie Campbell, program manager with The Credit Counseling Service of Metropolitan Toronto. If you cant reach a repayment agreement with your creditors or collection agencies, or the fear factor is too overwhelming, some credit counseling services offer no-cost/low-cost confidential help.

Theyll help you with budgeting and money management, give you a financial assessment and suggest ways you can handle your money, creditors and payments without getting further behind. For worst-case scenarios, theyll deal with your creditors on your behalf.

3.;Read your credit report.

What To Do If Youve Been A Victim Of Credit Fraud

Cleaning up your Credit Score  The Stylish Lender

If youve been a victim of identity impersonation or credit fraud, your credit score might have taken a hit. Improving your credit score in these situation involves taking many of the steps on this page.

When you check your credit file, keep an eye out for a Victim of impersonation notice. This marker is provided by Cifas, a not-for-profit fraud prevention service.

Cifas markers are put on credit files by lenders in cases where they believe there has been an attempt at fraud by people mis-using a loan applicants identity. Lenders are legally obliged to report such concerns.

Having a Cifas marker on your file serves as a warning to future lenders that youve been a victim, or are vulnerable to becoming a victim, of fraud.

The marker will stay on your file for 13 months.

The good news is that having a Cifas marker doesnt affect your credit score and doesnt stop you from taking out credit. But it may create problems if youre applying for credit that is processed automatically, such as store finance. This is because a lender would have to carry out a manual review of your file to understand why the marker has been added.

Find out more on the Cifas website

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Are There Effective Quick Ways To Fix Errors On My Credit Report

There are two steps in disputing and fixing errors on your credit report.

First, send a letter to the credit reporting agency, indicating what information you think is incorrect. Provide any supporting documentation, such as bank statements, debt-release paperwork, and correspondence youve had with lenders. In the letter, clearly state your name, address and each item you dispute. Use bullet points and break down each dispute by using words like what, who, when and how much. For example, if you disagree with the amount owed on a credit card account, clearly state what the dispute is about, who the lender is, when the item under dispute originated, and how much money you think you dont owe. Send your letter by certified mail, return receipt requested, so you have proof it was delivered, who signed for it, and when it was delivered.

The credit reporting agency would investigate your claim, notify the other two agencies, and contact the respective service providers. It will contact you within 30 to 60 days, and if your claim is valid, it will send notices of correction to various parties such as lenders, credit agencies, insurers, companies that may have denied you employment based on your credit report, and landlords.

How To Spot A Credit Repair Scam

The;signs below indicate that a credit repair company is a scam:

  • The company wants you to pay before it provides a service.
  • The company recommends that you dont contact any credit reporting agencies directly.
  • The company tells you it can get rid of negative credit information in your credit report, even if that information is accurate.
  • The company advises you to dispute all information in your credit report, regardless of its accuracy or timeliness.
  • The company suggests you create a new credit identity.

Companies that want you to lie about credit history or create a new credit identity can get you into legal trouble. Companies that provide new identifying information may use stolen Social Security numbers, and if you use this number, then you are committing fraud. Likewise, using an Employee Identification Number or Credit Profile Number provided by these companies is a crime. Rather than committing fraud, take the steps below to improve credit on your own.

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File A Dispute With The Credit Reporting Agency

Initiate a claim directly with the credit bureau by writing a dispute letter. The purpose of this letter is to notify them that you believe certain information in your credit file is inaccurate.

The Fair Credit Reporting Act requires creditors to report accurate information about every account. This means they have a legal obligation to review, investigate, and respond to your claim. This process is free and can take up to 30 days to complete.

You can begin a dispute with any one of the credit bureaus through their websites or via mail. The leading credit reporting agencies are Equifax, Transunion, and Experian. Its essential to have documentation and to be precise about the information you are challenging.

Each of the three major credit bureaus has an online section dedicated to walking consumers through the process of disputing a claim online. It would be best to dispute the entry with each credit bureau to make sure the removal is complete across the board. After receiving the initial claim, the credit bureau will contact the source of the erroneous information and dispute it on your behalf.

How to file a dispute letter:

How Do Collection Accounts Start

How To Fix Your Credit – Clean Up Credit Report

You may wonder, what makes a creditor send your account to collections? It all starts with that first missed payment.

  • You miss your due date and the debt goes 30 days delinquent.
  • Youll receive phone calls, emails, texts, and letters in the mail asking you to contact them. At this point, your account remains with the creditor.
  • Once youre 60 days late, the creditor usually turns your account over to their in-house collections department.
  • Youll receive more phone calls, emails, texts, and letters. This time if you call the creditor, youll go straight through to the collections department, not customer service.
  • The correspondence may be less polite and more demanding at this point.
  • If you let the account remain unpaid for 180 days, creditors usually give up at that point, selling your account to collection agencies for a fraction of the full balance.
  • Below is our recommended course of action for ALL consumers asking, How to Remove a Collection from Your Credit Report.

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    How To Monitor Your Credit To Detect Inaccuracies

    Along with inaccurate information about you, that debt collectors may report to Experian, Equifax, and TransUnion, you should also lookout for signs of identity theft on your credit reports.

    Identity theft happens more and more now as data breaches and scams keep exposing our sensitive financial data.

    Heres how to monitor your credit to make sure its in good standing with all three reporting bureaus:

    What Is The Credit Repair Organizations Act

    dispute negative information found on your credit reports. But in the past, some of these companies would overstate what they could do for consumers to drum up business.

    The Credit Repair Organizations Act is a federal law that became effective on April 1, 1997, in response to a number of consumers who had suffered from credit repair scams. In effect, the law ensures that credit repair service companies:

    • Are prohibited from taking any payment from a consumer until they fully complete the services they promise.
    • Are required to provide consumers with a written contract stating all the services to be provided as well as the terms and conditions of payment. Under the law, consumers have three days to withdraw from the contract.
    • Are forbidden to ask or suggest that you mislead credit reporting companies about your credit accounts or alter your identity to change your credit history.
    • Cannot knowingly make deceptive or false claims concerning the services they are capable of offering.
    • Cannot ask you to sign anything that states that you are forfeiting your rights under the CROA. Any waiver that you sign cannot be enforced.

    The CROA adds transparency and due diligence to the credit repair process, making it less likely that consumers will be taken advantage of. However, regulators have still found wrongdoing among credit repair companies.

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    Not Eligible For Any Credit Cards Try This

    If youve recently been rejected for a lot of credit cards or bank accounts, it could be that your score is too low for any provider to take a risk on you.

    Dont panic! There are some simple things you can do to start rebuilding trust in your credit score.

    1. Sign up for a basic bank account

    Most banks now offer a basic bank account. These have no overdraft facility or monthly account fees. If youve been made bankrupt or cant get another type of bank account, this will start you on the journey to rebuilding your credit score. Make sure you never go overdrawn though youll face hefty fees and damage your credit.

    The Money Advice Service has great information about basic bank accounts to get you started.

    2. Try LoqBox

    LoqBox is essentially a loan to help you rebuild your credit. You choose an amount you KNOW you can repay each month say £20 and youll get a loan of 12 months worth of that much.This gets locked into an account you cant spend the loan and you pay off your £20 each month as promised. At the end of it, you get your money unlocked and LoqBox confirms to credit agencies that you have successfully paid back a loan.

    Its a totally free service, too unlike some other similar credit repayment cards. You also wont need a credit check to apply. Your money is safe: its paid into a partner bank thats covered by the Financial Services Compensation Scheme.

    3. Use your rent to boost your credit

    Know What Not To Sweat

    Learn the best ways to clean up your credit from a former ...

    Items on your credit report that might seem alarming but arent include:

    • Closed accounts in good standing: Leaving them on your report can be good.
    • A hard inquiry will show up on your report if you applied for a loan or credit card. It can also crop up if you enter into a service contract for a cable TV or cellphone plan.

    Honestly, a hard inquiry is a very small impact on your credit score, and its short term, says Maxine Sweet, retired vice president of public education at Experian. It stays on for two years, but it has the most impact only within six months.

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    Use Different Cards For Different Needs

    Once you reach good credit, consider giving the Island Approach a shot. This means using a group of credit cards and assigning each a specific role.

    Isolating your financial needs on different credit-card accounts will help you get the best possible terms on every transaction that you make. For example, you could get the best cash-back credit card for everyday expenses, the best travel rewards card for airfare and hotel reservations and the best balance-transfer card for reducing the cost of your existing debt.

    The Island Approach also gives you a built-in warning system for overspending. If you ever see finance charges on an account designated for everyday expenses, youll know youre overspending. Separating everyday expenses from a balance that youre carrying from month to month will help you save on finance charges, too. Interest charges are based on an accounts average daily balance, after all.

    What To Do If You Find An Error

    When you get your credit report copy for free, its important to examine it thoroughly. Youll want to make sure all of the information is accurate.

    Check balances on all outstanding debts listed on your credit report. Make sure the information lines up with what you know to be your debt record.

    Did you find any discrepancies or fraudulent activity on your credit report? If so, follow up with the individual bureau.

    Get more information from them regarding the discrepancies or fraud. Do what you need to do to clear them up. Use the agencies above to help if needed.

    Youll want to take care of any long-overdue outstanding or written-off bills. Its possible that you might have forgotten about or werent aware of these. Do the research to make sure theyre yours.

    Make the necessary calls to get them paid off. Make payment arrangements if you have to. This way you can make sure your credit record gets and stays clean.

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    Negotiate A Pay For Delete Deal

    If you have collection accounts or charge offs that you have not paid off, you should try a pay-for-delete agreement to have the negative item removed from your credit report.

    For this to work, be prepared tonegotiate with the creditor or collection agency over the phone.

    Offer to pay the unpaid debt if the creditor will agree to delete the negative entry from your credit report entirely.

    This is very effective, especially with collection agencies because they earn a direct profit when you pay an old debt.

    But you must get your pay-for-delete agreement in writing before you make the payment.

    Negotiate over the phone if thats more convenient, but dont pay anything until you have the written agreement in hand.

    Collection agencies have short memories . You may need your written agreement to prove you had a deal in place when you paid.

    Monitoring Your Credit Score

    How To Clean Up Your Credit Report

    In order to catch issues, and stay on top of your credit score, you should implement a credit monitoring strategy. You can monitor your credit for free with LendingTree, MagnifyMoneys parent company. Keep in mind that LendingTree uses VantageScore, which is slightly different than the FICO score, although it has the same score range.

    If you prefer more monitoring and additional credit protection, you can pay a fee for services that provide daily three-bureau credit monitoring, resolution assistance if your identity is stolen and insurance if you have to engage in a legal battle. This guide ranks the top identity theft protection services.

    Whether you choose a free or paid version, credit monitoring is a great service. As soon as you detect suspicious activity, you can take action. The sooner you work to deal with issues in your credit report, the less the damage may be.

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