Repairing Your Credit Report
Fixing your credit report and
repairing your credit are two distinct processes and problems. If your
credit is bad, you can implement some of the strategies below to fix a
low score.
Negotiate down the amount of
debt (it s easiest with private individuals). To do this, you must demonstrate
the reason for falling behind. One of the tools you can use as leverage
is offering something (not the full amount) rather than nothing. For example,
explain why the lender should take $5,000 instead of $10,000. You can say
I m calling five other creditors today. I m offering you $0.50 on the dollar
and if you aren t interested, I ll file for bankruptcy, in which
case they wouldn t get a nickel).
Negotiate a forbearance with
credit card companies and clients with mortgages. If there was an illness,
death of a breadwinner, divorce or some other legitimate reason incurring
severe financial difficulty, you may have a case. Show them you had a good
reason for falling behind, agree to stay current on the current payment
and offer to pay X amount per month toward what you owe. You also can stick
the amount owed on the back of the loan. These are legitimate ways to negotiate
and repair your credit.
Beware of illegitimate ways
to repair credit
Watch out for companies that
will put together new tax returns for you. They re essentially offering
to dummy up tax returns. Another scam is when they take advantage of the
credit reporting service s limited window to answer disputes. If, for example,
the window is 14 days, they ll write a letter saying you don t owe
(when you actually do). It s just a matter of time before the bank fails
to meet the 14-day window; when they miss deadline, you are not required
to pay the disputed amount. Not only is this wrong ethically, but it doesn
t fix your credit problem. Additionally, companies that charge you an upfront
fee to get you new credit (often ranging from $100 to $1,000), especially
out of other countries, is a scam.
Recommended Read
I recommend Your Credit
Score by Liz Weston, a helpful book on different strategies of legitimate
ways to improve your credit score on your own. If you feel like you need/want
help, there are legitimate services available to you as well.
Author-Bio: During my years
of law school, I completed an internship with a New York Supreme Court
Justice and second legal internship with a law firm and also began investing
in real estate. Immediately upon graduating law school and passing the
bar exam, I opened my own law practice. From 1988 to 2001, I practiced
with my partner under the name Miles and Gillard, where I concentrated
in the area of real estate and business law. Find Out More: http://www.pfbs.com
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