Better Business Bureau: Advice on credit repair

 

As part of National Consumer Protection Week, which takes place March 2-8, the Minnesota Department of Commerce and Better Business Bureau of Minnesota and North Dakota are partnering to offer consumers advice on companies offering credit repair services.

 

In Minnesota, the Department of Commerce regulates two types of firms offering credit repair services: credit service organizations and debt management companies.

 

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5 Characteristics of People with an Excellent Credit Score

 

 

 

credit score

 

Are you one of those people with stellar credit? If so, that’s wonderful! If you’re like a lot of people, though, your credit is a work in progress and you’re always trying to keep your finances solid. So, what is different about those people who have excellent credit?

 

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Understanding Mortgage Credit Scores

Your credit report is separate from your credit score, though the score is developed from the report. In addition to viewing credit reports from the three major reporting bureaus, you also should obtain your FICO score. Your score is like a report card. Fair Isaac & Co. (the FICO score keeper) assigns you a number based on the information in your credit report. Since there are three credit-reporting bureaus, you have three FICO scores. Here are the scoring factors:

Credit Checklist

  • Payment history
  • Amounts owed
  • Length of credit history
  • New credit
  • Types of credit used

 

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How Credit Scores Affect the Price of Credit and Insurance

Ever wonder how a lender decides whether to grant you credit? For years, creditors have been using credit scoring systems to determine if you’d be a good risk for credit cards, auto loans, and mortgages. These days, other types of businesses — including auto and homeowners insurance companies and phone companies — are using credit scores to decide whether to issue you a policy or provide you with a service and on what terms. A higher credit score is taken to mean you are less of a risk, which, in turn, means you are more likely to get credit or insurance — or pay less for it.

 

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Your Credit Score Affects Your Love Life

A few years ago, credit scores were taboo. The idea that a credit score could be used for more than just determining qualification for a loan was at best unfair and at worst discriminatory. Employers in some circumstances can use credit scores or credit reports to determine whether to offer jobs to applicants. If you sign a credit authorization form, which some employers might imply or outright say is necessary to be considered, the company can use your credit against you.

Auto insurance companies can use credit scores to set your rate because they’ve found that there is a correlation between higher scores and safe driving. If you intend on renting an apartment, the landlord can choose to perform a background check, and credit history could be included.

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Do Credit Repair Services Really Work?

You’ve seen the ads claiming to be able to fix your bad credit, but do credit repair services really work? Honestly, many of the companies are a scam. But the credit repair services that have been around for a couple decades know the rules surrounding credit repair and know how to navigate those rules to either raise your credit score or give you your money back. That of course doesn’t mean that it works for everyone. There is no magical formula to raise your credit score in a hurry, but there are a few instances where credit repair can help you give your score a deserved bump.

 

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14 Sample Credit Repair Letters for Competent Disputes that Work

If you think debt repair is just sending one template dispute letter, think again. Credit restoration is a process. You can see from these free 14 credit repair letters that it takes escalation and a strategic knowledge of your specific situation to get the job done quickly and competently. Without the right information and without follow up or follow through, these credit dispute letters will not work on their own.

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How to Be Your Own Credit Repair Specialist

To err is human. But if you’re shopping for a new car loan, mortgage or credit card, having an error on your credit report can be costly, and there’s a need for a credit repair specialist.

According to the FTC, one in four consumers have errors on their credit reports and those errors could affect your credit score. And if you’re looking to apply for credit, even one point can be the difference between hitting a “good” threshold or being labeled “fair” or worse. Yet experts say a majority of consumers aren’t aware of credit report errors until it’s too late. In fact, the FTC study says approximately one in 20 consumers had errors that resulted in losing more than 25 points from their credit score.

 

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Credit Repair: How to Help Yourself

You see the ads in newspapers, on TV, and online. You hear them on the radio. You get fliers in the mail, email messages, and maybe even calls offering credit repair services. They all make the same claims:

“Credit problems? No problem!”

“We can remove bankruptcies, judgments, liens, and bad loans from your credit file forever!”

“We can erase your bad credit — 100% guaranteed.”

“Create a new credit identity — legally.”

 

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Is there a legit company to fix my credit score?

Dear Debt Adviser,

Is there a legitimate company out there I can consult to assist with increasing my credit score and deleting derogatory marks on my credit report? Thanks for your time and consideration to my question.

— Quan

 

Dear Quan,

I know it seems strange that in our age of instant everything, some things still take months or even years to accomplish. But, in the case of credit scores, it’s true. Your credit score is based on your past actions, and your past took time to create. Sometimes, it’s even longer to outlive. When you’re late on a bill, it stays on your credit report for a long time and there is little you can do about it. But yes, there are still some things you can do.

 

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