Most of the time, if you have an account that has gone to collections or been written off as a bad debt, you know about it, according to Rhonda Bailey, credit counselor and credit report review manager for the nonprofit Credit Counseling of Arkansas.
But not always.
"There are those few instances, like an old utility bill after you've moved, [where] the collection agencey didn't find them and [the consumer] forgot about it," she says. "I see that occasionally."
If you find an item that isn't yours, you can dispute it and have it removed from your report.
If the item is yours, you have some decisions to make, Bailey says.
Can you afford to pay it?
It's a good idea to check your state's statute of limitations, which is the period of time creditors have to sue you over a debt. Your state attorney general's office can give you that time limit, she says.
Aside from that, the item can stay on your credit report for seven years. The longer it's been on your report, the less it affects your score.
Coming up in Part 4: Judgments, Liens and Bankrupcies
CALL BANCO FINANCIAL TODAY AT 248-286-5100 FOR ALL OF YOUR CREDIT RESTORATION NEEDS!
Friday, July 29, 2011
Thursday, July 28, 2011
Six items to review on your credit report, Part 2: High debt-to-credit limit ratios.
Credit scores typically look at your debt-to-credit limit ratio or utilization in two ways:
1. They compare the balance on one revolving account to your available credit from that lender. For instance, if you have a credit card with a $1000 balance and a $5000 credit limit, this ratio would be 20%.
2. They calculate the total of all your debts on revolving accounts against your total credit lines on those same accounts. So if you have four credit cards, each with a $5000 credit line ($20,000 in credit) and you have a $100 balance on two of them and nothing on the other two ($2000 in debt), this ratio would be 10%.
"In an ideal world, you would want to have [those ratios] under 10%," says Hendricks. "But certainly you want to keep them under 40%. There's no magic number."
But if you're running up a balance of $2000 to $3000 with a card that has a $5000 limit, "that's really going to hurt your score," says Brobeck (executive director of Consumer Federation of America). "And what's worse is running up balances on several cards.
Coming up in Part 3: Collection Activity.
1. They compare the balance on one revolving account to your available credit from that lender. For instance, if you have a credit card with a $1000 balance and a $5000 credit limit, this ratio would be 20%.
2. They calculate the total of all your debts on revolving accounts against your total credit lines on those same accounts. So if you have four credit cards, each with a $5000 credit line ($20,000 in credit) and you have a $100 balance on two of them and nothing on the other two ($2000 in debt), this ratio would be 10%.
"In an ideal world, you would want to have [those ratios] under 10%," says Hendricks. "But certainly you want to keep them under 40%. There's no magic number."
But if you're running up a balance of $2000 to $3000 with a card that has a $5000 limit, "that's really going to hurt your score," says Brobeck (executive director of Consumer Federation of America). "And what's worse is running up balances on several cards.
Coming up in Part 3: Collection Activity.
Six items to review on your credit report, Part 1: Late Payments
You've pulled one of your credit reports. Now what?
As you've probably heard by now, you entitled to free copies of your credit reports. Federal law gives you the right to request your three credit reports, one from each of the three major credit reporting agencies, every year through CreditCheckTotalcom.
You can get them all at once or throughout the year. Personal finance gurus often recommend pulling one report every four months so you're regularly tracking your records. Either way, checking your credit report is a smart move when you consider that information from your credit report determines your credit score.
But once you get that report, what do you do with it?
How about giving it the six-minute treatment? While you definitely want to read the full report in detail, a quick check on a handful of indicators can give you an instant appraisal of how good - or bad - your credit is right now.
1. Late Payments.
"Delinquencies are huge influences on the credit score," says Stephen Brobeck, executive director of the Consumer Federation of America. In fact, they make up 35% of your FICO score.
"If you see notations that bills have been paid 30, 60, 90 or 120 days late, that's very damaging to your credit," he says.
The other factor that's important here - the timeline. How late was the payment, and how long ago did you make this mistake?
"The later the payment, the more it hurts your credit," says Evan Hendricks, author of "Credit Scores & Credit Reports: How the System Really Works, What You Can Do."
"But the more time that has passed since you made a late payment, the less it will affect your credit," he says.
Coming up in Part 2: High Debt-to-Credit Limit Ratios.
As you've probably heard by now, you entitled to free copies of your credit reports. Federal law gives you the right to request your three credit reports, one from each of the three major credit reporting agencies, every year through CreditCheckTotalcom.
You can get them all at once or throughout the year. Personal finance gurus often recommend pulling one report every four months so you're regularly tracking your records. Either way, checking your credit report is a smart move when you consider that information from your credit report determines your credit score.
But once you get that report, what do you do with it?
How about giving it the six-minute treatment? While you definitely want to read the full report in detail, a quick check on a handful of indicators can give you an instant appraisal of how good - or bad - your credit is right now.
1. Late Payments.
"Delinquencies are huge influences on the credit score," says Stephen Brobeck, executive director of the Consumer Federation of America. In fact, they make up 35% of your FICO score.
"If you see notations that bills have been paid 30, 60, 90 or 120 days late, that's very damaging to your credit," he says.
The other factor that's important here - the timeline. How late was the payment, and how long ago did you make this mistake?
"The later the payment, the more it hurts your credit," says Evan Hendricks, author of "Credit Scores & Credit Reports: How the System Really Works, What You Can Do."
"But the more time that has passed since you made a late payment, the less it will affect your credit," he says.
Coming up in Part 2: High Debt-to-Credit Limit Ratios.
Thursday, July 7, 2011
Banco Capital Services
Our services offer some of the most comprehensive credit correction available in the industry today. Ours is an elite service in challenging inaccurate and unverifiable information damaging clients' credit reports. It is your responsibility to make sure that your credit reports accurately represent your behavior as a consumer. Call Banco Capital @ 1-800-442-1591.
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