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10 Contributions 54 People Helped Top Contributor

Member Since: September 2008

Most Helpful Contribution

My credit score used to be 819 before buying a house and now its 766, is it normal?

Jun 08, 2010
Helpful to 13 out of 16 people

With a new mortgage, the additional debt and the credit new credit inquiries as part of your loan process will lower your credit score. Over time, your credit score will increase provided you continue to maintain an excellent on time payment history.

When it comes to credit, you should think of good credit as a currency. Whenever you use your credit for a lower rate or the convenience of mortgage or credit card, you are using some of the good credit you built. Your credit will increase as you make payments on the new loans you have taken.

Activity (10 Total Contributions)

Do you recommend credit repair companies? And if so do you have some referrals?

Jun 08, 2010
Helpful to 5 out of 5 people

A vast majority of credit repair companies do not work. Credit repair tactics can range from things you can easily do yourself to solutions that are felonies. Here is a list of the common approaches used by these companies.

1. Constantly Disputing Derogatory Credit Information - By law, a creditor has 30 days to respond to disputed items. If the creditor does not, then the credit bureau would have to remove the disputed item from the report. A group of credit repair companies have built a practice of spamming creditors and bureaus alike with disputes. These disputes clog resources for people with real inaccuracies.

In addition to wasting resources, this solution does not work. Creditors will simply add the negative information back on the next reporting cycle and they have every right to do so. No company can guarantee removal of accurate and timely information from your credit report.

2. Piggybacking on Someone Else's Credit - This practice involves borrowing someone’s good credit score to boost your own credit. For a period of time, this worked for many people. However, all the major credit score models and credit bureaus have caught on to the process and have since changed their scoring methodologies to deemphasize the value of piggyback account, generally rendering it much less valuable.

3. Using a New SSN or EIN (File Segmentation) - Some credit repair companies will advise the consumer to apply for an EIN "Employer Identification Number". These EIN are the social security numbers of businesses and have the same number of digits as a social security number. As such, the credit repair companies then have the consumer use this number as their SSN on loan or credit applications. Since these new EIN numbers are not associated with the users credit report, it is like starting from scratch.

What the credit repair companies do not tell you is that you are committing fraud and potentially a felony. In addition, it is usually caught by the lender anyways. Using a new EIN number would show that you have no credit history and the lender would require additional checks.

In many of these cases you will spend hundreds if not thousands of dollars with no impact on your credit score. If are serious about getting help, contact the National Foundation for Credit Counseling to find counseling for a low fee.

Can your credit score increase after declaring bankruptcy?

Jun 08, 2010
Helpful to 5 out of 5 people

Surprisingly, the answer is yes. For some people credit scores actually increases after a bankruptcy.

Consumers who are on the verge of bankruptcy already have poor credit with late payments, high balances, and charged off accounts or collections accounts. When an individual declares bankruptcy, many of the collections and high balances are wiped clean leading to a potential increase in credit scores. But remember these scores are already significantly depressed so don’t look at bankruptcy as a way of increasing your score.

My credit score used to be 819 before buying a house and now its 766, is it normal?

Jun 08, 2010
Helpful to 13 out of 16 people

With a new mortgage, the additional debt and the credit new credit inquiries as part of your loan process will lower your credit score. Over time, your credit score will increase provided you continue to maintain an excellent on time payment history.

When it comes to credit, you should think of good credit as a currency. Whenever you use your credit for a lower rate or the convenience of mortgage or credit card, you are using some of the good credit you built. Your credit will increase as you make payments on the new loans you have taken.

How can I get detailed information on my credit report?

Jun 08, 2010
Helpful to 9 out of 11 people

If you want to access your full credit report for additional details, you will need to get a copy of your credit report. I suggest using AnnualCreditReport.com or becoming a member of a credit monitoring subscription service.

AnnualCreditReport.com is the official site to help consumers obtain their credit report for free as required by federal law. AnnualCreditReport.com allows consumers to request a free credit report once every 12 months from each of the three nationwide consumer credit reporting companies-- Equifax, Experian, and TransUnion.

If you want to check your credit report more regularly than the three reports per year provided by AnnualCreditReport.com, then consider subscribing to a credit monitoring program. These programs will not only provide you full access to your credit score and credit report details, but will also provide 24/7 email alerts of changes to your credit report. However, these services can run from $15 to over $30 per month.

Is it possible to get a credit card without spending $200 with an average score?

Jun 08, 2010
Helpful to 1 out of 1 people

While it is definitely possible to get a credit card without spending 200 dollars, it depends on where your "average credit score" falls and what type of credit card you can qualify for. For example, if your score falls in our range of fair credit scores of 550-639, you are much more limited in your credit card options and may only be approved for a secured credit card, which has some fees and costs. A secured card functions like a credit card but also requires a minimum $200 security deposit from the cardholder.

On the bright side, this card has no credit requirements and is especially effective at building good credit history for people with less-than-perfect credit. However, like all secured cards, there is a $200 minimum security deposit and this card also requires a one-time application fee of $79. If you aren’t willing to deposit the $200, keep in mind that you’ll get 100% of your deposit back if you close your account in good credit standing. Think of the deposit as an investment in your credit history that will enable you to build your credit and qualify for a traditional credit card.

If you want an unsecured credit card, your score should fall within good credit range from 640-719. With that credit score, you are likely to qualify for credit cards like the Chase Freedom Card, which is a great cash back card with no annual fee and $50 cash back with your first purchase. Another good option is the Citi Platinum Select Card, which has low interest and fees. With a better credit score, you'll have a better chance qualifying for a credit card with low fees and does not require a deposit.

Where can go to see if someone can pay off my credit cards and what does it cost?

Jun 08, 2010
Helpful to 1 out of 1 people

Debt consolidation is often a convenient choice for people looking to convert smaller loans into one large loan. Multiple bills and smaller debt piles will be collapsed into one large debt repayment plan. This not only provides the convenience of one monthly bill instead of many, but consolidation might help you save on interest and get out of debt faster.

You're going to have to do some serious number crunching to see if debt consolidation works for you, but in short you should compare the overall debt repayment costs of your current debts with the overall repayment cost of the consolidation loan. One of the nice components of debt consolidation is that, generally, your monthly payment is less than the combined amount of minimums due on your previous smaller debts. Once you consolidate your debts, try to use the additional freed up monthly minimums to pay down your new consolidation loan quicker.

If you decide debt consolidation is for you, be sure to shop around different debt consolidation plans to compare interest rates and savings. You can go with a third-party company that will charge additional fees or you can look at debt consolidated loans through a bank or credit union. Debt consolidation can help you get out of debt more efficiently, but it is no quick fix-it; so if a consolidation plan looks too good to be true, it probably is.

What can I do to fix errors on my credit report?

Jun 08, 2010
Helpful to 8 out of 12 people

Credit report blunders happen more often than consumers think, everything from small inaccuracies, erroneous late payments, and even misplaced data due to mistaken identities. If you notice an error on your credit report, it is definitely in your benefit to resolve and fix these issues as soon as possible.

Here's how to set the record straight:

1. Before you start, be in the mindset to record every step of the dispute with proper documentation, evidence, records of phone conversations, paper trails of all transactions, etc. This additional precaution will help to support your claim.

2. Get on the phone and talk with the company that has reported the erroneous data to the bureau. They have the best visibility into your account history and ultimately will have to be the company to acknowledge the error.

3. If talking with the company doesn’t help or you don’t get a response, request an investigation and file your dispute with credit bureaus that have the mistake on your credit file. Sometimes an error may only be within one or two of the bureaus’ data files. You can dispute an error online or by phone, but the best way is an old-fashioned, formal written letter of complaint detailing the company you have a dispute with, the account number of the disputed item, reason for dispute, and request for correction. A written letter will provide physical proof that the bureau received your claim. It also doesn’t hurt to inform the company you are disputing an item with that you are investigating your credit report via the bureaus.

4. From this point on, the credit bureau should be busy investigating your claim. Under the Fair Credit Reporting Act, bureaus have to investigate your claim within 30 days and correct any errors they find. If the investigation is resolved in your favor, the bureau will correct the error and notify other credit bureaus, update your credit history, and send you a free credit report with the correction.

5. If the company still does not acknowledge their error, you can ask the bureau to include your version of the dispute (restricted to a 100 word addition to your credit report) on your record so that creditors who pull your credit report know that there is another side to the story. From here, keep working towards a cleaner credit history by paying bills on time and managing your credit wisely.

Access your credit report for free once every 12 months from each of the nationwide consumer credit reporting companies including Equifax, Experian and TransUnion via AnnualCreditReport.com and review each and every line item for accuracy. One error can cause a credit score change of 5-50 points – the difference between being Approved or Not Approved.

How long does it take for collections to go off the credit report?

Jun 08, 2010
Helpful to 4 out of 6 people

Depending on how you resolved your credit collections, these negative marks will reflect in your credit score even after you've paid them off. According to FICO's recent disclosure of credit score damage points, a late credit card payment can cost you 60-110 points and a debt settlement costs 45-125 points. While you took a smart step towards improving your credit by paying these derogatory accounts, your credit score won't benefit immediately. Negative marks typically remain on your credit report for up to 7 years and will drag down your overall credit score regardless of your other accounts being in good standing. The good news is the affect on your credit score will decrease over time. Within a year of good credit behavior such as on-time payments and paying off more debts, you'll see your hard work pay off in a healthier credit score.

What credit score do I need to qualify for a mortgage?

Jun 08, 2010
Helpful to 8 out of 13 people

In order to qualify for the best rates, the baseline minimum score is 720. However, the mortgage underwriting process takes into account several factors including income, outstanding debt, and amount of liquid assets (think savings accounts and 401K) as well as your credit score. This means that you may still qualify for a mortgage with a lower score. On the flip side, you may be required to have a higher score for certain mortgages and other contribution factors especially in today's economic environment. Speaking with a mortgage professional and going over your particular situation is a good way to know if you qualify for a mortgage.

Can I do anything about derogatory credit marks on my credit report?

Jun 08, 2010

In short, no. If you agreed to be a co-signer to another person's credit card and they begin defaulting on payments, these derogatory credit marks will show up on both the primary cardholder's credit file as well as yours. Both of your redit scores will be negatively impacted by the cardholder's delinquent actions, and you will not be able to remove these past defaults from your record.

As a co-signer, you contractually agreed to pay off the account if the cardholder does not, and thus any actions reported on the account will affect you as if you defaulted on the payments yourself. Technically, as a co-signer, you will be obligated to the account until it is paid in full or the primary applicant refinances without you as a co-signer. If you're going to sign on the dotted line, you should be sure you are ready to pay.