How Does The Credit Dispute Process?

Posted under Credit Repair on May 4, 2007 @ 11:49 am by Bruce Liu

Upon receipt of your dispute letter, the credit bureau first reviews and considers the relevant information you have submitted regarding to the nature of your dispute.

If the review doesn’t resolve your dispute and further investigation is required, notification of your dispute is provided to the creditor, including the relevant information you submitted.  The creditor reviews the information provided, conducts an investigation and reports the result back to the credit bureau.

The credit bureau then makes deletions, or changes to your credit file based on the creditor’s investigation result.  The name, address, and the telephone number of the creditor is shown under the result section on the cover letter that comes with the copy of your revised credit file.

If you still disagree with an item after it has been verified, you may send second or third dispute letter with additional documents to support your dispute.

You may also send a 100 words brief statement, explaining the nature of your dispute.  Your statement will become part of your credit file and will be disclosed each time that your credit file is reviewed.

You have the right to request that the credit bureau sends your revised credit file to any company that received your credit file in the past 6 months for any purpose or in the past 2 years for employment purpose.

Remember, the credit bureau is not necessary to do so unless you ask!

How To Spot A Predatory Lender

Posted under Credit Repair on April 27, 2007 @ 02:12 pm by Bruce Liu

Predatory lenders do not have horns and tails.  They seems like nice, friendly, helpful people.  They are trained to gain your trust. So how will you know one?

1.  None of your questions get answered, or the answers don’t really make sense.  A good lender can explain your loan in everyday language. 

2.  The lender pressures you to sign things before you’re ready or rush you through the paperwork.  A good lender won’t pressure you. 

3. The ledner doesn’t explain or tell you about all the costs for getting a loan. A good lender will explani the costs and the service you’re geting. 

4. Things change at the closing. You’re not getting the loan your were promised.  A good lender will honor their commitments. 

5. The ledner wants you to borrow more money than you need.  A good lender will let you decide how much money you borrow. 

6. The lender makes you feel like you don’t ave other choices, as if other lenders won’t give a loan.A good lender will let you know you have other options. 

7. The lender gives you a quick yes, but it may not be the best loan for you.  A good lender will take time to explore your options with you. 

8  You have a feeling somethings just not right.  Follow your instincts.  A good ledner makes you feel informed and confident.

Don’t let a predatory lener pressure you into a costly loan. The best advice is walking away from those lenders.   If you have questions about your loan, visit www.dontborrowtrouble.com for free advice.

What makes your FICO credit score?

Posted under Credit Score on April 19, 2007 @ 03:53 pm by Bruce Liu

As a rule, credit score analyze the credit related information on your credit report.  How they do this varies.  Since FICO scores are frequently used, here’s how these scores assess what is on your credit report:

1.  Your payment history – about 35% of a FICO score

Have you paid your credit account on time?  Late payments, bankruptcies and other negative items can hurt your credit score.  But a solid record of on-time payments help your score.

2.  How much you owe – about 30% of a FICO score

FICO scores look at the amount you owe on all your accounts, the number of accounts with balance, and how much of your available credit you are using.  The more you owe compared to your credit limit, the lower your score will be.

3.  Lengthy of credit history – about 15% of a FICO score

A longer credit history will increase your credit score.  However, you can get higher score with a short credit history if the rest of credit report shows responsibility credit management.

4.  New credit – about 10% of a FICO score

If you recently applied for or opened new credit accounts, your credit score will weight this fact against the rest of your credit history. FICO score distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. 

If you need a loan, do your rate shopping within a focused period time, such as 30 days, to avoid lowering your credit score.

5.  Other factors – about 10% of a FICO score

Several other minor factors also can influence your score.  For example,  having a mix of credit type on your credit report – credit cards, installment loans such as a mortgage or an auto loan, and personal lines of credit – is normally for people for with longer credit histories and can add slightly to the credit score.

What You Can Do To Rebuild And Improve Your Credit Rating?

Posted under Credit Repair on April 13, 2007 @ 12:57 pm by Bruce Liu

• Open a checking and savings account and begin making regular deposits even if they are small.

• Apply for a department store or gas credit card (easier to qualify for) and pay all your bills on time, including your utilities.

• If you feel you need a credit card for identification, for travel, or for emergencies, take out a secured credit card by depositing money with the issuing bank and make charges that you pay on time (interest is generally 7-23% and some cards have no annual fee).

• If you need to buy a car, put down a high down payment and select the most economical car that fits your needs (not your wants) at a low price.

• If you are married, it is a good idea for each spouses to establish their own, separate credit history. The Equal Credit Opportunity Act requires that if you have had a joint account, you can request a creditor to report your individual participation and performance on that account separately.

• In the future, do not go overboard with credit. You could be turned down for new credit if you already have too much revolving credit.

 

5 Hot Tips To Save Your Money On Credit Cards

Posted under Money Saving on April 2, 2007 @ 10:26 am by Bruce Liu

The following tips are basic principles about obtaining and using credit cards that can save you some serious cash and keep you out of debt.

6. Always Shop Around

Don’t apply for the first “pre-approved” offer you receive in the mail or any for that matter. Do the research for yourself. There are plenty of sites such as bankrate.com that allow you to compare hundreds of credit card offers with a simple search. You’ll get the best deal by shopping around.

5. Read the Fine Print

The terms and conditions are the equivalent of the disclaimer you hear on car lot commercials. It cuts through the hype and reveals the true terms of the credit card such as what happens when you miss a payment and what you’re really getting from the rewards. Most terms are not that long, usually around one full page, it’s worth your time to read them.

4. Ask for a Better Rate 

Once you have been a credit card customer for a few months call them and ask for a better rate. They won’t laugh at you, they get hundreds of these calls every day and if you’ve been a good customer it usually will work. Credit card companies work hard to obtain you as a customer and they will work hard to retain you.

3. Pay Off Full Balance Every Month 

All credit cards have high interest rates compared to other types of loans. You should never plan to carry a balance on a credit card. If you must make a large purchase that you do not have the money for at the time, obtain a loan or a revolving line of credit from your bank. You will save a bundle on interest rates.

2. Do not get a Cash Advance 

This is the second worse thing you can do with a credit card, short of missing a payment is getting a cash advance. The cash advances usually come with a very high interest rate.

What makes it worse is the fact that with most companies this higher rate credit will not get paid off first, or even in the order that you took it out. They will apply your payments towards all the lower rate purchases and will only begin paying off your high interest cash advance will all other items on that credit card have been paid off.

1. Never, EVER Miss a Payment 

This is the absolute worse thing you can do with a credit card. Not only will you incur a late fee, but your interest rate will also skyrocket. In addition it will be a negative blemish on your credit report which can cause the rate on any other loans or credit cards you have to increase as well as insurance rates. It also makes you less likely to get approved for future credit.

Simple Steps To Update Your Credit History

Posted under Credit Repair on March 20, 2007 @ 05:47 pm by Bruce Liu

After you have gone through the process of ordering your credit report and correcting any incorrect information, you will need to focus on rebuilding yourcredit history.

You’ll need to update your existing file and start working toward establishing a strong, newcredit history that proves you have changed poor repayment habits, if those were in fact part of your old history.

• Provide the credit bureaus with any positive information which is not appear on your reports but definately help boost your credit rating.

• Make sure the status of all accounts on the report is accurately reflected.

• Close any open accounts you’re not using.

• Work with your creditors to delete derogatory information that is not yours. For detail, see my article posted on last year - How To Dispute And Fix Your Credit Report Errors

• Clear up any erroneous student loan matters.

• Clear up any incorrect public record information.

How To Dispute Defective Goods or Poor Services

Posted under Credit Repair on March 13, 2007 @ 01:13 pm by Bruce Liu

If you have a problem with merchandise or services that you charged to a credit card, and you have made a good faith effort to work out the problem with the seller, you have the right to withhold from the card issuer payment for the goods or services.

You can withhold payment up to the amount of credit outstanding or the purchase, plus any finance or related charges. If the card you used is a bank card, a travel and entertainment card, or another card not issued by the seller of the defective goods,
you can withhold payment only if the purchase exceeded $50 and ccurred in your home state or within 100 miles of your billing address.

If these conditions do not apply to you, you may want to consider filing an action in small claims court — an informal legal proceeding that can be used to settle disputes.

While the maximum amounts that can be claimed or awarded differ from state to state, most small claims courts hear cases involving amounts ranging from $25 to $2,000.

Some states have recently raised their limits to $5,000. Check your local telephone book under your municipal, county, or state government headings for small claims court listings.

Protect Yourself By Placing a Security Alert On Your Credit File

Posted under Credit Report on March 7, 2007 @ 09:55 am by Bruce Liu

You have the right to place a security alert on your credit file, which will warn anyone
who receives your credit file that your identity have been used without your consent and being advised to verify your identify before issuing any credit.

This security alert may prevent credit, loans, mortgage and financial service from being approved in your name without your consent.

However, it may delay or interfere with with timely approval of any application you make that involves access to your credit file such as a new loan, credit mortgage insurance, rental, empolyment, utilities, cellular phone,and other financial services.

This security alert will remain on your credit report for not less than 45 days after the date the security alert is place on the your file.  You have the right to obtain a free copy of credit report every 45 days while the security alert is in effect.

You may call credit bureaus requsting a security alert on your credit file.  Experian 1-888-397-3742, TransUnio 1-800-680-7289 and Equifax 1-800-525-628

Take Advantage of IRS Programs and Save More of Your Tax Refunds

Posted under Money Saving on February 21, 2007 @ 03:40 pm by Bruce Liu

If you are low and moderate-income taxpayers, then you should take advantage of IRS programs and bank services that can help you save more money for future goals, including buying a home or funding a child’s education, tax preparation, qualify for tax credits, etc.

IRS-coordinated Volunteer Income Tax Assistance (VITA) program that provides free tax-preparation services for qualifying individuals.

Also, IRS has the ability to direct deposit tax refunds in up to three different checking and savings accounts at up to three different U.S. financial institutions.  It encourages you put part of your refunds into both savings and checking accounts.

If you are interested in obtaining free tax return preparation, you should call the IRS at 1-800-829-1040 or go to www.irs.gov/individuals to locate a VITA site.

How To Fix Your Credit Card Billing Errors

Posted under Credit Repair on February 16, 2007 @ 06:41 pm by Bruce Liu

Federal law provides specific rules that the card issuer must follow for promptly correcting billing errors. The card issuer will give you a statement describing these rules when you open the credit card account and, after than, at least once a year.

In fact, many card issuers print a summary of your rights on each bill they send you.

You must notify the card issuer in writing at the address specified for billing errors when you find an error, and you must do so within 60 days after the first bill containing the error was mailed to you.

For this reason, keep your credit card receipts and promptly compare them when your bills arrive.

In your notification letter, include your name, your account number, the amount of the suspected error, and the reason why you believe that the bill contains an error.

The card issuer must look into the problem and either correct the error or explain to you why the bill is correct. This must occur within two billing cycles and not later than 90 days after the issuer receives your billing error notice.

During the period that the card issuer is investigating the error, you do not have to pay the amount in question.

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