Have you ever heard your parents or grandparents tell you, ?we used to go to the grocery store down that street, picked up whatever we needed and if we did not have money to pay right then, we would ask the store owner or manager to add the items to our bill and next time we come in, we'll pay the bill?? It was a trustworthy relationship (as described in the credit definition-above) people had a few decades ago. However, that type of trust seems to be a thing of the past. Now, we live in a bigger, more crowded, and distrusting world. Most to all of those mom and pop stores have been closed, become major corporations or that the employees? and managements? ?ideologies? have changed. It is also because some of us have abused the ?Trustworthiness afforded to us by others.? Although some utility companies may still apply some concept of the old school credit and trust on us; however, they still request a cash deposit or ask to see our credit report in advance of connecting our services, which takes us to the next paragraph.
What is a Credit Report?
As a result of the changes in our lifestyles, distrust and other issues discussed in the paragraph above, for profit companies (Equifax, Experian, and TransUnion) have been established to obtain, process and hold our history of trustworthiness (?credit history?). These companies, which are called credit reporting agencies or ?credit bureaus?, have been receiving our credit history, accumulating, holding and processing them into an organized, readable format (called credit report) for others who are willing to lend us money (Creditor). Therefore a credit report is a collection of your payment history for loans and Credit Cards of over the past several years. As a result, whenever you want to purchase something using Other People's Money (OPM), the one who wants to lend you money or extend credit in some fashion, would want to pull/obtain/retrieve your credit report.
Note: Since we mentioned 'several years?, lets make this phrase clear.
a.If you opened an account and the account is still open, then it will be reported on your credit report (also called ?credit file?) from the date the account was opened? now read b.
b.When an account closes, it still remains and reported on your credit report for yet another seven years.
c.Now if the account was in good standing and closed that way, there will be a note/comment on your credit report (on the last line of the history for this account) that will say, ?account closed at consumer's request.? However, if the account was in default (you missed payments and the creditor was forced to close the account) then, it will state, ?Account closed by credit grantor.?
d.If the account has a balance and was not paid at the time it was closed, then depending on the type of account, it will report serious negative on your credit report such as ?Collection,? ?Charge-off,? 'repossession,? ?Foreclosures,? or some other adverse wordings (depending on the type of account you were holding. (For more in depth information, please read the my book called, ?Your Credit = Your Life, Fix It Now!?
e.Whichever type of accounts you may have (whether good or bad), it will NOT be reported for more than sever years on your credit report, UNLESS, you file Bankruptcy and include some accounts in your Bankruptcy petition; therefore those accounts will be reported longer (based upon the type of Bankruptcy filed).
Since all these discussions are extensive and takes pages, please read about them in the ?Your Credit = Your Life, Fix It Now!? book.
Why credit repair is important?
First let's make something clear. Although a lot of credit repair companies want to mislead you by making you to believe creditors and credit bureaus are horrible devils from ?hell?, the truth is that all parties can make mistakes. The same way that we may make a mistake and forget to pay a bill on time (once or twice), the creditors may report inaccurate information by mistake. There is no law broken. However, the law is breached when a creditor or a credit bureau does NOT want to fix the mistake, argue with you or abuse their discretion. As stated in the last paragraph of ?What are Credit Bureau's Responsibilities?? A bureau is responsible to report accurate information and any evidence of inaccuracy must be resolved in favor of consumers. This includes when a creditor or a collection agency does not reply to the bureau's request for correct information. See the ?Your Credit = Your Life ?? book.
The way the credit system works is similar to the court system. You are presumed innocent until proven guilty. However, in the court system a person that is charged with a crime, is arrested, taken to jail, finger printed, booked, a bond is set (in most cases), then released on bond until a later date when through a series of court hearing the person is proven innocent or guilty. Although most credit repair companies want to make you believe that the credit system works in the reverse order, this is not true and do NOT be deceived. As I stated above, mistakes can take place by both (your creditor and or the credit bureaus). It is your job to look at your reports, find the inconsistencies and contact the bureaus or the creditors to resolve the issues. Please read the book, ?Your Credit = Your Life, Fix It Now!?, so that you can become informed about all aspects of credit repair.
Since the inconsistencies can take place accidentally or inadvertently, no one can be blamed UNLESS you notify the party who made the mistake and no corrections are made. Some credit repair companies use scare tactics concerning credit bureaus to get your business. Do NOT be INTIMIDATED....
I repeatedly use the expression that ?lack of knowledge costs a person a lot of money? or ?knowledge is wealth.? I interpret this expression by saying, 'scammers see your lack of knowledge as PRICELESS.? The book I mentioned above costs about $25.00 but WILL save you so much more and give you so much knowledge so that when you get fraudulent calls from collection agencies or even those so called 'debt consolidation?, 'debt reduction?, and 'debt management? companies or others, you will be able to immediately recognize the scams and fraud. In the ?Fraud Watch? article, I will give you examples.
The Fair Credit Reporting Act (FCRA) gives you the right to accurate credit reporting. Exercise that right by having your questionable credit items either verified as accurate or removed from your credit files according to the law.
What are Credit Bureaus? responsibilities?
As we discussed under the main paragraph of ?What is a Credit Report?), the bureaus? responsibility is NOT to act on creditors or lenders behalf, but only to report accurate information concerning your credit history. However, while accumulating data from creditors, lenders, collection agencies or others, bureaus may receive inaccurate data and process the data into inaccurate information, which is then displayed on your credit reports/files. Although Experian's representatives are known to argue with consumers about the inaccurate information reported on a person's credit report; however, by law they are NOT justified in doing so. A credit bureau's job is ONLY to accumulate, process, and report information given to them (whether electronically or through paper) by the creditor/lenders and collection agencies. If you feel intimidated by a bureau's representative, DO NOT HANG UP the phone; get the person's name, ID, department or any other information, then ask for the supervisor, and finally report the company to the FTC (Federal Trade Commission) by phone or visit the website .
There are a couple of books out there called ?Your Credit = Your Life, Fix It Now!? (same link as above), and ?Consumer Advocacy? (in the Author Bio section, please see the address to the Attorney General of the ALL states) , they teach you how to effectively catch people in their act of deception, fraud, and consumer abuse.
The credit bureau is responsible to investigate and properly affect corrections on your credit report when any inaccuracies are reported to them. See the next paragraph for details.
Although, the law gives you the right to dispute any listing on your credit reports that may be inaccurate, untimely, misleading or unverifiable (questionable items), the law can?t protect you at all times until you push the issues and be consistent with your pursuit for justice and credit issues. If a credit bureau can't verify the accuracy of a disputed listing, then it must be removed the item from your credit report. However, there is a lot more to credit repair than just disputing a line item entered on your credit report. When you know the law and have knowledge of the proper way in handling your affairs, then you have the upper hand.
I can repeatedly suggest that you read, read and make time to read until I turn blue and yet you may still come up with some sort of excuse. It is true that I can NOT twist your arm or force you to act responsibly and to understand that your financial destiny is in no one else's hand but your own. You must understand, I spend hours writing these articles, hired Internet experts-spend unexpected amounts of money posting them to give you ideas, provide you important information and encourage you to take control of your life at no cost to you when and where there is no benefit to me. Even if you think you are not a good reader, fast reader, do not have time for it or whatever your excuse may be, I am certain you care about making and saving your money; therefore, do something that would benefit you.
Not until you admit that you have a problem, can you face and fix it. Just like an alcoholic or drug user who claims he/she doesn?t have a problem, people who don?t want to admit they have financial or credit problems cannot fix their problems. Before I give you an example, let me clarify that I am not trying to brag but am thankful to GOD for the intelligence he has given me. Now, I am trying very hard to share those experiences with you.
Most of my friends work for the government or companies and make more money than I do. However, most of them had or have bad credit, spend a lot more money in an attempt to catch up with their bills and none of them live in a house as nice as I do. Again, I am NOT trying to brag. My credibility was in the millions up until I met three con-men who took me to the cleaners. However, I had one thing going for me, my credit. Every time, my friends wanted to buy something, they had to cough up a lot of cash, get higher than normal interest rates, pay so much more for the loan cost, spend about two months trying to get a loan or many other situations which was uncomfortable to them. On the other hand, I was and am able to get loans larger than they can and ONLY in a matter of a few days, without any problem and at a much lower cost and rate. I have bargaining and negotiating power due to my good credit.
Every one of my friends has asked me how do I do it. But none of them wanted to set forth any effort to do what I have been doing. Some of them did not ask for help with their IRS, State tax liens, Property Tax liens, medical bills (co-pay portions), collections, and so on and so forth until years later. Although, I helped them for free, it took them years and a lot of wasted money (on higher interest rates, late fees, and other overcharging fees) plus aggravations to finally give up and do something. Please do not be like some of my friends. Do something NOW.
When I tell people that I can close on mortgage loans within SEVEN (7) days, they do not believe it until I show them proof. No, I am not talking about from the time the underwriters FINALLY approve my loan until the time that we agreed on a closing date. I not only do this for myself, but also have proof of what I have done for a couple of my clients. I am talking about; it took me 7 days from the actual time of application until the signing of the security deed, exchange of money and documents. Again, I make less money than most of my friends!! And, I do NOT pay a dime over what my actual bills are. No. I am not talking about paying more than what I have to, because when you are forced to pay late fees and over limit fees then you HAVE TO pay. ?HAVE TO pay? is very different and higher from ?the actual bill.? I save my money very properly. How are you Saving Your Money? Read this book.
Why act now?
As lending and credit options for consumers with poor credit continue to decrease, having a good credit report and credit score has never been more important (especially now with all the foreclosures or repossessions and loan defaults). A lot of people become statistics and consider the alternative method (which is waiting seven years for credit problems to go away). However, the seven years will never come; because, every day we need something that requires credit. We continue borrowing money or live on credit. As we do so, our rates, cost of obtaining a loan/credit/service goes up, our late fees and over limit fees don?t stop (because we can?t catch up with the payments that were set high to begin with), etc, etc. Therefore, we never see the end of the month let alone the end of seven years.
It is true that some bad stuff (derogatory) may fall at the end of the seven years (if we ever get there) but, some remains (see my book ?Your Credit = Your Life??) Moreover, as some old stuff is removed, some new BAD stuff may take their place. IT IS A NEVER ENDING CYCLE. So don?t fool yourself that in sever years everything will be OKAY and then you can turn your life around. I promise you that attitude will NEVER WORK. There's no better time to act than the present.
You have an incredible array of rights and a long list of options to improve your credit. However, you MUST take action NOW.
I have a sign on my office door and I make sure everyone reads it before they enter my personal office. It says, ?More is lost by indecision than by bad decision.? It is also on my business card. I stole the statement from the analysis of the book ?Your Credit = Your Life, Fix It Now!? Please understand the issues surrounding your life, willpower and future.
Since all these discussions are extensive and takes pages, please read about them in the "Your Credit = Your Life, Fix It Now!" book at the website, post your questions and comments.
Best of luck
Mike Samadi
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