Bad Credit History, What Now?

To begin, take a moment to visualize yourself with excellent credit. See yourself living in your dream home…driving your dream car, money in the bank…comfortable and happy… whatever happiness means to you. If you can’t see it… feel it, then you will not experience it. See it clearly in your mind in explicit detail and focus your mind on these images. It helps to surround yourself with these images so that you have constant reminders of your goals and stay motivated. For no reason should you lose sight of where you want to go…despite what obstacles you may anticipate that stand in your way. Those who accomplish greatness only see where they want to go, and don’t worry about how they are going to get there. By acting in that wisdom alone miracles somehow just happen!

Ok…now let’s talk credit! What you are about to read are some facts, and some information you may find interesting. It is my hope that you feel inspired to take action, having a better understanding of the credit game, and some knowledge with where to begin.

Credit Facts

- Credit Bureaus, also called Credit Reporting Agencies, are owned privately, with the sole function of collecting information regarding your credit history, and then selling that same information to creditors/lenders for a fee. These lenders/creditors need this information for marketing purposes, for example, so they know who to send their credit card offers.

- There are 3 main CRA’s, TransUnion, Equifax, and Experian. As you see I underlined “main” as there are other reporting agencies, though for the purposes of composing your FICO score the above mentioned 3 are used exclusively. You can obtain a copy of your report by contacting these CRA’s, or going online to MyAnnualCredit report.com. Don’t be fooled by other online companies offering a “free report”, as there are many.

You will need a current copy of your credit report to begin repairing your credit.

- Your FICO score, created by Fair Isaac Corporation, is a numerical score, used as an indicator of how credit worthy you are, or how great a risk you are. It ranges between 300-850, and is used by all 3 CRA’s, and the majority of lenders/creditors. Generally speaking if you were to rate your standing based on this number range it would look like this:

750+ (Excellent)

720+ (Very Good)

661-720 ( Not Bad)

620-660 (Average)

619 and below (low)

(give or take 1-2 points here or there, depending on the source)

-Your FICO score does not come automatically when you order your credit report. FICO scores require an extra charge. To be safe, it is best to obtain these scores from myFICO.com, as the CRA’s may offer a score calculated by that agency and not a true FICO score. Look for “Certified FICO Credit Score” to be sure.

-Your FICO score is impacted either positively or negatively based on:

1.) your payment history, i.e., history of late payments

2.) the amounts you owe on each account

3.) the length of your credit history (the length of time you’ve had active credit)

4.) newly opened accounts and inquiries

5.) types of credit (the types of accounts on your profile).

-You can repair your credit and raise your score by consistently paying your bills on time every month, disputing items on your credit report and having those negative items removed, and if you have few open accounts and very poor credit, obtaining secured credit cards, to build your standing. There are many ways to have items deleted from your credit profile, and the CRA’s must comply because they are mandated by law to do so.

- Please note also, if you dispute items on your report, and then within the 30 days allowed, the CRA’s send you back a letter indicating that they have verified the item(s) to be accurate, you can request that they explain their method of verification, and essentially prove to you that they conducted a “reasonable” investigation. The burden of proof is on them.

- The Fair Debt Collections Practices Act, and the Fair Credit Reporting Act, were both created to protect you, the consumer, from unfair practices used by debt collectors, and the CRA’s.

Wow…I could go on and on. There is so much regarding this topic, and truly many, many ways to approach repairing your credit. The above mentioned has barely scratched the surface, but it is a great start. It is my belief that if we seek knowledge….wisdom, etc., we will find it. And to be honest, I don’t even think it’s so much our finding “it”, but rather “it” coming to meet us, revealing itself to us because we had faith enough to try…to believe. It is my sincere desire that you obtain much success in all you aspire to do.

Related posts:

1. Make Your Bad Credit History A Thing Of The Past
2. Credit Scores vs. Credit History in Mortgage Lending
3. How to Erase Your Bad Credit History
4. Does Your Bad Credit History Still Haunt You?
5. 5 Reasons to Check Your Credit History
6. Bad Credit No Money Down Loans
7. Tips for Starting A Positive Credit History
8. 10 Steps to a Better FICO Score
9. Ways Start Building Your Credit History, Today!
10. 10 Steps to Building Good Credit History

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