Thursday, April 25, 2013

5 Deadly Mistakes to Avoid When Looking for a New Home

5 Deadly Mistakes to Avoid When Looking for a New Home

By Daniel Sater C.C.E CFP
Nationally Recognized Credit Expert, Author, Speaker, and Credit Coach to the Credit Repair Industry

631-392-8685      ©2012 CREDIT SCORING ADVISOR

1)      Not Paying Down Credit Card Accounts with Balances in Advance of Applying for Credit

The credit scoring model takes 30 to 60 day to reflect what you do today and Mortgage lenders will no longer allow you to pay off credit cards to improve your debt to income ratios. This area accounts for approximately 30% of your credit score. I have seen more damage done in this area due to the consumer’s lack of knowledge. As you use more of your credit limit you lose more points from your score. Max out 5 or 6 credit cards and you may lose 80 to 125 points. Paying down your credit balances is one of the fastest ways to boost your scores. The best is to have your balances below 10% usage prior to applying for new credit or a big ticket item.

2)      Closing Accounts, or not Using Credit Card Accounts to Keep them Active.
According to Fair Isaac, the people who developed the FICO Scoring Model, ALL account reporting on your credit report are scored, OPEN OR CLOSED. There is little distinction between open and closed accounts. You NEVER get a scoring benefit by closing tradelines. Closing a tradeline will NEVER help your scores but can only lower your score. So will not using or having Credit Cards.

In addition to the effect on your debt to available credit ratio, you also run the risk of shortening your credit history. Over time, these closed accounts will drop from your report, eliminating a good account and reducing the number of accounts you have successfully had.

3)      Missing Payments

For some reason people get complacent when paying bills and don’t thinks one slip means that much. If your score is high, (>750) one missed payment will cost you 80 to 110 points. (Good News! If your score is already 550 you might lose on 10 to 20 points.) A rule of thumb, the more recent the more damage will be done. Also, the more severe (90 days late vs 30 days late) and/or the more frequent the lower your score. It doesn’t matter if it’s $10.00 of $10,000. If you have missed a payment, bring it current as soon as possible.

4)      Apply for New Credit of Any Kind.  Including those “You have been pre-approved” credit card invitations that you receive in the mail.  Every time that you have your credit pulled by a potential creditor or lender, you lose points from your credit score immediately.  Depending on the elements in your current credit report, you could lose anywhere from 2- 15 points for one hard inquiry. New Credit will also change your scores.

5)      PAYING OFF COLLECTIONS OR CHARGE OFFS during the process thinking they will be removed from your credit report or improve your score. IT WON’T HELP. This is where a Professional Credit Restoration firm with the knowledge and skills can help Boost your Scores. We average a 70% deletion record. Give us a call. 631-392-8685
Daniel Sater is a Nationally Recognized Credit Expert who founded Credit Scoring Advisor, a national credit repair company specializing in Rapid Credit Repair for their clients. In addition Dan trains and Coaches numerous Credit Repair Companies across the country, he is a Speaker and Author. He last book, "The Top 20 Toxic Credit Mistakes" is available on the Credit Scoring Advisor website. He can be reached at 631-392-8685.

Thursday, April 18, 2013

The Truth About Credit Repair Companies

The Truth about Credit Repair Companies
Many people have advised you to be wary of Credit Repair Companies. You were told that they can’t remove accurate tradelines, and that almost all negative entries will stay on the credit report for 7 years. Repairing you credit takes time. They go on to tell you that anything Credit Repair Companies can do, you can do for yourself at little or no cost. They imply and sometimes actually say that Credit Repair is only a scam.
What you should know is that all the characterization comes originally from Fair Isaac Corp., the developers of the FICO Scoring Model, and the three main credit bureaus. So methodical was their campaign that the State Attorney Generals, the Federal Trade Commission, various consumer groups, and the clueless media credit experts and reporters that gain their “knowledge” from news services and staff that research the topic by contacting the people who are creating the lies to begin with, and then, accepted their words without question. To prove their point, they hold up the scam operations that have ripped off the public. What they don’t tell you is that every industry has their share of unethical people. They even have influenced congress to write what I believe are restraint-of-trade laws that state, if you use or consult a credit repair company they can view your dispute as “frivolous”.
Why have they done this you ask? Changes to the credit model costs them money. In fact, they have a vested interest in you having credit scores lower than they should be. Their subscriber (your creditors), make more money off your debts that way. They are actually afraid of what credit repair companies have been able to do for their clients.
Professional credit repair companies are able to achieve better and faster results for their clients due to their experience and training.
At Credit Scoring Advisor we are the experts. We have trained and coached many credit repair companies throughout the United States and have spoken at numerous trade conferences on credit scoring and credit repair and have created several certification exams for the industry. You have continued access throughout our process to a recognized credit expert. Give us a call for a free consultation at 631-392-8685.

Mistakes You Can't Afford to Make with a Debt Collector

Mistakes You Can't Afford to Make with a Debt Collector
By Daniel Sater CCE, Certified FICO Professional

Avoid these mistakes when dealing with a debt collector. Here is what you need to know: 
#1  Mistake: Giving a debt collector your banking or credit card information.
 If you tell a collector to take $75 per month out of your account and at some point in the future they empty your account, you’re screwed. Why? Because the collector is going to say you gave them permission and it becomes at best a “he says, she says” type of situation. Any attorney will tell you you don’t have much of a case against them. NEVER give a collector you credit card or bank information. Send a money order instead. Best to get the money order from a bank you don’t use.
Never do Check-by-Phone or Western Union

#2 Mistake: Sending money to a debt collector without getting paperwork FIRST,
showing who they are, what you owe, how they arrived at that figure, who the original creditor and what was the original amount. It also pays to ask if they were assigned the debt or if the bought the debt. (Ask for papers showing their authority to collect for the creditor).
Don’t let them intimidate you. You have what they want – the money. Believe me, it’s all about the money and getting it as soon as possible. You have the upper hand; ask for them to prove the facts. If they cross the line you can threaten them with a lawsuit, and that you will notify the BBB, their States Attorney General and the Federal Trade Commission FTC.

 #3 Mistake: Not showing up in court, or answering a court suit, when served.
If you don’t appear, you automatically receive a default judgment. It goes on your record for seven years as a judgment. It will continue to accrue interest and depending on your state can follow you for ten years and possibly be renewed for an additional ten years. Many attorneys file a suit in court because they know you likely will not show up (90% don’t show), so it’s an easy payday for them, they've done their part by submitting the paperwork. The judge thinks, the consumer doesn't care, why should I? He’ll even add on court cost.
 NEVER ignore a lawsuit; we can help you with referrals to local consumer law professionals. Don’t tell me you can’t afford a lawyer, you have no idea how easy it is to hire one. It can be a lot more expensive not to.
REMEMBER, even if the Statues of Limitation has expired barring them from getting a judgment, if you don’t show up, the Judge won’t question how old the account is and issue a judgment. Once the judgment is on your record, it can be enforced. You must be there to claim an affirmative defense regarding the Statutes of Limitation or you lose.

#4 Mistake: Signing an agreement or legal document without consulting with an attorney.
Don't do it, even if you are threatened. Again, get in touch with us; you have options, let’s discuss them.

#5 Mistake: Failure to dispute the validity of the debt and dispute any credit bureau reporting. These are important steps in protecting your rights, invoking the federal laws that protect you and making these bottom feeders back up their claims. We can offer you Dispute Validation Forms, credit disputing tips and access to the brightest consumer law professionals in the country. Debt collectors have to abide by the law, make them realize you know your rights, make them work for it.

#6 Mistake:  Document everything, phone call times and dates and who called. Request that all communication is done in writing. 
It can take most of the possibility of intimidation and threats out of the conversation. It’s the best way to keep a record of conversation.

#7 Mistake:  Thinking paying off a debt will automatically remove it from your credit report.
All you will have is a paid collection, that is paid. You will avoid al lawsuit, and, your file being sold to yet another collector who will hound you for money.
If you request that payment will have them remove the item reported, get the agreement in writing FIRST.

At Credit Scoring Advisor, we are the Experts. We have helped thousands of clients reach the goal of buying a home, a new card or just be able to get credit cards for everyday use.

Daniel Sater has trained and coached numerous Credit Repair Companies across the country to have a better understanding of how the FICO scoring model works and how to get the best results in repairing their client’s credit. We are proud members of NACSO the Credit Repair Industry’s Trade Association.

If you need help improving your credit, give us a call at 631-392-8685 – you’ll be glad you did. We provide rapid, personalized credit repair – you will be working directly with a Nationally Recognized Credit Expert.