CREDIT REPAIR - FIX YOUR CREDIT

Whenever you apply for any type of credit or financing, a credit report is pulled from at leastone of the three major credit bureaus. While there arehundreds of smaller credit bureaus around the country,virtually every credit bureau is affiliated with eitherExperian, Trans Union, or Equifax.

These credit bureaus collect andmaintain information on the vast majority of Americans, butthey are not affiliated with the government in any way. Thecredit bureaus are for-profit corporations and they sellyour personal information for money.

The credit bureaus receive yourpersonal information through the same lenders who grant youcredit. They have agreements with each of these creditgrantors that require the credit grantor to inform thecredit bureaus of everything that occurs in yourrelationship with the credit grantor. If you make a paymentlate, the negative credit listing is quickly reported to atleast one of the three major credit bureaus and is added toyour credit history. Credit reports are not just a record ofhow you are currently managing your credit accounts. Creditreports are histories of everything you are doing with yourcredit now, and everything you have done in the past.

The credit bureaus collect thisinformation, list it on your credit report, then sell it toother credit grantors who wish to see your credit historybefore they decide to lend you money. The credit grantorswho review your credit are especially interested in anynegative credit. If you have shown any tendency to pay late,or to disregard your financial commitments in the past, thenthe creditors' computers will typically reject yourapplication.

Just like when you were in gradeschool, your credit report is your financial report card tothe world.

Merchant Trade Lines
These include all regular credit lines such as departmentstore cards, auto loans, mortgages, and credit cards. Ifthere is any history of late payment, or if the trade linewas included in bankruptcy, charged off, or put intorepossession, the listing will be considered negative by allcredit grantors.

Collection Accounts
When an account is referred to collections because ofdelinquency or because of a bad check, this appears on thecredit report as a collection account. Collection accountscan appear as paid or unpaid accounts. Any type ofcollection account, whether paid or not, is considered verynegative by all credit grantors.

Court Records
Court records include bankruptcies, judgments, liens,divorce, satisfied judgments, and satisfied liens. All courtrecords, including satisfactions, are considered negative byall credit grantors.

Inquiries
Every time a potential credit grantor looks at your creditfile, a credit inquiry appears on at least one of yourcredit bureau reports. If the number of inquiries is veryfew over the last two years, then there may be no negativeeffect on your credit worthiness. However, if there are manyrecent inquiries showing on your credit report, creditgrantors may become nervous and deny you credit.

With the passing of each year, yourcredit report is used more and more often as a yard stick tomeasure your character. Prospective creditors will alwaysreview at least one of your credit reports before grantingyou credit. Today it is increasingly common for insurancecompanies to review your credit before extending auto orhealth insurance. Many employers now check credit beforethey consider you for a position. If you rent, you may havealready been through a credit check to determine yourworthiness as a renter.

The Fair Credit Reporting Act (FCRA)requires that most negative credit items be deleted fromyour credit bureau file in no more than seven years, exceptfor bankruptcy which can be reported for up to ten years.These are the time limits for reporting negative credit. Thecreditor or the credit bureau can choose to have thenegative credit information deleted whenever they please.Inquiries may remain on the credit report for up to twoyears.

Under the new Fair Credit ReportingAct, no collection or charge off may remain on the creditreport for more than seven and one half years from the firstlate payment that initiated the collection or charge offstatus.

Most credit grantors are not allowedby the credit bureaus to show you your own credit report.But you can purchase your credit report from the creditbureau for a fee or you may buy it on line through a varietyof services.

If you order your credit report fromthe credit bureaus themselves, you may find that you cannotread it because the information is listed in an unfamiliarcode. Trans Union and Equifax credit reports are verydifficult to interpret and understand. Experian creditreports, however, are relatively easy for most people toread. The Qspace report is one of the most easy to read.

As you may have already experienced,even one small late pay listing may result in creditdenials. It is a myth that a large amount of positive creditcan outweigh some negative credit. Any negative creditwhatsoever can become a substantial credit obstacle.

Different kinds of creditors responddifferently to bad credit. It is safe to say that yourbankruptcy will continue to make it more difficult to getcredit for seven years after your last late payment assumingyou don't repair your credit.

Within two years after the lastnegative listing, a consumer can usually acquire"sub-A" financing for a home (assuming allaccounts are paid.) Within three years, the consumer shouldbe able to get normal, "A," mortgage rates evenwithout credit repair (that assumes that the person has beencurrent on bills all the while.)

Auto financing is a little lessforgiving. You may find yourself paying higher or slightlyhigher interest rates on cars until seven years after thenegative listings (without credit repair), when the listingsare deleted from the credit report. You can get autofinancing with bad credit in most areas, but the rates aregoing to be astronomical. Yet, time heals all wounds, andyou should be doing better within three years of thenegative listing.

Credit cards and banks are the leastforgiving of all. Many standard rate credit cards will noteven consider an application from a person with a anynegative credit on their credit report. In these days,though, there are credit cards that cater to every creditsituation; even someone who discharged their bankruptcy theday before applying. Most of these cards charge very highinterest or unusual up front fees or security deposits. Itis common for one of these cards to charge you an"application" fee equal to the limit on the card.After the bankrupcty ages, prospects become better, but theywill remain sub-standard until the negative listins fall offthe credit report. With that said, it shouldn¹t beforgotten that bad credit can usually be repaired (after asignificant amount of effort and follow-through.) Evenbankruptcy can be repaired after enough effort and time arededicated to the task.