The Exciting World of Credit Repair

A mortgage news and information blog post by mortgage banker Gaffney Neptune of Consumer Real Estate Financial Company (CREFCO)

A Brilliant Option

Credit repair offers a brilliant option to living a life with bad credit. Removing genuine derogatory history is not the point. And finding and eliminating those ever-so-common credit reporting errors although important, is only part of the picture. Real credit repair is about a complete tune up of everything that can affect your credit scores and the attractiveness of your credit reports to prospective lenders. Everything matters, from tracking down reporting compliance mistakes, to reshaping the content of your bureau reports. And beyond the reports, but impacting them, are collectors and the legislative environment in which they operate. Let’s take a look at the exciting world of credit repair.

Errors Errors Everywhere

The best advice anyone could give about the task of tracking down mistakes on your credit report is to remain skeptical about everything you see. It matters little that an account seems familiar. In the world of credit repair familiarity is a long way from accuracy. You need to look at every detail. Some of the most common errors which often go unnoticed include closed accounts that report as open, duplicate accounts, and revolving limits reported too low. And then there are the purely inaccurate accounts; those which do not belong to you and those which are in some sort of derogatory status through no fault of yours. In addition, and in a special category of their own, are collections, which we shall discuss in detail in a few moments.

The Right Kind of Credit

For credit repair success, in addition to adopting a skeptical attitude about the content of your credit reports, it pays to rethink your overall approach to credit scores. You could easily make all of your monthly payments on time, even early, never failing, even once, for years on end, and still have dismal credit scores. It does not seem right, but there it is. Credit scores are a bit more complicated, in fact they are not designed to grade you on your payment history. Credit scores are designed to predict the odds that you will default on prospective debt. Your payment history does come into play, but there are other factors which can overshadow your perfect history.

The Inner Workings of Credit Scores

Some refinement of understanding is essential in credit repair. Credit scores are not too hard to grasp, but their inner workings are often neglected. Imagine that you were trying to figure out whether someone would repay a loan and all you had all of the information on their credit report to work with. You would want to see of they paid their existing bills on time, but what would you look for if you wanted a more complete measure of risk? You might consider looking at their existing balances. High balances, it turns out, are strongly correlated with future defaults. You might also examine the exact mix of credit types in use. It turns out that people that use a lot of inferior and expensive consumer debt like store cards and furniture store loans are prone to falling behind on their payments. Understand the logic and structure your own credit report accordingly.

The World of Collectors

Collectors are in a world of their own, and if you want your credit repair project to pay off you need to understand their world. Collectors buy and sell debt. When they fail to collect they often bundle up their unprofitable accounts and sell them to another collector. The new collector will attempt to collect the debt, and in the course of events will report the account to the credit bureaus. This is where credit repair comes into play. Collectors are supposed to remove the account from your credit report when they sell it to another collector, and yet they seldom do. There is no real incentive for them to correct their reporting, or punishment for failure to comply. There is a simple test you can employ in your credit repair. If more than one collector is one your credit report for the same debt, at least one of them should not be there.

Put Everything Together

Credit repair success means putting all of these factors together. Every component is a major contributor. Do not make the mistake of thinking that you can neglect a single item. As much effort as you are putting into the project you should not risk disappointment by letting your credit card balances run up to their limit, for example, or ignoring less threatening reporting problems. Everything adds up and some issues may weigh more heavily on your credit repair than you think. Put everything together and you will have spectacular success. There is no reason to settle for less!

Do you have any loan questions? Want to get pre-approved? What’s your situation?

I am your one stop shop for all mortgage financing needs. CALL ME TODAY!

Gaffney Neptune
Mortgage Consultant
Consumer Real Estate Finance Co.
888 E. Las Olas Blvd
Ft. Lauderdale FL 33301
Office: ( 216) 236-7348
Fax: (216) 236-7261
gneptune@crefco.com