Archive for the ‘Credit Repair’ Category

Sometimes, credit problems can seem insurmountable. While the average consumer hopes to increase their credit score so they can shave a few percentage points off their mortgage rate or get a low interest credit card, there are many consumers whose credit rating essentially excludes them from the credit game entirely. They are being denied loans at any interest rate and the dream of owning their own home is nothing more than that; a dream.

It is people in this category that have lost hope and begin to look to illegitimate methods of credit repair. They start looking into credit repair clinics who promise a way to completely start over. Clinics who claim to be able to create a brand new credit identity and a brand new credit report – clinics that seem to have the perfect solution to a hopeless situation.

Most people realize that when something sounds too good to be true, it usually is. Even the people who fall for these credit repair scams probably know the clinics that provide these services are not to be trusted. But when faced with the prospect of having a repossession, foreclosure, or bankruptcy on their credit reports for years to come, they become desperate enough to do things against their better judgment.

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As anyone who has researched credit repair to any degree has heard, you absolutely have the right to repair your credit on your own. In fact, Dr. Randy Padawer, who co-wrote the best selling “FICO® 850″ seminar for The Motley Fool and acts as a consultant for Lexington Law, became a credit expert by becoming an uber-do-it-yourselfer when it comes to credit repair.

You have probably also read that you can dispute the questionable negative items in your credit reports for free. The credit bureaus even provide a form on their websites to make this process easy for you.

Something that you likely will not hear as often is that repairing your own credit is rarely as easy as it initially seems. On its surface, credit repair seems to be a simple process. You obtain a copy of your credit reports, identify the inaccurate items they contain, dispute them with the credit bureaus, and wait for the bureaus to perform their investigation. Of course, if it really were that easy, there would be no reason for Lexington Law or any other credit repair organization to exist.

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According to the FTC website “No one can legally remove accurate and timely negative information from a credit report. The law allows you to ask for an investigation of information in your file that you dispute as inaccurate or incomplete.”

This is a message that is seemingly black and white on the surface. In fact, many critics of credit repair and credit repair law firms such as Lexington Law will try to use this message to imply that there is little that can be done about bad credit, that the only recourse for people with a bad credit score is to wait for their credit to improve on its own, and that it is a futile attempt and a waste of money to work with any credit repair company.

When you take time to research the credit reporting system and your rights to dispute the questionable negative information in your credit reports, you will find that there is much more ambiguity in the FTC quote than critics of credit repair would have you believe.

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Transcript from the video

“My credit really turned sour after my divorce. I had been married for 8 and half years, We had two children. And at the end of my divorce, I was pretty despondent, and basically, made some wrong decision and let my bills go for several months. Had all major credit cards… I had just finished graduate school two months prior to our divorce – so I had a lot of student debt. And as a result, my credit was, really, just shot. I felt that there was no hope. Essentially, I found Lexington Law Firm… and I’ve had 50 deletions on my credit reports.

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Full transcript from the video:

The credit system may seem like a private conversation between your creditors and the credit bureaus, but this conversation is not complete until you have joined it. You have the right to question any information on your credit reports that you feel may be inaccurate, untimely, misleading, incomplete, ambiguous, unverifiable, biased or unclear – also known as “questionable”. If an item cannot be verified, then it must be removed.

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