Month: October 2008

What is an Accurate Credit Listing?

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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Low Credit Score? Credit Card Issuers Could Make it Worse

In an interesting reversal of trends, some credit card issuers are now automatically lowering customers’ credit limits as a means to reduce risk. In the past, the industry had been known to increase the credit limits of customers who were using credit responsibly. Now these companies are starting to lower limits for customers in response to a drop in their credit score, a late payment, or the addition of new lines of credit.

Credit card issuers claim this practice is good for users because it helps prevent them from getting over their heads in debt and is a better system than raising the interest rates of higher risk customers which is the more traditional way to account for credit risk.

While lowering limits is a better mechanism for consumers in general, there are two potential effects of this method of risk management that credit card users need to be aware of.

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