Credit Myths Exposed

Credit myths are not just annoying, they can be dangerous. Check out the 4 perceived credit myths below and find out whether they are true, false, or somewhere in between. 

Myth #1: An Account May Only Stay On My Credit Report for 7 Years

False:  The Fair Credit Reporting Act (FCRA) limits credit reporting on most negative accounts to around 7 years. However, there are exceptions to this rule (i.e. unpaid student loans, unpaid tax liens, judgments, bankruptcy, etc.). 

Myth #2: Collection Accounts Must be Deleted from My Credit Report Once Paid or Settled.

False:  The FCRA does not require for your debt collectors to remove paid collection accounts from your credit report. The balance on the account should be updated; however, many times they do not fulfill  this obligation. If a paid/settled collection is reporting on your credit you can either dispute the mistake on your own or work with a professional credit repair company who can send disputes to the credit bureaus on your behalf. 

Myth #3: Being Turned Down for a Loan Hurts My Credit

False:  There is nothing on your credit reports which records the event when you are turned down for a loan.  However, the simple fact of having your credit pulled for the application (aka the inquiry) could potentially have a negative impact upon your credit scores. 

Myth #4: Debt Collectors Have the Right to Call Me to Collect a Debt

True:  Your debt collectors do have the right to call you to try to collect a debt as long as they follow the rules and UNLESS you request to only be contacted via mail.  If a debt collector is harassing you, the Fair Debt Collection Practices Act (FDCPA) gives you the right to request for the calls to stop.

Looking for Professional Help?

Dealing with credit issues can often be very overwhelming.  You have the right to work on your credit problems alone, but you can also rely upon professionals to guide you through the process.  If you need help with your credit, please click here or call 704-499-9696 today.  We are waiting to hear from you!

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Ron Lambright is an expert with over a decade and a half of experience in credit repair, credit improvement, credit reporting, and credit scoring. Ron is called upon weekly to speak at various seminars educating attorneys, loan officers, Realtors, other professionals, and consumers regarding the complex subjects of credit reporting and credit scoring. He is regularly featured on talk shows and podcasts and has been published in countless articles, educational handbooks, and blogs. He is an expert at teaching consumers and business owners how to achieve their credit related goals. Connect with Ron on Facebook here. 

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Beware of Credit Repair Scams!

Let's face facts. The credit repair industry has a bit of a black eye. Sometimes credit repair companies have a very bad reputation for a good reason.  There are companies which claim to help repair your credit which are simply scams.  There are dishonest people out there who will promise you the moon and the stars when it comes to improving your credit.  However, just remember, if it sounds too good to be true then it most likely is.

Companies that promise to improve your credit 100+ points in 30 days are not being truthful.  In fact, they are most likely either lying or doing something illegal. The truth is, there definitely are ways to improve your credit.  However, it will usually take some times to see results.  Any company that makes untruthful promises regarding lightning fast credit repair is willing to lie to you in order to get your money.  Beware!

A full credit education program, like HOPE4USA, is typically your best bet when it comes to resolving your past credit issues.  HOPE4USA offers credit report dispute services and helps you learn how to leverage your rights, of course, but we also offer budgeting assistance, guidance in establishing and maintaining the right kind of current credit and, most importantly, HOPE4USA educates its members on how to keep the healthier credit once it has been earned. 

If you or someone you know could benefit from the services offered by HOPE4USA, please contact us.  You may call 704-499-9696.  We would love to hear from you!

Is It Possible To Get A Credit Card With My Current Credit Problems?

Is It Possible to Get a Credit Card with My Current Credit Problems?

Even with damaged credit, there is a good chance that you will be able to qualify for a credit card account. There are several credit cards out there designed to help those with less than perfect credit. 

Even if you have been turned down for credit cards in the past there are likely options still available to you.  For a list of these types of cards, please visit www.hope4usa.com/credit-cards.  Remember, regardless of your credit issues, you may still be able to qualify for a credit card account.  Just visit the link above to consider some of the options available. 

Is It Better To Fix My Credit Myself?

Is It Best to Fix My Credit Myself?

Let's face it, the credit repair industry has a bad reputation.  There is a lot of scam and deception associated with credit repair.  Because of this fact, many people believe the best option available is to fix their credit reports themselves.

Now, I agree that it would be better to try to fix your own credit than to be ripped off by a dishonest company and you absolutely have the right to try to navigate the tedious and complicated process of repairing your credit on your own. However, there are some reputable and trustworthy options out there you may want to consider first. 

Here are a few reasons why it can be better to have professionals, like the credit experts from HOPE4USA, to assist you rather than trying to make sense of the credit maze all alone:

1.  Speed - Those who try to tackle their credit problems alone often give up after unsuccessfully trying for years and still never achieving the results they want to see.

2. Aggravation - HOPE4USA clients do not have to spend their own precious time on the tedious process of trying to deal with the credit bureaus, creditors, and collection agencies all alone.  Our team is here to take most of the leg work out of the process for you. You do not have to spend hours upon hours on the phone trying to resolve and track down old, potentially inaccurate accounts when you can have a professional work to try to accomplish these goals on your behalf.

Remember, it is your legal right to work on your own credit reports. If a company tries to tell you otherwise, run away because it is definitely a scam.  However, it is also your legal right to file your own taxes or to represent yourself in a court of law.  Most of us hire an accountant to file our taxes and most of us would hire an attorney to help us with legal matters. Why, because of the experience of these experts which can often help us to achieve a more favorable outcome than we would have on  our own. The same principle rings true when trying to work on your credit problems. 

What Makes Up A Credit Score?

I am often asked: "What makes up my credit scores?"

Credit Score Factors

Although we don't know 100% about how a credit score is determined, FICO considers the following factors (the weight it assigns to each category is in parentheses):

Length of your credit history (15 percent).
The longer your accounts have been open, the better.

Payment History (35 percent).
Your score is negatively affected if you have paid bills late, had an account sent to collection, or declared bankruptcy. The more recent the problem, the lower your score -- a 30-day late payment today (currently past due) might even hurt more than a bankruptcy five years ago.

Outstanding Debt (30 percent).
If the amount you owe is close to your credit limit, that is likely to have a negative impact upon your scores. A lower balance on two cards is generally better than a high balance on one card. Your best bet is to pay your credit card balances off in full monthly.

Recent inquiries on your report (10 percent).
If you have recently applied for many new accounts, that will likely negatively affect your score. Promotional inquiries or checking your own credit does not count against you.

Types of credit in use (10 percent).
FICO likes to see that you have a history of managing a variety of account types.