Cleaning your credit?

I recently pulled of my credit report for the first time in 3 years. It is pretty bad. I wasn't sure if I should us a clean credit company to help get my credit score back up....how does that work?

I agree with the posters on here not to use those services. Just by going on here and looking up past answers can do you more good than those companies ever could. If you're wanting to know how to fix your credit...

Keep reading...

Yes, it's possible to fix your credit yourself. With a little hard work and perserverance, and patience, you could get it back up there. What you have to understand is what makes up your credit score:

1. Payment history- 35%
2. Total debt owed to avialable credit ratio-30%
3. Length of time establishing credit-15%
4. Types of credit established-10%
5. Inquiries and New accounts-10%

With that in mind, this is some steps that you should do in order to get yourself in a better financial position to rebuild your score:

1. Open a checking and savings account- while this won't directly affect your credit score, it does many things. It re-establishes a relationship between you and a financial institution, which by being an customer in good standing, could help make it easier to get approved for credit cards and loans. Most importantly, by opening a checking account
it gives you the single most powerful tool in building credit, to help pay your bills on time, especially if the bank offers online billpay.

2. Gather ALL your credit reports- It's important to know exactly what's on your reports. A lot of times, people believe that their credit is so bad, that they don't bother to check their reports for mistakes, and trust me, mistakes DO happen. The credit bureaus don't get paid to be accurate, they get paid to report. It's important that you gather reports from all 3 agencies to determine not just who and how much you owe, but to make sure that what's on there is even correct. If you do happen to find something that you're sure is not right, you should dispute with all 3 agencies, they all have an online dispute feature in which you can dispute the item. Once you've made sure that there's no inaccuracies on your report, then you should arrange your debts from most recent and lowest amount to oldest and highest amount. Debts that are newer than 2 years are hurting your score the worst and should be handled first. What you should know that just paying off debts, especially collection debts will not help your score. A "pay to delete" or "deletion payment", which is a payment in exchange for removing it from your report completely. I posted several links that explains this more in detail.

Link(s) to debt negotiation:

http://www.creditinfocenter.com/debt/settle_debts.shtml

http://www.creditinfocenter.com/debt/neg_rating_after_settle.shtml

http://www.creditinfocenter.com/debt/CanCreditorSue4SettlementDifferences.shtml

http://www.creditinfocenter.com/debt/ActualDebtSuccesses.shtml

http://www.creditinfocenter.com/debt/debt-negotiation.php

If you're sucuessful, this will help your score.

3. Open new credit- I had mentioned in #1, about opening a checking and savings account with a bank or credit union, I'm going to tie that in with what I'm about to say. Some major banks (Bank of America, Wells Fargo, USBank, Orchard Bank) and some credit unions offer secured credit cards, which are credit cards that require a deposit to establish credit. Whatever you deposit would be the credit line, for example, if you deposited $300, then your credit line would be $300. The deposit isn't used to pay for what's purchased on the card, you would still need to either pay in full or make monthly minimum payments. The deposit is used only if the account becomes delinquent and goes to collections. A couple of good things is that you can increase the credit limit by adding to the deposit, which can help your score because it creates a much needed cushion between the total debt that's owed and the available credit, and also the deposit is sometimes linked to a savings account which earns interest while you're building credit, so the deposit isn't just sitting there. A good way to build credit with the card is to make small purchases ($20/month max) and pay it off on time every month, while adding to the deposit. Usually after a year or so, of paying it off on time, the card either converts to a regular card or it's upgraded to a better card, and most importantly the deposit isn't needed anymore and it's given back. My suggestion would be to open another secured card and repeat the process or open 2 at a time, which would speed things up. If you make small purchases, pay it off and increase the limits, that will really help your score. In the end, you'll have 2 credit cards with decent limits and an emergency fund from the deposits.

4. Enroll with PRBC- PRBC is America's Alternative Credit Bureau, providing a helpful service to the over 50 million people with limited or no credit history. If you pay your monthly bills on time, PRBC can help you build credit to qualify for a mortgage and better interest rates.On-time payments for the following bills are not reported to the traditional credit bureaus:

Rent
Cable
Phone
Daycare
Insurance
Electric
Natural Gas
Cell Phone

The only time your payments for these bills are reported to the other credit bureaus is if they're missing or late.With PRBC, your on-time payments count. You build credit for paying your bills on time, even if you have no credit history. PRBC offers two simple ways to start building credit today.

In closing, just a few more things to keep in mind.

-Don't spend more than 30% of your combined available credit on all your cards.

-Only apply for credit when necessary.

-Pay on time

Hope this helps...

Thanks for reading and...

Good luck!

the best thing you can do is keep your bills up to date ,pay any outstanding debts,making sure that the companys you pay inform the three credit bureaus that the debt is payed and it is noted on your report, and pay all bills on time.If you do that, you'll notice improvement in a few months.

You have already taken the first step in cleaning up your credit

Do not pay a so called clean your credit company because they are a rip off and you need to stay clear of all of them

It's not hard to clean up your credit; it takes patience and time that's all

Now that you have pulled your credit, your next step is to go through each report with a fine tooth comb and see if they is anything on there that don't belong to you

If there is then you can dispute it. For the rest of the stuff that is yours then you just work on getting it paid off;

Call those creditors and see if they will make a settlement with you

While you are getting everything cleaned up, just keep an eye on your credit report and you will see how your credit will slowly but surely improve

you can only remove incorrect items for your credit report

Yes, you should contact a non-profit organization like Consumer Credit Counseling. If you decide to go with a different company, make sure they are non-profit organization. They should be able to help you out greatly! Good Luck!

The ONLY way to clean your credit is to PAY ON TIME. Some little things can help - but the major thing is (see above).

If you do not have any open accounts - get one. Pay it 1 week early each month.

If you have large balances on you existing accounts - pay them down. Start with the one with the highest interest rate and pay it off. Then proceed through your accounts and pay them down in descending order of interest rates.

Don't ask for credit you know you can't get just to get the 10% off at the store for applying. Each credit inquiry counts against you.

Did I say PAY ON TIME (be on time with your payments).

Depending on the reason for the credit - borrowers look at the percentage of your income goes to paying for existing credit. pay your accounts down.

See a recurring theme here? Good luck!

DON'T USE A CREDIT SERVICE!!!!

You CAN do it yourself, and save a bunch in the process. First of all, take another look at it. Are there Credit cards you can close? Can you pay off or seriously pay down a card or two? Last ditch effort: Have you gone through Consumer Credit Counseling? (That last is a last resort, but they helped me, and I now have a decent credit history again!) Take a look on the web for other ways to clean your record yourself--

Best of luck!

Most companies are a rip off and not legit.

What they do is poll the creditors until they miss a deadline and the report gets wiped. And they can't even get that right.

You can do it on your own.

Look through the agencies and see which ones are "legit". Remember you did sign for that credit, no one put a gun to your head.
Look for the ones that you Know you did not or resolved a while back. Contact the company and the credit bureau and get it straighten out.

Bad news can't be erased. It stays there.

Incorrect news can be fixed. Send a letter to the credit bureaus (equifax, trans union, and experian) explaining the mistake.

i don't think it is possible to "clean" credit. your probably better off waiting 7 years for it to reset

I would like to hear more info as u didnt give us nothing besides ur report is not good.
like other ppl say only way to pay on time. But here is the glitch. If you havent paid for no. of years and the amount is too high to paid them off. I would rather not pay it since it will go off from ur credit report after few years.
Note: Just an advice, U dont have to listen me. I could give better advise if i know more details. Email me if u think i can be any helpful.

When I looked I was sent to consumer credit counselors, they recommended bankruptcy because I had more debits than income. Stupid me I put it off, kept thinking I could do it. Well they were right bankruptcy was the only way to go. I am glad now nore more collections.

Enter Your Message or Comment

User Name:
User Email:
Post a comment:

Archive: Forum -Forum -Finance - Links - 1 - 2 - RSS - All RSS Feeds
The Causes and the Results. 0.024
Copyright (c) 2011 Financial Crisis Sunday, May 27, 2012 - Terms of use - Privacy Policy