HOW TO CLEAN UP BAD CREDIT AND ESTABLISH AAA-1 CREDIT RATING
Transcription
HOW TO CLEAN UP BAD CREDIT AND ESTABLISH AAA-1 CREDIT RATING
HOW TO CLEAN UP BAD CREDIT AND ESTABLISH AAA-1 CREDIT RATING By Conleth C. Onu DISCLAIMER The author has endeavored to ensure the accuracy of all information in this book. It is believed that all material is accurate as of the date of publication. However, the author and publisher make no guarantees, warrantees, or representations of any kind. Neither the author nor the publisher assumes any responsibility for the use or misuse of information contained in this book. If legal advice, or advice in any other field is needed, the reader should seek the assistance of a professional expert in that field. © Conleth C. Onu. All rights reserved worldwide. No part of this book may be reproduced, stored in a retrieval system or transmitted in any form or by any means without the prior agreement and written permission of the author. http://www.ConlethOnuPublishing.com 2 TABLE OF CONTENTS DISCLAIMER...............................................................................................................2 INTRODUCTION .........................................................................................................6 YOUR RIGHTS UNDER THE FAIR CREDIT REPORTING ACT .........................8 UNDERSTANDING CREDIT REPORTING AGENCIES.......................................10 The Three Major Credit Bureaus ...............................................................................11 WHAT’S IN YOUR CREDIT REPORT?..................................................................11 OBTAINING A COPY OF YOUR CREDIT REPORT ............................................12 REVIEWING YOUR CREDIT REPORT .................................................................13 REMOVING NEGATIVE ITEMS.............................................................................14 The 7-Year/10-Year Time Period ...............................................................................15 Incorrect Information ................................................................................................15 Reasonable Period of Time........................................................................................16 Creditor Cannot Be Contacted...................................................................................17 Creditor Fails to Respond..........................................................................................17 Credit Bureau Fails to Investigate .............................................................................18 Disputing Directly with Creditors..............................................................................18 Negotiating with Creditors ........................................................................................18 Filing a Consumer Statement.....................................................................................20 HOW TO REMOVE INQUIRIES AND FILE VARIATIONS.................................20 HOW CREDIT REPAIR AGENCIES OR CONSULTANTS REMOVE NEGATIVE ITEMS....................................................................................................22 GUIDELINES TO HELP YOU IN THE DELETING PROCESS............................23 PUTTING POSITIVE ITEMS ON YOUR CREDIT RECORD ...............................28 REVIEWING YOUR UPDATED CREDIT FILE.....................................................28 FILING COMPLAINTS ABOUT THE CREDIT BUREAUS ..................................29 REBUILDING YOUR CREDIT RATING ................................................................29 3 Secured Credit Card..................................................................................................29 Instant Credit ............................................................................................................31 HOW TO ESTABLISH AAA-1 CREDIT RATING..................................................32 HOW TO ADD UP TO TEN YEARS OF EXCELLENT CREDIT HISTORY ON YOUR CREDIT FILE.................................................................................................33 ESTABLISHING CREDIT FOR THE FIRST TIME ...............................................34 SPECIAL NOTICE TO WOMEN CONCERNING CREDIT ..................................35 Establishing Credit In Your Own Name .....................................................................35 What to Do If You Have a Negative Credit History ....................................................36 SAMPLE LETTERS ...................................................................................................36 Request for a Copy of Your Credit Report..................................................................36 (Within 60 Days of Credit Denial) .............................................................................36 Request for a Copy of Your Credit Report..................................................................37 (Not in Response to a Credit Denial) .........................................................................37 Request for Deletion of Negative Item That Has Been on Your Credit Report for More than the Prescribed Time...........................................................................................38 Disputing Accuracy of Negative Information .............................................................39 Request for Correction of Personal Statistics.............................................................39 Request for Correction of Personal Statistics.............................................................40 Request for Deletion of Inquiry..................................................................................41 Request for Deletion of Unauthorized Inquiry............................................................41 Request for Deletion of Negative Information Due to Expiration of “Reasonable Period of Time”.........................................................................................................42 Request for Correction of Account Status (Disputing Directly with the Creditor).......43 Disputing Directly With the Creditor .........................................................................44 Disputing Directly With the Creditor .........................................................................45 Request to Pay Fraction of the Debt in Exchange for Deletion of Negative Information ..................................................................................................................................46 Request for Inclusion of Statement of Dispute in Your Credit File..............................47 Letter of Request to Have Positive Items Listed on Your Credit Report .................48 Request for the Credit Bureau to Distribute Corrected Credit Report ........................49 CONCLUSION............................................................................................................50 4 HOW TO RAISE MONEY WITH CREDIT CARDS AND PARLAY IT INTO A STEADY INCOME.....................................................................................................51 HOW TO MAKE YOUR FORTUNE SELLING INFORMATION ON THE INTERNET..................................................................................................................52 Creating Your Own Information Product...................................................................53 5 INTRODUCTION Credit has become a way of life in our society. It makes it possible for us to buy needed items now and pay for them later. In today’s world it’s almost impossible to live without it. Without good credit, you can have difficulty buying those big-ticket items such as houses, cars, and appliances. Good credit enables us to enjoy the good things months or years ahead of the time we could pay for them in cash. In other words, credit helps us to purchase items that would have required the accumulation of many years’ savings. Have you ever been denied credit because of negative information contained in your credit report? I have. I know how frustrating it is to be turned down for credit. Most people think that if they have bad credit, there is no way to change it; that there is nothing they can do except to wait out the seven to ten year statute of limitations. But that is not true. You can change your credit record for the better. When I was grappling with my credit problems, I was determined to learn all I could about consumer credit and credit repair. Finally, after much research, I discovered the closely guarded secrets used by the best credit consultants in the business. I eventually was able to clean up my credit. You may have heard of credit repair companies that offer to erase bad credit history and help you get credit. These companies often charge hundreds or even thousands of dollars to perform a simple service. You can repair your credit yourself without paying such hefty fees. These companies cannot do anything that you cannot do for yourself. They use nothing more than the dynamic techniques that are revealed in this book. My goal is to help smooth the way for others who are confronting the same (or similar) problems I did. With this book, you can benefit from the experience of someone who has been there. It is written in easy-to-follow format, so the average person can understand it. This book is power-packed with the specific techniques that you can use to have your credit repaired or purged of negative information. I present to you step by 6 step instructions on how to legally clean up bad credit and re-establish your credit profile. You will learn about the Fair Credit Reporting Act and how this law protects you against the reporting of inaccurate, misleading, or obsolete information. I give you the know-how, advice, and guidance that you need to wipe the slate clean. This is not a book to be quickly skimmed and placed on the shelf. I recommend that you first read the entire book once to get an understanding of what is being said, then go back and read it through a second time slowly and carefully. On the initial reading, you will get a complete overview of what credit repair is all about. In this book, you will explore the many ways you can remove negative items from your credit report, how to add favorable items, and how to establish AAA-1 credit rating. I also include sample letters for each of the strategies to give you an idea of what to send. Read and reread this book as you begin the process of clearing your credit report. Inside, you’ll learn an ingenious way to raise money with credit cards. Also included is a special report on how you can make money selling information on the Internet. All of the methods presented herein are tried and true methods. They have been used by thousands of individuals from all walks of life to realize their dreams of success and wealth. The knowledge contained within the covers of this great book will help you make your dreams come true. 7 YOUR RIGHTS UNDER THE FAIR CREDIT REPORTING ACT As a consumer, you have specific rights with regard to the information that the credit bureaus are sending out about your ability and past repayment history. You can remove negative information contained in your credit report using the rights given to you by the Fair Credit Reporting Act. As you’ll see in the following pages, much of the derogatory information that can enter your report can be challenged or even erased if you dispute the accuracy or correctness of the items. In addition, many of the negative items on your credit report must be deleted within a certain time limit. The Fair Credit Reporting Act is a Federal Law passed by the United States Congress, which places certain restrictions and responsibilities on credit reporting agencies. This Federal Law gives consumers specific rights designed to assure maximum possible accuracy of items contained in their credit file. It attempts to ensure that credit reporting agencies (credit bureaus) exercise their responsibilities fairly. Here is a summary of your legal rights under the Fair Credit Reporting Act. The credit bureau shall have negative information removed from your file after seven years, except bankruptcy, which may be reported for ten years. The credit bureau shall, upon your request and proper identification, disclose to you the nature, substance, and source of the information about you in its files. The law requires that you obtain your credit report free of charge if you request it within 60 days of the time you were denied credit, otherwise the credit bureau can charge a reasonable fee for the disclosure. You have the right to be told the name and address of the credit bureau responsible for preparing a report that was used to deny you credit. If you dispute the completeness or accuracy of any item of information contained in your file, the credit bureau shall, within a reasonable period of 8 time, reinvestigate the matter and, if found to be inaccurate or unverifiable, remove it from your file. When you dispute an item in your file, and can’t resolve it with the creditor, the credit bureau has to place your version of the dispute in your file and include it in future reports. If the credit bureau deletes or corrects certain information in your file they must, at your request, send notification to any person who received a credit report on you within the previous six months (or two years if it involves employment) of the deletion or correction. You can be accompanied by anyone of your choosing when visiting the credit bureau to check your file. 9 UNDERSTANDING CREDIT REPORTING AGENCIES Before reciting how to correct errors or remove negative credit information, it is appropriate to examine how information is collected, and disseminated by representative agencies. Credit reporting agencies, often called credit bureaus, are companies that collect, store and sell information on credit users, in the form of credit reports. They sell information relating to the identity, paying habits, and financial well being of consumers, such as you. This information is obtained from department stores, banks, credit card companies, loan companies, credit unions, other credit granting institutions, and from public information available through court records and other public documents. Credit bureaus make a profit by providing credit grantors with information concerning the financial profile and credit history of an individual such as you. Businesses pay fees to these credit bureaus, in return for access to these files. They serve merely as a source or library of information concerning your past performance. They pass this information on to businesses and institutions that subscribe to their services. These businesses turn in information (positive or negative) of each credit account. In turn, this information is added to the existing report on an individual, or in some cases, a new report is then initiated. Credit bureaus do not decide whether you should be granted credit or declined. They simply give a computer readout showing your past credit performance to prospective creditors, who then determine the fate of your credit application. Most credit granting institutions will base their approval or rejection of your credit application on your credit report. If your credit report indicates that you have been reliable in the past, then in most cases credit is granted. There are about 2,500 credit bureaus in the United States. These bureaus simply store and disseminate information that is provided to them by their subscribers every time a credit report is required. They do not make final judgments as to whether or not you are creditworthy. They simply provide the information. The lender is the one who, applying their own credit granting criteria, determine whether your credit application should be accepted or denied. 10 The Three Major Credit Bureaus There are three major credit bureaus around the country: Experian (formerly TRW), Equifax, Trans Union. The odds are you will have a brush with at least one of these agencies every time you apply for credit with a credit granting institution. Their names and addresses are as follow: Experian P.O. Box 2002 Allen, TX 75013 (888) 397-3742 www.experian.com Equifax P.O. Box 740241 Atlanta, GA 30374 (800) 685-1111 www.equifax.com Trans Union P.O. Box 1000 Chester, PA 19022 (800) 916-8800 www.transunion.com WHAT’S IN YOUR CREDIT REPORT? Your credit report contains information collected by the credit bureaus from stores, and banks, finance companies, other lending institutions with whom you have dealt with, from public records and other sources. Any time you request credit in any form, the prospective credit granting institution will pull a credit report on you from one of these bureaus. The credit report gives these credit grantors a quick and convenient method of determining whether or not to approve an application. 11 The first section will generally feature the information used to identify you: your complete name, current address, previous address, social security number, date of birth, and your occupation, employer’s name and address, and marital history. Following this will be a section consisting of your credit history. This will outline the types of credit accounts you may have - your past and present repayment activities on charge accounts, credit cards, loans, and other credit accounts. It will contain the names of creditors, the subscriber number, credit account number, the dates of the accounts’ opening, the credit limits of these accounts, type or nature of each account, current status of each account, outstanding balance, your monthly payment schedule and how you have performed on that schedule (your repayment history). Also reflected on your credit report is information regarding any collection attempts, bankruptcies, tax liens, garnishments, court judgments, or other public records that have been issued against you. Next there is a section that details the number of times credit grantors have accessed your credit report. It lists the names of institutions that have inquired about your credit history. When you apply for credit, and sign the application form, you are authorizing the creditor to peek at your financial history. There is a portion of the report that most people are not even aware. This portion is known as the “consumer statement.” It allows you to provide explanations or make arguments up to one hundred words in length about items on the report with which you disagree. OBTAINING A COPY OF YOUR CREDIT REPORT Earlier you read how credit bureaus gather, and place information on your file. Before you can start the process of deleting these undesirable marks from your report, you must first find out what is contained in it. Therefore, the first step is to obtain a copy of your credit report. You are entitled by law to learn what is in your credit report. Upon request and proper identification, every credit bureau must clearly and accurately disclose to you what information they’re giving out concerning your name and your credit. There are many credit bureaus in the United States. So to find out which agencies are used in your area, ask a local banker or merchant for their names and addresses. You can also check the Yellow Pages under “Credit Bureaus,” or 12 “Credit Reporting Agencies” or by contacting your local Chamber of Commerce, or Better Business Bureau. Or contact the three largest credit bureaus to determine which bureau maintains a file on you. More than one credit bureau may be maintaining a file on you. When you find out which bureaus have file on you, write to each one of them to request that they send you a copy of your credit report. The cost will be minimal, normally $10. Costs vary, depending on the credit bureau and the state in which you live. Call your local agency and inquire what their charges are for reviewing a credit report. If you have been denied credit within the past 60 days, you are entitled to a free copy of your credit report from the credit bureau that reported negative information. The name and address of the credit bureau that furnished this information will be stated on the rejection letter from your creditor. Send a copy of the rejection notice to the appropriate credit bureau, along with a letter indicating that you want a copy of your credit report. Be sure that you include the following information with your request: 1.Your full name (including middle name) 2. Your spouse’s name (if you’re married) 3. Your Social Security Number 4. Your current address 5. Your date of birth 6. Also, be sure to sign your letter Normally it will take the credit bureau two to three weeks to send you a copy of your credit report. An alternative method is to review the contents of your credit report at the credit bureau office during normal business hours. It is wise to call and make an appointment rather than just stroll in and request the report. Be sure that you bring the required identification. REVIEWING YOUR CREDIT REPORT When you receive your report, examine it carefully. Study it, scrutinize it, and be sure that you understand it. Take time to evaluate each entry. Make sure all the information is current and accurate. 13 You will want to be sure that all accounts listed on your report are in fact your own. Remember, with the massive volume of information handled by the credit bureaus, it is very likely someone else’s information could erroneously show up on your credit report. It is possible that information of a namesake may have been mistakenly reported on your credit report. Or someone could have gained access to your file and opened an account in your name. In addition, pay particular attention to balances listed on your credit report. Be absolutely sure that all outstanding balances listed on your report are accurate. One of the most important information contained in your credit report is your payment history. This plays a major role in a creditor’s decision to either grant or deny you credit. It is essential that you be absolutely sure that all account status reports are accurate. Account status reports reflect your payment history for each account. If you have made on-time payments on your accounts, no past-due amounts should be noted on your report. Accounts that are closed should be listed as closed, not open accounts. Also, take a look at the inquiry section. It is possible for people to inquire about your credit history without your authorization. If there are credit inquiries that were not authorized by you, you should ask the credit bureau to check with the subscribers who made the inquiries and have them removed, or you can contact the credit bureau and advise them to remove such entries immediately, or face legal action. Credit bureaus are usually cluttered with symbols and abbreviations. Read the explanatory information that accompanies your credit report. It will make deciphering this complicated document a little easier for you. If there is something you do not understand, or any numbers that don’t correlate to what you think they should, do not hesitate to ask for help. Contact the credit bureau that has supplied you with the report, and ask them to explain the information to you. There are trained personnel at the credit bureau that will help you decipher what each abbreviation stands for. REMOVING NEGATIVE ITEMS I have discovered a number of methods to remove derogatory or negative information from your credit file. The following techniques are all based on rights granted to consumers through the Fair Credit Reporting Act. Each one of these techniques produces results at one time or another. They are as follows: 14 The 7-Year/10-Year Time Period There is no time restriction for reporting positive (favorable) credit information. Assuming you had a credit account eight years ago that you paid according to the terms of your agreement, positive information regarding this account might still be shown on your credit report. In addition, positive information such as current accounts will remain on your credit report indefinitely. When you are ready to start the deletion process, the first thing to look at is the time involved in negative information. Law requires credit bureaus, to automatically remove adverse or bad information from the credit file after a certain period of time has elapsed. Negative information such as delinquent accounts, collection accounts, lawsuits, judgments, accounts charged to profit and loss, must be removed from your credit report if it is over seven years old. Other negative items such as repossessions, tax liens and records of arrest or conviction, must be removed it occurred seven years or more before the report is issued. A significant exception to the above is a bankruptcy, which can remain on your credit report for ten years from the date of bankruptcy. In some places, bankruptcy can be kept on your record up to fourteen years. If you find items over the allotted time periods on your credit history, you should contact the credit bureau demanding that the derogatory information be removed immediately. Send a certified letter, and be sure to state that you are acting within your rights under the Fair Credit Reporting Act, and that the bureau is in violation of this law. They will certainly comply with this section of the Fair Credit Reporting Act. If not, then you should consider legal action against the credit bureau. Incorrect Information When you dispute an item in your credit report, the credit bureau by law must reinvestigate the information. If the bureau cannot verify the information, the item must be deleted from your report. 15 So if you inform the credit bureau that the information contained in your report is in fact incorrect, the credit bureau shall conduct an investigation. To carry out its investigation, the credit bureau will contact the creditor that reported the information, inform them of your dispute, and state your position. The creditor will then be asked to prove that the information is correct, or accept your explanation. If the information is found to be incorrect or can no longer be verified, the information must be removed from your file. The credit bureaus do make mistakes. They maintain files on several million consumers and could have entered incorrect information on your file. It is possible that an employee at the credit bureau hit the wrong button on a computer terminal, thereby entering incorrect information. Again, it is possible that the information may not even pertain to you. Once the credit bureau discovers that the information is incorrect, they will delete it from your file. Reasonable Period of Time If you dispute the completeness or accuracy of any item of information contained in your credit report, the credit bureau must reinvestigate and record the current status of that information within a reasonable period of time. Most credit bureaus give the creditor twenty-one to thirty working days to respond to dispute items. To use this technique, you send a letter to the credit bureau, disputing the negative information. To conduct its investigation, the credit bureau will contact individually each creditor and ask for a re-verification of the item. The creditor may not respond to the credit bureau within the time constraints set by the credit bureau. If the credit bureau fails to reconfirm the information within a reasonable period of time, the disputed negative items must be deleted from your file or revised to reflect a more accurate status. So when the credit bureau fails to respond to your dispute letter within a reasonable period of time, send them a follow-up letter, demanding removal of the negative item. By law they must delete the derogatory information from your credit file. 16 Creditor Cannot Be Contacted When you dispute negative information in your report, the credit bureau will investigate the matter, by contacting the creditor that reported the information. If the creditor cannot be contacted by the credit bureau, the item must be deleted. There are many possible circumstances that can cause the credit bureau to loose contact with the creditor that reported the negative information. The creditor may have relocated and no longer subscribes to that particular credit bureau. It is also possible that the creditor has gone out of business. Creditor Fails to Respond It is common, however, for the credit bureau to attempt to conduct an investigation concerning the information you dispute, and receive no reply from the creditor. When this happens, the credit bureau must give you the benefit of the doubt. Many creditors do not have the time to dig out records and verify information whenever someone disputes an old account. Sometimes, these financial records are stored at another location once the account is closed. In some cases, the creditor has thrown away or lost their records on the transaction and there is no way they can prove that you still owe them. It is possible that you might have paid off the debt since they don’t have records of that, in which case they will not respond to the verification letter. If the disputed item is not verified, it must be removed from your credit report. Another reason why verification letters never get answered is many companies have a limited number of people working in the credit department. They don’t have the necessary manpower available to respond to all the verification requests they receive. Their time is budgeted on a priority basis and they regard the requests for verification from the credit bureau as troublesome and negligible matters. So they will not bother to respond to these letters. Occasionally the creditor forgets to respond to these letters or the letters get lost. Either way, the unfavorable or negative information must be removed from your report. 17 Credit Bureau Fails to Investigate When you embark on a letter writing campaign and paperwork and dispute letters start piling up, the element of human error can come into play. The dispute letter might get lost, which should result in a non-response. These items must be deleted. If you sent your dispute letter by certified mail (which you should), you would have proof that they received it. Disputing Directly with Creditors You’ve learned how you can dispute items contained in your credit report by contacting the credit bureau. However, if the bureau cannot correct the problem, there is an alternative dispute method you can use. This method involves contacting the creditor with whom you have a dispute to see if the matter can be resolved directly. To do this, write a letter to the creditor that reported the negative information and tell them you feel the adverse information they are currently reporting on your credit record is either inaccurate or incomplete. Provide them with enough information to prove your point. By disputing directly with the creditor, it is often possible to have the status of your account changed to a positive rating. If the creditor alters your account status to reflect a positive rating, be sure to let them know how much you appreciate their endeavors. Negotiating with Creditors After blitzing the credit reporting agencies with numerous verification requests, contact each remaining creditor to negotiate a settlement. It is in the interest of both parties to reach a reasonable settlement agreement. Contact the credit bureau and request the name and address of each creditor who is reporting negative information. Now think for a moment what each party would like to see next. You want the negative item deleted from your credit report. And the creditor wants his money. When this happens, it becomes a win-win situation. 18 After a certain period of time of having written off a debt as a loss, a sensible businessperson would jump at the chance to recoup on debt that has been written off. Send a letter to the creditor, to settle the debt. Offer to pay a percentage of the debt as full settlement of the account if he will in turn remove the negative remark from your credit report, and enter “Paid Satisfactorily.” A good target figure is 70 percent of the debt. Make sure that your negotiation letter is properly worded. Your goal here is to get the creditor to register your credit rating after the settlement with a notation of "Paid as Agreed". Something less will have a negative impact on your credit rating. If the creditor refuses your offer and demands payment in full, keep negotiating and insist that they change the remark from negative to a positive rating, once you settle the debt. Try to approach the situation by remembering that they will take less money then what they say. Often creditors will settle for 50 cents on the dollar and sometimes less. If you cannot get the creditor to change your account status to a positive rating, settle for a non-rating. Request that they remove the entire transaction from your report rather than showing “Paid Collection Account.” “Paid Collection Account” or “Paid Charge-off” are not positive ratings. Settlements aren't easy to collect, and they'd rather have you commit to something you can pay than chase you around for another year and eventually end up back in court. Make sure to have all conditions written down before you even think about sending that check. Do not expect a creditor to fulfil an agreement you made only verbally. All details must be written down to make the creditor observe it until the end of the bargain. Ask the creditor to sign and date the letter if he agrees to the settlement proposal and send it back to you. Once you receive the letter indicating that the creditor has agreed to your request, send the money as agreed. This letter serves as a contractual agreement between you and the creditor. If you cannot pay the full amount at once, you can ask to work out a payment schedule to pay up the debt. After paying off in full, contact the creditor and be sure that they update your credit record. 19 The negotiation strategy is a proven method of correcting items that have not yet been paid off. It is a win-win strategy. Filing a Consumer Statement You have the right to file a statement of one hundred words or less for inclusion in your credit file, detailing your side of the story. So if you dispute an item in your credit report and it is not changed and you feel strongly that the report is unfair, you have the right to write a rebuttal to the bad report and have it incorporated in your file. A credit bureau by law must add such a statement to your file. If you file a statement, it must relate to the obligation in question. You should use your statement to explain the circumstances or tell other creditors why this information is misleading or should be updated. I suggest that you do not use your statement to slam the creditor with disparaging comments, make it positive and upbeat. Explain what steps you have taken to try to correct or resolve the matter. Putting your side of the argument onto the report can improve your chances of getting credit. The logic is that a negative entry with your statement explaining your side of the dispute looks better on a credit report than a negative entry without an explanation. The statement of dispute serves to show that there is another side to the story. Thus, creditors looking at your report, will be convinced that there were some grounds for the problem, and will be able to consider your statement alongside the adverse entry. The statement you make becomes part of your credit report. The credit bureau must then include your statement of dispute in your report each time they send it out. Employees of the credit bureau can assist you with the writing of your statement if you ask them for their help. HOW TO REMOVE INQUIRIES AND FILE VARIATIONS An inquiry is a listing of the names of institutions that have requested a copy of your credit report. Although inquiries are not rated on your credit report, if potential lenders see a lot of inquiries, they are probably going to assume that you 20 are applying for too much credit and are likely to conclude that you will not be a responsible user of credit. In such cases, lenders are likely to deny your credit request. So a multitude of inquiries can prevent you from obtaining credit. To avoid having potential creditors turn you down because of many inquiries, limit the number of credit applications you submit. Inquiries are usually kept on your credit report for two years. After two years, the credit bureau should automatically erase inquiry listings from your credit report. If you want to apply for credit and would like to have the inquiries removed from your credit record, there are two ways to do it. The first approach is, you can contact the credit bureau and ask them to delete the inquiries listed on your report. Tell them the inquiries have prevented you from obtaining credit and you would appreciate their removal. They may grant your request and have the inquiries removed. They may require a modest fee for each inquiry removed and they may not. The second approach is to dispute the inquiries listed that do not lead to credit being issued or loans being granted. You might contact the credit bureau stating that you never applied for credit with the creditors who made those inquiries. Request that they investigate and delete these from your credit file. This is a better approach, and it is often successful. A file variation appears on a credit report when information entered in the subscriber’s inquiry does not correspond to the information listed on file, such as different name or different social security number. In most cases, however, file variation is simply a case of clerical error. An employee at the bank or other subscriber’s office might have entered incorrect information or have mistakenly transposed a number or letter. These errors can be corrected by contacting both the credit bureau and the creditor (subscriber). You can send a letter to the credit bureau informing them that you always used your correct social security number and that the other social security number listed is not yours. Demand that they investigate the matter and delete the file variation. To some creditors, file variation on a credit report can be considered quite negative. They may think that you are in some way attempting to mislead creditors about yourself. To avoid creating new file variations, be sure to keep the information you give on credit applications consistent. 21 HOW CREDIT REPAIR AGENCIES OR CONSULTANTS REMOVE NEGATIVE ITEMS Many entrepreneurs have opened businesses where they offer to “clean up” bad credit for a set fee. The technique they use generally does work. It can remove most of the unfavorable or negative items (true or not) from your credit record years before they would have been deleted by the time limits set by the Fair Credit Reporting Act. What trick do these agencies use? First, they know that any and all negative items on a credit record must be investigated and substantiated if it is to remain. If the item cannot be proven, it must be deleted from the credit record whether it was true information or not. And the credit repair agencies know that every derogatory or negative item can be denied or challenged at any time. The credit bureau must then conduct an investigation at any time the consumer requests them to do so. If the completeness or accuracy of the item cannot be re-verified within a reasonable period of time, it is automatically deleted from the credit file. Most credit repair companies challenge every negative item on a client’s report, whether the information is true or not, expecting that most of the creditors will fail to respond or that the credit bureau will fail to complete their investigation of the disputed item within the allotted time. To accomplish this, the company will act as your representative and, for a fee, basically challenge all negative items that appear on your credit report. They will embark on a systematic letter-writing campaign to clean up derogatory entries on your file. About three to four weeks later you get back a corrected report and chances are your new credit report will contain an average of fifty percent fewer negative items. They will wait a few weeks, and resubmit a verification request on the remaining items. There is no legal limit as to how many times this can be done. The first time the creditor who reported the negative item, fails to respond within the reasonable time period, the negative entry is removed from your credit record. They usually continue the challenging process until all or most of the negative items on your report are removed. This procedure will, usually, result to a clean or reasonably strong credit report. 22 If there are negative items remaining on your credit file, they’ll have you take advantage of the one hundred-word consumer statement. This is how these credit repair companies erase negative information from your credit file. There is nothing magical about this process. You can do it for yourself. GUIDELINES TO HELP YOU IN THE DELETING PROCESS The idea behind dispute letters is to keep sending them so as to trigger a non response from the creditors or a failure on behalf of the credit bureau to reconfirm the item in question within a reasonable period of time. When the creditor or the credit bureau fails to respond within the allotted time, the negative item must be removed from your credit report. If your first dispute does not remove all the negative items on your record, wait for some weeks and then repeat the aforementioned procedure. Keep repeating this procedure until you have removed most of the negative items. If you see that the remaining creditors are not ready to give up, it is time to negotiate or take advantage of the consumer statement. Keep up the persistence and maintain accurate records of all correspondence. Keep a copy of each letter you send out, for your files, making sure to keep a record of the date on which they were mailed. Mail all correspondence to the credit bureau by certified mail with a return receipt requested, so you can keep track of the number of days it takes them to complete their reinvestigation. Since more than one credit bureau may be maintaining a file on you, cleaning up your credit record with one credit bureau does not change the information maintained on you by another. You may need to contact the other credit bureaus to get them to remove the derogatory items as well. HOW TO HANDLE COLLECTION AGENCIES Some creditors set up their own collection departments to handle their debt collections activity. However, most collections activity is performed by third-party collection agencies, which are separate from the original creditors, and collect 23 debts on behalf of various lenders. They may also deal in what are known as junk debts. These are debts which have been designated as charge-offs by the original creditor. These companies purchase old debt (where the Statute of Limitations has already expired) from original creditors for literally pennies on the dollar and go after old, written off credit card debt with a vengeance. The lender no longer has any interest or share in the debt. Thus, whatever the collection agency can collect belongs to them. Some of the people working at these agencies lie, cheat, and do whatever they can to get you to pay what they claim you owe. These Junk Debt Buyers (JDB) use threat and intimidation because they’re going after consumers who rarely know the law (and who cannot afford to hire a lawyer for that matter). They’re hoping that, either the debtors will be scared, or that they won't be aware of that "out-of-statute" status. But if you make it clear that you understand the legal situation, then the collectors are likely to give up and move on to easier targets. Debt Validation – A Powerful Technique To Stop Collection Agencies In Their Tracks Collection agencies rely on the fact that most people do not know the law, and they cannot afford an attorney. The truth is that they really don't have any authority to do anything to you. You should become familiar with the Fair Debt Collection Practices Act, which places many restrictions on collection activities. If you're dealing with a collection agency or debt attorney who purchased your debt, demand that they show you proof there is written documentation indicating that you owe them anything or ever agreed to deal with them. To validate a debt, the collection agency needs to provide current documentation, obtained from the original creditor, proving that you indeed owe the money and also that they have legal right to collect it from you. This also means that the collector has to cease all collection activity until they provide this evidence to you. When you write to the collection agency demanding debt validation, simply tell them that you dispute the debt and are requesting debt validation. You are not required to tell them why you dispute the debt. Do not provide them any additional information about the debt and never acknowledge you owe the debt. It is their job to prove you owe the debt, not yours. 24 Be sure to send the letter by certified mail, return receipt requested. Allow the collection agency 30 days from their receipt of the letter to respond. If they fail to respond or can’t provide sufficient evidence that you owe the debt it must end its attempts to collect on the debt and remove the collection from your report. If they can’t prove they have the legal right then you don't pay. This process of validation can be a powerful technique in your battle to get rid of the collection actions on your credit report. This is because more often than not collection agencies really don’t have the proper documentation required to verify your debt. This is especially true if the debt has been passed around from one collection agency to another. Many times debt collectors will simply send you a computer generated form made to look like a billing statement from the original creditor. This because they do not have any proof from the original creditor when they purchased the debt. The Federal Trade Commission has made it clear that a mere itemization isn’t sufficient proof to constitute a validation of a debt. They must get the original contracts directly from the original creditor and send them to you. Anything can be typed into a computer system, printed out, and mailed. The only true validation is a copy of the contract you first signed with the original creditor agreeing to pay the debt. Debt Validation is an exremely powerful method of removing negative credit. It forces the collection agency to prove that you owe the debt and that they have legal right to collect the debt. By using this technique, you can get accurate harmful information removed from your file simply because there is no trail of documentation attached to it. Take the time to read the Fair Debt Collection Practices Act. Statute of Limitations - An Effective Technique To Stop Collection Agencies From Bothering You Before you attempt to settle a debt, check the Statute of Limitations. Debt collectors only have a certain amount of time to sue you for payments. The Statute of Limitations is a time limit, measured in years, after which a debt can no longer be legally collected in court. If the Statute of Limitations has run out, you no longer have a legal obligation to pay this debt. 25 If the Statute of Limitations has expired on the debt, you cannot be legally sued for the debt. If a collection agency sues for a debt when the Statute of Limitations has expired, don’t ignore the lawsuit. You can have the suit dismissed. Make sure you appear in court and let the court or judge know the debt is, indeed, time-barred and the Statute of Limitations has expired. When does the Statute of Limitations start? Generally, the statute of limitations begins ticking the day you make your very last payment on a debt. So check your state’s Statute of Limitations on written contracts. Important Note: While the Statute of Limitations is running or even after it's expired, making a specific promise to pay, or a partial payment can reset or restart (depends on your state law) the Statute of Limitations clock and open the door for the collector to seek a judgment against you. Sometimes the collection agency will try to get you to pay a small portion of the debt. If you make a payment, they have reaffirmed the debt and started the Statute of Limitations over again. It is very important that you be aware of your rights and the laws that protect you as a huge number of these debt collectors will use any trick to get you to pay what they claim you owe. Warning: Collection agencies will always encourage the debtor to call the collection agency on the phone. They prefer to hassle you on the phone because they want to intimidate and upset. They know many people are not aware the FDCPS has laws to protect you from them. It's always a good idea to deal with collection agencies in written communication only. Always send the letter via certified mail, return receipt requested. And be sure to state in the letter “this is not an acknowledgment of the debt and the Statute of Limitations has expired.” Your Legal Rights Regarding Collection Agencies Are debt collectors calling several times a day demanding money? Have they been calling at all hours of the day and harassing you and your family and just want the calls to stop? Anyone who has ever been the victim of nasty or harassing phone calls from the debt collectors knows that those calls can be not only bothersome, but in many cases, extremely unsettling, frightening and even intimidating. 26 You don't have to take harassment from a creditor or debt collector. If you're being hounded by bill collectors, don't be intimidated. Consumers do have rights. The Fair Debt Collection Practices Act protects you if your creditor has given your account to a third-party collection agency. Knowing your rights as a debtor can help you stop this abuse and harassment from collection agencies. Collection agencies are not allowed to do the following: Call you at work, if they know your employer disapproves. Since bill collectors usually don't know your work rules, you should advise them of this. Call your home before 8 a.m. or after 9 p.m., and if you put your request to stop calling in writing, they have to stop. In that case they can only contact you in writing to say they’re taking you to court (which they won’t bother doing). Address you in an abusive manner. Threaten to sue unless they are actually taking legal action. In some states, third-party collection agencies may not sue. Falsely claim to be an attorney, a representative from a credit bureau or a member of law enforcement. Threaten you with arrest or jail. Call family or friends in an attempt to collect your debt. The debt collector may not contact anyone other than your attorney. If you do not have an attorney, a collector may contact other people, but only to ask for your phone number or address; they are not allowed to discuss the debt. Debt collectors usually are prohibited from contacting such permissible third parties more than once. . Under the Fair Debt Collection Practices Act (FDCPA), debt collectors cannot harass you. If any of the above is happening to you, tell the collection agency to stop harassing you. If it continues, find out their name and address and file a complaint with the Better Business Bureau, the Federal Trade Commission or your state's attorney general's office. 27 You do have rights. You don’t have to put up with harassment and abuse. Check out the laws in your state, and The Fair Debt Collection Practices Act. You can sue a debt collector for violation of the FDCPA.. You have up to one year after the alleged violation to sue. PUTTING POSITIVE ITEMS ON YOUR CREDIT RECORD Your credit file may not contain information on all of the accounts you have. There are some companies who are subscribing members of the credit bureaus, who use their membership only to run credit checks and to report negative account information. However, if your account is in good standing with them, they seem reluctant to report it to the credit bureau. If you have favorable accounts that aren’t listed on your credit report, you should ask that they be added to your report. You can write to the credit bureau and ask that they add these accounts to your report. Some credit bureaus will contact the creditors you name as favorable to you and if it is correct, the item will be added to your report. They may charge you a small fee for this service. Call them to find out their procedure for placing positive credit information on your credit report. Also, contact those non-reporting creditors with whom you have favorable accounts and authorize them to send your account record to the credit bureau. Tell them you need your account information to be listed on your credit report. Adding favorable accounts to your credit file will help in offsetting some negative items on your report. So get those good accounts listed on your report in order to bury the bad ones. REVIEWING YOUR UPDATED CREDIT FILE Following completion of each investigation, the credit bureau is required by law to provide you with an updated copy of your report, reflecting the results of all challenges. They will send you a copy of your credit report reflecting the deletions or change made in your report as a result of reinvestigation. 28 Once you have all the negative or potentially negative items removed from your file, or have added a statement to offset any remaining negative item, it’s time to have your new, better report sent out to your creditors. The credit bureau must furnish a revised copy of the report to any person who has received a report on you within the preceding six months (or two years if it involves employment), informing that recipient of any deletion, revision, or inclusion of statement in your report. But you have to demand that the credit bureau furnish such revised reports to specifically designated creditors. The credit bureaus will not do this unless you ask them. So be sure it gets done right away. FILING COMPLAINTS ABOUT THE CREDIT BUREAUS If you feel that the credit bureau has failed to comply with the law, you should contact the Federal Trade Commission. If, for example, you have disputed negative items on your credit report and the credit bureau refuses to reinvestigate and remove inaccurate items, your next step is to file a complaint with the Federal Trade Commission as well as with the State Attorney General’s Office. If you write to the Federal Trade Commission, be sure to include the name and address of the credit bureau, the name of the person you dealt with, the nature of the problem, a copy of your request and their responses. The address of the Federal Trade Commission is as follows: Federal Trade Commission Pennsylvania Avenue at 6th St., N.W. Washington, DC 20580 www.ftc.com REBUILDING YOUR CREDIT RATING There are several ways to build, or rebuild credit. The following methods are proven ways to build a good credit rating. Secured Credit Card 29 One of the most important tools in rebuilding your credit profile, and obtaining further credit is a Visa or MasterCard. It serves as an excellent reference when requesting credit elsewhere. Now there is a proven way to obtain a Visa or MasterCard regardless of your past credit situation. A few banks and other financial institutions offer a unique program known as Secured Credit Card. Secured credit cards are offered to people with marginal credit, or no credit experience. A secured credit card is obtained through the establishment of an account (usually interest bearing account) that serves as security for your purchases on the card. The money is held as security on your credit card. In the event of your default, the institution or company that issued the secured credit card can use your collateral (your money on deposit) to cover the purchases you made on the card. Your credit limit on your secured credit card may vary from bank to bank. Some banks will issue you a secured credit card with a credit limit of one hundred percent (100%) of your deposit. Other banks will grant you a credit limit equal to fifty percent (50%) of the money you have on deposit with the bank. Each financial institution has its own list of minimum requirements. Some will accept applicants with previous credit problems, such as collections, late payments or bankruptcies, while others will not. In general most will require that you have a good job, and no history of credit card fraud. If, for example, you deposit $1000 in a savings account with a financial institution and the percentage that the limit is based on is 100%, $1000 will be your credit limit. If the institution grants you 50% of the secured deposit, your credit limit will be $500. The interest rates, annual fees, and setup fees can vary from institution to institution. Secured credit cards look like, and are used the same way as other Visa or MasterCard is used. A secured credit card is an ideal way for someone who has had credit trouble in the past, to reestablish credit. It is also designed to help those who want to establish credit for the first time. For a list of institutions offering secured credit cards, call Bankcard Holders of America. Their telephone number is (540) 389-5445. You can contact these institutions and request an application and other pertinent information. When you send in your application the bank will check your credit history. Some will require that you send your application along with your account deposit. Once you’ve met with their minimum requirements, they will issue you your credit card. 30 Instant Credit Once you have obtained a major credit card, it becomes much easier to obtain other credit. For example, many department stores around the country have different forms of “instant credit,” and you can qualify simply by having your very own major credit card. You simply walk into the credit department of the store and get an application for their instant credit program. Fill out the instant credit application, show your pictured I.D. or driver’s license, a visa or MasterCard, and then receive credit on the spot. You will then be issued a temporary card with a pre-established credit limit. And about a week or two later you should receive your charge card in the mail. The idea behind instant credit is simply that people who already have major credit cards can be trusted, and must be credit worthy. In other words, major credit cards are difficult to obtain, and credit can be safely extended to those who already have these cards. Each account you open should go on your credit record, and adds another favorable reference to your credit record. Examples of businesses offering some form of instant credit are: J.C. Penny, Robinson’s May, Emporium, Zales Jewelers, Capwell’s, Bullocks, Saks Fifth Avenue, Nordstrom, Weinstocks, Sears, I. Magnin, Spiegel, Levitz Furniture, Wikes Furniture and several other places. You may call around your town to see what stores or businesses have instant credit program. Or the next time you’re making a purchase, ask the store attendant if they offer this kind of instant credit. A good rule of thumb is to apply at stores where you are likely to shop. Inactive accounts will do nothing for your credit profile. There are many other businesses, such as department stores, oil companies, etc., which will issue you their charge cards once you have a visa or MasterCard. Examples of oil companies offering charge cards are: Chevron, Shell, Mobil, Texaco, and Unocal. You may call them to request their application, or pick it up at their place of business. After you have received their application, complete and mail it back to them. A few weeks later, you should receive a response from them. 31 Remember that too many applications at the same time can look bad. Do not apply for too many charge accounts at the same time. The inquiries enter on your credit file, and a multitude of them at the same time makes credit grantors look at your application suspiciously. You can turn in two or three applications at a time. Then, allow some weeks before applying in other places. HOW TO ESTABLISH AAA-1 CREDIT RATING The following is another way to build a good credit record if you’re in a hurry to get a visa or MasterCard. You can develop several solid credit references following this unusual plan. You’ll need about $1000 cash to carry out this plan. You can use less money or a larger amount; it’s up to you. First, go to any bank in town and open a saving account with the $1000. Wait at least three days for the paperwork to go through. Then, apply for a loan at the same bank in the amount of $1000, payable in twelve monthly installments. Explain to the loan officer that you’d like to use your savings account as collateral. You will have no problem getting the loan since you’re pledging your savings account for the loan. After you’ve been granted the loan, go to another bank (not a branch of the first one) and open up another savings account with the $1000 that you just borrowed. A few days later, take out a $1000 loan using your savings account as collateral. Next, go to a third bank and repeat the procedure. Again, take out $1000 secured loan. By this time, you will have three savings accounts, and still have the original $1000 in your pocket. With your floating $1000, open a checking account at a fourth bank. You will need this checking account to make payments on your loans. A week later send a check for your loan payment to each of the three banks, even though it is not yet due. Wait about a week, then make your second monthly payment, and a week after that make another payment. 32 After making the third payments on these loans you will have an excellent credit with each of these banks because you have actually made three payments before the first payment became due. Any credit investigation will show you with three $1000 bank loans on which you are months ahead on payments. Continue making payments on the loans for four to six months, and then make a lump sum to pay off the loans. Once you’ve paid off the loan, your money will be freed up. After you have completed the repayment process, your credit profile will be in AAA-1 condition. This is one of the easiest ways to establish AAA-1 credit rating in a minimal amount of time. Once you have established a good paying history for all three loans, it is now possible to begin obtaining credit cards and other forms of credit. To ensure you have no difficulties, apply for the easiest cards first, and then the difficult ones last. Start with oil company and department store cards. Use the cards to purchase something, and make payments accordingly. Apply for unsecured visa and MasterCard. Purchase something and pay the bill when it is due. Then apply for entertainment and travel cards, such as American Express and Diner’s Club. HOW TO ADD UP TO TEN YEARS OF EXCELLENT CREDIT HISTORY ON YOUR CREDIT FILE It is possible to create an instant credit history dating back up to ten years or more, following an unusual technique. The secret to this method is to have a trusted friend or family member with good credit add you as a user on his/her credit card account. To do this, he has to ask his credit card issuer to issue an additional card to you. The institution will honor this request without quibbling since the cardholder authorizing of the second card has a good payment record with that account. If the person (your friend or relative) is not comfortable doing this, you can convince him by letting him know that he can take the card from you as soon as you receive it. 33 Once the card id issued to you, the complete history of that credit card account will appear on your credit record. This includes the date the account was opened, limit, balance and the payment history of the account. Remember, your objective is to establish an excellent credit history. You don’t want to inherit a history of late payments or other derogatory information. So be absolutely sure he has an excellent payment history with each account he adds you as a user. This technique will help you add up to ten years of excellent credit history on your credit file. ESTABLISHING CREDIT FOR THE FIRST TIME If you do not have a credit history on file with a credit bureau, you may have trouble obtaining credit. This is because potential creditors have no independent way of evaluating the risk you pose to them. Your credit report provides the creditor with the information they need to determine whether you will be a good credit risk. You must prove your existence to the credit world. Your credit history begins the first time you apply for credit. For example, if you go to a store or bank and fill out a credit application and the creditor sends information on your credit application to the credit bureau, the credit bureau will start a credit file on you. The following methods are recommended for establishing credit. Feel free to utilize whichever methods you like. Apply for easy to obtain charge accounts, such as, store or gasoline account. Use the card to make purchases and make prompt payments. Once you have shown the credit world that you are a good credit risk, you will soon find your mailbox full of credit card and loan applications. Another way to obtain your first credit extension is through the use of a cosigner, especially if you don’t qualify on the basis of your own credit reputation. You can have a financially responsible person, with a good credit rating, cosign for you. By cosigning for you, this person is making a legal commitment to repay your indebtedness if you should fail to make the required payments. Since the cosigner is guaranteeing payment of the debt, his or her credit history will be used when evaluating the credit worthiness of your credit request. Creditors are comfortable 34 with this type of set-up because if you fail to make payments, they have someone else they can legally go after for repayment. You can also develop a credit history by obtaining a secured visa or MasterCard. Having a secured credit card can be a stepping-stone for obtaining additional credit. Once you have a visa or MasterCard, getting other types of credit is much easier. Or take out a small installment loan from a bank and pay it back promptly. SPECIAL NOTICE TO WOMEN CONCERNING CREDIT Under the provisions of the Equal Credit Opportunity Act, married women may apply for credit in their own names. It is usually in the husband’s credit file that joint accounts are listed. After divorce or the death of the husband, the woman has no credit file. If you have been or currently are married, you should develop your own independent credit identity, a credit file that is separate and apart from that of your husband. Such identities are also crucial in the event of divorce, incapacity, or the death of the husband. Establishing Credit In Your Own Name If you’ve never held credit in your own name, there are steps that you can take to establish a credit rating. The Equal Credit Opportunity Act is a law that entitles a married woman to establish credit under her own name rather than her husband’s and allows her to keep the credit ratings they had established prior to marriage. To assist you, follow the advice in the “Establishing Credit For The First Time” section. Be sure to use your own Social Security Number, and list your own financial resources. Do not list items that are held solely by your husband. A creditor must consider the credit history of accounts you have held jointly with your husband. By law if you and your husband jointly hold credit obligations (provided they were opened after June 1, 1977), these should be reported under both your names. Be sure to list any joint accounts for which you share responsibility. Any joint credit accounts opened before June 1, 1977 may only appear on your husband’s or former husband’s credit report. So, contact your creditors and inform them that you would like them to report the accounts in both of your names. In 35 addition, you might also contact the credit bureau and ask them to add these accounts to your file. Some credit bureaus will add this type of information for a small fee. Only do this for accounts that have a good payment history. In this way, you can establish your own credit. What to Do If You Have a Negative Credit History If a married couple has credit problems and the accounts are primarily in the husband’s name, the woman can still often establish a separate credit record and use it to the benefit of both. Let’s say they have a joint account, instead of battling against the negative credit record, the couple can build a credit history in the wife’s maiden name. If she got a credit card, for example, she could apply for a card to be issued to her husband. The legal liability is listed in her maiden name so no credit check is run on him or on her married name. SAMPLE LETTERS FOR CREDIT REPAIR The following are examples of successful dispute letters. They are for illustration purposes only. They are meant to give you an idea of how to properly word your letters. Do not copy them word for word. Simply use them as guidelines to help you as you prepare your own correspondence during the deleting process. By including these letters, I’ve made it easy for you to get started on the road to a new life of positive credit. Make sure you make copies of all letters you send, for your records. Also, send each letter by certified mail. Request for a Copy of Your Credit Report (Within 60 Days of Credit Denial) Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, 36 I was denied credit within the past 60 days based upon a review of my credit report as furnished by your agency. Please send me a free copy of my credit report. I have included a copy of my rejection notice. The following information is for identification purposes. Full Name: Current Address: Previous Address: Social Security Number: Date of Birth: Thank you for your cooperation and immediate attention to this matter. Sincerely, (Your Signature) Request for a Copy of Your Credit Report (Not in Response to a Credit Denial) Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, Please send me a copy of my credit report. I have enclosed a check in the amount of $___. The following identifying information should help you fulfill my request. Full Name: Current Address: Previous Address: 37 Social Security Number: Date of Birth: Thank you very much for your cooperation and prompt attention to this matter. Sincerely, (Your Signature) Request for Deletion of Negative Item That Has Been on Your Credit Report for More than the Time Allowed Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, After a careful review of my credit report, I discovered that the following account has been reported on my credit report for more than seven years (or ten years as the case may be). Subscriber Name: Subscriber Number: Account Number: Under the Fair Credit Reporting Act, negative information must be removed from a credit file after the statute of limitations period has expired. This account is past the statute limit. I hereby request that you immediately delete this item from my credit report, and send me a corrected copy of my report. Sincerely, (Your Signature) 38 Your Name Social Security Number Date of Birth Disputing Accuracy of Negative Information Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, I have recently reviewed my credit report. The following item, which is recorded on my credit file, is inaccurate and is highly injurious to my credit history. Subscriber Name: Subscriber Number: Account Number: This account is not mine. I have never had an account with this creditor. Please investigate and remove this inaccurate data in order to show my true credit history, and provide me with the results of your investigation within a reasonable period of time. Thank you for your prompt cooperation. Sincerely, (Your Signature) Your Name Social Security Number Date of Birth Request for Correction of Personal Statistics Your Address 39 Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, I recently received my credit report and it shows a checkpoint that my name is Tony J. Johnson. I have never used this name. This must have been a clerical error from a creditor inquiring into my credit history. My name is Tony R. Johnson. Please delete this inaccurate data from my credit file, and forward to me a copy of the corrected report. Sincerely, (Your Signature) Your Name Social Security Number Date of Birth Request for Correction of Personal Statistics Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, My credit report shows a checkpoint, indicating that my Social Security Number is 123-54-6789. This erroneous information is highly injurious to my credit history. It is possible that a clerk at the bank must have mistakenly transposed the number. Please remove this checkpoint. My Social Security Number is 123-45-6789. Please send me an updated copy of my report. Thank you for your cooperation and immediate attention to this matter. Sincerely, 40 (Your Signature) Your Name Request for Deletion of Inquiry Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, I have recently received a copy of my credit report, and I saw an inquiry that should not appear on my report. I do not recall applying for credit with this creditor. Name of Subscriber: Date of Inquiry: I hereby demand that you immediately investigate and delete this item from my file. Please provide me with a corrected copy of my credit report. Thanks for your immediate attention to this matter. Sincerely, (Your Signature) Your Name Social Security Number Date of Birth Request for Deletion of Unauthorized Inquiry Your Address Date 41 Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, While reviewing my credit report, I saw an inquiry made by (name of creditor). I never authorized this company to inquire into my credit history. This erroneous data is highly injurious to my credit history. Name of Subscriber: Date of Inquiry: I hereby demand that you immediately delete this inquiry from my credit report. Please provide me with a copy of the corrected report upon correction. Thank you for your immediate attention to this matter. Sincerely (Your Signature) Your Name Social Security Number Date of Birth Request for Deletion of Negative Information Due to Expiration of “Reasonable Period of Time” Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relation Dear Sir/Madam, On June 5, 2010 I sent you a letter disputing certain items on my credit report that I believe to be incorrect. To date I have not received any response. I am wondering why you have not responded to my request. 42 In accordance with the Fair Credit Reporting Act you must insure the correctness of reported information. Also, you must comply with your obligation to respond within a “reasonable period of time” (legally defined as thirty calendar days). Therefore, I hereby demand that these items be promptly deleted from my credit report. A copy of my previous letter is enclosed for your reference. I would appreciate your prompt attention to this matter, and your sending me a corrected copy of my credit report immediately afterward. Sincerely, (Your Signature) Your name Social Security Number Date of Birth Request for Correction of Account Status (Disputing Directly with the Creditor) Your Address Date Name of Creditor Address of Creditor Attention: Credit Department RE: Account #_________________ Dear Sir/Madam, I saw a negative remark on my credit record indicating that I owe you $312. I tried to have this negative information removed from my credit file, by disputing directly with the credit bureau. But this erroneous remark still remains. This has been very annoying. I made purchases with my charge card. I made payments as agreed for several months. I subsequently sent you a third party check. This person who issued me the check had owed me $187. He paid me with a check, which I accepted and endorsed it over to your company. Your office accepted the check and cashed it. I paid off the remaining balance of $125 in full with a money order. 43 I paid promptly and I don’t owe any money on this account. I don’t see any reason why my positive credit record with your company should be showing negative at the credit bureau. This is in violation of the Fair Credit Reporting Act (FCRA). Check your records very well, and correct this error. I have sent numerous dispute letters to the credit bureau, in order to resolve this reporting error, but each subsequent letter brought back no positive response. My credit file still shows the erroneous remark and as a result, I have suffered severe financial setbacks and emotional distress. I’m not going to take it anymore. Your representatives remain convinced that the computer is infallible. I know otherwise and, at the suggestion of my attorney, I think it fair to give you a final chance in the hope that you’ll be able to straighten out this matter. Please inform the credit bureaus to change the status of this account to a positive rating so that no further action will be required. Also, notify me as soon as this matter has been taken care of, so I can review my updated credit file. Thank you for your anticipated help in resolving this problem. Sincerely, (Your Signature) Your Name Disputing Directly With the Creditor Your Address Date Name of Creditor Address of Creditor Attention: Credit Department Dear Sir/Madam, While reviewing my credit report, I saw an inquiry made by your bank on July 5, 2010. I have never applied for credit at your bank, so this inquiry was not authorized by me. Be advised that you are in violation of the Fair Credit Reporting Act and have made illegal inquiry into my credit history. 44 I hereby demand that you immediately have this inquiry deleted from my credit file, or face legal action. And, be sure to notify me immediately following deletion of this inquiry. Sincerely Yours, (Your Signature) Social Security Number Date of Birth Disputing Directly With the Creditor Your Address Date Name of Creditor Address of Creditor Attention: Credit Department Dear Sir/Madam, While reviewing my credit report, I saw a negative item, which was reported by your company. I have never had an account with your company. This is highly injurious to my credit history. Through numerous letters I have tried for several months to have this item deleted from my credit file, by disputing directly with the credit bureau. But each subsequent copy of my report shows the inaccurate item. This has been time consuming and annoying. I have had enough patience. Before I go to make a formal complaint with the Federal Trade Commission (FTC) and/or bring a lawsuit, I am giving you one more chance to correct this error, or else we will have to resolve it in court. I demand that you give me a full explanation and supply me with documentary evidence, which include, items purchased, date of each purchase, and signature card showing signature of the person who opened the account and/or who made the purchase. 45 Please respond to this letter by June 5, 2010. Be advised that unless you correct this error or respond by the above date, I will take legal action against you. I hope that we will be able to resolve this problem, so that no further action will be required. Sincerely Yours, (Your Signature) Your Name Social Security Number Request to Pay Fraction of the Debt in Exchange for Deletion of Negative Information Your Address Date Name of Creditor Address of Creditor Attention: Collections Department RE: Account #________________ Dear Sir/Madam, The purpose of this letter is to resolve our longstanding dispute concerning the above referenced account. I made purchases with my charge card, and made payments as agreed for several months. Due to unfortunate circumstances, I had to leave town for one year. So I sent a lump sum of money to pay off the bill. During that period of time I lost contact with your office, even though I filed a “change of address” notice at the Post Office. But my credit report shows that I still owe you $800. I cannot recall owing you any money because I made every effort to pay off all of my debts then. As of now, I cannot prove that I don’t owe you because all of my records have been lost. With the expenses that I have, I cannot pay the full amount. However, I am willing to work out the following compromise with you to settle this longstanding dispute. 46 I will pay you 30% of each dollar owed, as full settlement of this account. This works out to $240. I will pay $100 immediately, and will then make four monthly payments of $35. I will make each payment before the first day of the month. In return, I ask that you have the negative notation removed from my credit record, as soon as you are in receipt of the initial $100. That is, have the remark changed to a positive rating (Paid Satisfactorily). I feel I have made a good effort to settle this debt. This is a better solution for all of us. Your cooperation in this matter is greatly appreciated, and if you agree with this proposal please sign in the space below indicating agreement, and return it to me. As soon as I receive this signed acknowledgement, I will immediately forward you a cashier’s check or money order in the amount of $100. Thank you very much for your immediate attention to this matter. Sincerely Yours, (Your Signature) Your Name Agreed To By: __________________________On_______________ (Date) Request for Inclusion of Statement of Dispute in Your Credit File Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations Dear Sir/Madam, I sent several letters to both you, and the creditor, (name of creditor) concerning a negative item on my credit report. Despite my attempts, this negative information still remains on my report. As I said earlier, this debt has already been paid in full. Since the creditor (name of creditor) still does not agree with me, please add the following statement of 47 dispute to my credit file, in accordance with my rights under the Fair Credit Reporting Act. And, send me an updated copy of my credit report. “I do not owe (name of creditor). I made payments as agreed for one year. I stopped making payments only after I discovered a billing error in the statement for October 2002. I decided that I would not make any more payments until the problem was resolved. The error was corrected, and they notified me. Three months later, I paid the balance in full. I believe clerical error is the cause of this problem, and should have been corrected long ago. I still maintain that this account has been paid in full, and their record should reflect this.” Thank you for your prompt cooperation. Sincerely, (Your Signature) Your Name, Social Security Number Letter of Request to Have Positive Items Listed on Your Credit Report Your Address Date Name of Creditor Attention: Credit Department RE: Account #_________________ Dear Sir/Madam, I recently received a copy of my credit report, and I noticed that this account is not listed on my report. I’d like you to report my good credit record to the following credit bureaus. Experian P.O. Box 2002 Allen, TX 75013 (888) 397-3742 Equifax 48 P.O. Box 740241 Atlanta, GA 30374 (800) 685-1111 Trans Union P.O. Box 1000 Chester, PA 19022 (800) 916-8800 Please notify me as soon as you have reported it. Thanks for your cooperation. Sincerely, (Your Signature) (Your Name) Request for the Credit Bureau to Distribute Corrected Credit Report Your Address Date Name of Credit Bureau Address of Credit Bureau Attention: Consumer Relations RE: File #___________________ Dear Sir/Madam, I recently received a corrected copy of my credit report from you, and it shows my true credit history. Please send a copy of the revised report to each company that has received my credit report within the past six months. Thank you so much for your time. Sincerely Yours (Your Signature) Your Name 49 CONCLUSION Now that you have read all of the information in this book, I trust that you feel ready to use it to your advantage. Remember all the times you’ve dreamed of having good credit. A good credit rating can enhance your life. It will give you access to the things you want in life. I believe that I have given you the information you need to clean up bad credit and restore your credit rating. However, just reading this book is insufficient. You must act. Without action on your part, your credit rating will never change. Do not expect to be able to restore a good credit history overnight. It took you time to create a bad credit history, and it will take you some time to put it behind you. However, with the Fair Credit Reporting Act (FCRA) backing you up, you shouldn’t be forced to wait out the seven/ten year reporting period. Now that you know how it’s done, the ball is in your court. Don’t give up. It will take persistence, determination, and some patience. But it will be well worth it. If you will work quickly following the instructions that I have given you, it is possible to completely clear your credit report in just a few weeks or months. Once you have established AAA-1 rating, you must do everything in your power to protect it. I enjoy hearing from you about your successes as you “Clean Up Bad Credit and Establish AAA-1 Credit Rating.” Write to me and let me know how the information I have laid out in this book, has helped you restore your credit rating. Conleth C. Onu http://www.ConlethOnuPublishing.com 50 HOW TO RAISE MONEY WITH CREDIT CARDS AND PARLAY IT INTO A STEADY INCOME In today’s economy, the need for money by individuals has never been greater. Millions of people are looking for money to go into business or to take care of other financial problems. The inability to raise the necessary cash when presented with business opportunities is one of the most frustrating experiences anyone ever lives through. You can overcome this obstacle by using credit cards. America is a credit-oriented society. Credit has become a way of life in our society. Virtually every one has credit cards. Most people do not know that in addition to purchasing merchandise and services, they can also get cash with their bank credit cards. Credit cards provide you with the means to raise instant cash and take advantage of investment opportunities. The majority of banks offer you “cash advances” on your bank credit cards (Visa, MasterCard, etc.). The procedure for obtaining cash advance is simple. All you have to do is walk into any bank, present your card, sign the receipt, and they’ll give you the money immediately. Having a multiplicity of credit cards not only solidifies your credit rating, but also increases the amount of cash at your fingertips. Let’s say you have 10 credit cards, with cash advance limit of $1,000 per card. Within hours, you can get up to $10,000 in cash. Gold/Premier credit card lines have a minimum of $5,000 cash. Thus, if you have 10 of these cards, each with a cash advance limit of $5,000, you can raise up to $50,000 by simply walking into any bank, showing your cards, and asking for cash. 51 Most people fail to capitalize on moneymaking/business opportunities because they do not have the required cash. This method of raising cash will enable you to obtain the money you need to start your own business. In the following pages, you’ll learn how you can start your own business and parlay it into a steady moneymaker. HOW TO MAKE YOUR FORTUNE SELLING INFORMATION ON THE INTERNET Did you ever have fabulous fantasies of making your fortune on the Internet? Well, for some people, it’s no longer a fantasy. One of the most profitable businesses to get started in on the Internet is selling information. People are looking for all kinds of information on the Internet. Information is a hot seller. Almost everybody wants information on how to do something. There is a tremendous demand for valuable information. There is no doubt about it. People will always be willing to spend money for information that will make them wealthier, wiser, and happier. Multi-millions of dollars worth of information are sold every single day throughout the whole world. Selling valuable, helpful information is a depressionproof business. It is a business in which any person can make a fortune, almost from scratch. Selling information offers great potential and yet not calls for very much in the way of initial capital. It is an exciting, interesting and very lucrative field that can be started with an unbelievably small investment. It’s a dream come true for any person who would like to strike out on his own without risking his life savings. There is plenty of room for start-ups in this remarkable and robust industry. This business has transformed the lives of thousands of men and women. You too can become part of the multi-billion dollar information marketing revolution. As you already know, the Internet is all about information. Think about what you do on the Internet most of the time. You are looking for information aren’t you? That’s why ebooks are considered to be the “perfect” online product. Ebooks are one of the biggest sellers on the Internet. 52 Ebooks are electronic books that can be downloaded from anywhere on the Internet. They give people “instant gratification.” They can be made available to your customers by way of digital download. So you never have to worry about inventory, packing and shipping. Ebooks are much more cost effective when compared to print versions of books. They can be sold easily with no cost to reproduce them. Only one copy of the ebook is needed to be kept in the website. Different buyers will continue to download the ebook from the website after each purchase no matter how many purchases are made. This is a simple business you can operate in the privacy and comfort of your own home. And you can run your business from anywhere in the world. All you need is a computer and Internet access. Everything from order to delivery to follow up can be automated on the Internet. This is the perfect hands-free business. Now there are two ways you can go about this and that is to create your very own information product or buy the resale rights to other people’s products. I recommend you do both. The combination of selling other people’s products along with your own is a combination that is hard to beat. Creating Your Own Information Product Do you have the solution to a problem? Do you have knowledge and experiences that is beneficial to others? Can you provide a quicker and easier way to do something? Then you can create your own information products. Write your information product then sell it to others across the Internet over and over again. You can write about something that you know a great deal about and sell it. Or you can research something that people want to learn, and teach them. People want information on every conceivable subject. That is, titles on how to save money, make more money, start a business, find love, improve your sex life, repair your car, rebuild your credit, and the like will continue to be top sellers. These types of information products are in great demand. The ebook marketplace is still young, and it’s growing steadily. You can create and market your own ebook for an unbelievably low price. If you can write a letter to a friend you can develop your own information book, booklet or report. Here are the steps to producing an ebook and selling it. 53 1. Choose your topic and research it. 2. Write your book and proofread it. 3. Prepare your ebook in a word processor, such as Microsoft Word. 4. Select the ebook format you intend to use, and then format the material accordingly. 5. Set a price for your ebook. 6. Copyright your ebook. 7. Obtain an International Standard Book Number (ISBN). Not mandatory. 8. Set up a website that sells your ebook. 9. Choose a Web Host Provider. 10. Register your domain name. 11. Set up an online payment system 12. Advertise your ebook through search engines, forums, press releases, ezines, articles and any other means available to you. 13. Set up your affiliate program. If you’re serious about making money selling information on the Internet, now is the time to do something about it. Take the first step toward a more satisfying and fulfilling life. If you’d like more information on how to get started in this exciting and rewarding business, go to: http://www.ConlethOnu.com http://www.ConlethOnuPublishing.com http://www.ResellRightsMarketing.com 54 55
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