Should You Work With a Consumer Credit Counseling Agency?

If you’ve made a few mistakes when it comes to using credit cards, you are not alone. The majority of Americans live paycheck-to-paycheck and have stumbled a time or two when it comes to their Visa, MasterCard or American Express card. So how can you get back on track?

At Credit Repair by Attorney, we help ordinary people repair their credit. So, if you’re serious about making a change but don’t think you have enough discipline to create and stick to a realistic budget but haven’t been able to work out a repayment plan with your creditors, you may consider contacting a non-profit credit counseling organization. Many such organizations work with consumers to solve their financial problems.

Reputable credit counseling organizations can advise about managing money and debts, help developing budgets, and offer free educational materials and workshops. Their counselors are certified and trained in the areas of consumer credit, money and debt management, and budgeting. And counselors help customers develop a personalized plan to solve money problems.

However, please be advised that, just because an organization says it is “nonprofit,” doesn’t guarantee that its services are free, affordable, or even legitimate. In fact, many credit counseling organizations actually cause more problems for their clients than they solve.

If you are dead-set on using such an organization, before you sign on the dotted line, you should be aware of potential drawbacks to working with a credit counseling service:

  • Not all organizations are legitimate. Many universities, military bases, credit unions, housing authorities, and branches of the U.S. Cooperative Extension Service operate nonprofit credit counseling programs. Your financial institution, local consumer protection agency, and friends and family also may be good sources of information and referrals to a legitimate firm.
  • Many credit counselors charge exorbitant fees, which can be hidden. Even if fees are not set, some companies urge consumers to make “voluntary” contributions that can actually increase instead of reduce your debt.
  • Most credit counseling firms recommend clients begin Debt Management Plans. If your financial problems stem from high debt or inability to repay debts, a credit counseling agency may recommend enrollment in a Debt Management Plan (DMP). The problem with a debt management plan is that you are required to pay your entire debt in one large monthly lump sum. Even if the credit counseling agency is able to arrange a discount on interest, you may find yourself with a DMP payment of several hundred dollars per month. Also, all credit counseling agencies charge a fee for managing client DMPs. Even non-profit organizations charge this type of fee.
  • DMPs are costly and time consuming. A successful DMP requires you to make regular, timely payments, and could take 48 months or more to complete. Most credit counselors should be able to estimate how long it will take you to complete the plan. And during this period of time you may have to agree not to use or apply for any credit the entire time you are participating in the plan.
  • Many credit card companies count debt management plans against clients. So, even if your intentions to repay your debt are honorable, participation in a debt repayment program might actually negatively impact your ability to secure credit in the future.

If you have made some mistakes on your way to building great credit, fear not. Even if your credit score is low, you have the power to change the paradigm. Consider proactive credit repair services. The truth is, if you follow proper procedures, proactive credit repair services can help you reach your credit goals despite some missteps. Inaccurate information and untimely information must be removed. And, admittedly, in many cases, this is a frustrating and difficult process. But we can help. At Credit Repair by Attorney, we take control of the disputing process for you and make the process fast, effective and convenient for you.

Credit Repair by Attorney specializes in helping consumers fix their credit scores. We are a premier credit repair service—we know how to fix credit reports. We understand the necessary steps and procedures to get the job done quickly and correctly, having helped tens of thousands of consumers repair credit reports. Improve your credit today and qualify for the credit you deserve. Located in Rancho Cucamonga, California, Credit Repair by Attorney serves clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.

How to Handle Creditors

Do you know how to handle creditors?

As with many things, the key to protecting your valuable FICO scores has to do with communication. At Credit Repair by Attorney, we help ordinary people repair their credit so they can get on with their lives. In this blog, we offer free advice and helpful information for those who find themselves in a difficult spot when it comes to managing their money. This week, we’d like to focus on your options when it comes to dealing directly with creditors. The first order of business if you’re having trouble making ends meet is to proactively contact your creditors before they start calling you:

Unsecured Debt

Unsecured debts are not tied to assets and include most credit card bills, charges for medical care, signature loans and payday advances.

  1. Answer the phone.
  2. Explain why making payments is difficult for you.
  3. Try to work out a modified payment plan that reduces your payments to a more manageable level.
  4. Don’t wait until your accounts have been turned over to collections. At that point, your creditors have already given up on you and have likely reported your missteps to credit bureaus.
  5. The Fair Debt Collection Practices Act is the federal law that dictates how and when a debt collector may contact you. A debt collector may not call you before 8 a.m., after 9 p.m., or while you’re at work (if the collector knows that your employer doesn’t approve of the calls). What’s more, collectors may not harass you, lie or use unfair practices to collect a debt. Also, they must honor a written request from you to cease contact.

Secured Debt

Generally speaking, low amounts of secured debts are easier to qualify for because the lender has the right to regain possession over the secured item if the debtor defaults on the loan. Managing secured debts such as auto and home loans is different from handling unsecured consumer credit since secured debts are tied to assets like an automobile loan for your car or a mortgage for your house. If you stop making payments to lenders who have secured the debt, they are legally entitled to repossess your car or foreclose on your house.

Most automobile, motorcycle, RV and boat financing agreements allow creditors to repossess the associated vehicle if the borrower is in default. And, in fact, no notice is required to do so. If you are cash-strapped and are making payments on a home or vehicle wherein you owe more than the item is worth, relinquishing the item might sound attractive. However, be aware that if your car is repossessed or the bank takes your house, you may have to repay the balance due on the loan, as well as associated fees.

In the case of an auto loan, you might be able to regain ownership of the car if you pay the past due balance as well as towing, storage costs and fees. If you can’t do this, the creditor has the option of selling the car. And the lender may be able to sue you for the difference between what you owe on the vehicle and what the car sold for at auction. If you see default approaching, you might actually be better off selling the car yourself and repaying the debt. If you do so, you will avoid the additional cost of repossession as well as a negative entry on your credit report.

If you fall behind on your mortgage, contact your lender immediately to avoid foreclosure. Most lenders are willing to work with you if they believe you are acting in good faith and the situation is temporary. Some lenders may reduce or suspend your payments for a short time. When you resume regular payments, however, you may have to pay an additional amount toward the past due total. Other lenders may agree to modify the terms of the mortgage by extending the repayment period to reduce the monthly debt. Ask whether additional fees would be assessed for changes made to the loan, and calculate how much the new fees total in the long term.

If you and your lender cannot work out a plan, contact a housing counseling agency. Some agencies limit counseling services to homeowners with FHA mortgages. But, particularly in this economy, many offer free help to any homeowner who is having trouble making mortgage payments. Call the local office of the Department of Housing and Urban Development (HUD) or the housing authority in your state, city or county for help in finding a legitimate housing counseling agency near you.

If you have made some mistakes with your credit, fear not. Even if your FICO score is low, you have the power to change the paradigm. Consider proactive credit repair services. The truth is, if you follow proper procedures, proactive credit repair services can help you reach your credit goals despite some missteps. Inaccurate information and untimely information must be removed. And, admittedly, in many cases, this is a frustrating and difficult process. But we can help. At Credit Repair by Attorney, we take control of the disputing process for you and make the process fast, effective and convenient for you.

Credit Repair by Attorney specializes in helping consumers fix their credit scores. We are a premier credit repair service—we know how to fix credit reports. We understand the necessary steps and procedures to get the job done quickly and correctly, having helped tens of thousands of consumers repair credit reports. Improve your credit today and qualify for the credit you deserve. Located in Rancho Cucamonga, California, Credit Repair by Attorney serves clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.

How to Live on a Budget

  1. Are you dodging phone calls from creditors?
  2. Do you hide from the mailman because you are sick of seeing overdue notices?
  3. Is it difficult to pay your bills?
  4. Are your accounts being turned over to collections?
  5. Are you in danger of losing your home or your car?

If you answered yes to any of these questions, chances are that your credit scores are a casualties of your financial struggles. At Credit Repair by Attorney, we help ordinary people overcome credit challenges every single day so they can improve their FICO scores and qualify for consumer loans to rent homes and apartments and purchase cars and houses.

In your struggles, know that you’re not alone. In fact, you might be surprised to learn that most Americans face a financial crisis at some point of their lives. No matter whether the crisis resulted from personal or family illness, job loss, or overspending, financial turmoil can leave you reeling.

At Credit Repair by Attorney, we are committed to helping our clients and friends get their financial lives in order. Our part of the equation is to help repair clients’ FICO scores. But, because we care about the financial health of our clients, we want to offer a few hints to right the rest of the financial ship. And one of the first steps to fix your finances is to learn to live within a budget.

Here are a few ideas to get you started:

  • Create a realistic assessment of how much money you make and how you spend on either a weekly or monthly basis.
  • List your income from all sources.
  • Note cash-on-hand, including the money in your purse or wallet as well as everything on deposit.
  • Detail “fixed” expenses— those that are the same each month, such as mortgage payments or rent, car payments and insurance premiums.
  • Write down those expenses that vary—such as entertainment, food, recreation and clothing.
  • Journal all of your expenses (even those that seem insignificant). This is a great way to track spending patterns and identify necessary and optional expenses.
  • The ultimate goal is to make sure you can make ends meet on the basics: housing, food, health care, insurance and education before spending the surplus
  • If you’re like many people, you might uncover a shortage instead of a surplus. That’s when the tough decisions come into play. If you spend more than you make, you might consider increasing your income by taking on a second job or renting out a room.
  • For free, you can check out materials about budgeting and money management from the public library.
  • For a nominal fee, you can purchase booklets and computer software programs to use for developing and maintaining a budget, balancing your checkbook and creating plans to save money and pay down your debt.
  • Check out our blog on a weekly basis for ideas about how to get your financial life in order,

If you have made some mistakes on your way to building great credit, fear not. Even if your credit score is low, you have the power to change the paradigm. Consider proactive credit repair services. The truth is, if you follow proper procedures, proactive credit repair services can help you reach your credit goals despite some missteps. Inaccurate information and untimely information must be removed. And, admittedly, in many cases, this is a frustrating and difficult process. But we can help. At Credit Repair by Attorney, we take control of the disputing process for you and make the process fast, effective and convenient for you.

Credit Repair by Attorney specializes in helping consumers fix their credit scores. We are a premier credit repair service—we know how to fix credit reports. We understand the necessary steps and procedures to get the job done quickly and correctly, having helped tens of thousands of consumers repair credit reports. Improve your credit today and qualify for the credit you deserve. Located in Rancho Cucamonga, California, Credit Repair by Attorney serves clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.

Why Credit Scores Matter More than you Think

In our technology-based world, it is more important than ever to develop and maintain good credit to help protect your professional image. Your credit can be pulled not just for credit card applications but also when you are applying to rent a home, purchase or lease a vehicle or even when you apply for a job. In this blog post, we will review the basics of credit score calculations as well as the ways that FICO ratings can affect your life.

What is a Credit Rating? The basics:
Using credit of any kind is borrowing money that you promise to pay back within a specified period of time. Credit scores are the statistical methods used to determine how likely any one individual is to repay what he or she has borrowed.

There are three major credit bureaus that collect information and calculate scores—Equifax, TransUnion, and Experian. Although each bureau has its own unique way of calculating precise scores, each takes into consideration all of the information contained in a person’s credit report.

The primary factors used to calculate an individual’s credit score are:

  • Credit payment history
  • Current debts
  • Length of credit history
  • Variety and frequency of applications for new credit.

How Your Credit Score will Impact Your Life

Shelter:

One of the most important decisions you will make is where you will live. And if your credit scores are good, you will have a myriad of options open to you. Whether you choose to buy or rent an apartment, condo or single-unit home, having good credit is important. Property managers and mortgage lenders review housing and credit applications to make sure you won’t default on your lease or mortgage. Poor credit scores could result in a higher security deposit or interest rate or worse yet—a denial of the application or loan.

Transportation:

Unless you live close enough to work to ride a bicycle, walk or take the bus or have enough cash to purchase a car, you’ll need to apply for a lease or a loan for transportation. Your credit scores will not only affect whether you qualify for a loan, but also the amount and interest rate of the loan. Generally, loan applicants with good credit qualify for larger loan amounts with lower interest rates. And, again, the better your credit, the more options you will have for transportation.

Utilities:

Did you know that your credit will be evaluated when you first apply to establish utility services such as electric, natural gas, landline, Internet service, cable, water, trash, sewer and cell phone? These companies effectively contend that you are borrowing one month of utility service. So, before turning on your power, they will check to see if you have good credit. If your credit is poor, you could be turned down for utility service or charged exorbitant start up fees.

Employment:

While most of us realize that our home and vehicular lives are largely determined by the amount of credit lenders are willing to extend to us, we are not always aware that potential employers are able to conduct credit checks as a part of the hiring process. If you haven’t demonstrated financial responsibility, prospective employers might hesitate to hire you. Also, your level of debt might be considered too high for the salary offered.

Small Business:

Do you have dreams of starting your own business so you can be your own boss? Most business startups require a sizable amount of capital that might not be readily available. If you ever plan on applying a small business loan, you will need to bring good credit scores to the application table.

Since your credit is defined by how you’ve paid (or not paid) your bills in the past, many businesses – landlords, mortgage lenders, utility providers, and even employers – use your credit to predict your future financial responsibility. Anytime you need to borrow money, or even services, your credit is called into question. This is why maintaining good credit is so important.

If you have made some mistakes on your way to building great credit, fear not. Even if your credit score is low, you have the power to change the paradigm. Consider proactive credit repair services. The truth is, if you follow proper procedures, proactive credit repair services can help you reach your credit goals despite some missteps. Inaccurate information and untimely information must be removed. And, admittedly, in many cases, this is a frustrating and difficult process. But we can help. At Credit Repair by Attorney, we take control of the disputing process for you and make the process fast, effective and convenient for you.

Credit Repair by Attorney specializes in helping consumers fix their credit scores. We are a premier credit repair service—we know how to fix credit reports. We understand the necessary steps and procedures to get the job done quickly and correctly, having helped tens of thousands of consumers repair credit reports. Improve your credit today and qualify for the credit you deserve. Located in Rancho Cucamonga, California, Credit Repair by Attorney serves clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.

How to Build Good Credit

Build great credit from the ground up.

In the United States, credit card offers are a dime a dozen. As soon as you turn 18, register for college or get a job, you will likely start receiving pre-qualified offers for consumer credit and credit applications in your email and physical mail boxes.

The sad truth is that some people see these offers as free money and apply for anything and everything as soon as they are legally able. And since they are able to charge exorbitant interest rates and excessive annual fees, credit card companies are more than willing to extend credit to virtually anyone with a pulse. As a result, all too often, people are given access to credit before they are ready to responsibly handle it.

At Credit Repair by Attorney, we help people repair their credit. So we understand the value of building good credit and guarding it like a precious jewel. So if you are new to the wonderful world of consumer credit, take a deep breath before you decide to proceed:

  1. Carefully evaluate every offer. The first offer for credit you receive will likely be for a low balance VISA or MasterCard with a high interest rate and ridiculous “processing fees.” Shred these and wait for another offer. Your patience will be rewarded.
  2. Start off with a low-balance student credit card. Once you receive an offer for a low balance card with a low APR, apply. Start out with only one credit card, no matter how many offers you get.
  3. Avoid choosing cards by label or title. Although your first inclination might be to select a card that’s entitled, “Student Card,” pay close attention to associated fees and interest. Just because a card is called “credit starter” or “student card,” doesn’t mean it’s the best bet for you.
  4. Use the card. You might be afraid to dive into the credit game, leaving your new credit card at home. But if you do this, your credit scores will plateau. Instead, to build your credit, charge something on your first card and carry a small revolving balance from one month to the next. This might be counterintuitive since cash purchases are best. But to build your credit, you have to demonstrate your ability to responsibly use it. Otherwise, you will struggle when it comes time to apply for loans to finance a vehicle or home.
  5. Pay on time. No matter how difficult it might be to make your payments, make them. Pay on time every single month. If you prefer making online payments, set up an account and opt for eco-friendly paperless statements. Or send your check at least five days prior to your due date. Once financial institutions note your tendency to pay on or before your monthly due date, they will up the ante by offering you higher credit limits at lower interest rates.
  6. Charge only 50% of available credit. One of the ways credit bureaus evaluate your credit is by the amount of credit remaining. So try to keep all of your balances at or below 50% of credit limits.
  7. Keep a lid on available credit. As you begin to build a great credit profile, continue to be discerning in accepting offers for credit. If you have thousands of dollars of available credit, bureaus could use this as a way to reduce your credit score since you could potentially charge every card up to its limit at any given time.

Today, having good credit scores is not optional. It is a requirement. If you have made some mistakes on your way to building great credit, fear not. Even if your credit score is low, you have the power to change the paradigm. Consider proactive credit repair services. The truth is, if you follow proper procedures, proactive credit repair services can help you reach your credit goals despite some missteps. Inaccurate information and untimely information must be removed. And, admittedly, in many cases, this is a frustrating and difficult process. But we can help. At Credit Repair by Attorney, we take control of the disputing process for you and make the process fast, effective and convenient for you.

Credit Repair by Attorney specializes in helping consumers fix their credit scores. We are a premier credit repair service—we know how to fix credit reports. We understand the necessary steps and procedures to get the job done quickly and correctly, having helped tens of thousands of consumers repair credit reports. Improve your credit today and qualify for the credit you deserve. Located in Rancho Cucamonga, California, Credit Repair by Attorney serves clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.

Frequently Asked Questions about Credit Repair (Part 3 in a 3-Part Series)

In the United States, consumer credit scores are critical for anyone who would like to have the option of financing large purchases such as a home, car or major household appliance. But low credit scores can place large items out of reach for the majority of Americans, many of whom do not have immediate access to large sums of cash. What can you do if your finances take a hit and ultimately negatively impact your credit scores?

Over the past two weeks, we covered some of the most frequently asked questions about credit repair. This week, we will conclude our series with a few more:

  • Do credit scores improve when borrowers pay off liens and collections?

In the long run, it is advisable to pay off liens and collections. However, in the short term, paying these loans will not have much of an effect on your credit scores. This is true unless the outstanding balance is listed in the “past due” section of your credit report. If your report contains such items, pay off all balances in the past due column as long as the associated debts are less than two years old. However, when you make a payment against a collection or a charge off, the seven-year clock starts and the item will be reported for seven years from the date the last payment was made. If you fail to pay a collection, it will disappear seven years after the date of the last payment made to the credit card.

  • In an effort to improve credit scores, should a borrower cancel all of his or her credit card accounts?

Absolutely not!!! Closing credit card accounts will only decrease credit scores due to the fact the debt ratio will increase as a result of the closed account and also can decrease the average length of time an account was open. The best advice we can give is never to close a credit card account.

  • Will even a small credit repayment mistake such as a missed or late payment impact credit scores?

Even one late payment can result in credit or loan denial. There are multiple factors like income, credit history, balances being carried over on credit cards and number of credit cards that can result in a denial even if you have nearly perfect credit. But removing derogatory items is the single most important step you can take in improving your chances of being approved for consumer credit.

  • How can I make sure I’m getting my money’s worth when hiring a credit repair firm?

Credit Repair by Attorney offers a money-back guarantee. Unlike other credit restoration firms, Credit Repair by Attorney offers an easy-to-understand guarantee. We agree to refund our clients after one year if they are not completely satisfied for any reason (provided our clients follow all instructions on the sign-up form and return all correspondence received from creditors within 10 days of their receipt.) A per-client and per-item successful removal or correction processing fee will apply.

  • Is credit repair legal?

Although credit bureaus would like to convince borrowers that credit repair is illegal, this is not true. Fixing your credit is your right under Federal Law. At Credit Repair by Attorney, we make sure our clients’ rights are invoked to the fullest extent. You have the right to disagree with credit score results on your credit report just as you have the right to plead “not guilty” in a court of law.

Check our blog post next week for part three in our three-part series, which covers frequently asked questions about credit repair. At Credit Repair by Attorney, located in Rancho Cucamonga, California, we serve clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.

Frequently Asked Questions about Credit Repair (Part 2 in a 3-Part Series)

(Part 2 in a 3-Part Series)

In the United States, consumer credit scores are critical for anyone who would like to have the option of financing large purchases such as a home, car or major household appliance. But low credit scores can place large items out of reach for the majority of Americans, many of whom do not have immediate access to large sums of cash. What can you do if your finances take a hit and ultimately negatively impact your credit scores?Last week, we covered some of the most frequently asked questions about credit repair. This week, we’d like to discuss a few more.

How are credit scores calculated?

Although each agency applies different calculations, this is roughly the method most firms employ:

    • 35% Payment History
    • 30% Account Utilization (balances being carried over)
    • 15% Length of Credit History
    • 10% Types of Credit (a mixture is best)
    • 10% Inquiries (only first 10 count)

What is the range of credit score?

Credit scores range from 350 to 850 points. When you reach a score of 580, you will likely start qualifying for loans, although the interest rates might be high. If you have a score that’s more than 680 points, you can usually qualify for a much lower interest rate.

How can bad credit be removed from any given report?

At Credit Repair by Attorney, the first step we take on behalf of our clients is to draft letters on their behalf to challenge creditors and credit bureaus. We use the Fair Credit Reporting Act and/or The Fair Credit Billing Act to help our clients improve their credit. While it’s true that you can do this on your own, doing so is much like representing yourself in a court of law. If you are in a car accident, you have the right to sue the opposing party for damages and to represent yourself. But would you really do so if you want to win? Not likely. You would probably (wisely) opt to hire an attorney who handles such matters on a daily basis, so he or she knows instinctively what to do when problems arise.

We represent our clients to credit bureaus hundreds of times each month. So we know exactly what to say to get great results. A disputed credit listing must be accurately reported and verifiable if it is to remain on any given credit report. If the credit listing is inaccurate or unverifiable, it must be deleted. Our extensive knowledge of the Fair Credit Reporting Act prepares us to properly dispute those credit items that can easily be removed. Thankfully, virtually anything on your credit report can be legally removed…if you know what to do.

Is it possible to remove inquiries from a report?

Yes, it is possible to remove inquiries. We do this for our clients for a nominal fee.

To correct credit, should a person pay off his or her debt?

If you are actively trying to repair your credit report, you should repay only those debts that are credit card related. Try get revolving balances to 50% or less of credit limit. Paying collections actually lowers scores and brings old debts to the top of the report since they are recent.

Which balances should I carry on my credit card to maximize my credit scores?

Try to keep all of your credit cards at 50% of available credit, if at all possible. This is especially important for people who are planning on applying for credit in the near future.

Check our blog post next week for part three in our three-part series, which covers frequently asked questions about credit repair. At Credit Repair by Attorney, located in Rancho Cucamonga, California, we serve clients in Los Angeles, Orange, Riverside, San Bernardino and San Diego Counties as well as Arizona and Nevada. Our team of highly qualified and experienced attorneys is ready to provide fast and effective solutions for your bad credit. For a free consultation of your credit situation, call us today @ 909-944-3222.