Credit Score Recovery…
Wondering how long it will take your credit score to recover from a home foreclosure or short sale? That depends on how good your credit was in the first place, says John Ulzheimer, a credit score expert who blogs on the subject for mint.com.
Somewhat depressingly, the better your credit score was before your mortgage woes started, the longer it will take you to recover. Citing data from credit reporting firm FICO, Mr. Ulzheimer said it would take roughly three years for a consumer with a 680 FICO to recover to that level after a foreclosure, compared with seven years for someone with a 780 score. That’s because high scores require “pristine” credit files, he said, while a middling 680 doesn’t.
Late mortgage payments follow the same pattern. A person with a 680 score who pays 30 days late can bounce back to that level in about six months, compared with three years for someone with a 780 score. His (somewhat obvious) advice? Don’t miss payments.
This is where we can help. Want to get back to that status from earlier? Simply contact us for information on how to get your credit life back on track.
By Cesar Marrufo
ELITE FINANCIAL, LLC
Cesar is an expert in the credit repair field, with over 10 years experience reading and analyzing credit reports. For more information or for help with your credit, visit www.elitefinancialllc.com or call (909) 570-9048
Now is the best time for credit repair!
The three credit reporting agencies – Experian, Equifax and Trans Union – get overwhelmed during the holidays, specifically between Thanksgiving and New Year’s. The reason is credit card companies flood the agencies with holiday “Instant Approval” applications to be processed with credit checks. Then throw in the fact a large number of staff at the bureaus, credit card companies, and collection agencies are using their vacation days during this time. This under staffing and overwhelming workload makes it difficult to get all of the credit reports resolved during this time. The good news for consumers is that more negative accounts are deleted during this time than at any other time of the year.
Staffing at the Credit Bureaus in the Customer Service Areas Handles:
• Taking In and Logging Disputes
• Verifying Information
Taking in Disputes – The Call Center
Apparently, the attrition rate is VERY high in call centers, as is the “call off rate” (people calling in for personal time and sick time.) On an average day the call off rate is about 10-15%. If a customer service pool consists of 200 employees, this means that 20 people are absent. Often, the missing employee workload plus any additional high volume can be transferred to a third party vendor.
During the holidays, many employees want to spend their vacation with their families, and the call off rate is about 25%. All credit bureau call centers are not just under the thumb of the FTC and the Fair Credit Reporting Act (FCRA). Their customer service must also follow federally mandated guidelines, the Average Speed of Answer or ASA. They can’t just let the phones ring off the hook.
Credit Dispute Verification
Like the call centers, the credit dispute investigation department has extremely high turnover and attrition, and they don’t get the best candidates for the positions because they pay so poorly. The people doing the investigative work pay their staff even less than the call center people and can’t hold the ones they have. It’s no wonder credit reports contain so many errors. Part of the problem seems to be training. The credit bureaus must abide by many different kinds of law and most people of the caliber they recruit aren’t up to learning the details and technical information.
If a dispute is sent, and it seems knowledgeable as far as the FCRA, the dispute is sent to Special Handling. The employees in “special handling” are merely people that have been employed for a few years, not necessarily those with better (or any training).
Take Advantage of These Times!
Take the hypothetical situation that a Call Center Manager faces: a ton of investigations sitting in a system waiting for verification, as well as high call volumes and not enough people to handle them. Many times people are pulled from the investigation area to answer the phones, lest they get in trouble with the government for not keeping to the federally mandated ASA.
In the meantime, credit disputes are piling up, and the staff to handle them is diminished. Disputes are sitting there waiting, with very few people to work them. The FCRA states that if a credit bureau cannot verify information in a dispute, the information must be deleted. Many times the information is deleted just so the credit bureaus can stay within federal guidelines.
The bottom line is that from around the end of November until after the 1st of the year, productivity is at an all time low because they have staffing issues. This is the best time of year for Credit Repair.
Credit background checks have become routine among employers, even as soaring unemployment and foreclosures have resulted in black marks on millions of people’s credit histories.
Credit checks are required for federal jobs with security clearances, but six out of 10 private employers check the credit histories of at least some of their job applicants, according to a recent survey by the Society for Human Resource Management.
Companies do so primarily to prevent or reduce crime, such as theft and embezzlement, the survey indicated. The idea is that people who have debt problems are more likely to steal or commit other crimes.
Overused and abused
I’ve been reluctant to weigh in against employers using credit checks, assuming companies would use some common sense.
Thirteen percent of employers use credit checks for all their employees, including those who don’t handle money, have any fiduciary or financial responsibilities, or even access to sensitive information. There’s no evidence credit checks are effective in preventing crime even in financially sensitive positions, so how can we justify them for anyone else?
Twenty-five percent acknowledged that a bankruptcy on an applicant’s credit report would most likely result in a decision not to make a job offer. Here’s the problem: Using a bankruptcy as a decision not to hire (or to fire or to refuse a promotion) is illegal under federal law.
A majority (65 percent) allow applicants to explain credit-check results before the final hiring decision is made. But 22 percent allow applicants to explain only after a decision is made, and 13 percent don’t allow any explanation. Even if employers are convinced that credit checks prevent crime, why wouldn’t they want to know if an applicant was the victim of identity theft or ran up debt for a life-saving operation for their child?
If companies aren’t willing to use a little common sense on their own, maybe some needs to be imposed on them.
No evidence supports use
There’s no hard evidence that links bad credit and bad morals.
“At this point we don’t have any research to show any statistical correlation between what’s in somebody’s credit report and their job performance or their likelihood to commit fraud,” Eric Rosenberg, the state government liaison for TransUnion credit bureau, conceded in testimony to Oregon legislators.
Rosenberg was actually arguing against a state bill that would limit employers’ ability to use credit checks. TransUnion and other credit bureaus that provide the reports say they’re an important tool for evaluating applicants.
The arguments didn’t sway the Oregon Legislature, which recently passed a law prohibiting credit checks for hiring, firing, promoting or determining compensation for most workers. Exceptions were made for financial institutions, public-safety offices and other employment if credit history is important to a job and a background check is disclosed to the applicant or employee.
Washington state and Hawaii already have curbed widespread use of credit checks in making hiring decisions. Other states are considering similar laws, and U.S. Rep. Steve Cohen, D-Tenn., has sponsored a bill that would ban employment-related credit checks nationwide except when the job:
– Required a national-security or Federal Deposit Insurance Corp. clearance.
– Was with a state or local government agency that otherwise required the use of a consumer report.
– Was in a supervisory, managerial, professional or executive position at a financial institution.
5 Cures for a High Doctor Bill
Just as the health-care system prepares for an influx of newly insured patients, some consumers are facing hefty doctor bills that they weren’t expecting.
As the Wall Street Journal reported this week, the higher costs reflect a bigger trend in medicine. As more hospitals buy up private physician practices, they’re often able to charge higher rates than those doctors’ offices formerly charged—sometimes more than twice as much for the same procedures. Since insurance plans typically cover a fixed percentage of a doctor’s bill, the patients’ out-of-pocket costs often go up as the total bill gets higher.
It’s an awkward situation that can leave patients at odds with both their doctors and the insurance company. But experts say there are options for sticker-shocked patients besides paying the full bill.
Bargain it Down
In the case of a surprisingly high tab for medical work, patients should approach their doctor, says Matthew Tassey, principal of Scribner Insurance and former chairman of the Life and Health Insurance Foundation for Education. When a patient explains that he or she can’t afford to pay a bill, the doctor or hospital is likely to work out a payment plan; the care provider might also reduce its fees, by charging the patient the in-network rate for an out-of-network service, for example. From the doctor’s perspective, even a partial payment can be better than a non-payment or a long dispute. “It’s much less time consuming and aggravating if you can make a deal to pay half of it in cash,” Tassey says. The first step is visiting the doctor’s office manager or the hospital’s finance office and asking to speak with your doctor. Even if lowering the fee isn’t at the doctor’s discretion, “You need an ally on the inside,” Tassey says. “If you can help that doctor be your advocate, you have a much, much higher success rate at getting the bill reduced.”
Review Your Bill
Insurance experts say that as the medical billing system becomes increasingly automated, billing mistakes are common—and if the doctor’s visit is coded incorrectly, the insurance provider might refuse to reimburse it. The bill can clue the patient in to why the insurer did not pay for the procedure, which could help in an appeals process. Many insurance companies also allow patients to track their bill’s processing online and find out if the insurer has paid it yet.
In some cases, an insurance company may refuse to pay some or all of what the doctor or hospital charges, leaving the patient on the hook for even more of the bill. The Affordable Care Act strengthened consumers’ ability to appeal their insurance companies’ reimbursement decisions by requiring an external appeals process through an independent review body, in addition to the internal appeals process that insurers already offered. To appeal, patients have to illustrate why the medical care was necessary or why the insurance plan’s guidelines are outdated. Again, it helps to talk to your doctor first, says Cheryl Fish-Parcham, deputy director of health policy for Families USA, a consumer health advocacy organization: “You definitely need medical evidence to be successful,” says Fish-Parcham.
Get Help Negotiating
Many states now offer so-called consumer assistance programs, funded by grants through the Affordable Care Act, to help people navigate health insurance headaches, including filing appeals with insurance providers. In their first year, the consumer assistance programs recovered more than $18 million for consumers, according to the Department of Health and Human Services. In states that don’t have one of the programs, patients can hire independent health care advocates to help guide them through the appeals process or negotiate with medical providers.
To prevent a future sticker-shock situation, experts advise staying in network whenever possible. If time permits, they add, it’s also worth asking your doctor how much a procedure will cost and if it would be cheaper to get it elsewhere—shopping around can save hundreds of dollars.
By Jen Wieczner
Smart Money Article
Wonder how your credit report is created? Sometimes it’s best not to know how the sausage is made, but in this case some extra knowledge may be enlightening.
John Ulzheimer, a credit expert, worked with the Web site Credit Sesame to create a graphic map showing how various types of information make their way — or not — into your credit report.
In most cases, Mr. Ulzheimer said, the credit bureaus — like Equifax, Experian and Transunion — receive information from institutions where you have accounts, like credit card issuers or home loans or student loan lenders. In industry lingo, these are known as “trade” or “tradeline” accounts, he said.
Those accounts make up the bulk of the information in your credit report. Institutions provide the data under agreement with the bureaus, in exchange for access to credit files so they can evaluate the creditworthiness of applicants. Institutions aren’t legally required to report credit information — but if they don’t, they lose the benefit of having access to credit reports.
When credit bureaus get customer data, he said, they generally audit it before posting it to your credit file, to help avoid errors and disputes. A batch of data with an unusually high proportion of delinquencies, for instance, might be sent back for double-checking.
When lenders seek your credit report in response to an application for a credit card or a loan, it shows up as a “hard” inquiry. Too many such inquiries may cause your credit score, which is based on information in your credit report, to dip.
Some inquiries don’t affect your score, however. They include requests made as a result of applying for insurance or for service from a utility company, Mr. Ulzheimer said, and requests you make yourself for a copy of your credit report.
Some public records, like bankruptcy filings or federal tax liens, usually appear on your credit reports because the credit bureaus have electronic access to federal courts through the Pacer document system. But civil judgments filed with state and county courts may or may not show up on your report, since not all of those courts make such information available electronically. Credit bureaus may be able to find the information through database services, but its appearance in credit files is generally less consistent than legal information generated by federal courts. (In other words, you may get lucky.)
Have you ever had a legal judgment appear on your credit report? What impact did it have?
By ANN CARRNS
For Credit Sesame
Section 604 of the Fair Credit Reporting Act says that the credit reporting agencies, Equifax (EFX), Experian (EXPN) and TransUnion, may furnish reports to any company that intends to use that information for the purpose of underwriting insurance. So, at the Federal level, the use of credit reports for underwriting insurance is perfectly legal and many of them do so. The real question is, why do they do it?
Insurance companies have the same issues lenders have: understanding the risk of doing business with certain consumers. It’s not necessarily the risk of being paid or not being paid for their services (premiums). It’s more so the risk of providing a policy for someone who is more likely to file claims and thus be a less profitable customer. It’s all about the money.
The primary difference between banking and insurance is that insurance policies are all secured, essentially. If you don’t pay your premiums they’ll cut you off, which could lead to you losing your home (it’s called a non-monetary default) or you getting arrested for driving without insurance. Determining whether or not you’ll pay your premiums is not the primary reason some of them pull your credit reports and credit scores.
The primary reason is to determine if they even want to do business with you and/or under what terms. Despite what many believe, how you manage your credit is very predictive of what kind of insurance customer you’ll be. It’s predictive not only of your likelihood of filing claims but also predictive of how profitable you’ll be. If it weren’t, insurance companies wouldn’t spend the money buying millions of credit reports and scores each year.
They’re Not The Same Credit Scores
Much like the financial services environment, the insurance environment relies heavily on credit scores. This isn’t anything new. However, the type of score they’re using is not the same type of score banks and other financial services companies use. In fact, they’re very different.
The scores used by insurance companies are called Insurance Credit Bureau Scores or Insurance Risk Credit Scores. They are developed by a variety of companies, including FICO and LexisNexis. LexisNexis develops the LexisNexis Attract Score, which is very commonly used by insurance companies.
Insurance scores consider credit information and/or previous insurance claim information. So, if you filed an auto claim or a homeowner’s claim it can be considered in your insurance score and it can result in a lower score. And if you’re assuming the presence of claims means that you’re a less profitable insurance customer, well, you’d be right. Yes, it’s all about the money.
But They’re The Same Credit Reports
While the scores used by insurance companies are different, the reports they use are the same as the reports used by financial services companies. The reason: all credit reports originate from the same three places; Equifax, Experian and TransUnion. Point being, there are no secret credit reports that insurance companies use to set your premiums.
Insurance Inquiries Don’t Hurt Your Credit Scores
Enough bad news. When you apply for insurance, the insurance company may or may not access your credit reports and scores. There is no guarantee that they will, in fact, pull your credit reports. But, it’s a safe bet.
If the insurance company does choose to access your credit report and score, there will an inquiry posted to the credit file. It will clearly be identified as being from your insurance company. And, more importantly, it will systemically be coded as coming from an insurance company. This is good news because insurance related inquiries are not counted in your credit scores.
You will be able to see them, but no other entity will be able to see them. And, credit-scoring systems don’t not consider insurance-related inquiries so they’ll never lower your credit scores.
I’ll end on that high note.
By John Ulzheimer here
Let’s say you’ve made some mistakes with your credit. With over 35% of the population scoring below 650 on the FICO scoring scale, you’re certainly not alone. But now that you’ve made the mistake, how long are you going to have to live with it?
Each and every negative item has a reportable statute of limitations. That means the credit bureaus can legally report it for some period of time before it must be removed. Let’s dive in…
This one has possibly the most confusing statute of limitations so let’s get it out of the way first. Chapter 7 bankruptcies can remain on your credit files for ten years from the date filed. Chapter 13 bankruptcies can remain on file for seven years FROM THE DISCHARGE DATE. This is important because most people believe 13s have to be removed seven years from the filing date, which is incorrect. It normally takes three to five years for a Chapter 13 to discharge due to the repayment process. That’s when the 7 years begins. The cap on all bankruptcies is ten years so most 13s remain on file for a full ten years, just like Chapter 7s.
This one has the longest statute of limitations and must be broken down into three categories; released, unpaid, withdrawn.
Released Tax Liens – Released liens can remain on file for seven years from the date released. This included liens that have been settled for less than you really owe.
Unpaid Tax Liens – Sit down. Unpaid tax liens can remain on your credit file indefinitely. That’s the bad news. Now the good news…
Paid and Withdrawn Tax Liens – Paid tax liens normally stay on file for seven years, but the IRS announced that they will withdraw the lien if paid in full AND the taxpayer requests a withdrawal. The credit bureaus do not report withdrawn tax liens so they will come off your files almost immediately if you get them withdrawn.
Defaulted Government Guaranteed Student Loans
The amount of time is actually governed by the Higher Education Act instead of the FCRA. Defaulted student loans can remain on your credit reports for 7 years from the date they are paid, 7 years from the date they were first reported or 7 years from the date the loan re-defaults. The point you should take away from this…pay your student loans!
The Seven Year Club
Delinquent Child Support Obligations
Judgments – Seven years from the filing date whether satisfied or not.
Collections – Seven years from date of default with the ORIGINAL creditor, not seven years from when the collection agency buys or is consigned the debt.
Charge Offs – Seven years from the date of the original terminal delinquency.
Settlements – Seven years from the date of the original terminal delinquency
Repossessions and Foreclosures – Seven years from the date of the original terminal delinquency.
Late Payments – Seven years from the date of occurrence.
You’ll notice “terminal delinquency” several times above. The seven year period actually begins 180 days AFTER the original delinquency that leads to a collection, charge off or similarly negative action. So, technically these items remain on your credit file for 7.5 years from the date of the last delinquency before the terminal delinquency.
If you’ve never heard of this term let’s hope you never do. Re-aging is the illegal process of changing the “purge from date” so the credit reporting extends past the allowable period of time. This is not common but when it’s done, it’s usually a collection agency or debt buyer who is breaking the law. It’s a clear violation of the Fair Debt Collection Practices Act and the Fair Credit Reporting Act but the debtor has to know it has happened.
Looking to a fresh start for the new year? Want to take advantage of the historically low rates? Maybe you need to buy a car this year? What ever it is… Look no further! We are the credit repair company for you! We service the entire United States. Our core help is local, how local? Yucaipa, Redlands, Moreno Valley, Highland, Beaumont, Banning, San Bernardino, The High Desert, The Low Desert, Mountain Cities. We have a strong presence in Riverside, CA and Rancho Cucamonga as well. All it takes is a single phone call, email or find us on Facebook for more information.
Yucaipa, Redlands, Moreno Valley, Highland, Beaumont, Banning, San Bernardino, The High Desert, The Low Desert, Mountain Cities. We have a strong presence in Riverside, CA and Rancho Cucamonga as well. All it takes is a single phone call, email or find us on Facebook for more information.
Fontana, Rialto, Bloomington, Colton, Grand Terrace, Etiwanda, Ontario, Loma Linda, Rubidoux
Here is ANOTHER happy camper! We get to see results like this ALL the time and it is very rewarding. Here is a great example…
Our client signs up for our services in July and within 60 days we are able to get the IRS to “Withdraw” (Meaning DELETE) 4 tax liens…1 of which is reporting to the credit bureaus.
Would you like to see results like this for yourself?
What are you waiting for? Call us today!
Will Defaulting on Season Tickets Hurt My Credit Score?
Attention sports fans: This answer could prove helpful if your team ticks you off.
We recently received a reader question that was very interesting — something we hadn’t thought of before. This one’s for you sports fans out there:
Does anyone know the impact of defaulting on season tickets will have on one’s credit? Will it have an impact on my car insurance, current loans for cars, or anything else? Please let me know. – Angry Fan
How defaulting on season tickets would impact your credit would depend on whether or not the organization reports the incident to the credit reporting agencies. If the default is reported as a collection, because collection accounts are considered severe delinquencies, the account would have a significant impact on your current credit standing and would hurt your credit scores.
This wouldn’t necessarily impact any accounts you currently have open, but if the impact is significant and your credit scores take a severe hit, it could affect future loans, their interest rates and your ability to qualify for them.
Your question prompted us to make a couple of calls to find out exactly how season ticket holder accounts are handled by major league sporting establishments. Interestingly enough, policies vary depending on the establishment, but what we learned may ease your mind.
According to the two major league establishments I spoke with, season tickets are normally paid for in advance, prior to the tickets being released and issued to the purchaser. Generally speaking, there are no contractual payment plans or financing options for standard individual season ticket purchases.
However, depending on the ticket package, some plans may allow the purchaser to hold their preferred tickets with a deposit, offering them a short grace period before they’re required to pay the remainder of the balance.
In the event the purchaser is unable to pay the remaining balance before the deadline defined by the establishment, the hold is ended and the tickets are re-released to the public for purchase.
In some cases the deposit will be refunded, and in others the deposit may be forfeited. It all depends on the purchase rules outlined by the individual establishment. In either case, defaulting on a season ticket purchase would have no bearing on your credit unless there were a contractual obligation or financing option involved with the purchase.
For corporate packages or purchases where suites are a part of the season ticket package, it’s an entirely different ballgame. Suites are contractual and legally binding. If you sign a contract and default on the purchase agreement, this is when defaulting on season tickets could end up as a collection in your credit reports and hurt your credit scores.