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Credit Bureaus Archives | Ovation Credit Repair Services

Apr 13
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Credit Report Errors: Why, How and Solutions to Fix My Credit

By | Credit Reports

Credit report errors can happen to anyone. It affects roughly 25 percent of files in the United States. This statistic is high enough to cause alarm, and one in 20 files have errors that cause financial damage. A small percentage of these instances involve borrowers with wrongfully reduced scores of 100 points or more.

Credit Report Errors

Check for Credit Report Errors First

If you’re concerned, check each of your credit reports (Equifax, Experian and TransUnion) to see if there are any incorrect entries. Begin by scanning for information that doesn’t line up properly. There might be different balances, payment dates or your account might not even show up.

Keep in mind: credit-reporting companies are only required to provide information to one of the three bureaus. It’s possible to have details and accounts on one file that aren’t on the others. This is a leading cause of credit report errors and it’s not always easy to fix.

You can get your files from www.AnnualCreditReport.com, the government-authorized source for your free annual report. This is a right for American consumers, thanks to the Fair Credit Reporting Act (FCRA). If you’ve already requested a file and you want more current information, you can pay a nominal fee to each bureau for a fresh copy.

Common Types of Credit Report Errors

Sometimes, a credit report error is because of an innocent mistake by one of your credit card providers or lenders. Other times, it might be a mishap with your work’s accounting department. Worst case scenario, the errors on your report are a sign of credit fraud or identity theft.

Regardless of the details, any wrongful entries on your credit report should be taken care of immediately. If not, it’s possible for the negative effects to carry on for years — while keeping your credit score down in the process.

Take a look below for some tips on clearing up certain types of errors.

How to Handle Mismatching Credit Reports

Unfortunately, you can’t force the reporting company to notify the other bureaus if they only reported to one. This can put you at both an advantage and a disadvantage.

It’s beneficial if you have negative items and they only show on a single file. However, it can be a serious setback if your positive items are not there. It can result in your FICO score dropping — which means more rejections and higher interest premiums.

Your best bet is to contact the credit-reporting agency. You can request that they report to the other bureaus. If they won’t, there’s little you can do, “by force,” to make it happen for you.

How to Remove Outdated Information

Your credit report can only contain negative items for a set time frame. After the period runs out, you’re allowed to request removal of any items that still show. To do this, you must send a dispute letter to the respective credit bureau(s). This is also the standard process for dealing with errors. Outdated information is different since it’s so easy to check and prove, so no further information is needed.

You’ll hear back in 30 days or less with a decision. If you have a delinquency stated on your file, inside the acceptable reporting period, you’ll have to prove to the bureau that it’s incorrect. In most cases, this happens when debt goes to a collections agency — as it gets reported with a delinquency, inaccurately, on a more recent date.

How Long Does It Take to Fix Errors?

The FCRA states that the credit bureau you send the dispute letter to must get back to you within 30 days. They’re required to investigate your claim and determine whether there’s any accuracy to it. The simpler issues tend to get fixed right away, but it’s possible you’ll be asked for more documentation.

Should You Use Credit Repair Services?

Credit repair companies focus on fixing your credit report, not your score. The goal is to make sure that all information matches up between each of your credit files. It means an expert will work with you to go through all your credit reports. They’ll have a much better eye for finding errors.

However, most of the time, you can identify the errors yourself. It only becomes important to consider hiring a credit repair agency when fixing the problem. This will save you a good 30-60 hours in paperwork, phone calls and other tedious processes. It also means you have a greater chance of removing the error, as your case will be represented as best as possible.

Credit report errors are always a headache. However, you don’t have to stress over the situation too much. Credit repair professionals can take all the manual work out of the reparation process. The law is also by your side when it comes to removing inaccurate negative items.

Things will only get more confusing if you’re dealing with fraudulent entries. In this case, you might need to supply police reports, FTC Identity Theft Affidavits and much more. The problem could take 100s of hours to resolve as well, which is when a credit repair expert can really save the day.

Sources:

https://www.consumer.ftc.gov/articles/0155-free-credit-reports

http://www.wisebread.com/heres-why-credit-scores-and-reports-are-not-the-same

https://www.creditkarma.com/article/credit-report-differences

https://www.thebalance.com/removing-old-debts-960491

https://www.consumer.ftc.gov/articles/0384-sample-letter-disputing-errors-your-credit-report

http://www.cnbc.com/id/100449912

Mar 15
0

Understanding Your Credit – Score, Reports and Bureaus

By | Credit Reports

Understanding Your Credit

Most Americans do not realize how credit scores, reports and bureaus actually work. In fact, 42 percent believe the myth that lenders must report to all three major credit bureaus. This is wrong and causes a huge headache at times. The truth is that your score could vary by as many as hundreds of points between your files at each of the bureaus.

This is just one of many examples of credit misinformation. When you research how credit works, there is a web of knowledge to uncover. It all helps you become a better borrower, as you can pay your debts and manage new credit more efficiently.

Credit Scores & FICO Explained

Your credit score, or “FICO score,” is something you need to mentally master. It is a single output that significantly impacts your borrowing abilities and creditworthiness. All credit score factors matter to you – therefore, it is essential to have a solid understanding of how they work.

The Types of Credit Scores

While there are many types of credit-scoring algorithms, the majority are a type of FICO score. This is why the term “FICO” goes hand-in-hand with “credit score” so often. If you hear the term “FAKO score,” it just means anything but a FICO score.

Here are some different credit-scoring models that exist:

  • BEACON
  • CE
  • Empirica
  • FICO
  • VantageScore 3.0

At least nine of 10 lenders use a FICO score to screen applicants.

 

(Source wwww.myfico.com)

How Does FICO Calculate Your Credit Score?

  • Payment History = 35%
  • Amounts Owed = 30%
  • Length of Credit History = 15%
  • New Credit = 10%
  • Credit Mix = 10%

Of course, each type of credit rating will have a slightly different algorithm. But, you should hold these rating factors as the most important variables. Focus on avoiding delinquencies or worse, and start bringing your total debt down.

Hint: pay revolving debt first. Your installment debts (such as student loans) do not count toward your utilization ratio.

Which Credit or FICO Scores Do Lenders Use?

FICO offers 28 main score versions to each of the three major credit bureaus. It provides a scoring algorithm for these bureaus to determine a FICO score to assign to each file. With the help of FICO, every credit bureau also has an in-house scoring model. They are as follows: BEACON (Equifax), FICO Risk Score (Experian) and Empirica (TransUnion).

A lender will decide on which credit bureau to pull your file from. That bureau will dictate the score that is provided – based on the type of account you wish to open. This means your score could vary for a car loan, home mortgage and so on.

Auto Score vs. Bankcard Score vs. FICO Score

There is an appropriate time for a lender to use each type of score. FICO Score 8 is the most generally accepted model between borrowers and lenders. Older FICO score versions are regularly used and more common in the mortgage market. FICO Auto Score is the go-to score when qualifying an applicant for an auto loan, and Bankcard Score is used to measure the worthiness of credit card applicants.

FICO Scores Used by Auto Lenders

FICO Auto Score is most common, but the version each bureau uses will differ. Equifax typically supplies FICO Auto Score 5 or 8. Experian uses Auto Score 2 or 8. Meanwhile, TransUnion falls to Auto Score 4 and 8. Since the FICO Auto Score 9 recently came into being, it might start gaining traction with any or all of the credit bureaus soon.

FICO Scores Used by Credit Card Issuers

FICO Bankcard Score 2 and 8, and FICO Score 3, are all sometimes pulled for the purpose of making credit card lending decisions. FICO Bankcard Score 9 also now exists but is not yet commonplace. The Bankcard Score focuses more on your credit card history and less on your medical debts, utility bills and any one-off missed payments.

FICO Scores Used by Home Loan Providers

A mortgage broker or private lender will typically use a dated FICO Score. This is because the underwriting rules for the U.S. mortgage industry require the use of older versions. As such, Equifax uses FICO Score 2, Experian uses FICO Score 5, and TransUnion uses FICO Score 4 to qualify mortgage applicants.

Even after reading about scores here, you no doubt have some questions. A good way to gain more knowledge is by reading the informative content on myFICO.com’s website. This will give you a better idea on how the credit rankers run things, too.

Credit Report Mystery

Reading and Understanding Your Credit Report

Confusion forms when you first look at your credit report. It is hard to know what is there, what is not and how things got there in the first place. But, this foggy way of thinking clears up once you get a good grasp of basic credit report terms. Below are some things you might find in your file:

Default

After you fail to pay, it will say you are in default on your debt. This happens after you fail to repay as scheduled. With credit cards, a default is usually reported after you go 90 days without making any payments. The default status will stay on your credit report for six years before it drops off.

Derogatory

A derogatory mark means only that the item is a negative one. It usually implies a late payment, charge-off or court judgment against you. It serves as a warning from a scorned lender and symbolizes a lack of creditworthiness. The derogatory status can stay on your report for up to seven years.

Satisfied

A satisfied item is anything that went into dispute with a creditor but is now fully resolved. As with all public record documents, a court judgment will stay in your file for seven years from the date you satisfy the debt.

Settled

A settled item is a debt that was in arrears but no longer exists because a settlement agreement was made between you and the creditor. This is a payoff that allows you to settle for less than what you actually owe – it is common when dealing with debt collectors since they pay pennies on the dollar to own the debt and will typically negotiate. Not paying the total amount back can harm your score, and the damage will stay on your file for seven years.

If you are a responsible borrower, the positive terms you might see include “Pays As Agreed” or “Paid/Closed Never Late.” Additionally, when you start running late on your payments, you might see 60 Days Past Due or 120 Days Past Due on your report.

What Else Your Credit Report Tells You

Your credit report contains many other pieces of information aside from the current account status for each debt. Take a look below to better understand what all is on your credit report and how to read it.

Personal Information

Your credit report will provide personal information, including your full name, where you live, your place of employment and your Social Security number. This data is gathered from the various accounts you hold that are being reported to the credit bureaus. A credit report will get an update to its information any time an account is updated. It can mix up information at times if your accounts are not up-to-date, so keep that in mind.

Soft / Hard Inquiries

Any time a lender pulls your file, it will result in an inquiry. This inquiry can be either soft or hard, with the latter having a short-term negative impact on your score. Soft inquiries mostly occur when employers run a background check for employment purposes. Many lenders will also perform a soft pull of your credit report to see if you pre-qualify for one of their offers before sending it to you.

Hard inquiries occur when lenders determine your creditworthiness at your request. A hard pull can drop your score a few points but will drop off of your report two years after it posts.

Public Record and Collections

Your credit report will include any public records in your name, such as bankruptcies, court judgments, foreclosures, lawsuits, wage garnishments and tax liens. The length of time these entries stay on your reports is variable. A civil judgment will last for seven years. Meanwhile, tax liens are very dangerous – they drop off seven years after the paid date, but leaving them unpaid can plague your file for 15 long years.

Credit Errors

 

Tackling Your Credit Report – and the Errors!

You have a credit report on file at Equifax, Experian and TransUnion. Each bureau accepts information from credit reporting companies. The creditors submit details to one, two or all of the major bureaus. Thus, it is possible for your reports to contain inconsistent information.

Some lenders will pull from one credit bureau only. This means your chance to qualify for credit comes down to which bureau they choose. So, it is important to make sure your information is accurate. You also need to make sure that all your accounts show up on each of your reports.

Boost Your Score by Fixing Credit Report Errors

Did you know that the FTC’s 2015 follow-up study on credit report accuracy found that roughly 20 percent of subjects saw a credit score increase after fixing errors found on their reports? This news came after discovering that 20 percent of credit reports contain at least one inaccuracy.

These errors are often little details that get mixed up. This typically happens when lenders only report to one of the credit bureaus. The missing pieces of your payment history can make or break your credit score. Furthermore, having only part of your debt in each file will result in an inaccurate calculation of your credit utilization rate – for better or worse.

Credit Report Errors Worth Disputing

The hardest thing to decide is whether you should report an error or not. It is not wise to ignore anything that is incorrect, but many issues will not impact your score. Little discrepancies in your personal information, for example, will not lead to a points boost.

The best time to report an error is when you see a major issue. If something is literally holding your score down, then you should report it. Even as little as 25 points can influence how you are able to build your credit. Imagine a few unjust rejections as you apply for loans and credit cards – these further drop your score. Ultimately, you look like a less reliable borrower than you really are.

Here are the errors that can impact your FICO score the most:

  • Letting an account enter Collections status = up to 100 points
  • 30 days delinquent on a bank card debt = up to 100 points lost
  • Missing a single credit account = up to 100 points difference by file

Understand that if you have an error causing a 100-point difference, it is severely holding you back. Going from a 780 to 680 score alone can result in more than $450 annually spent on extra interest. Take advantage of the chance to improve your score whenever you can. However, make sure not to fabricate errors or exaggerate issues to get bad debts removed.

How to Find Errors on Your Credit Report

First, simultaneously obtain current copies of your credit reports from the big three credit agencies. Then, you can compare the data and determine where any inconsistencies lie. This will be effective for picking up on most or all errors, but further review may still be still necessary.

One thing to watch for is debt that gets sold and resold. The information can change with time, and even the amount owing might be different. Any discrepancies may be grounds for removal of the entry.

This can bring your score up, but, how much will it increase? Four in every 1,000 reports with errors will see a change of as many as 100 points. This is a staggering statistic, but you should look at the stats affecting the majority. Five percent of erroneous credit reports contain inaccuracies of 25 points or more.

It is free to dispute credit reporting errors. Do this if you find anything in your file to be unfair or unjustified. Your credit score will improve after the errors are removed. However, make sure to only report true inaccuracies; if the debt reappears, your score boost will reverse itself fast.

Step-by-Step Credit Report Error Guide

So, have you come to the decision that reporting your errors is the right thing to do? It can make a major difference and aid you in your journey to rebuild your FICO score. With that said, you will only get good results if you follow the proper protocols.

Here’s how you can go about reporting errors in your credit file:

Contact the Credit Bureau

Reach out to the credit bureau to report your claim with a dispute letter. Be respectful, and provide all evidence you have to back up the fact that an item should be removed. If the information is inaccurate with all three bureaus, make sure to report the problem to each.

Wait to Hear Back

The company that reported the debt will have a short period to dispute your claim. This is when any information against you can come into play. After that, the dispute can go into mediation for a final judgment. Typically, you will hear back from the creditor within 30 days.

Usually, the judgment will be completed within this short time frame. In difficult situations, though, it can run on for a few months or longer. Once all is over, your score will recalculate. However, it is important to note that the entries might drop off temporarily and return after evidence against you is found. So, if you report factually accurate entries, it could end up leaving you in a worse position later.

What if You’re the Victim of Identity Theft?

This is an entirely different situation, but the process for handling identity theft is somewhat similar to reporting other issues. You must contact the credit bureau(s) with your claim. However, to be better prepared, a copy of your FTC Affidavit should be supplied. You can also use this to obtain a police report at your local police station.

Supplying all this information, along with your proof, will be adequate. From there, you will wait for a reply and see if any further documents are needed. Identity theft entries can damage your score drastically, and they should be reported as soon as you notice them.

Furthermore, it is important to watch out for identity theft all the time. This issue hurts many Americans every year, and there are endless ways for fraudsters to target you. There are many free identity theft protection services that work wonders.

If you believe you are the victim of identity theft and have contacted the credit bureau, you will also receive a fraud alert on your credit report. This lets lenders know to be careful when dealing with someone who connects to your file.

Read the FTC’s Disputing Errors on Credit Reports to learn the entire process.

Credit-Related FAQs

You should have a clearer view now of how credit works, but here’s extra info (and reminders) to help you out!

1. Do Lenders Report to ALL Credit Bureaus?

A lender can post information to one or all of the major credit bureaus, which are Equifax, Experian and TransUnion. This data will calculate into your FICO score. Eventually, a lender will use your credit rating to determine your loan eligibility. Your reports can get mixed up and have varying scores, which can result in unjust denials of credit.

2. How Do Credit Bureaus Collect Personal Data?

Information like your current employer and physical address can come from your credit card issuer, your loan provider or your utility provider. These data points are put in your file on a somewhat regular basis – monthly, quarterly, etc. This gives the bureaus what they need to try and keep your personal information up-to-date.

3. How Do You Get a Copy of Your Credit Report?

Go to www.AnnualCreditReport.com to make a request online. This is a service that allows U.S. citizens to request a free credit report from Equifax, Experian and TransUnion. You can pull your reports once a year, and per the FACT Act, it is your legal entitlement. You may view the reports online or request that printed copies be mailed to you. However, keep in mind that this will only get you copies of your reports – and not the associated credit scores.

4. How Often Should You Check Your Credit Report?

You should always stay up-to-date with what posts to your credit report at each of the major credit bureaus. Spread things out, and check one of your files every four months. Alternatively, a free or affordable credit monitoring service can help you keep tabs on things.

5. Can You Find Out Which Score a Lender Will Use?

Thanks to the FCRA Act, a lender must include “the range of possible credit scores under the model used to generate the credit score.” This means you will know whichever credit ratings a prospective lender receives. Not only that, but you will also be told the type (version) of FICO score that was pulled for your application.

6. How Long Does Stuff Last on Your Credit Report?

  • Unpaid tax liens: Up to 15 years from the filing date
  • Bankruptcies: 10 years – possibly seven years if you get a Chapter 13 discharge
  • Tax liens: Seven years from the filing date
  • Collection accounts: Seven years + 180 days from the first month’s missed payment
  • Foreclosure: Seven years after the date of your foreclosure
  • Late payments: Seven years after the date of the payment delinquency
  • Charge-offs: Seven years after the date your debt is written off as a loss
  • Soft inquiries: Two years from the date of the inquiry
  • Hard inquiries: One year from the date of the inquiry

Sources:

https://blog.creditkarma.com/personal-finance/how-much-do-americans-really-know-about-credit/

http://www.myfico.com/crediteducation/credit-score.aspx

http://www.myfico.com/

https://www.ftc.gov/news-events/press-releases/2015/01/ftc-issues-follow-study-credit-report-accuracy

https://www.ftc.gov/news-events/press-releases/2013/02/ftc-study-five-percent-consumers-had-errors-their-credit-reports

https://www.consumer.ftc.gov/articles/0151-disputing-errors-credit-reports

Nov 28
0

3 Credit Myths Debunked

By | Credit Repair, Credit Reports, Credit Scores, Your Credit

There have been a lot of great movies in recent years based on mythological characters: Percy Jackson & the Olympians: The Lightning Thief (2010), Clash of the Titans (2010), Immortals (2011), and Thor (2011). Myth-based movies are great entertainment, but myths about your credit score can be expensive. The following three myths about your credit score can end up being very costly.

Myth One: If I Pay Off the Debt, They’ll Report It

One of the biggest myths about your credit score is believing that the company to whom you’ve paid a debt will properly report it to the credit agencies. People often believe that as soon as they’ve paid off a debt, the company will immediately report that to the credit agencies and their score will improve. Unfortunately, depending on the company’s reporting practices, they may wait three months to report the payoff, or they may never report it at all.

What you actually owe a lender and what’s reporting on your credit report are often two different things. It’s crucial to review your credit report regularly and take charge of making sure it stays up to date if you really want to improve your credit rating.

Myth Two: If It’s Not on the Report, I Don’t Owe the Debt

Another myth that hurts consumers is the assumption that if something does get removed from your credit report that you no longer owe the money. For example, let’s say you really do owe $4,000 on a charge off, but we’re able to get it removed from your credit report because it isn’t being accurately reported. That doesn’t mean you don’t still owe the money.

Myth Three: Paying Off Debt Fixes Everything

Many consumers believe that the minute they pay off their debts that their credit rating will increase significantly. But if you’ve had a history of late payments and delinquencies, companies can still report all the late and missed payments for seven years. It can take that long for your credit to fully recover.

Paying off your debts and bringing payments current will help your overall credit score. Making the debt go away, especially if it is in collection, helps in two ways: one, it shows paid instead of still owed. Two, it stops the date of last activity, which means seven years from that date it goes away. Otherwise, it just keeps being a current reporting, and the seven years keeps being seven years in the future.

Nov 03
0

“No Reason” Is No Excuse

By | Credit Laws, Credit Repair, Credit Reports

Looking at your credit report is a bit like being in an episode of CSI. You’ll need to carefully pick apart the scene of the credit crime looking for the right clues. “No reason” really means “I don’t know” when it comes to credit score drops, and it usually takes nothing more than a little old-fashioned sleuthing to discover the no-reason reason.

The first step in your CSI Credit Crime adventure is to request copies of your credit report, which are available free to you once per year by law. The first crime you should eliminate is length of credit history. Not having enough of a credit history is an often hidden clue. In the industry this is called a thin credit file.

Have you closed a credit card lately? Recently closed accounts also provide a reason for “no reason” credit drops. Solve this credit crime by opening new accounts and being careful about what accounts you close in the future.

To get away with a credit crime or two, you need to know how to close accounts when you need to. As with all things in credit, there’s a right way and a wrong way. Keeping between four and six accounts open allows you to show companies you are using credit regularly and responsibly. Use one, pay it off in full every month and pay down on the rest. This is what creditors and credit-reporting bureaus want to see.

Don’t, however, close the oldest account you have. This is one of the most serious credit crimes you can commit. It makes your credit history appear shorter than it is and can cause your credit score to take a hit. Definitely don’t cancel several accounts all at once and don’t over-consolidate your cards so that you have too much debt in one place. Another reason your credit score can drop for “no reason” is when you use too much of a single available line of credit. Keep your credit balance below 30% of the total available credit.

Many no-reason credit crimes are committed unintentionally. While it’s often stated that your credit score takes a hit due to inquiries, this is largely overstated. You credit rating likely receives several inquiries per month from people wanting to issue you credit. These have a negligible effect on your credit. Even an inquiry into your credit rating from an employer or credit card application has a minor effect on your credit rating. Don’t spend too many crime scene investigation resources looking into inquiries.

When your credit score takes a dive for “no reason,” chances are it’s taken a dive for a reason – just not one you understand. Investigating your credit report with the attention of a CSI unit allows you to better appraise what “no reason” is the reason for your credit score’s recent dip so you can make the necessary repairs.

Oct 25
0

Somebody’s Watching You…

By | Consumer Rights, Credit Laws, Credit Repair, Credit Reports, Credit Scores

No, we’re not reminiscing about the 80’s hit by Rockwell…this is more sinister. From hacking computer systems to trapping codes at ATM machines, identity theft is rampant and can have a devastating impact on your life. It can affect your ability to buy a car or a home, it can prevent you from getting a job, and there have been (albeit rare) cases of innocent people being arrested for crimes committed by an identity thief. Keeping a close eye on credit reports is an excellent way to detect fraudulent activity, and credit monitoring can be a helpful tool to do just that.

The three credit reporting agencies – TransUnion, Equifax, and Experian – are required by the federal government to provide an annual copy of your credit report at no charge. Go to AnnualCreditReport.com to order it and monitor your own credit by reviewing it carefully to ensure all information is accurate. Doing this once a year is the first step toward thwarting thieves.

The next step would be to hire a company to monitor the credit reports real time and inform you, probably via email, of any changes. Most notices would regard changes in account balances on credit cards or an inquiry for a line of credit at a retail store. In an identity theft scenario though, a thief might use your social security number, stolen while dumpster diving at a local bank, to apply for a new credit card. The timely credit monitoring service notification of this fraudulent application for credit could mean the difference between a small hassle and full-blown, financially crippling identity theft.

Sadly though, not all credit monitoring services are created equal. The ones managed by the three credit reporting agencies are typically pretty good, and the timeliness of the information is excellent – which is the most important element in the detection of fraud. Some of the second tier services though report outdated information since they have to pay for the data and retrieve it periodically from the primary agencies. Another potential problem with the second tier services is that they may offer a free credit report (mimicking the government-mandated service), but once the consumer accepts the free report, they are unwittingly enrolled in a potentially expensive service. What a sneaky and underhanded thing to do – it sure doesn’t make us want to trust them with our financial information.

The Federal Trade Commission (FTC) has a program called “Deter, Detect, Defend: Avoid ID Theft.” It is a good program, especially in its education about how to protect personal information (and thereby deter ID theft). Combine this with credit monitoring by a high quality provider and good financial decision-making, and we will stop letting the identity thieves bully us.

Apr 12
0

FDCPA: Harassment and Unfair Conduct

By | Consumer Rights, Credit Laws, Debt, Personal Finance, Your Credit

How can you tell if a debt collector is harassing you, or just legally attempting to collect a debt?  This is part 2 of a series of posts relating to debt collection and credit repair.  The Fair Debt Collection Practice Act defines conduct that is considered harassment.  According to the Act, a debt collector may not engage in any conduct the natural consequence of which is to harass, oppress, or abuse any person in connection with the collection of a debt.

Debt collectors are prohibited from the use or threat of use of violence or other criminal means to harm the physical person, reputation, or property of any person.  They also may not use obscene or profane language or language the natural consequence of which is to abuse the hearer or reader.

Debt collectors may not publish a list of consumers who allegedly refuse to pay debts, except to a consumer reporting agency (like Equifax, Experian and TransUnion) or to a few specifically defined entities.   Reporting a debt in collection to the credit bureaus has a significant impact on credit scores, and in essence, is available to anyone that may have a valid purpose to review your credit report.  This includes lenders, employers, insurance companies, etc.  Regardless of how it is ultimately resolved, an account in collection is never a good thing to have on a credit report.  Reporting to the bureaus may be the single most effective tool for debt collectors prior to initiating a lawsuit.   Debt Collectors may not advertise for the sale of any debt to coerce payment of the debt. 

Although vague, the Act also provides that a debt collector may not cause a telephone to ring or engage any person in telephone conversation repeatedly or continuously with intent to annoy, abuse, or harass any person at the called number.   Debt collectors must also disclose of the caller’s identity.

Apparently it is not harassment if the debt collector calls repeatedly or continuously without the intent to annoy, abuse or harass.   Let’s face it, debt collectors call repeatedly hoping that you will get tired enough of hearing from them that you will pay a debt.   Now isn’t that annoying?

Harassment is one form of prohibited conduct.  The Act also defines unfair conduct.  A debt collector may not use unfair or unconscionable means to collect or attempt to collect any debt.  The following debt collection conduct is deemed to be unfair or unconscionable:

  1. The collection of any amount (including any interest, fee, charge, or expense incidental to the principal obligation) unless such amount is expressly authorized by the agreement creating the debt or permitted by law.
  2. The acceptance by a debt collector from any person of a check or other payment instrument postdated by more than five days unless such person is notified in writing of the debt collector’s intent to deposit such check or instrument not more than ten nor less than three business days prior to such deposit.
  3. The solicitation by a debt collector of any postdated check or other postdated payment instrument for the purpose of threatening or instituting criminal prosecution.
  4.  Depositing or threatening to deposit any postdated check or other postdated payment instrument prior to the date on such check or instrument.
  5. Causing charges to be made to any person for communications by concealment of the true propose of the communication. Such charges include, but are not limited to, collect telephone calls and telegram fees.
  6. Taking or threatening to take any non-judicial action to effect dispossession or disablement of property if (A) there is no present right to possession of the property claimed as collateral through an enforceable security interest;  (B) there is no present intention to take possession of the property; or (C) the property is exempt by law from such dispossession or disablement.
  7. Communicating with a consumer regarding a debt by post card.
  8.  Using any language or symbol, other than the debt collector’s address, on any envelope when communicating with a consumer by use of the mails or by telegram, except that a debt collector may use his business name if such name does not indicate that he is in the debt collection business.

Be sure to document any violations.  There are civil remedies available (which will be detailed in another post) for debtors that are victims of debt collectors that engage in harassing or unfair conduct.

Mar 26
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What Items Are Reported to the Credit Bureaus?

By | Consumer Rights, Credit Cards, Credit Laws, Credit Repair, Credit Reports, Credit Scores, Fair Credit Reporting Act, Personal Finance

The credit reporting system is not perfect.  In fact, it is far from perfect.  As a result, a consumer that manages credit responsibly may not be rewarded with an appropriate credit score.  To understand how this can happen, consumers need to understand who reports credit data to the credit bureaus. 

Approximately 30,000 data furnishers provide data to the credit bureaus each month.  This results in about 4 billion points of data each month.  That breaks down to approximately 130 million items each and every day.  The largest providers of data are financial service providers such as banks, credit unions, and consumer finance companies. 

While these numbers are staggering, there is a lot of data that is not reported.   Creditors are not actually required to report data to the credit bureaus.  As a result, some creditors choose not to report any data at all.  Other creditors choose to only report negative information or to exclude important key data points such as credit limits.  If you have positive information and your creditors do not report it the bureaus, or if they only report negative or incomplete items, your credit score will be impacted negatively.  This is simply because you will not receive the benefit of this positive information when your credit score is calculated.

So why wouldn’t a creditor want to report information?  Some creditors are concerned that their competitors will obtain valuable information about their customers and then use this information to compete for the customers or evaluate certain lines of business.  Some creditors choose not to report to limit the potential liability imposed on data providers by the Fair Credit Reporting Act.  Some creditors simply want to avoid the costs associated with providing data altogether.  These costs include reporting expenses, dispute investigation expenses, compliance expenses, and system maintenance expenses.  Some regulated entities, such as telephone companies, are restricted by regulations as to the information they may report.  Some of these companies, for example, are only permitted to report data about accounts that are past due or are in a charged-off status.

If you are trying to improve your credit score, it is important that you work with creditors that report both positive information as well as the negative information.  It is also important that they report all of the information, not just selective data that may negatively impact your credit score even though your account is in good standing. Check your credit report frequently and verify that all of your creditors are reporting to the credit bureaus correctly.  Remember that your credit score is based only on the information that is reported, and your credit score could be higher if you have positive information that is not reported or not reported completely.

Jan 26
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If I file Bankruptcy, I will not have to pay back my debt and my credit report will be wiped clean, correct?

By | Ask a Credit Expert, Bankruptcy, Collections, Credit Repair, Credit Reports, Credit Scores, Debt, Personal Finance, Your Credit

This is one of the biggest myths and misunderstandings with credit.  When you file bankruptcy you are telling the court that you do not have enough money to pay your bills.  Since you do not have enough money to pay your bills, you will have to include EVERYTHING in the bankruptcy and in return you can wipe away your debt and stop the collection calls.  If you file a Chapter 7, then you debt is wiped away.  If you file a Chapter 13, then you set up a payment program to pay a percentage of the money back to your creditors over the next 3-5 years.  The debt may be gone or may be lowered dramatically and put in a payment plan and the creditor calls will stop, but remember the Bankruptcy as well as all of the creditors included in the bankruptcy will report on your credit report.  All of your creditors (even positive accounts) will now report as Included in Bankruptcy, which reports in the same category as Charge off or Collection accounts.  So, your debt may have been wiped away but you usually end up with an even lower credit score in its place.

Bankruptcy is not the end of the world.  A bankruptcy does report for 10 years but sometimes it is the only way out.  As a consumer you need to focus on rebuilding your credit after you file bankruptcy.  In the last several years a lot of credit companies have changed their approval process and will approve consumers for credit after a bankruptcy.  That is great news, so you can start rebuilding your credit, but start small.

After filing bankruptcy you want to check your credit reports as well and make sure that all of your creditors are reporting accurately.  It is very common for creditors that are included in the bankruptcy to report the account as charge-off that is inaccurate information that can damage your credit score, so you need to get all information reporting inaccurately fixed. That is what Ovation Credit Services is here!

If you have any of these errors or have any questions about a bankruptcy you filed and how it is reporting, give Ovation Credit Services a call.  Our Case Analysts would be happy to review your credit reports with you and make sure everything is reporting accurately.   Call us at 1-866-639-3426 option 2 for your FREE Credit Consultation. During your free credit consultation we will also help you order your credit reports so we know exactly what is going on with your case.

If you have any questions for our Credit Expert Kristi Thornton, please email me at [email protected].

Jan 21
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You’re Ready. Is Your Credit?

By | Consumer Rights, Credit Repair, Credit Reports, Credit Scores, Personal Finance, Your Credit

Armed with an impressive resume and knowledge of the company you are interviewing for, you confidently approach the interviewer and begin to craft the inspiring ‘first impression’ you envisioned last night as you went to bed.

You may feel prepared for the interview and qualified for the new job, but there is a strong possibility that the interviewer has already formed an opinion about you – through information contained in your credit report. 

Increasing numbers of companies are requesting credit reports to assist them in the job hiring process.  Essentially, your credit report is your financial resume and employers use it as an indicator of your personal integrity and how and how you conduct your life.  With that in mind, it’s alarming that seventy none percent of all credit reports contain errors.  A qualified job seeker simply can’t afford to have credit report errors sabotage an excellent employment history.

In the competitive job market, an accurate credit history may be the decisive factor in gaining a job interview.  Inaccurate credit reports can torpedo the most impressive resumes, and you won’t have a second chance to make a first impression.

The labor market is not only intense form the job seekers standpoint, but employers also are striving to gain a competitive advantage in the hiring process by accessing all the information available to improve the quality of the workforce.  Employers are also more likely to check the credit history of prospective employees who will be involved in some aspect of the company’s finances.

You can use this trend of employer credit checking to your benefit by repairing and/or maintaining a clean credit history.  Your credit report is your financial fingerprint, so check it frequently and keep it accurate so you are prepared to jump on the dream job opportunity should the occasion arise.

Jan 13
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Fixing Your Credit Should Be Your New Year’s Resolution

By | Ask a Credit Expert, Budgeting, Credit Repair, Credit Reports, Credit Scores, Debt, Personal Finance, Your Credit

It is the beginning of a new year and most people have made their New Year’s resolutions.  What are your resolutions? Some of the most popular ones each year are: to lose weight, stop smoking, pay off debt, and of course Fix Your Credit. Fixing your credit and paying off your debt can affect a lot of other issues and resolutions in your life, like relieving additional stress in your life.

So, if fixing your credit was one of your resolutions then let’s get started. Credit scores are based upon information reported on a consumer’s credit profile. Unfortunately, statistics show that approximately 3 out of every 4 credit profiles contain potentially serious errors. Here are some alarming statistics about credit reports:

79% of credit reports contain some type of error.

25% of all credit reports contain errors serious enough to result in the denial of credit.

29% of consumers have variances of 50 points or more in their credit scores as reported by each of the three major credit bureaus.

54% of credit reports contain personal demographic identifying information that was misspelled, long-outdated, belonged to a stranger, or was otherwise incorrect.

30% of credit reports contain credit accounts that had been closed by the consumer but incorrectly remained listed as open.

If you fit into any of the above statistics it is important to start fixing these errors as soon as possible. The best way to get them corrected is to go directly to the three credit bureaus: Experian, Equifax, and TransUnion, as well as directly to your creditors. As a consumer it can be very time consuming to research your credit reports and the disputing process and then to actually dispute. That is why most consumers choose a credit repair company to do the work for them.

Ovation Credit Services works with the credit bureaus and your creditors to resolve these issues on your credit reports for you.  Their goal is to help you achieve your optimal credit profile and score as quickly as possible. The professionals at Ovation Credit have studied credit reporting, the credit bureaus and creditor reporting methods to maximize the results they obtain for consumers.  Ovation Credit’s programs are based upon extensive research of consumer credit laws, credit bureau tactics and persistence for their clients. Their programs are 100% legal, and are developed and managed by the very same lawyers who founded the company. They have helped tens of thousands of Americans correct their credit profiles and counting.

As you can see, there are A LOT of reasons that Ovation Credit Services is the BEST! This is also why they are an Accredited Business with the Better Business Bureau and have an A Rating.  So, come and join their family by clicking here https://secure.ovationcredit.com/Signup.aspx and get back to a BETTER financial future! You can also call 1-866-639-3426 Option 2 for a FREE credit consultation today or visit the Ovation Credit site at www.ovationcredit.com for more information.

If you have a question for our Credit Expert Kristi Thornton, send an email to [email protected]

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