Tag Archives: Late Payments

Improve Credit Rating – How to Raise You Score More Than 100 Points

Irena Bocheva asked:

Are you trying to improve credit rating? Do you want to increase your chances of getting approved for a mortgage or an auto loan? Are you hoping to get a favorable business loan, but fear your credit score won’t qualify you? Creditors, employers, insurers, landlords and many more are pulling up your credit report when evaluating your application. Because of the growing significance of your FICO score, a good credit score is no longer a luxury. It’s a necessity.

Here are 3 simple tips that will help you understand how fast credit repair works:

1 Evaluate your situation.

Do you need to raise your score with 5,10,50,100, 200 points? What are the specific requirements of creditors for a mortgage or auto loan in your area? In order to come up with a winning credit strategy, you have to know where you stand (current FICO) and where you need to be (desired FICO).

2 Winnow the chaff away from the grain.

Not all debt is created equal. Certain items in your credit report affect your score more adversely that others. The typical order of adverse items is bankruptcies, foreclosures, repossessions, loan default, collections, past due payments, late payments, declined credit, credit inquiries. Take a careful look at your report and highlight the items that affect your score most adversely. Also keep in mind that more recent accounts have bigger impact on your FICO than older accounts. Once you identify the most problematic accounts, start working on them.

3 Different strokes for different blokes.

Credit bureaus, collection agencies and original creditors can help you raise your score fast if you know how to approach them. Different strategies should be used for different agencies. For example, if you want to get a creditor to remove a one time late payment from your account, you have to be diplomatic and polite. Explain the sob story surrounding the one time late payment and promise to be a good customer in the future. When dealing with collection agencies, however, you can use more aggressive strategies. Ask for validation of debt-you’ll be surprised to find that most collection agencies don’t have the proper paperwork.

Always hassle till you reach a settlement amount that satisfies you. Keep in mind that collection agencies still make a handsome profit out of you even if you pay them 25% or less from what you actually owe. Also promise to pay ONLY if they agree to remove the negative item from your credit report. In a nutshell-use different strategies with different agencies if you want to achieve maximum results. There are different ways to improve credit rating. Knowledge about the credit system and the various loopholes in it, however, seems like the fastest route. Once you start thinking outside the credit box, you’ll be surprised to find how easy credit repair actually