Credit Score: Assessing the Damage

There is so much talk when it comes to credit scores and how they affect finances. When you have a good score, you have more chances getting that loan you need, but when your credit score is low, your chances slide down as well. Funding from banks has had tighter standards since more people have been defaulting on their loans. Increased debt to income ratio can also prevent you from receiving funding even with a high credit score. Applications for loans are more scrutinized than they were even five years ago. For this reason, individuals are working harder at righting their wrong budgets and working to create a balance between income and debt. Lowering your debt to income ratio helps to raise your credit score.

Another aspect of improving your credit score is to correct any errors that you may find on there. There are certain criteria in which the credit bureau follows with the reporting and removal of negative reports. To start the process, you will want to order credit reports from each of the credit agencies; Equifax, Experian and TransUnion. You can do this online and print copies of each. Read through each one. You are looking for any inaccurate information, fraudulent charges, and highlight dates that negative reports were made. The dates are very important, as negative remarks do expire. This list will give you the guidelines of when you can expect these negative reports to “fall off” your credit.

• Bankruptcy – Chapter 13 will remain on your credit for 7 years and Chapter 7 will remain for 10.
• Debt which is “charged-off”, meaning that the creditors wrote your debt off as a loss, will remain for 7 years.
• Collections records will remain for 7 years after the 180 late payment date from the original creditor.
• Closed accounts with negative reports will remain on your credit for 7 years, but closed accounts without any negative remarks will remain for 10 years.
• Foreclosure records will remain for 7 years.
• Inquiries to your credit made by creditors will remain for 1-2 years, but if you made your own inquiry, there are no negative reports.
• Judgments made by the court will remain on your score for 7 years. This includes child support, civil and small claims.
• Late payments remain on your account for 7 years, but only ones that show more than 30 days late will show negativity unless you make them often.
• Vehicle and property repossession records will be reported for 7 years.
• Tax liens from the city, county,state, or federal government will remain on your report indefinitely if left unpaid. Pay off the lien and the record will last another 7 years. The IRS will lift the lien off your record if you have it paid and make a request for them to do so.

If you find any disputable errors, you can do so by writing a letter to each of the credit bureaus and request that they investigate and correct your credit report. The bureaus have 30 days to do their investigations and will report to you by letter, their findings and any actions that were taken on your behalf. If  their findings does not support your claim, then you can resubmit a request with new documentation to prove your case. You can also try to call the creditors yourself and dispute the report. Make the request to remove negative remarks directly to the creditor.

Spotya! Cash Advances are small short term loans aimed at helping people get out of emergency cash situations. Credit history is not used in the approval process. There is an in-house collections to work with any customer who needs additional payment scheduling support.  

About Holly Petherbridge

I am a Blogger, Web Content Writer, Teacher, Mom. A woman of many hats. As an elementary teacher, I had always encouraged my students to write more. I find myself falling back on my own teaching techniques to share what I know about building and rebuilding personal finances.

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