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Credit Score: Assessing the Damage to Better Your Financial Situation

There is so much talk when it comes to credit scores and how they affect your financial situation. When you have a good score, you are more likely to get that loan you need, but the probability goes down when your credit score is low. Funding from banks has had tighter standards since more people have been defaulting on their loans. High debt to income ratio can also prevent you from receiving approval, even with a high credit score. 

Raising Your Credit Score

Applications for loans are more scrutinized than they were five years ago. For this reason, individuals are working harder at righting their inaccurate 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 correcting any errors you may find on your report. A consumer should review this regularly. There are specific criteria in which the credit bureau follows with the reporting and removal of adverse information. 

credit score

Here’s Where to Start

Order credit reports from each credit agency: Equifax, Experian, and TransUnion. You can do this online and print copies of each. Review each one. There are also websites available that include all the reporting agencies. When you review the website or credit bureau agencies, look for any inaccurate information, or fraudulent charges. Highlight the dates with the wrong reporting information. The dates are significant, 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 report.

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

What To Do to Correct Inaccurate Information

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 report to you by letter, their findings, and any actions taken on your behalf. If their conclusions do 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. You will find that they make errors too. Request to remove negative remarks directly to the creditor.

Spotya! Cash Advances service 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 collection to work with any customer who needs additional payment scheduling support. At times they can send out their defaulted customers’ loans to an outside collection agency.

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