The essential do-it-yourself credit fixes

Ok, so now that you have corrected all of the mistakes on your credit report, you are at the perfect starting point to really dig in on the do-it-yourself credit fixes. Take a deep breath and prepare for some painful introspection and an honest look at your financial situation. Wait, wait, don’t stop reading! It’s completely worth your time and effort, your credit score will thank you.

Take an hour or so and pull together all of your bank statements, credit card statements and that credit report you pulled after you finished correcting your credit report. Take an honest look at the report, specifically the derogatory accounts section.

What to look for in the derogatory accounts section:

1. Identify the problem -Get out your highlighter and mark up the “derogatory” items. You could see late payments, collection accounts, or a past bankruptcy, foreclosure or short sale items. This will help you pinpoint exactly where to begin your restoration.

2. Interpret the problem - If you have a bankruptcy, foreclosure or short sale in your past there is not much you can do to “restore” your credit. You’ll need to focus on establishing positive credit instead. If the shadow in your past is mostly items like late payments or collection accounts, it’s time to establish automatic bill-pay or payment plans.

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The Identity Theft Epidemic : What The “Experts” Aren’t Telling You

Picture yourself walking down the street, all alone. It’s late at night. It’s a bit brisk, and the wind is blowing through the tall buildings on both sides of you. Suddenly, from out of nowhere, someone runs by you, knocks you over, grabs your
wallet, and takes off.

It sounds like a scene from a movie, and there may come a time in the future where this type of person-to-person crime
is only found in movies. Why would anyone rob a bank, or rob an individual, when they could simply use a person’s
information to obtain employment, credit cards, and lines of credit?

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The most important do-it-yourself credit fix

Managing your credit can be quite an undertaking, especially when you start with a less than perfect credit history. If you’re someone with great credit, congratulations! Just keep doing what you’re doing! If you’re like the rest of us there is room for improvement. Not to worry there are a few simple fixes to boost your credit score all by yourself.

To be honest, we’re not in the business of sharing our best strategies to fix a credit score, but there are a few simple steps you can take which will without a doubt improve your score. Follow these straightforward steps and you’ll be on the road to a credit score that won’t make you cringe.

1. You’ve got to start somewhere - Pull your free annual credit report from annualcreditreports.com.

2. Check & double check - Read it carefully! Double check all of the information is correct, if you have questions or doubts, highlight the item and research further. Lenders typically do a decent job of reporting items correctly, but there is more often than not at least one mistake on every credit report.

3. You’re the boss - Take charge of these questionable items. Contact the business with which you hold the account and see if they’ll work with you. If you face resistance write a formal letter to the business with copies sent to the 3 credit bureaus; keep one for yourself too.

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The New Bankruptcy Law "Means Test" Explained in Plain English

With the new Bankruptcy law in effect as of October 17, 2005, there is a lot of confusion with regard to the new "means test" requirement. The means test will be used by the courts to determine eligibility for Chapter 7 or Chapter 13 Bankruptcy. The purpose of this article is to explain in plain language how the means test works, so that consumers can get a better idea of how they will be affected under the new rules.

When most people think of bankruptcy, they think in Terms of Chapter 7, where the unsecured debts are normally discharged in full. Bankruptcy of any variety is a difficult ordeal at best, but at least with Chapter 7, a debtor can wipe out the debts in full and get a fresh start. Chapter 13, however, is another story, since the debtor must pay back a significant portion of the debt over a 3-5 year period, with 5 years being the standard under the new law. Prior to the advent of the “Bankruptcy Abuse Prevention and Consumer Protection Act of 2005,” the most common reason for someone to file under Chapter 13 was to avoid the loss of equity in their home or other property. And while equity protection will continue to be a big reason for people to choose Chapter 13 over Chapter 7, the new rules will force many people to file under Chapter 13 even if they have NO equity. That's because the means test will take into account the debtor's income level. To apply the means test, the courts will look at the debtor's average income for the 6 months prior to filing and compare it to the median income for that state. For example, the median annual income for a single wage-earner in California is $42,012. If the income is below the median, then Chapter 7 remains open as an option. If the income exceeds the median, the remaining parts of the means test will be applied. This is where it gets a little bit trickier. The next step in the calculation takes income less living expenses (excluding payments on the debts included in the bankruptcy), and multiplies that figure times 60. This represents the amount of income available over a 5-year period for repayment of the debt obligations. If the income available for debt repayment over that 5-year period is $10,000 or more, then Chapter 13 will be required. In other words, anyone earning above the state median, and with at least $166.67 per month of available income, will automatically be denied Chapter 7. So for example, if the court determines that you have $200 per month income above living expenses, $200 times 60 is $12,000. Since $12,000 is above $10,000, you're stuck with Chapter 13. What happens if you are above the median income but do NOT have at least $166.67 per month to pay toward your debts? Then the final part of the means test is applied. If the available income is less than $100 per month, then Chapter 7 again becomes an option. If the available income is between $100 and $166.66, then it is measured against the debt as a percentage, with 25% being the benchmark. In other words, let's say your income is above the median, your debt is $50,000, and you only have $125 of available monthly income. We take $125 times 60 months (5 years), which equals $7,500 total. Since $7,500 is less than 25% of your $50,000 debt, Chapter 7 is still a possible option for you. If your debt was only $25,000, then your $7,500 of available income would exceed 25% of your debt and you would be required to file under Chapter 13. To sum up, first figure out whether you are above or below the median income for your state (median income figures are available at http://www.new-bankruptcy-law-info.com/). Be sure to account for your spouse's income if you are a two-income family. Next, deduct your average monthly living expenses from your monthly income and multiply by 60. If the result is above $10,000, you're stuck with Chapter 13. If the result is below $6,000, you may still be able to file Chapter 7. If the result is between $6,000 and $10,000, compare it to 25% of your debt. Above 25%, you're looking at Chapter 13 for sure. Now, in these examples, I have ignored a very important aspect of the new bankruptcy law. As stated above, the amount of monthly income available toward debt repayment is determined by subtracting living expenses from income. However, the figures used by the court for living expenses are NOT your actual documented living expenses, but rather the schedules used by the IRS in the Collection of taxes. A big problem here for most consumers is that their household budgets will not reflect the harsh reality of the IRS approved numbers. So even if you think you are "safe," and will be able to file Chapter 7 because you don't have $100 per month to spare, the court may rule otherwise and still force you into Chapter 13. Some of your actual expenses may be disallowed. What remains to be seen is how the courts will handle cases where the cost of mortgages or home rentals are inflated well above the government schedules. Will debtors be expected to move into cheaper housing to meet the court's required schedule for living expenses? No one has any answers to these questions yet. It will be up to the courts to interpret the new law in practice as cases proceed through the system.

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About The Author Charles J. Phelan has been helping consumers become debt-free without bankruptcy since 1997. A former senior executive with one of the nation's largest debt settlement firms, he teaches consumers a do-it-yourself method of debt negotiation & settlement. Expert training via audio-CD plus personal coaching helps debtors achieve professional results at a fraction of the cost. http://www.zipdebt.com/.

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The State of the Consumer Protection Financial Bureau

Thanks to such financial catastrophes as Enron, the recent real estate market collapse, and the overall lack of consumer confidence, Americans have cried out for a voice in the drowning noise of big business and the 2010 Dodd-Frank Act has answered the call.Officially named the Dodd-Frank Wall Street Reform and Consumer Protection Act, it called for the formation of an entirely unprecedented Consumer Financial Protection Bureau to do just that; protect consumers.


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Weighting short sale vs. foreclosure? Read this first

Facing the very real prospect of having to choose between squeaking by another month of mortgage payments or paying other monthly bills and buying necessities like groceries has unfortunately become a regrettable realty for millions of Americans.Whether you’re struggling to make your monthly payment due to the loss of a job, an interest rate re-adjustment, ugly divorce, sickness or injury, the question millions are forced to ask, “Should I try for a short sale or go ahead with a foreclosure?” Only use a foreclosure as a last resort The buzzword “foreclosure” is everywhere these days; we all are talking about it.


Facing the very real prospect of having to choose between squeaking by another month of mortgage payments or paying other monthly bills and buying necessities like groceries has unfortunately become a regrettable realty for millions of Americans.Whether you’re struggling to make your monthly payment due to the loss of a job, an interest rate re-adjustment, ugly divorce, sickness or injury, the question millions are forced to ask, “Should I try for a short sale or go ahead with a foreclosure?” Only use a foreclosure as a last resort The buzzword “foreclosure” is everywhere these days; we all are talking about it. 

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What does that Equal Credit Opportunity Logo Really Mean?

Think of the Equal Credit Opportunity Act (ECOA) as a sort of a civil rights act for credit. Creditors are not allowed to discriminate on the basis of race, color, religion, national origin, sex, marital status, age, or because you receive public assistance. This means they are not able to deny, grant or provide different terms based upon those factors. You probably have noticed that various applications may ask these types of questions, but they are not allowed to make a credit decision based upon this information; this information is likely used for marketing or other unrelated reasons. The Equal Credit Opportunity Act includes all credit companies including department store cards, mortgage companies, real estate companies, banks, small loan companies and credit unions.

Credit Companies may NOT:


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Credit Repair; Help is Out There


Credit Repair is not a losing battle. Any and all tactics to improve or repair your score are well worth your time and effort; but there are better ways than others to help best determine where to start and how to best allocate that time and effort to make the most difference.



There are many companies offering to help you repair your credit score and even more willing to take your money and repay you with just about nothing other than a big bill and still just as ugly of credit. It is important to understand that each persons’ credit history is different and if there is a company out there offering a quick and simple ‘one size fits all’ solution it is best to avoid them all together. An individual with a few late credit card payments should have an entirely different repair plan than the one fresh out of bankruptcy, foreclosure, or a short sale or two.



In order to repair credit, it is important to first and most importantly understand credit and how it works! If you’re one of the lucky ones with cash on hand to begin repairing your credit there are still quite a few things you should know before you do so. Simply throwing money at your overdue bills may get the creditors to stop calling, but it will not fix the whole problem and it certainly will not repair your credit. If you’re like most people in need of credit repair, you may just need a clear plan of action and a moment to breathe some fresh air instead of lying helpless under that mountain of overdue notices and stress.



Help really is out there. There are a handful of honest companies out there offering legitimate advice, counseling and education on how to best repair your own individual credit. One of the best ways to find great service and honest results are to ask friends, relatives or reliable individuals if they have any dependable referrals or if they know of a great credit repair companies.


Unfortunately for many, damaged credit can be a touchy subject and friends or family members may not be too willing to discuss such sensitive information. A good way to determine an honest credit repair company is to be sure that all of the information and advice they provide is drawn specifically from your credit report; in other words if they are able to bark our generic answers over the phone without looking at your scenario, hang up. Credit repair can be quite complex, that’s why you are looking for advice now isn’t it? There are no simple answers when it comes to credit, so be ready to face the tough question and don’t be afraid to ask even tougher ones.

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Credit Repair: How it can help you


When it comes to your credit, even the smallest mistake can come back to bite you in the future. To make matters worse, if you’re like most with damaged credit it isn’t due to one late payment. More than likely you’ve taken a slide down the slippery slope and had one late payment lead to another on one card, and a collection account on another, and so on. Debt management can be quite difficult once that first payment is missed, you end up feeling like you’re playing catch up and can’t quite ever catch your breath. Credit repair is the first step to picking yourself back up to stop hiding from collection calls or nasty letters in the mail.

Credit repair can’t erase your credit history. If anyone or company ever tells you that they are able to “make your bad credit disappear”, they are lying or doing something very illegal. The reality is, is that your credit mistakes will always appear on your credit, but what credit repair does is diminish the impact of those negative aspects. There are three essential steps to credit repair:

1. Clean up misreported, fraudulent or inaccurate information

2. Organize your payment schedules and monthly cash flow to work away at your current debt

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Considering being a first time homeowner - Consider all the factors


Imagining grassy lawns, picket fences and friendly neighbors? Dreaming of good schools for your kids and a comfortable home to retire in and pass on to your family? Homeownership is the hallmark of the American dream. Owning your own home can act as a 30-year savings investment plan and provide financial stability for your monthly budget and the foundation for your retirement plan. There really are a myriad of reasons why homeownership massively outweighs renting year to year.

Homeownership does also come with a few realities that dreamers like you don’t consider; which is fair! You don’t know what you don’t know quite yet. Owning your own home comes with a new list of responsibilities that you need to consider before purchasing that home and the maximum end of the amount your lender has approved you for. There are a bunch of new expenses to factor in both monthly and yearly that renters simply don’t have to deal with.

As the ink is still drying on your purchase contract you may be faced with a bunch of expenses you’ll have to dump right away into your new home. Consider the cost of having to replace a dishwasher, a leaky toilet or a bad showerhead. Don’t forget you may need to purchase your own appliances such as a refrigerator, washer, dryer or stove. For bigger repairs like a new air conditioner or a burst water heater you may want to consider purchasing a home warranty policy either through your title company at closing or through another company of your choosing.

That new home have a beautifully sparkling pool and the green lawn you were dreaming of? Well both take consistent effort to keep them as pristine as sale condition! Either plan on spending your weekends out doors or setting aside a couple hundred a month for landscapers and pool maintenance, not to mention higher monthly water bills for both.

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Buying A Car? Check Your Credit Score First

Thinking of buying a car?  Check your credit scores first.. 

Do you check your Credit score and credit report before you go shopping for a car? You might find out that it is well worth your while to do so, as some auto dealers are taking advantage of the fact that many consumers do not know their credit scores.

No one likes buying a car; the entire process is awkward and cumbersome. Most items we buy are plainly marked with the price, but with cars, the price is often a mystery. Then you have to haggle with a salesman and hope that you have worked out the best price possible. Having done that, you have to arrange financing. You can often get an acceptable interest rate when financing through the dealer, but some dealers are padding their bottom line by offering loans at higher rates than they otherwise might.

The scam works like this – You negotiate your best price with the dealer and you agree to finance through them. You fill out the credit application and hand it over to the salesman, who has promised you some reasonable Terms. He takes off to process the application and to check your credit report while you have a cup of coffee. He returns a few minutes later, shaking his head. He informs you that your credit score is only 600 and that you will not qualify for the interest rate he offered you. He says that you will have to pay a higher rate. And not knowing any better, you agree.

Had you done your homework by checking your credit score ahead of time, you would have known your actual credit score and you could have pointed out that the salesman’s assessment of your credit score was incorrect. At that point, you could insist upon receiving the more favorable interest rate or threaten to finance elsewhere. This is a common scam that works because most people really do not know their exact credit score.

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After bankruptcy you can’t avoid credit forever

Bankruptcy isn’t the final nail in the credit coffin.It is nearly impossible to live without credit or at least an established credit history. Whether you like it or not it, credit will be needed in the future for one thing or another. Those who have filed either a chapter 7 or 13 bankruptcy are faced with the difficult task of reestablishing credit after the discharge of their old debt which is certainly more difficult than establishing credit the first time. Both types of bankruptcy will remain on the individual’s credit report for up to ten years and will serve as a huge impairment on anyone’s credit. Before new credit is established out of bankruptcy, people face suspicions by new lenders that they are permanently unable to effectively manage debt and therefore shouldn’t be able to acquire new lines of credit.Of course this is absolutely untrue.

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Additional Protection for Soldiers on Active Duty


Congress passed the Fair Credit Reporting Act several years ago in an attempt to smooth out some problems in the Credit reporting industry. The best known provision of this Act is one that permits Americans to receive a free copy of their credit reports from each of the three main credit bureaus once per year. So far, this provision of the Act has been a success. A lesser-known provision of the legislation is one that is intended to protect active duty military personnel from being victimized by identity theft while they are out of the country.

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5 Ways Poor Credit Scores Costs You Extra Money

Most of us want a good credit report to obtain automobile financing, credit cards, and to purchase a home. But, beyond these consumer loans, your credit report can cost you in everyday living expenses. What you don’t know about your credit could be costing you money. Having a credit card means that you can order tickets, rent a car, and reserve hotel rooms. Besides these conveniences, your credit report can mean that you must pay higher deposits and fees for everyday services.

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5 steps to bankruptcy recovery

In recent posts, we’ve talked about what bankruptcy is, who can file, what kinds of bankruptcy exist, and how one gets started. Now let’s talk about what happens after a bankruptcy. First, the order of the court is executed, whether that involves withholding of pay, liquidation of assets, or some other action. Next, your credit score is impacted.

This impact is likely to be very severe. People who successfully file for bankruptcy will find that a number of things that used to be easy are well beyond their reach: applying for home and car loans, some employment opportunities, and lines of credit with low interest rates or no fees. This can make getting back on your feet something of a challenge. Here are some tips:

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5 Most Common Ways to Hurt your Credit Score


Whether a consumer has an abysmal credit score or a fantastic one, the reduction of overall credit availability over the past few years has raised the standards across the board for credit score requirements. What was once considered a great score now doesn’t seem too great as lenders are requiring even stronger credit histories and in most cases a greater minimum score up about 20-40 points. Not only have minimum scores risen but also the method in which the Equifax, TransUnion, and Experian formulate their FICO scores has changed and continues to change.



There are five ways consumers consistently kill their scores, a few of them most people are unaware are making such a significant impact on their scores.

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10 Vital Questions Before Applying for a Secured Credit Card


Secured credit cards are a great way to establish new credit as well as building new credit after a bad run crushed your credit score.Especially after bankruptcy your reestablishment of credit is extremely important to show future lenders you have learned from your mistakes.



1.What exactly is a Secured Credit Card?

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10 Simple steps to creating and sticking to a budget


      1. Understanding the Necessity of a Budget


Even the most savvy of spenders need a budget. Keeping on top of your bank account to avoid overdraft fees does not count as a “budget”. Even if you are able to spend your money wisely and keep all of your bills in check, a budget is the necessary first step to establishing a long-term savings plan for those rainy days of even more importantly, retirement.


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10 Credit Myths

As they say, ‘Knowledge is power.’ Many times people either act on false information or fail to act because they didn’t know what could be done to their benefit. This is the case in many areas of life, but on the top of that list is money. And in the money category, you will find lots of misinformation about Credit.

There is so much to talk about on the topic of credit myths that an entire book could be dedicated to it.

Myth #1: I’m a complete financial loser for getting myself into this mess.

Fact: It may be true that you’re responsible for getting into debt, but that doesn’t make you a loser. In fact, it may not be your fault at all. As long as you start working on becoming more knowledgeable when it comes to finances, you will ultimately find success in controlling your debt.

Myth #2: Credit is what got me into this mess.

Fact: Spending is what got you into this mess (debt). Credit was the means to spend. If your problem is spending, then you very well may have spent all your cash. However, credit cards may make it easier to spend.

Myth #3: There’s nothing I can do about it now. My credit is destroyed forever!

Fact: As long as you work, starting today, to rebuild your credit, you’ll eventually get it under control. Rebuilding your credit means: (1) Paying on time; (2) Looking for better credit options; and (3) Learning more about money and credit.

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10 Best Tips You Can Use Right Now

We've all heard horror stories about fraud that's committed by someone stealing a name, address, Social  number or . Here are 10 suggestions you can take to help protect yourself.

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