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:

Next Step

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

In the last post, we talked about how bankruptcy works, in general terms. In this post, we’re going to talk about who can file, why you would want to file, and what types of bankruptcy (chapters) are available.Technically, anyone can file for bankruptcy, but most people who file have far more debt than they can possibly pay. Filing for bankruptcy is not free, and if bankruptcy is not granted by the court, those fees essentially become wasted money. You may be able to find free consultations with bankruptcy lawyers in your area—make use of this service to see if a lawyer thinks you actually have a chance of success in bankruptcy court.

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.

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.

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.

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:

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

Plainly put, Identity Theft is when anyone uses your name, social security number, credit card information or any personally identifying information as their own to commit a crime; including fraud. Identity theft takes many forms in the day and age of technology. It can range anywhere from someone simply verbally pretending to be you all the way to a complete theft of an identity including your social security number and credit history.

The Credit Repair Organizations Act is a relatively new piece of legislature that is intended to protect consumers from predatory practices of companies masquerading as advocates for those struggling with debt.I wouldn’t go as far to officially call these guys con artists, but they absolutely have put an ugly black eye on the credit consulting industry.The prevalence of these detestable organizations called for the Federal Trade Commission to thankfully put into effect the Credit Repair Organizations Act.

What are the rules of the Credit Repair Organizations Act?

Car repossession is a real nightmare. No really, it might be worse than you think. It can lead to paranoia, loss of job and sleepless nights. Sounds like one of those bad prescription drug commercials doesn’t it? If you’ve been through repossession you’re probably shaking your head in agreement as you read this right now.

In a perfect world we would all have enough cash on hand to pay for everything we need up front. Obviously this is not reality and in one-way or another we all need credit. Whether it comes to financing a new car, buying a home or even simply having the basic necessities like water and power in your home, businesses will want to pull your credit to evaluated and be sure that you would make for a reliable customer. In the past, a consumer had very little control over how businesses would perceive them based upon their credit scores. Thanks to the Fair Credit Reporting Act we now have the power to understand, monitor, correct and control our credit information.

What is the Fair Credit Reporting Act?
The Fair Credit Reporting Act was passed to even the playing field between creditors and consumers. When consumers accept credit from a business, that consumer is essentially giving the business the power to make or break their credit history and affect all financial avenues of their life. We all make mistakes, and the Fair Credit Reporting Act allows us to manage and contain these mistakes. There are several different aspects of the Act but most importantly it gives consumers the power to control their financial past and future.

How do I know what information is being reported about me?
As of 2005 you have the ability to pull your credit information once a year at no cost and at no penalty to your credit score. To do this simply visit annualcreditscore.com and answer a few questions to have all of your current credit information displayed. Additionally any time that you apply for new credit or have any company, landlord or anyone else pull your credit report, you have the right to receive a copy of that report at no charge. As of currently a credit history is required to be shared, not a credit score; this you will typically have to pay for.

Is there anything I can do to fix wrong information?
If you receive your credit report and discover inaccurate or fraudulent information, the Fair Credit Reporting Act gives you the right to dispute these items. The quickest and most effective way to go about this is to submit a dispute letter to the company reporting the item as well as a letter to each of the three credit bureaus. These days, Experian, Equifax and TransUnion are converting this process to an online system to speed up this process. According to these new laws, your concerns must be acknowledged and researched in a timely manner. Once the company in question acknowledges a mistake be sure to have an official letter on company letterhead sent to you for your records, and be sure to send copies to the three credit bureaus as well.

I made some credit mistakes in the past, will these stick with me forever?
Thankfully no! Every derogatory item has a maximum time it is allowed to appear on your credit report. The lifespan of a 30-day late payment is different from, say, a bankruptcy but they each do have a specific timeline they are able to affect your score. Be sure to check the laws in your state as the timelines differ depending upon where you live. As soon as these derogatory items expire, be sure to have them removed. It’s your right!

Can just anyone look up my information?
Absolutely not. Your information is yours and only you have the right to share it with others. Your credit report will tell you each and every inquiry made on your credit report as each inquiry has the capacity to hurt your score a few points at a time. If you see any suspicious items on there, be sure to inquire as well. The Fair Credit Reporting Act also has given you the right to “opt out” of those obnoxious “pre-approved” credit offers that clog your mailbox.

 Be sure to visit www.ftc.gov/credit for more information on how to protect your credit score and for more information about the timeline for derogatory items on your credit report. Call Praxis Credit Consulting for your free consult go over how this will effect you.

When it comes to your credit health, the options for repair are as varied as your financial history itself. This article delves into the intriguing comparison between DIY credit repair and seeking professional assistance. We’ll explore the benefits and drawbacks of each approach, guide you through the steps of both paths, and help you make an informed decision that aligns with your goals and circumstances.

Understanding the Basics

Before delving into the nitty-gritty, it’s crucial to understand the fundamental concepts. DIY credit repair involves taking matters into your own hands, using resources and knowledge to challenge inaccuracies and improve your credit profile. You will need to become a pro on the details of the Fair Credit Reporting Act. On the other hand, professional credit repair services are offered by experts who navigate the complexities of credit reporting, dispute processes, and negotiations on your behalf.

Pros and Cons of DIY Credit Repair

The allure of DIY credit repair lies in the empowerment it offers. You become the driver of your credit destiny, learning about credit reports, dispute techniques, and building negotiation skills. However, this route demands a lot of time, dedication, and a thorough understanding of the credit system. The how’s & why’s it is reported on your credit report. Missteps could potentially prolong your credit woes.