CLICK HERE TO LEARN MORE ABOUT CREDIT REPAIRSin 30 days or so to get best credit card offers and best mortgage deals that are likely coming very soon. To take advantage of best credit deals that will come with new administration, you must hurry up and fix credit score fast to be ready. Why is all the urgency? Speaking with ABC's Stephanopoulos last Sunday, Axelrod who is Obama's senior advisor, whatever that means, stated that Obama will have a strong message for bankers once he takes office - start lending again, we want to see credit flowing again. Banks have hoarded a lot of tax payers money, and to jump up economy and make money, they will eventually start lending, and do it on very generous terms, at least initially. With the current interest rates at all time lows or very close to it, there will be a window of opportunity to secure best credit card offers and more importantly best mortgage deals. Those, however, will be only available to the borrowers whose credit is close to impeccable. So it is of a paramount importance to fix credit and do it fast.
What may happen next is the inflation which in turn will lead to a rapid and large jump in interest rates. So the opportunity will likely be short lived and you have to increase credit scores quickly. You must rely on yourself and follow steps outlined below. Don't try to reinvent the wheel, self credit repair works as long as you diligently follow the steps and don't do anything stupid to worsen your credit. Can you increase credit score in 30 days? Yes, but even 60 days should do just fine.
1. Get your credit report and go after obvious and easily fixable errors such as- public records section with any erroneous records- negatives records that do not belong to you, including late payments, charge-offs, collections- revolving accounts that incorrectly show balances too high and/or credit limits too low- any account with status anything other than CURRENT or PAID AS AGREED if they are fully paid on time - accounts listed as UNPAID that were included in a bankruptcy discharge - any negative items that exceed bad credit time limits - older than 7 years, and 10 years for bankruptcy - any account with status CLOSED BY CREDITOR when it was closed by you
2. Dispute old negative records such as small unpaid medical or utility bills that are now with collection agencies. Argue that account is not yours to begin with and request debt validation. Otherwise, claim that it is there by mistake and you paid in full. Chances are collection agency won't bother with older and small, up to $100 - $150 amounts. Here is debt validation letter.
3. If you have some collections in the $400 to $500 range, consider settling with collection agencies. Offer them 50% to 70% of collection amount and in return, agency must remove a collection debt from your credit report. Get everything in writing before you pay, send a money order only and only after you receive agreement. Removing collection from credit report will fix credit score fast.
4. If you had a late payment more than 6 months ago, but otherwise have been always on time, try to convince a creditor in writing to remove this late payment. While there is no guarantee that a lender agrees, it often works and tends to increase credit scores quickly.
5. Pay down your credit cards and other revolving accounts as much as you can to increase the gap between your balance and credit limit. Both, FICO and Vantage scoring systems put heavy emphasis on the ratio between revolving balance and credit limit. The smaller this ratio the better for your scores, but try to keep balance on each individual card as well as your total revolving debt under 30% to 35%. If you want to increase credit scores quickly, do not pay down the highest interest rate cards first, instead get the ratio between revolving balance and credit limit down.
6. Do not max your revolving account every month, even if you pay your balance off monthly. Your available credit limit is averaged over your billing cycle, which is closer to 25 days than to 30 days. If your limit is $2,000 and you charge $2,000 and pay it off each month, your credit balance will show $1,000 - a 50% usage limit, which will make your score to go lower by about 7 to 10 points - not a big deal if credit score, let's say 750, but if you go below 720 as a result, you may very well miss the best credit card offers and best mortgage deals, as those are currently reserved for borrowers with middle score of 720 or higher.
7. Stay away from credit card issuers which do not report your credit limit. Normally you may experience this with a secured credit card, but I have seen American Express, Capital One, HSBC and certain Citi credit cards that did not report credit limits. In such cases, three credit agencies use the highest balances to substitute your credit limits, making accounts look like they are maxed out.
8. Business credit cards while personally guaranteed, in general do not appear on your credit report. Chase won't even report, if you are less than 30 days late on occasion or go over the limit once in a while. They just charge you with some $39 fee. Some issuers however do report business credit cards, so if you have such, do not max it out. If you are getting close to your credit limit, try to get another business credit card to split the chargers.
9. If you have relative or friend who trusts you enough, ask to add you to one of their cards as an authorized user. The longer they have the card, the better for you. This will fix credit score fast, and boost it by a very nice margin. You don't have to have the card in your possession, simply being listed as an authorized user does the trick. Credit card piggybacking program was about to be terminated by Fair Isaac Corp. due to abuses, but unexpectedly got a full pardon and is included into FICO 08.
With all that said, I might add that to fix credit score fast is crucial for the first time home buyers as well as for seasoned real estate investors. If you want to expand your fleet of rental properties, the timing may never be better. Foreclosed and REO homes located in nice neighborhoods, are and will be in abundance, with prices depressed to the ridiculously low levels. But to take advantage and obtain low interest fixed rate mortgage, work to increase credit scores quickly. At the very least, you will have good credit history. Previously, rebuilding credit after bankruptcy and improve credit score fast.
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