How to eliminate collections from your credit report

New advice on credit: never let the collectors get the upper hand!

Clean Up My Credit Report: How to Get Rid of Collections

By Irena Bocheva

"How to clean up my credit report?"-that's the question which bothers most of the 35 million Americans with less that perfect credit. According to the popular myths fixing credit takes years, financial effort and careful budget planning. There are, however, far easier and smarter ways to fix credit report. The only thing needed for fast credit repair is credit knowledge.

Here are 3 simple tips that will show you how credit knowledge can be useful in order to clean up your credit report.

1. Never pay collections in full. Always settle for less.

Collection agencies make a bank out of the huge crowd of misinformed people with bad credit. Debt collectors literally pay pennies for every dollar you owe. If the debt was recently charged off, they pay 5-6 cents a dollar. If it's an old debt-they pay 1, 5-2 cents a dollar. Old and out-of-state accounts are usually sold for less than a penny per dollar. If you do the math, you will realize that collection agencies still make a pretty handsome profit out of you even if you pay them 25 % or less. And this gives you pretty good leverage when negotiating.

2. Validation of debt.

Under FCRA( Fair Credit Reporting Act) all credit bureaus, collection agencies and original creditors are required to provide validation of debt upon the request of consumers. If they fail to provide proper documentation, they have to remove the negative item from your credit report. Since most of your debt gets resold to various agencies down the road, most of them don't have the right paperwork to validate your debt. Use this fact to pressure collection agencies to remove an item from your record.

3. Payment for deletion.

This is the best thing you can do in order to raise your credit score. A paid collection will not necessarily raise your score. Quite the opposite-it may lower it. A deleted collection, on the other hand, will boost your score instantly. Negotiate with collection agencies and promise to pay them only if they remove the item from your record. Make it sound like a business proposal and remind them of the handsome profit they would make out of you.

The answer to the question "how to clean up my credit report" is simple-learn more about the credit system and the various loopholes in it. Once you start thinking outside the box, you'll be surprised to find how easy credit repair actually is.

Author: Irena Bocheva
http://fix-credit-score.info/
Do you really think that fixing credit takes a long time? Click on the link above and learn about the fastest ways to raise credit score.

Article courtesy of: Irena Bocheva





This DVD available from Amazon.com promises to help guide you through the process:


Fix Your Credit DVD - How to Fix Mistakes on Your Credit Report and How to Improve Your Credit Score (Credit Repair)

Fixing credit report mistakes a DIY job

From FTC.com:

Your Rights Regarding Credit Repair

"No one can legally remove accurate and timely negative information from a credit report. The law allows you to ask for an investigation of information in your file that you dispute as inaccurate or incomplete. There is no charge for this. Some people hire a company to investigate on their behalf, but anything a credit repair clinic can do legally, you can do for yourself at little or no cost."

Fix your own bad credit yourself. Find how to do it at
www.findhow2.com/repair-credit.html

Favorite "credit repair" books available from Amazon.com:


BestCredit: How to Win the Credit Game, 2nd Edition

Credit Repair

Credit Repair Kit For Dummies (For Dummies (Business & Personal Finance))

The Insider's Guide to Credit Repair

"Bad Things Happen to Good People." "Your Credit = Your Life, Fix It Now!" The Complete Self-Help-Kit for Credit Repair and Money Management. The Insider's Solutions to all your Credit-Problems. w/CD.

How to get better credit

Links to help you get a better credit score:


Google search results


This book could help you rebuild good credit:


Live Better, Spend Less, and Save More: Spending and Saving: How to Get Credit and Your Money to Work for You

New consumer credit protection rules coming in February 2010

After 6 years of wrangling and delays, finally, the Federal Trade Commission and the Federal Reserve have instituted consumer credit protection rules, originally required by Congress way back in 2003. Both agencies published these important regulations, that they now claim will safeguard loan applicants from overcharges on interest rates stemming from errors and outdated information lurking in their credit bureau files.
We applaud these changes. They are late. But they are necessary. Now, hopefully, people will have better protection for their credit reports and will not be victimized by mistakes that get into the credit reports, mistakes which affect their credit score.

Here is a new article summarizing the changes: www.washingtonpost.com

More in-depth help here: www.findhow2.com/repair-credit.html

Helpful books from Amazon.com:


Credit Scores and Credit Reports 3rd ed: How The System Really Works, What You Can Do (Credit Scores & Credit Reports: How the System Really Works,)

The Road to 850: Proven Strategies for Increasing Your Credit Score

Credit report agencies carry big stick when it comes to getting credit

Check out HowStuffWorks.com to learn how credit report agencies influence who gets and doesn't get credit in this credit-based society:

If you've ever owned a credit card or applied for a loan, then you have a credit history. Your credit history is compiled and maintained by companies called credit reporting agencies or credit bureaus. Credit reporting agencies collect your credit history from credit card companies, banks, mortgage companies and other creditors to create an in-depth credit report. The information in that report is also used to calculate a three-digit credit score.

Read the rest at: www.HowStuffWorks.com

Great book to read, available at Amazon.com:


Your Credit Score: How to Fix, Improve, and Protect the 3-Digit Number that Shapes Your Financial Future, 2nd Edition

Clearn credit card strategy helping consumers deal with high interest charges

This article will help illustrate a novel way to use credit cards and not get burned by huge credit card balances. Offers a great way to use strategy in your credit spending habits.

Check it out at:http://consumerist.com

For more credit card reduction strategies, check out:


Talk Your Way Out of Credit Card Debt!: Phone Calls to Banks That Saved More Than $43,000 in Interest Charges and Fees

FICO reveals how credit scores are calculated

When myFICO.com details what goes into a "credit score," they admit that it's not a simple numerical score used by all lenders:

They claim:

"In general, when people talk about "your score", they're talking about your current FICO score. However, there is no one credit score used to make decisions about you. This is true because:


Credit bureau scores are not the only scores used.

Many lenders use their own credit scores, which often will include the FICO score as well as other information about you.

FICO scores are not the only credit bureau scores. There are other credit bureau scores, although FICO scores are by far the most commonly used.

Other credit bureau scores may evaluate your credit report differently than FICO scores, and in some cases a higher score may mean more risk, not less risk as with FICO scores.

Your credit score may be different at each of the main credit reporting agencies."

Each credit reporting agency will wind up considering what that agency deems relevant to determine your "creditworthiness." This differs from Equifax, Experian and TransUnion, the Big 3 credit reporting agencies.

Most importantly -- your credit score changes all the time.

The reason for this goes as follows:

"As your data changes at the credit reporting agency, so will any new credit score based on your credit report. So your FICO score from a month ago is probably not the same score a lender would get from the credit reporting agency today."

Check out www.myFICO.com today and learn more about the ins-and-outs of credit scores, before you need to apply for a new home loan or new car.

More information is available in these books at Amazon.com:


Your Credit Score, Your Money & What's at Stake (Updated Edition): How to Improve the 3-Digit Number that Shapes Your Financial Future

The Road to 850: Proven Strategies for Increasing Your Credit Score

Fix My Credit Software 2009

The Credit Secrets Bible