Many of you have Credit Problems

Some of you need a lawyer

Many people come to me for advise when they find out that they can't buy a house, car, or they are about to be sued for nonpayment of a bill. They usually come to me asking me to give a magic spell to get them able to buy whatever they want to buy. Yes, I am a descendant of the Cherokee Blue Klan but I can't help people undue stupid stuff that they have done in the past.

 

It is equally funny that these are the same people that tell me how tight I am with money and that I should spend my money according to what they think I should spend my money on. When I tell them that I protect my credit report, making sure that I get my payment  to creditors on time, they laugh at me and tell me that their creditors will get paid when they want to pay them.  Here is why they have bad credit and cannot buy things when they want it or need it.

 

My credit score by all three credit agencies is between 750 and 800. Because they do not care to protect their credit report, showing creditors how reliable they are in paying their bills, they are usually scored between 350 and 500.   

 

Everyone hits an occasional rough patch in his or her financial life. Unfortunately, some situations will hurt your credit score worse than others. Here are four common pitfalls that will negatively affect your credit.

 

1. Not Paying Your Bills On Time

 

Missed payments, also called delinquencies, are probably the most common black marks to appear on credit reports. These can happen for a number of reasons: you forgot to schedule a payment before you went out of town, you moved and forgot to give your new address to your creditor, or your finances were just too tight that month. Whatever the reason behind them, missed payments are likely to be reported by your creditor to the credit reporting agencies (especially if you didn’t contact your creditor to explain yourself).  A delinquency can stay on your credit report for up to seven years. But don't worry, the further in the past a delinquency is, the less impact it has on your credit score.

If a potential creditor claims that this is why you cannot get credit, you can contact the posting credit reporting agency with the delinquency to your credit file and contest the issue. If the creditor is in error, it may be removed.

 

2. Keeping Your  Credit Cards at the Maximum

 

Too much debt can also lower your credit rating. Lenders review your total level of debt compared to your total amount of available credit. If that ratio is out of balance (for instance, if your credit cards are almost maxed out), your credit score will suffer. Keep your credit card balances well below your credit card limits for optimal financial health.

 

3. Applying For Every Credit Account That You Can Find

 

I see many people stopped by store workers in the mall asking them to apply for an account and they will receive a free gift. Sometimes they will say that the application will not be turned in, just fill it out.  Sooner or later, this type of freebee will caught up on the creditor.

 

Applying for lots of new credit at once can also damage your credit. The number of applications you make for credit and loans is recorded on your credit report in the form of inquiries. A lot of inquiries in a short period of time can signify that you are desperate for new lines of credit and may reflect negatively on your credit score. It’s okay to apply for new accounts when you need them, just limit your applications to those cards and loans you have researched and truly need.

 

4. I Know My Credit is Bad

 

That is another badge of honor that I hear people saying. For some reason, they think that it will not catch up with them in the future.  All they are telling creditors is that their word is no good and they cannot be trusted.

 

Public records are never good to have included on your credit report. Bankruptcies, tax liens, and court judgments all fall into this category. If you have one or more of these negative items listed on your report, you’ve probably noticed a significant drop in your credit score. While these records are damaging, they won't stay on your credit report forever. According to the Fair Credit Reporting Act, public records must drop off of your report within seven years. If you have public records listed that are more than seven years old, you can file a dispute with the credit reporting agencies.

 

It is Christmas time. Remember this advise when you are out spending money. Think about how you are going to pay the bills on time when February rolls around and your creditors has their hands out. Your creditors can make you or break you in the future when it comes to buying big ticket items.