Tired of Credit Offers? Opt Out

If you are tired of getting credit card offers in the mail, there is an easy fix: opt out. You can go the opt out webpage. Here, you will be required to enter some information. Once you have finished the process, you have officially opted out of credit offers.

This right is afforded you by the FCRA (Fair Credit Reporting Act). The best part about opting out is that you should see your score increase. This is because you are no longer receiving soft hits on your credit score.

How to Build Business Credit

If you are at the point of wanting to build business credit, I’m going to assume that you have already set up your business and filed all the appropriate paperwork for licensing and so forth. Having that out of the way, you are now ready to start building credit for your business. Here are the steps

Open a Business Checking Account

This is important in showing that your business is established. It will all be monitored by Dun & Bradstreet. Soon enough, you will be rated based on the amount of money you hold in your account at all times. For now, just worry about getting it set up.

List Your Business

You should take the time to have your business listed on 411 search, yellow pages, and google business. Also, if you have a website, make sure it is listed with all the major search engines. It is recommended that you have your phone and a fax numbered registered in your business name.

Dun & Bradstreet

DNB is the largest tracker of business credit. They keep track of business credit; and for a fee, they sell different business profile options and business credit reports. You will need to get on their website and apply for a DUNS number. This number acts as an identification number for your business. It typically takes 30 days for them to set this number up, and you don’t need to pay for it. They will make the file and add to it as soon as you start applying for credit under your business name.

Start Applying

At this point you can start applying for credit. The easiest place to set up credit is with vendors with whom you already have a relationship. Also, you can try office supplies stores such as staples, Kinkos, etc. These office supply/print stores typically grant credit easily to businesses. Some business credit cards are given very easily; others require a longer history. You can always work your way up. Try to get at least 5 vendors or creditors that will report your credit.

Pay Early

You will be given a Paydex rating for your business. Besides the amount of money in your account, they will also look at how long it takes you to pay your “net 30” bills. I recommend that you pay them as soon as possible, because each day counts in the world of business credit. Paying them in fifteen days is better than paying them in 20. You want the best Paydex score you can get. The better your score is, the better your opportunities for loans.

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How to Dispute an Error on Your Credit Report

One of the many problems with our credit system is that it allows for so many errors to show up on our credit reports. With identity theft increasing at an alarming rate, you need to monitor your credit report and remove the errors fraudulent activity. There are two general ways to remove a discrepancy from your report and rebuild your credit. I will show you how.

The Company

I have found the best way to remove any error or problem is through the company that issued it, if I am still a customer. For instance, assume you just had a late fee show up from American Express, and you are a customer of American Express. The most effective way to remove it is to write American Express a letter. If you tell them that you are loyal customer who loves American Express, and you need their help in removing the error. They will cordially oblige, because they want to keep you as a customer—a happy one incidentally.

Most people overlook this and go straight to the bureaus. The problem with this is that the bureaus are designed to be mechanical. They don’t care about your situation. They will process the information they are given. If you send them a letter, they will contact American Express. American Express will respond that it is valid. Now, if American Express does notice their error (not very likely), they will respond that it is erroneous and the bureau will delete it. However, if American Express just responds that it’s valid, you get a letter back saying it has been verified.

For this reason, I want to contact the company first. They have an interest in me as a customer; they want to keep me satisfied. I can add a personal touch with them which will make them want to help me. Here’s the real bonus though. Most of the time, they will delete a late payment for you, even if it’s not an error. Why? Because they are making money off every purchase you make. Why would they want to estrange and upset you? If they don't want to help you, then maybe you ought to look for a new card. Talk to the business first.

Through the Bureaus

If you do need to contact the three monsters: Transunion, Equifax, Experian, you will have to write three letters because they do not corroborate or work together. You will have three battles that are not easily won. The good news is that you have a couple advantages. The bad news is that there are some pitfalls to watch out for.

What’s on Your Side

Time is your first ally. Everyone knows that the FCRA (Fair Credit Reporting Act) requires the bureaus to respond to your letter in 30 days. If they do not, they technically have to delete it. This sounds great; but I will be honest, this does not happen very often.

Hassle

The other thing that you have going for you is that it is a hassle for the bureaus and the companies with whom they are investigating to verify this information. If the company has lost the information or simply ignores the request for validation long enough, the bureau will delete it because it cannot be verified or it took too long to verify it.

What’s Against You

Be prepared. The credit bureaus have some tricks up their sleeves. Anything they can do to deter you from pursuing your investigation they will try to do. They don’t want to have to spend the man hours investigating your errors. They want you to give up, accept it, and forget about it.

The Blanket Refusal

Invariably, if you send a dispute letter, you will get a blanket refusal to investigate based on several frivolous reasons. Depending on the bureau, they will say that the letter seemed to be a form letter, and they need to verify it was actually you who sent it. They will tell you that you have to prove your identity and place of residence first. The list goes on. These are meant to deter you.

What you can do

The best thing that you can do is put your social security number in your letter and attach a copy of your driver’s license and a proof of residence. This way, they cannot say they did not know it was you disputing it, and they cannot return your letter and say verify your identity.
Here are the addresses to the bureaus:

Experian
P. O. Box 9595, Allen, TX 75013-9595 Tel: 888-397-3742

Equifax
P. O. Box 740241, Atlanta, GA 30374-0241 Tel: 800-685-1111

Trans Union
P. O. Box 1000, Chester, PA 19022 Tel: 800-888-4213


Remember, the best way is to start with the company. If that does not work, move on to the bureaus. Success with the bureaus depends upon persistence. Good Luck.

P.S. If you decide that it's too much trouble to do it on your own, I recommend Lexington Law Firm


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The Best Way to Monitor Your Credit

There are a ton of sites and companies out there that offer credit monitoring service. Some of them are offered for $9 a month, some for $30. The problem with most of these sites is that they are affiliated with only one of the credit bureaus; i.e. they have an agreement with Equifax but not Experian or Transunion and so forth. The best way I have found to monitor my report and score is through True Credit on Credit.com. This company is affiliated with Transunion, but they have agreements with the other two bureaus to allow you to check your credit. The best part of the program is that it allows you to check all three reports and scores as many times as you want.
That means you can update your score anytime you feel like it without paying for each update. They charge $15 a month to track your changes and allow access to all three scores. I can tell you right now that this is great deal. In order to purchase your separate report and score from all three bureaus, you would need to pay $45 each time.
Besides a regular update to my report and score, I also print off my report before I apply for anything. I give the report and score to the loan officer and make sure that I will be qualified for whatever it is I’m applying for before they check my credit. This way, I can keep my credit inquiries to a minimum.

Four Myths about Credit Debunked

For most people, credit scores are something of an enigma. We all understand the basic underlying principle—if I pay my bills, I’ll have good credit—but few of us actually know the details involved in calculating a credit score. Worse yet, many of us hurt our scores because of our lack of understanding. Here are four commonly-held myths about credit that are holding you back.

Myth #1: Too many credit cards will hurt my credit score.

This commonly-believed myth about credit hurts people in a couple ways. First, I’ve interviewed many people who have cancelled all but two of their credit cards because they believed that these cards were hurting them. The truth is that the moment they cancelled their cards, their scores dropped by as much as 150 points. Yes, it is true. By cancelling your cards, you reduce the number of healthy accounts you have, which lowers both the amount of credit you have been granted and, in most cases, the average length of credit history for each account, reducing your score drastically.

Secondly, too many people refuse credit applications because they fear they will have too many accounts. Fair Isaac Corporation, the company that designed the formula for credit scoring, says that the average consumer has 13 credit obligations. However, adding more accounts does not hurt.

On the other hand, it is true that too many credit inquiries will hurt your score. In other words, if you are out applying for a new card or loan every week, your score will be lowered. This is also another reason why you need to get the credit accounts you desire and keep them. Do not whimsically apply for and cancel credit accounts.

Myth #2: I have to use my credit cards to build credit.

This is the classic myth; it’s everywhere. How many people have you heard say “I use my card once a month so it shows activity on my account?” I used to believe this one myself, but here is the truth: you don’t have to use your card at all. In fact, it’s better if you don’t. Fair Isaac Corporation says that the average consumer carries a balance of 30% of their credit line. If you go over this, your score will be lowered. If you stay under this, your score will be raised. If you have a zero balance, you will get the most points possible. They only report balance and payments; whether or not it’s been used is superfluous.

Myth #3: I should have good credit; I pay my utilities and cell phone bill on time every month.

This is one of the sad facts about credit. It may be used to determine your ability to pay for everything you do, but not everything you do will reflect on your ability to pay. In other words, your cable company, phone company, gas company, etc., are all going to check your credit (they probably won’t tell you either). However, because these institutions are not granting you credit, they will only report to the credit bureaus if you fail to pay. In other words, when it comes to phones, utilities, and cable, you can only hurt your credit, not build it.

Myth #4: There is nothing I can do once I have a late payment.

This one has got to go. It’s actually extremely easy to remove a late payment, and the sooner you do it the better. Removing a late payment from years ago can be a little more difficult, though definitely doable, than removing a late payment from last month. If you show a late payment on your transaction history, call your credit card company and you’ll be amazed how easily they will remove it. Call the company and get a customer service representative on the line. I simply say “I have a favor to ask of you. I have a late payment showing here on my account record. Is there any way you can remove that for me? I’d really appreciate it.” I’ve actually never had a credit card company refuse my request. Why? Because they want me to keep using their card, that’s why. Now, that’s not to say you can be late all you want. If you are late each month, then you probably aren’t going to get much help. If you were late one time in a year, I’m sure you’ll be helped. I can also tell you that a penitent tone will get you further than yelling. In the past, I’ve simply told them that I spaced the payment, and they have been accommodating for me.

You may not like the credit game, but we all have to play it. So, you might as well know the rules. With these four myths debunked, you are that much closer to having excellent credit and better borrowing capabilities.

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