IFS - Services

I. ABOUT CREDIT

1. What Can Be Done?
2. The Truth About Credit Records
3. What About Credit Repair Companies?
4. Credit Myths
5. The cost of bad credit
6. Fair Credit Reporting Act

II. OUR SERVICE

7. How do you do it?
8. How long will it take?
9. Is what you do legal?
10. If an item you've deleted comes back on my credit report, then what?
11. What about my bills?
12. Will paying my bills fix my credit report?
13. Do you have any kind of guarantee?
14. Can I do this myself?
15. Can I call you if I have any problems or questions?
16. How will I know when my credit report has changed?
17. What is FICO/Credit score enhancement?

III. COST & WARRANTY INFORMATION

18. How much does it cost to retain Integrated Financial Solutions?
19. Why do you require debt or credit card drafts?
20. When are funds drafted?
21. What if I want to quit? What if I'm not satisfied with your work?

IV. CREDIT REPORTS

22. What is a credit report?
23. What kind of information can appear on my credit report?
24. How long does negative information stay on my credit report?
25. Can I see my credit report?
26. How many negative items can be on my credit report before I have trouble?
27. Who looks at my credit report?
28. What does R1 and R9 mean?
29. What is a charge off?

V. OTHER QUESTIONS

30. What about bankruptcy as an answer to my problems?
31. What about IRS issues?
32. Who is Consumer Credit Counseling Services (CCCS)?
33. What should I know about FICO
34. The 7 year myth

What can be done?

YOU KNOW THE IMPORTANCE OF HAVING GOOD CREDIT!
Regardless of what you may have heard, thousands of clients have had derogatory information legally removed from their credit files. Here's an interesting true story that illustrates....

Five years ago, an attorney visited a regulatory agency for a casual conversation with two agents. Members of the agency’s office, as a matter of course, believed the credit bureaus’ claim that bad credit could not be deleted.
The visiting attorney asked, “How many negative listings would you have to see deleted from consumer credit reports before you would believe that bad credit can be deleted: Ten? Fifty? One hundred? One thousand?” The agents responded with blank stares.

“How about 50,000 deleted listings? Would that number convince you?” continued the attorney. He pulled a stack of papers six inches thick from his briefcase. “In these pages, we have listed the permanent deletion of over 50,000 listings from our clients’ files in the last two years alone,” he explained.
The state agents pulled the stack across the conference table and began to pick through the pages, obviously taking in the massive list.

“But have you deleted any bankruptcies?” shot back one of agents, “We know that bankruptcies can’t be deleted.” The attorney leaned across the table and ran his finger down the first page. “There’s one deleted bankruptcy…and, there’s another…and another. Should I go on?” asked the attorney.

The state agents sat back in their chairs. “You know,” began the junior agent, “I have this one listing on my credit report that simply must belong to somebody else…”

Though the system of correcting credit is not easy or foolproof, you will learn for yourself that you have the right to improve your credit. Good credit can be restored, and it need not take seven years.

The truth about credit records

Regardless of what you may have heard, thousands of clients have had derogatory information legally removed from their credit files. Unfortunately, the three major credit bureaus (Equifax, Experian and Trans-Union) have spent millions of dollars successfully convincing the American public that bad credit cannot be deleted from an individual’s credit report. (See interesting true story above)

But remember, there is no "magic wand" that someone can wave over your credit files to make years of bad credit "disappear" overnight. Most individuals begin to see impressive results within 60-90 days. The majorities achieve their goals of restoring their good credit within 6-12 months, depending upon the individual's unique set of circumstances.

It takes the efforts of a firm experienced in the field of credit restoration and score enhancement to achieve the impressive results our clients have come to enjoy.

What about credit repair companies?

Many credit repair companies have made some outrageous claims concerning the removal of bad credit. Their advertisements claim, "Money-back guarantees" or "100% guaranteed results". A few even claim "one hundred percent of your credit report cleared within 30 days"!!!

There is no guarantee that bad credit can be deleted from an individual’s credit report. It takes a substantial amount of experience, knowledge and effort to produce impressive results.

Unfortunately, there are credit repair companies that do prey on those who truly wish nothing more but to restore their good credit. To those individuals we say, be careful. If it sounds "to good to be true" it probably is.

So, can credit repair companies really guarantee results?

Absolutely not! No credit repair company is so good that it can guarantee a particular outcome. Guarantees are a sure sign of credit repair fraud and you should stay away from those companies regardless of the cost. In fact, hiring a company not experienced in credit restoration may actually complicate the process, since the credit bureaus may disregard claims, which they deem frivolous or unsubstantiated, thus making it more difficult in the future to re-open a previous claim not professionally presented to the credit bureaus.

Should I listen to what the credit bureaus say about credit repair companies?

U.S. District Court Judge, J. Wexler, entered the following legal opinion in the federal supplement, "since allowing third parties to assist consumers will likely lead to the expedited correction of credit reports, it will further the purposes of the [fair credit reporting] acts."

In order to work within the system of the credit bureau bureaucracy, the credit repair companies have invested years in learning their systems. Regardless of all of this, the credit bureaus have declared war against credit repair companies and any organization that sells do-it-yourself instructions on repairing credit. The bureau's campaign to discredit the repair companies through the media is obvious and blatant. They even go so far as to send anti-credit repair literature to persons they believe are using credit repair services.
The simple fact is that you do not have to live with bad credit for the seven to ten years it takes for negative items to be deleted by the credit bureaus. Credit worthiness can usually be restored within 3-12 months, depending upon your individual circumstances.

Whatever path you choose to address your credit issues, we can assure you that thousands of individuals like yourself have become credit worthy once again.

Integrated Financial Solutions offers our clients the most cost effective way to systematically tackle their personal credit issues. Our experienced team of professionals will tailor a program specifically designed to meet the needs of your individual set of circumstances. And at a price you can afford!!!

Credit Myths

When I pay off a past-due account, such as a charge off or a collection account, it will show "paid" and will no longer be negative.

It is quite difficult to restore your credit without somehow satisfying your outstanding debts. However, the act of paying off a debt can actually hurt your credit. Negative credit is allowed to stay on the credit report for a maximum of seven years, except for bankruptcy, which may remain on the credit report for ten years. This seven-year clock begins ticking on "the date of last activity" or, in other words, when the last action took place on the account. By paying an outstanding, delinquent debt you will change the account status to "paid collection," "paid was late," or "paid was charged off" - which will still stand out as a very negative listing. Furthermore, you will create a new date of last activity on the day you settle the account. The seven-year clock will reset and begin all over again. When you have outstanding debt, it is almost always prudent to seek professional help so that you may settle your debts without further damaging your credit.

If I succeed in deleting a negative item, it will just come right back on my credit report.

The credit bureaus have cleverly spread this myth through the news media and government agencies. In truth, the credit bureaus will often temporarily delete a negative listing if they haven't heard from the credit grantor after approximately thirty days. If the credit grantor reports late, say after six weeks, and then verify the negative listing, the credit bureau will often reinsert the negative listing on the credit report. Usually, though, the creditor simply fails to respond and the negative listing is permanently deleted. If the credit grantor verifies the item, either before thirty days or after, the account may still be challenged again and again until it is successfully removed.

There are some negative listings, such as bankruptcies and foreclosures that are said to be impossible to remove from the credit report.

There is no type of negative listing that hasn't been removed from a credit report thousands of times. Negative items, such as bankruptcy or unpaid debts, are certainly more difficult to remove from the credit report, but this has more to do with the operational systems of the credit bureaus than with the severity of the bad credit item. For example, judgments and tax liens are severely negative listings, yet sometimes are easier to remove.

Disputing the credit report is easy and any consumer can do it himself for the price of a few postage stamps.

Disputing the credit report is easy. Getting results from the credit bureaus is amazingly difficult, complex, and infuriating. It is not a coincidence that the Federal Trade Commission receives more complaints against credit bureaus than any other type of business. Remember, the credit bureaus are primarily interested in protecting their profits. Investigating your challenge consumes these profits. Short of sparking a mass number of lawsuits, the credit bureaus seem to do everything in their power to discourage consumers from making progress with their credit restoration. Restoring your own credit is like repairing your own transmission or representing yourself in court. It is possible, but you must decide if you are willing to take the time and assume the risks of doing it yourself.

If I declare bankruptcy, I can begin my credit report all over with a clean slate.

Many bankruptcy attorneys do not adequately explain the effects of bankruptcy to their clients. Stated simply, bankruptcy is to the credit rating what the nuclear bomb is to war. When you file for bankruptcy, every credit account that you decide to include in bankruptcy will become an "included in bankruptcy" account. Additionally, a bankruptcy filing and bankruptcy discharge listing will appear in the court records section of your credit report. Because so many negative items are attached to the bankruptcy, it becomes very difficult to remove all trace of the bad credit. If at all possible, you should avoid bankruptcy.

If you are not satisfied with the results of your credit bureau challenge, you may file a "100-word statement" on your credit report explaining your side of the story. Creditors will read your statement and will take it into consideration.

No known creditor considers information given in a 100-word statement. The statement only serves to verify some of the negative listings on the credit report. Make 100-word statements the first things you delete from your credit file.

By changing numbers in my social security number or by using an EIN tax number, I can fool the credit bureaus into creating a completely clean, new credit file under my name.

This scheme has proven to be complex, difficult, and illegal. Legitimate credit restoration companies do not recommend such practices. In order to protect their clients from legal personal risk, they warn them that lying about personal information on a credit application is usually a criminal offense.

If I build enough good credit, it will offset my bad credit and make me credit worthy. After all, I was only late a couple of times.

Any amount of bad credit is devastating to your chances of being approved by a credit grantor. Most credit grantors never actually look at your credit report. A computer pulls your credit report, rates your credit standing, income, indebtedness, and stability, and then spits out an acceptance or denial. Even one or two slow pays will usually trigger a credit card or personal loan denial. The slightest amount of negative credit will cause the interest on an auto loan to skyrocket. You will probably find that even a little bad credit, regardless of how much good credit you have, is an unacceptable barrier to credit approval.

It is illegal for creditors to take a negative, accurate listing off my credit report. The law requires that these items remain on the credit report for at least seven years.

When you speak with credit grantors, collection agencies, or credit bureaus, their typically under-educated staff may tell you all manner of such pseudo-legal nonsense. The law demands that negative `listings appear on your credit report for no longer than seven years. The credit grantor or the credit bureau can choose to delete the negative credit listing whenever they see fit.

The Cost of Bad Credit

Costs of having bad credit or an incorrect credit report

We know that bad credit is costing you! How much depends on the individual. Let’s look at the information included here and maybe it will give you an idea of the answer to that question for your particular circumstance. The economical cost of Legacy Legal Services is a great investment in your future. Compare the figures and you will see that having Legacy Legal Services working on your behalf increasing your FICO/credit scores and restoring your good credit can save you hundreds if not thousands of dollars of interest.

Fair Credit Reporting Act

Fair Credit Reporting Act
Summary
Public Law 91-508

The Fair Credit Reporting Act (FCRA) allows a consumer to challenge the information on his credit report on the basis of "completeness and accuracy." If, after a reinvestigation by the credit bureau, the disputed information "is found to be inaccurate or can no longer be verified, the credit bureau shall promptly delete such information."

The credit bureaus are required to complete the investigation within a "reasonable period of time." This period has been set at thirty days.

The credit bureaus can ignore the consumer dispute if they have reason to believe that the dispute is "frivolous or irrelevant." The FTC commentary on the FCRA cites, as an example of a frivolous dispute, a dispute wherein the consumer challenges all negative items on his credit report without providing any allegations regarding specific items in the credit file. However, "a credit bureau must assume a consumer's dispute is bona fide, unless there is clear and convincing evidence to the contrary."

When a consumer challenges a negative credit listing on the basis of extenuating circumstances, such as health problems, divorce, job loss, etc., the credit bureaus are entitled to ignore that dispute.

When a consumer submits a dispute which is neither frivolous nor irrelevant by credit bureau standards, the credit bureau must "at a minimum... check with the original sources or other reliable sources of the disputed information and inform them of the nature of the consumer's dispute." In some cases of consumer dispute, "Reinvestigation and verification may require more than asking the original source of the disputed information the same question and receiving the same answer."

In other words, when a consumer files or re-files a valid dispute, the credit bureaus must contact the source of the credit information (the creditor) and confirm that the information is accurate, verifiable, and not obsolete. In some circumstances, the credit bureau is required to go beyond a simple verification of the creditor's own computer record. If, within 30 days, the credit bureau has not received verification from the creditor, then the credit bureau must promptly delete the credit listing.

In theory and law, the process is deceptively simple, thus leading many people to think that they can easily handle this themselves "for the price of a few postage stamps." Most quickly discover that the credit bureaus have made it much more difficult than one would imagine.

II. QUESTIONS ABOUT OUR SERVICE

How do you do it?

Here's how our system works:

If you don't already have copies of your credit reports, we ask that you order them right away and send us copies as soon as you receive them in the mail. Or if you prefer we will order your credit reports for you. This will be arranged on your initial phone consultation.

As soon as we receive copies of your reports, we begin the challenge/verification process by writing letters in your name. These letters are written in such a way that it encourages the bureaus to begin their investigations.

Does this all sound so easy that you're thinking you could restore your credit yourself?

While this may sound easy, any person who has attempted to dispute his or her own credit will tell you otherwise. According to federal law, the credit bureaus can ignore your dispute under a variety of conditions. In our experience, large parts of dispute letters sent directly from consumers are rejected, based on one pretext or another.

What makes the difference? Through our 15+years of experience, we know the credit bureaus ignore consumer challenge letters for various reasons. That is why we are careful to write exactly what the bureaus will respond to in a positive way. We definitely have experience on our side.

Many prospective customers ask how they are informed of changes on their credit reports once the system is underway. The answer is simple. The credit bureaus send copies of your credit reports to you through the mail whenever changes are made. It's important that you mail us a copy of this new, updated report so that we can continue our process.

There are several reasons the credit bureau removes negative items from credit reports:

1. A listing is only somewhat inaccurate. Sometimes, if the item in question is only somewhat inaccurate, the credit bureau may change it to show accurate status.

2. Often, a challenged credit item cannot be verified. The creditor either no longer possesses the information or does not wish to go to the trouble of verifying it. Once the 30-day limit for a challenge lapses, the credit bureau has no choice but to remove the listing from the credit report.

3. Many times the investigation is ignored or the bureau is unable to complete it within the 30-day time limit.

For the reasons listed above, properly challenged negative items are removed with remarkable frequency. About 30% of challenged negative items are deleted each time the report is challenged. That is why challenging the credit reports 4-5 times in a year can be so effective.

Looking for more than just the simplistic approach to restoring your credit?

Our system includes:

• In-Depth Credit Report Analysis
• FICO/Credit Score Enhancement
• Credit Report Challenge/Verification
• Debt Consolidation/Reorganization
• Credit Inquiry Challenge/Verification
• Credit Building
• Unlimited Personal Consultation with Firm

As you can see!

Our firm offers the most cost effective, comprehensive credit enhancement program today. If you’re serious about doing something about raising your scores we can help! Put our 15+years of experience and expertise to work for you.

How long will it take?

Your credit files are like your fingerprints, they are unique to you. No two clients are the same. Each case varies, and the credit bureaus’ response to each communication varies, therefore, it would be improper for our firm to say how long any individual case would require.

However if the credit reports are received promptly, you should see impressive results is as little as 60-90 days. After that, progress should be steady.

The speed of your progress can be greatly affected by your participation, the nature of your case, and the level of credit bureau cooperation.

Sending your reports promptly to our office while we are handling your case is a necessary step in the process of restoring your good credit.

Is what you do legal?

Disputing your credit report is your right (see Fair Credit Reporting Act). Credit restoration is as legal as pleading "not guilty" in a court of law.

Of course, properly presenting your case to the credit bureaus is an important step in the restoration process.

If an item you've deleted comes back on my credit report, then what?

To begin with, the new Fair Credit Reporting Act instructs the credit bureaus to inform you before they re-report a negative listing. Sometimes a creditor will eventually verify a deleted negative item. The Fair Credit Reporting Act also makes it more difficult for the credit bureaus to re-report previously deleted items. Due to these restrictions, it is more difficult for the bureaus to put deleted listings back on credit reports. If this ever occurs, Integrated Financial Solutions simply challenges the listing again and asks for a permanent deletion.

What about my bills?

When Integrated Financial Solutions deletes a negative credit report listing, the actual debt behind the listing remains the same. You still owe the same money that you owed in the first place. If you don't pay the debt, the creditor or collection agency could always re-report the item. So removing the listing without addressing the debt is only a temporary solution.

Will paying my bills fix my credit report?

The trick is to work on restoring your credit at the same time you pay off your debt.

Here's why:

The act of paying off the unpaid debts that show up on your credit reports can actually work against you. However, it is hard to restore your credit and not satisfy your debts. This dilemma has to do with time.

Bankruptcies can remain on your credit reports for ten years and other negative items may stay on for seven years.

The date of last activity is what starts the credit bureau clock ticking. So you see, if you pay a delinquent debt, your action changes your account to "paid collection" or "paid was late" or "paid was charged off". These will stand out on your report as negative listings.

As though this is not enough, a new date of last activity (the day you pay off the accounts) begins. THE SEVEN-YEAR CLOCK WILL RESET OVER AGAIN!

So, what is the answer to this problem? It is almost always advisable to seek professional help to guide you on how to settle your debts without further damaging your credit. Integrated Financial Solutions can assist you in this area.

Do you have any kind of a guarantee?

It's important that you understand there are no guarantees involved. Just like in a court of law, an attorney could never guarantee a client that the judge or jury would find in their favor.

We only get paid for results, so you have absolute piece of mind knowing that we are doing everything that our 15+years of experience has taught us to do in effectively causing positive change in your FICO/credit scores and your credit history.

Remember that you are not just a number to Integrated Financial Solutions. Your satisfaction is very important to us and we will use all of our expertise, talents and abilities we have learned over the past 15+years for you to have a great experience with us.

Can I do this myself?

Most individuals turn to a professional to handle credit restoration because of the limited success they've had in dealing directly with their creditors and the credit bureaus. However, it is your right (See Fair Credit Reporting Act) to dispute your case directly to those laying claim against you. If you have the time, background and experience necessary to produce "effective and meaningful" results, by all means attempt to settle your credit issues yourself. For the majority who do not have the professional experience to single-handedly tackle their personal credit issues, we encourage you to seek professional assistance of a firm that specializes in credit restoration.

Can I call you if I have any problems or questions?

Definitely. However, please give your Case Representative seven to ten days to contact you first. We will contact you over the phone or by email. After that period of time you can contact your case representative as much as you like by email or at 1-510-226-7196 during business hours.

How will I know when my credit report has changed?

Actually you will be the first to know. When negative items are removed from your credit report, the credit bureau sends a copy of the revised report to your home. Legacy Legal Service then depends on you to make a copy of the report and send it to us in the mail.

You also have the option to contact your case representative and request an update on your case.

What is FICO/Credit Score Enhancement?

We have done extensive research on the FICO/credit scoring system. We know that your score not only ultimately determines whether or not you are approved for credit, but also how much you will be paying. With our process we are able to look at your report and determine immediately what route to take in order to increase your credit score as effectively and efficiently as possible. Our systems have been designed to take a credit report and ensure that every item is legally accounted for. Our cutting edge technologies and strategies are completely legal, and effective. By using our 15+years of experience, proven methods and cutting edge technologies we have assisted thousands of our client’s in raising their credit scores and attaining their individual credit goals.

III. Cost & Warranty Information

How Much Does It Cost To Retain Integrated Financial Solutions?

We charge $125.00 per item, exceptions are foreclosure, repos and mortgage lates, which cost $250.00 per line entry.

Why Do You Require Debit Or Credit Card Drafts?

Over our 17+years of practice, we found that many client payments weren't coming in on time or sometimes not at all. It became so expensive to collect our fees that we began considering significant price increases.
Instead, we’ve decided to set up all the payments as electronic drafts or credit card drafts. In the final analysis, direct drafts succeeded in reducing late and missed payments and retainer prices did not increase, thereby allowing our firm to keep our prices affordable, while still providing a high level of service.

When Are Funds Drafted?

Funds are drafted each month for work performed on your behalf. Your account will be drafted approximately 30 days after you submit your retainer agreement on either the 1st or the15th of each month, and every month thereafter. It will began no sooner than 30 days after submitting the agreement; and continue until Integrated Financial Solutions completes its work, or our client is satisfied with their results. You will only be drafted one time each month, on the same date.

What if I want to quit? What if I'm not satisfied with your work?

You can cancel your agreement with us at any time. To qualify for a warranty claim, however, you must work with us for an entire year. The satisfaction of our clients is extremely important to us and we will generally go to almost any length to keep you satisfied with our progress.

However, it is important to give the process of restoring your credit time. This means sending your credit reports to us promptly upon receiving them. Also realize that the credit bureaus have 30 days by law to complete their investigation, and 15 additional days by law to send you an updated, corrected copy of your credit report. You will then immediately send them to our office, at which time we repeat the process, tackling your remaining credit issues. Remember, credit restoration is not an overnight process. Most clients see impressive results within 60-90 days, and steady results from then on until we complete our work.

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IV. Credit report information

What is a credit report?

The three major credit bureaus in the United States: Experian, Trans Union, and Equifax, are in the business of exchanging information. When you apply for a loan of any kind, the creditor pulls your credit report from at least one of these bureaus. There are many other credit bureaus throughout the United States, but they are mainly affiliated with one of the major three.

These credit bureaus collect and maintain information on the vast majority of Americans, but they are not affiliated with the government in any way. The credit bureaus are for-profit corporations and they sell your personal information for money.

The credit bureaus receive your personal information through the same lenders who grant you credit. They have agreements with each of these credit grantors that require the credit grantor to inform the credit bureaus of everything that occurs in your relationship with the credit grantor. If you make a payment late, the negative credit listing is quickly reported to at least one of the three major credit bureaus and is added to your credit history. Credit reports are not just a record of how you are currently managing your credit accounts. Credit reports are histories of everything you are doing with your credit now, and everything you have done in the past.

The credit bureaus collect this information, list it on your credit report, and then sell it to other credit grantors who wish to see your credit history before they decide to lend you money. The credit grantors who review your credit are especially interested in any negative credit. If you have shown any tendency to pay late, or to disregard your financial commitments in the past, then the creditors' computers will immediately reject your application.

Just like when you were in high school, your credit report is your financial report card to the world. Did you know that employers with increasing frequency are also requesting your credit files to screen potential applicants? Their rational for doing so is that if you are or have been conducting your personal finances in ruin, it probably is a clear indication of how valuable you will be to a potential employer. Think about it! Who would you hire to represent your company? The individual with good credit, or the person with a number of late pays, charge-offs, delinquencies, repossessions, tax liens, etc.? That’s why it is so important to monitor your credit files and keep them as close to perfect as possible!

What Kind Of Information Can Appear On My Credit Report?

Merchant Trade Lines

These include all regular credit lines such as department store cards, auto loans, mortgages, and credit cards. If there is any history of late payment, or if the trade line was included in bankruptcy, charged off, or put into repossession, the listing will be considered negative by all credit grantors.

Collection Accounts

When an account is referred to collections because of delinquency or because of a bad check, this appears on the credit report as a collection account. Collection accounts can appear as paid or unpaid accounts. Any type of collection account, whether paid or not, is considered very negative by all credit grantors.

Court Records

Bankruptcies, judgments, liens, divorces, satisfied judgments and or liens, are all considered court records, and are all considered negative by all credit grantors.

Inquiries

Every time a credit grantor looks at your credit file, a credit inquiry appears on at least one of your credit bureau reports. If the number of inquiries is very few over the last two years, then there may be no negative effect on your credit worthiness. However, if there are many recent inquiries showing on your credit report, it is possible that the grantors may deny you credit.

How long does the negative information stay on my credit report?

Even though your creditor or the credit bureau can remove negative items whenever they choose, here are the rules set forth by the Fair Credit Reporting Act (FCRA):

1. Most negative items must be taken off in no more than seven years.
2. Bankruptcies can be reported up to ten years.
3. Inquiries may remain on the credit report for up to two years

Can I See My Credit Report?

Most credit grantors are not allowed by the credit bureaus to show you your own credit report. But you can purchase your credit report from the credit bureau for a fee. Once you receive your credit report, you may find that you cannot read it because the information is listed in an unfamiliar code. Trans Union and Equifax credit reports are very difficult to interpret and understand. Experian credit reports, however, are relatively easy for most people to read. If you have been denied credit within the past 60 days, you may request your credit report for free from the credit bureau, which had provided the credit grantor the information used to determine your credit worthiness. In the rejection letter you receive from the credit grantor, it will list the credit bureau they used to provide your credit report.

How many negative items can be on my credit report before I have trouble?

As you may have already experienced, even one small late pay listing may result in credit denials. It is a myth that a large amount of positive credit can outweigh some negative credit. Fact is, any negative credit whatsoever can raise red flags for the credit grantors and provide justification for denial.

Who Looks At My Credit Report?

With the passing of each year, your credit report is used more and more often as a yardstick to measure your character. Prospective creditors will always review at least one or more of your credit reports before granting you credit. Today it is increasingly common for insurance companies to review your credit before extending auto or health insurance. Many employers now check credit before they consider you for a position. If you rent, you may have already been through a credit check to determine your worthiness as a renter.
In a nutshell, anyone extending credit to you in any capacity will be reviewing your personal credit files.

What doe’s R1 and R9 mean?

"R" refers to a revolving account, "I" refers to an individual account, and "M" refers to a mortgage account. The creditor supplies this rating. It is their rating of you as a borrower. There are only two ratings that are not negative. A rating of "1" is good and a rating of "0" means that they don't have enough history about you to rate you.

Every other rating, "2" through "9" is negative. In our experience, creditors don't look at these ratings when you apply for financing. The creditor usually looks at the late pays or other notations such as "charge off" or "collections." However, any rating but a "1" or "0" indicates that you have problems with the account.

What Is A Charge Off?

When you become very delinquent on an account, the creditor will probably charge it off. This means that they have written the debt off as a loss for tax purposes. This does not mean that they have given up collecting on the debt. The creditor is now likely to either sell the debt or send it to collections.

Charge offs are very negative listings, but they can often be settled through debt settlement for much less than you owe.

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V. OTHER CREDIT QUESTIONS

What about Bankruptcy as an answer to my problems?

Many bankruptcy attorneys do not adequately explain the effects of bankruptcy to their clients. Stated simply, bankruptcy is devastating to your credit for up to ten years. If you are considering bankruptcy, you should consult a local attorney who specializes in bankruptcy law. Here are some things to consider before you declare bankruptcy:

1. When you file for bankruptcy, every credit account that you decide to include in the bankruptcy will become an "included in bankruptcy" account on your credit report.

2. Additionally, a bankruptcy filing and bankruptcy discharge listing will appear in the court records section of your credit report.

3. Because so many negative items are attached to the bankruptcy, it becomes very difficult to remove all trace of the bad credit.
4. As mentioned, bankruptcies stay on your credit reports for ten years.

What about I.R.S. issues?

With tax liens, there are two problems, which need to be addressed. First, you have the actual tax debt, which can be negotiated, reduced and paid. Second, you have one or more negative credit listings, which appear, on your credit report.

We advise you to solve the first problem by seeking a skilled IRS mediator in your local area. The second problem is addressed through our credit restoration program.

Who Is Consumer Credit Counseling Services (CCCS)?

CCCS is a non-profit service, which negotiates with your creditors to reduce your monthly payments. It is also associated with the credit bureaus. CCCS can usually get you some immediate breathing room in your monthly budget.

You will end up paying more, because the lower payments will stretch your interest out over a longer period of time, But If you are currently having difficulty making your monthly payments, you will be best served by seeking help from CCCS first, before retaining our firm's services

You can reach a nationwide arm of CCCS by telephoning 800-783-5018.

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What should I know about FICO?

FICO is a mathematical equation used to determine your credit scores. It is very valuable to know how it affects your credit and your life. For visitors of our web site, we have prepared valuable free information. Click here.

The Seven-Year Myth

Question:
Why are things on file for seven or ten years? What makes that number so magical?
Fact:
In Washington, D.C. at one of the many sub-committee hearings held on Urban Affairs and Coinage, someone asked a high-ranking credit bureau official why we had this seven-year rule and ten-year rule for bankruptcies. He had no answer. It has been said that in biblical times seven years was how long you spent in debtor’s prison. A professor at Brigham Young University said, "seven years was how long a city was abandoned when destroyed, it wasn't purified to be re-inhabited until seven years." Or on a more superstitious level -if you break a mirror it's seven-years bad luck. Unlike the tracking of a new drug to see the effects of an experimental operation, the seven years was handed to us and accepted in blind obedience without any merit or question. It could have been six years, eight years or nine years, depending on what the credit bureau rule maker had for breakfast that day. So we adopted the magic number of seven.

Question:
Why is seven years the magic number credit bureaus use to repair your credit?
Fact:
Let's compare this holy number seven with other comparisons: Canada only has negative data on credit reports for six years, the Better Business Bureau, only goes back on companies for three years no matter what their reputation is. Check Systems, one of the nations largest bad check reporting agencies employed by banks, only goes back five years. Now that we have shattered the myth that the seven-year rule wasn't brought from Mount Sinai with the Ten Commandments and Moses, is it unethical to receive forgiveness from the adverse data sooner? How does anyone question this? The best example of how we have accepted it is the famous party line, "seven years is the date of forgiveness."

In fact, Harry F. Atkinson who oversees credit reporting in British Columbia thinks he knows a way to motivate people to payoff their debts and to circulate some money in the economy. Mr. Atkinson would prohibit credit bureaus from reporting after three years any debts that were paid off. Current law in the Canadian province prohibits reporting negative information after six years (seven under the U.S. Fair Credit Reporting Act). This change, he says, will "reward" consumers who settle unpaid accounts. This will be one of two amendments to the provincial law on credit reporting that will be offered by the government next year; the other would permit businesses to inspect their own credit reports, as individuals may now. Equifax of Canada is fighting the first change but accepts the second;

Dun & Bradstreet and Creditel, the two dominant commercial reporting firms, are opposed to the second reform. In fact a poll conducted in 1993 reflected that 83% of Americans believed when you paid an account in full, it should be deleted from their credit reports. If the seven year myth is intended to penalize the consumer for not paying, shouldn't they be given a break when they do pay in full because by that time the consumer has paid late fees, interest and penalties, which was his penalty. Even speeding tickets and fines are paid and forgiven much sooner than a paid account on your credit report.

Question:
Does the law say it has to be on for seven years?
Fact:
Page 18817 Federal Register I Vol. 55, No.87 I Friday, May 4, 1990 I Rules and Regulations Section 605(a) Favorable Information. The Act imposes no time restriction on reporting of information that is not adverse.
Use of Shorter Periods The section does not require consumer reporting agencies to report adverse information for the time periods set forth, but only prohibits them from reporting adverse items beyond those time periods.