January 16,2009
-
Surviving the CC Earthquake, Pt.4 –
– Getting down to work.The ‘baddies': More serious issues can fell your credit card score by 100 points or more. These are issues like foreclosures and delinquent accounts going into collections proceedings. Typically, negative credit card information can go back as far as seven years, but bankruptcies can go back for 10. Tax liens may never go away. New laws just released will limit credit card lenders from using certain unrelated items against you. But these regulations won't be enforced until July of 2010.
Fixing the ‘baddies': ‘Scrubbing' a bad credit report usually doesn't avail much. We're frequently inundated with marketing scams that claim they can clean up our credit report and ‘fix' your credit card score, even though we know we're at fault. Be leery of these (More on these later). There may be, however, some things that can be done if done right and in a timely fashion. These are new entries where a person has just received notice of being turned over to collections. By the time this happens, it's too late to work with the original business who turned you over. They may have even committed to you over the phone "Don't worry about it. We'll work with you". Once you've been turned over, they've already made an agreement with the collection agency not to discuss the case with you anymore. These are not just credit card lenders...most businesses work this way.
Unrealistic credit repair clinics: These abound. They may be few in number but tend to draw attention to themselves. Watch out for the ‘fees up front technique'. In credit card counseling, it's illegal to demand payment up front before service is provided. Jefferson Capital Systems, LLC and their parent company CompuCredit are some of the worst violators. They've recently been slammed for $114 million in refunds and $2.4 million in penalties by the FTC. If you have any suspicions or just have questions, call 1-877-FTC-HELP.