Your credit rating is more important in 2010 than
any other year in the history of America. There is
less available credit than any other time in
recent history.
Credit card companies launched a
massive wave of cut backs. You may have noticed
your available balance was slashed overnight.
It is much more difficult to get a mortgage. The
minimum score needed rose by an average of 40
points and the minimum score required for
reasonable rates is up 28 points.
The bottom line is that you can expect it to be
downright difficult – if not impossible – to
get new credit in 2010 if you’ve let your credit
slip.
What this means is that you need a plan to get
your credit in top shape for the new year.
I spent several hours last weekend writing down
my financial goals for 2010, which included my
FICO score goal of 775.
I assume that you also have some goals for this
coming year. Whatever your goals may be, you’ll
need a strategy. Your credit strategy should
include a plan to erase any negative items from
your reports, improve your score, and achieve your
financial goals.
Below you’ll find an easy
formula to achieve those goals:
Credit Strategy #1: Remove any questionable
negative item from your reports. If you have a
questionable charge off, collection, late payment,
repossession, bankruptcy, or any other derogatory
information, it needs to be disputed and removed
asap!
You can do this yourself with a regular dispute
letter which you can find here www.youcancreditrepair.com/index1.php.
Often some items can be quite stubborn. Charge
offs, judgments, and repossession are especially
“sticky”.
You may need to get more aggressive
than just a standard dispute letter.
You might consider a process called “debt
validation” where you demand that the original
creditor validate a debt. (It’s a lot different
than disputing with the bureaus – yet super
effective for removing collections and charge
offs).
I would not trust myself to properly execute the
debt validation process. In fact, I messed it up
so badly when I did try it that creditors began
ignoring my letters.
It was a different story when my attorneys at
Lexington helped though. They got a big bad
collection agency (Midland Credit) to contact the
bureaus and have them remove all the charge offs
and collections.
Lexington Law’s services are not for everybody.
It is more for people who are deadly serious about
their credit and have some immediate financial
goals for 2010.
If you are one of those people you
can get on the phone with a paralegal today by
dialing this number: 800-636-3158.
Credit Strategy #2: Build Good Credit
The good news is that this is easy to do if you
already have an unsecured account.
Keep paying those accounts on time. In fact, I suggest setting
up an auto payment system so you never slip up.
Plus, this saves postage so you are saving twice!
The bad news is for people who don’t already
have an unsecured account – like a
visa/mastercard account. It is tough to even get a
card if your score is in the 500 range.
I did find a company who does guarantee your
approval so long as you are employed and have a
valid ssn. There is a great opportunity with this
program to help you build credit. You can learn
more here.
Credit Strategy #3: Stay the Course
Stay persistent. This will take time. If you get
started today you can consider yourself ahead of
the game.
Keep a detailed log of what your score
is today and track your progress. Odds are that if
you follow these tips your score will continue to
climb each month.
Don’t get discouraged when things don’t go
your way. There are usually different ways to
tackle a problem.
Here’s to a great start to 2010!