How Can An Employer Access Your Credit Report To Check

An employer has several legal obligations to fulfill when it comes to checking the background of an employee including his credit report.

The one major point regarding an employer accessing your credit report is that he’s each must get permission from you in return before he can contact the credit reporting bureau to access your credit file. If you are worried about the information on your credit is pot and refused to give permission, you may well likely be refused a job. But then again giving access to your credit report to an employer when you know that it has damaging information may still result in the job getting denied due. For this reason it is a good idea to order a free copy of your credit report from each of the credit bureaus before you apply for a job. You may either have a suitable explanation for your empire for any negative information present on it or you may start working on it a bit in advance to fix and repair any mistakes or negative information.

In other to access your free credit report visit or call 18773228228.

When you order your free Annual Credit Report you will need to verify your identity for providing your name, address, Social Security number, date of birth as well as additional information that only you are supposed to know about such as a loan account number, mortgage payment etc. Keep certain basic financial information handy when you are trying to access your free Annual Credit Report.

You can also fill out the complete Annual Credit Report request form and mail it to the following address to get your credit report through postal mail.

Annual Credit Report request service, P.O. Box 105281, Atlanta, GA 30348 — 5281.

You can access the Annual Credit Report request form from www.FTC.GOV/credit.

There are also some more legal obligations that an employer is supposed to follow. He must show you the credit report and he must tell you how to get your own copy. If you are denied a job, you can access your credit report for free within 60 days.

How Credit Reports Become Part Of Background Check By Employer

Your credit report can very well and most probably be used as a part of background check done by employers when you are looking for a job.

Whenever you apply for a job, the employer is liable to do a check on a background. This background information can include your driving record, criminal record, employment history as well as a credit report. It does not matter how you have applied for the job. You may have applied online or send your resume to by mail.

As long as you have provided the potential employer with your permission to do a background check, he can access your credit report. Your credit report has information regarding your personal details such as where you live along with information about your finances such as how regularly you have paid your bills, whether you have filed for bankruptcy in the past or are there any public judgments against you.

Credit reporting bureaus and other businesses that provide background information to employers regarding potential employees send credit files to employers that use it in turn to evaluate your application for employment. Your credit report can determine whether you get the job, are promoted or reassigned.

Credit reporting agencies not only provide information to employers but to several other businesses as well. Credit reporting businesses have an extremely profitable business where they provide information on your financial background through your credit report. They sell it to other creditors, insurance companies and banks.

The Federal Trade Commission enforces a law called the Fair Credit Reporting Act which protects the privacy and accuracy of information in your credit report. The Fair Credit Reporting Act also speaks about your rights as a job applicant and the employer’s responsibility when using your credit report as a way to assess your job application. This is the same law that entitles you to a free credit report from each of the three national credit bureaus Trans Union, Equifax and experience once every 12 months. This means that in any year you can access three credit reports.


How To Handle Accounts And Creditors During A Divorce

These are some of the steps that you need to take to handle all credit and joint account matters when getting divorced.

Get Familiar With All Accounts

The first step to take, if you already haven’t done so is to familiarize yourself with all the various credit accounts that you have opened together. You should have a clear idea of what accounts are jointly held and what accounts bear your name. Some accounts simply require a signature privilege to make you liable on the debt as far as the creditor is concerned. For all practical purposes you should consider that account to be joint as well.

Usually it is considered the best possible tactic to close all the joint accounts or remove yours name from the accounts that are jointly held. This will take some doing but will also eliminate the ability of the other spouse to further rake up a debt for which you may be liable in the future. Most divorce proceedings, work towards this end, to somehow distribute the assets and eliminate joint responsibility on any debt or credit. The time period from when the decision to get a divorce is made and the actual filing of paperwork is a very important time for credit because it often continues to be accumulated during this time. A spouse that you planning to break up with may continue to use credit to purchase clothes, furniture, automobile etc., may use your primary credit account do so. It is not uncommon for his or her attorney fees to be paid through your credit or a joint credit account as well. This is why proper planning is so essential as it can prevent these unwanted charges and additional debt to create an additional burden for you.

Get A Copy Of Your Credit Report

One of the first and important steps in preparing for divorce is to pull your credit report as soon as you can. If your creditors and the credit reporting agencies have been dealing with your accounts as they’re supposed to, your credit report would indicate all the accounts that are being held under your name and the accounts that are jointly held with your spouse as well. The one account that they will not indicate is when there is an authorized user on your own account. If you do not have a record of this personally or you cannot remember, you should contact each creditor over the phone and preferably through a written letter as well saying that you no longer authorize any other users on your account apart from yourself. Your credit report however, will indicate when you are an authorized user on some other account.

Freeze Existing Joint Credit Card Accounts

One of the steps that is commonly taken is to freeze an existing credit card account. A creditor will normally refuse to close accounts till it has a balance on it. Loans such as personal loans can be frozen as well. Something as serious as a home loan account will probably have to be dealt with through litigation, to decide how to handle future payments and how is the responsibility for the mortgage payments going to be shared or divided. It is common for the house to be sold and the proceeds to be used to pay off the mortgage completely and close the account. The spouse staying back in the house may also take on the mortgage payments. Anyway, the amount that is owned on a home-loan account cannot be increased by the spouse so there is not much danger of additional liability there.

Keep Making Regular Payments On Mortgage

However, regular payment has to be ensured on the mortgage loan account which is jointly held even during the divorce proceedings till the division of the asset is finalized. If your spouse was responsible for making payments on the mortgage home loan, you should do your best to ensure that he/she continues to do so otherwise any late payment will reflect on your credit report and negatively impact your credit score. When an account is frozen, nobody should be able to charge more or increased the debt on it. This is particularly effective for a credit card account that is jointly held. Especially one that you personally are responsible for making payments on. You do not want your spouse to charge extra on it just to be malicious and leave you with additional debt burden. Unfortunately, there is no way to prevent anyone else from attempting to be open or re-activating the existing or previous account. Therefore, it is important to settle matters at the earliest possible and close the joint accounts. You should continue to review your credit file as often as 3 to 6 months after the divorce to make sure no negative data from any previous accounts is being reported.

As a general rule, all debt incurred during the marriage regardless of the reason or who actually benefits is a marital liability.

Dissolve Joint Account Responsibility

It is assumed that both the spouses are equally liable as far as creditors are concerned. One of the important financial aspects that is discussed during a divorce proceeding is how to deal with joint debts. A good plan involves one spouse taking a particular debt and paying it alone. An even better idea would be to pay off the debt using marital assets. At the end the idea is to pay off the jointly held accounts and close it so there is no negative remark on either credit report and is this no possibility of incurring additional debt by the other spouse.

Remember, revolving accounts such as credit cards can continue to be charged by your spouse if you do not close them. Make all efforts to have your spouse removed as a joint account holder if the credit card belongs to you. Remember, once the debt is incurred on the credit card, both the joint accounts are holders are equally responsible to pay it. Nonpayment will impact of the credit ratings of both the people. However, your spouse may not mind a dent on his/her credit rating just to be malicious. It is important to keep in mind that a judgment cannot command or require the credit reporting agencies to erase negative remarks on your credit report. You can ask your attorney to work out an agreement which allows you a larger property settlement in exchange for you taking over certain credit card and loan accounts so you can rely on yourself and not your ex to make future monthly payments on time.

Sell Larger Joint Assets

When dealing with larger assets like your own home and significant debts, it usually becomes necessary to sell the assets and pay off the debt completely in order to be able to close joint account. Many lenders such as mortgage lenders will not be comfortable with having the name of one of the spouses be taken off the mortgage loan payment because it increases the risk of repayment in case you happen to default in the future.

Affix Ownership for Joint Assets

There are also disagreement as to who should own the asset or the home which only leads to the inevitable decision that no one should and the house should be sold and the debt paid off. People are many times emotionally attached to their homes. However, you should bear in mind that your life will have to undergo some changes after such a major event like a divorce. It is better to move on as quickly as possible so that you can be better off financially in the long run. The advice that you would get from your accountants and your attorney will probably be to plan long term and not short-term. Even though you face difficulties in the short-term, you can climb your way to work through it and rebuild your life in the long-term.

Budget For Expenses of Divorce and Aftermath

Financially planning your budget to deal with expenses and burden of debt during and after the divorce is extremely important. This is where your professionals involved with your divorce proceedings such as an attorney and accountant can be of great help. They will be able to give you an idea of the future funds that you have coming to you from the divorce such as alimony, child support etc. They will be also able to give you an idea of the amount of liabilities you would incur as having to pay off existing debt. At no point of time do you want the divorce proceeding to damage your credit worthiness. You should aim to be able to pay off any existing debt in full, on accounts that are jointly held, using the proceeds from the divorce settlement. This includes settling the home loan from the proceeds of the sale of the home. If you are taking the home as a part of your settlement in a divorce proceeding you should ensure that your income permits you to maintain the house and does not leave you financially strained in the future.

Separate Financial Matters

An ideal outcome of a divorce settlement would be to be able to separate all your finances. There should be no joint debt, assets or credit accounts after the divorce. This may be the outcome of the judgment passed by a court as well. However, the law may require the judges to work out things in a certain manner which may not be to your maximum benefit. It is prudent, mature and advisable to just settle your dispute among yourselves and enter into a marital settlement agreement by having a discussion amongst yourselves. Try to be civil and maintain a level head as much as possible to deal with all issues of credit, and make a clear marital settlement agreement so that it makes sense to you and anybody else reading it.

Try To Do A Mutual Agreement and Settlement Out Of Court

A settlement agreement can go into as much detail as you state allows and your attorney can help with drafting it. You can spell out specifics regarding the debt and how you will manage to cover all contingencies. However, it is equally important to understand that your creditors and credit card companies are not party to to any divorce proceeding. They are not held liable or required to legally abide by any judgment passed by the judge. They can decide to recover the money from one spouse first even though the judgment decrees that the other spouse pays it off. Hence, it is once again a good idea to settle these matters amongst yourselves and deal with them as prudently and quickly as possible. It is also a good idea to communicate a marital agreement regarding his debt to the creditor.

As long as you are mentioned on the credit account as joint account holder, the creditor can come after you if your spouse defaults on the payment. As long as two people are joint account holders on the credit account, late payments will continue to affect the credit report of both the people.

Pay Off Debt On Secured Loans and End Debt Liability

When it comes to secured debts such as mortgage and car loans, once more the bottom line should be to be able to pay off the debt and close the account. You may want to divide the debt off cleanly. The option will be to liquidate or refinance the asset so that only one person’s name is associated with the ownership. However, what is best for you may not be always possible to do. For example, you may find yourself in need of financial resources after a divorce before you can meet certain financial obligations. For example, if you cannot sell the house now, you should provide in a written agreement that it will be sold before a certain date or upon a contingency such as when all the living children reach the age of 18. It may not be possible to refinance the home, as a single signatory without your spouse. Many mortgage lenders are un-willing to have a single spouse on a large home loan because it increases the risk of default.

Deal with Credit Issues Even Though It May Seem Trivial

Going through a divorce is a great emotional strain for most of couples. The fact of the matter is that issues like who opened the MasterCard account, who actually uses and pays the bills on a credit card, etc. may not seem like the most important things . There will be many other emotional issues on your mind which concern your life more deeply.

However, the hard fact of truth is that credit issues are something that can come and bite you later on in life. The hard fact is also that even if you were not responsible for the financial planning of your home, you will need to have your debt and credit matters set in order so that you do not end up with additional financial liability. No matter what angst or woes you may have against your spouse, it is usually in the best interest of both to settle the financial matters as best as possible. While the credit is issues may not be a priority during a divorce, you should make them see that they do not get ignored. This is something that can be dealt with in a clinical manner as opposed to the emotional and psychological factors involved in a divorce. So take care of this aspect of a divorce so that you are not burdened unnecessarily any more than you already are. It is one way of ensuring a better and a happier future for yourself.


Why Credit Management Is Important When Getting Divorced

If you do happen to face the unfortunate event of getting a divorce, you will need to plan for several things. Whereas, planning and organizing your life up for a divorce may involve several more important things such as your children, the scope of this article is limited to planning and organizing your credit and debt. One of the first things that you need to do when you know that divorce is an eventuality is to get the credit related aspects of your life in order.

There are two professionals that you should contact immediately and directly for advice on planning a divorce, an attorney and certified divorce financial planner. The role of the attorney is obvious as he will help you deal with several legal issues pertaining to the divorce. The role of the certified divorce financial planner is less known and it is a field that is relatively new. However, it is gaining in popularity as it has hurt a lot of people tackle a lot of financial issues more competently during a divorce. A certified divorce planning planner is an accountant or financial planning planner who concentrates on specific financial issues surrounding a divorce. A certified divorce financial planner can help you organize and plan for divorce and post divorce. He can help the spouse who has no prior knowledge of the family’s finances become more aware and help the sophisticated spouse organize and better plan budgets and decide on appropriate division.

For example, the commonest dilemma facing a divorce in person is how to divide up all the tangible and intangible assets and debts. A common divorce situation involves a family with two major sets which are, a home and a retirement account with roughly the same that were linked. While it may seem easy and simple that one person should take the one and the other take the remaining assets, it may not necessarily be the case.

For example, the spouse taking up the home, can he or she afford to keep it up? there is also a difference in the value of the two investment beyond the actual dollar work that needs to be considered. For example, can a similar home be purchased in the area with ease, is a similar housing available anymore or has inflation or other reasons put housing beyond the means available to the person? A certified divorce financial planner is a good source for answering this question as he can help determine what makes the most sense for you.

We will discuss more about handling creditors and credit accounts in the next post.

Why Credit Management Is Important During Marriage


How To Handle Credit Matters With Your Spouse

It is common for one of the spouse to be more proactive in handling the finances of the family. However, it is advisable that both the spouses be aware of the number and nature of the accounts specially the accounts that are jointly held, and accounts you are co-signed on. If possible share financial responsibility for these accounts as well even when you are not actively involved in the financial planning itself. It is a fact that a divorce can cost you less in time, emotion and the fees if you are more up-to-date on all your family’s debt and credit issues.

Keep Track Of the Accounts

It is important to keep track of how many accounts you own. Which one is our jointly held and which ones you are an authorized user on. Communicate clearly with your spouse in order to know how the credit cards are being used, what kind of revolving debt you have to deal with every month. The usage of Internet banking and Internet access to account statements and payment details has made it easy for a person to keep track on credit cards, checking accounts and savings accounts. All it takes is sitting down for an hour or so once every month and have a look at the usage of all your accounts, specially the ones on which you are joint account holder.

Be Communicative About Finances

Encourage your spouse to be communicative about any credit issue.

When a spouse is being uncommunicative it could be a pointer towards some financial trouble. It could be an additional burden on revolving accounts such as credit card, slow payment history or missed payments on important debt accounts. The silence or secretiveness about financial matters does not necessarily mean that your spouse is doing something wrong behind your back. It could just be a spot of financial trouble, being involved in some financial setbacks such as loss of job etc. which could be embarrassing for him or her to discuss. Understand that like everything else in a marriage, credit and debt management also requires clear and constant communication.

Be Considerate and Thoughtful

One of the largest reasons for divorce between a couple is financial trouble and discontent. Even in the best of circumstances, broaching financial topics and opening a discussion can be tricky. If credit-rating is a concern between how the financial situation is being tackled between you and your spouse, you do not want to make matters worse by acting thoughtlessly. While protecting your credit is possible and should be done, you should also exercise caution, thoughtfulness and consideration when discussing these matters with your spouse. You do not want to bring about any further emotional stress or trouble because of handling financial issues improperly.

Why Credit Management Is Important Before Marriage

Credit Issues To Discuss Before Getting Married

Even though it may seem unromantic, sensible and reasonable people may want to sit down and discuss each individual financial situation before getting married. A lot of your future happiness is going to depend upon the state of your finances. The credit rating of each spouse is an important contribution factor to the financial health of the family. It is a good idea to review your credit report, your credit scores and your credit usage habits. Lots of things changed when people get married. This may include the usage of credit and future burden on financial instruments such as credit cards and requirement of loans.

Maintain Your Single Credit Accounts as Such

It is advisable that if you had individual credit accounts such as credit cards before you got married, you should maintain them as such. Do not cancel them and do not add your spouse’s name to them. Instead of adding your spouse as joint account holder, you can always add them as an authorized user or a nominee. This way if God forbid, something should happen to you in the future, you spouse will have access to your hard-earned and saved financial resources. Adding them as a joint account holder to your existing credit account means that they now share the account equally with you and have the power to build or break those accounts.

If you have been working hard to maintaining these accounts, keeping them current and making timely payments, you will not want an untimely divorce or losing a spouse to cause unexpected changes and loss of a credit-rating. Jointly held accounts are complicated to deal with in a divorce proceeding. There is often a change in a personal life such as having to obtain a new job, a new home or insurance soon after the divorce. For all these things, a healthy credit rating is essential. If you are the one who makes the payments on a credit account, it is a good idea to keep them under your name and let your spouse maintain his or her individual credit account..

You should not close the single credit accounts in order to open new joint once because the odds are that your single credit accounts already have a credit history. The length and the depth of the payment history that you have on any credit account is an important factor that is considered for calculation of your credit score. Opening new accounts will mean that those accounts have a short-term history which will reduce your credit score. The older the credit accounts are with a long payment history the more chances you have of raising your credit score.

Manage Joint Accounts

By opening a joint account or making a current existing account into a joint account with your spouse means that you both share responsibility as if the account was opened using both of your Social Security number. Although you may be able to remove the name from your account in the future, it may be difficult depending upon the nature of the account and your circumstances. For example, a jointly held account may come under litigation in case of a divorce.

A personal loan that has both yours and your spouse’s name on it may make the lender unwilling to remove the name of the spouse because that increases the risk of recovery of the loan in case you happen to default.

Discuss Credit Usage In The Future

Another important thing to consider and discuss with your spouse is how you are going to use the credit jointly together in the future. For example, you may have conservative credit card using habits but your spouse may rely on making a lot of expense on the revolving accounts. Your spouse may be in the habit of carrying large balances on the credit card even though he or she pays the balances for a month. You should remember that the having a high balance on a credit card negatively impacts your credit score. Once you get married, you are going to have to plan for a lot of changes and additional financial burdens. The uses of credit has to be planned and organized accordingly.

For example, you may not want to use credit cards extensively and curb on your spending if you want to save for a home loan. Take a good look at the credit rating of your spouse and see how you both can maintain current good rating on how to fix a bad one. You may want to postpone opening joint account together till the time that the credit rating of your spouse can be adequately repaired. If there are any particular credit habits such as carrying high balances on the credit card that needs to be addressed, do so before having joint credit cards with your spouse. As mentioned before, the activity on a joint credit card account will impact the credit rating of both. It will be reported on the credit report of both the people and therefore any joint credit account should be used prudently and wisely in order to prevent a negative impact on anyone’s credit score.

Drafting a Prenuptial Agreement

Another thing to consider is the importance of credit issues when drafting a prenuptial agreement. A prenuptial agreement is becoming more and more common with people as a part of making arrangements to get married. Unless of course you are one of the people who think that is a it is unromantic. When people think of a prenuptial agreement they think in terms of setting down terms and conditions for preservation of assets and limitation of alimony. However, credit rating is just as valuable an asset as anything else. A credit rating today determines your credit worthiness and how available things like credit cards, home loan, automobile loan, student loan, utility service and even jobs are for you. Therefore one of the principal issues to be discussed in a premarital planning or a prenuptial agreement should be to spell out how you will handle debt and credit during and at the conclusion of marriage.

If you do not intend to have a prenuptial agreement for your marriage, you should at least plan the use of credit in a manner that will allow you to preserve it as an asset of your own. The credit rating of a person does not get distributed in a divorce. It is yours now and forever. So it is your job to protect it as much as possible. You do not want it getting damaged at the hands of a neglectful or malicious spouse after divorce.

Taking Advantage of Spouse’s Better Credit Rating

The flipside of this situation can equally be true. Your spouse can have a better credit score than you and you can take advantage of it by opening joint accounts. In any case, you should keep an eye out and monitor any accounts that have held jointly so as to ensure that they stay healthy. Once an account is jointly held you cannot legally restrict anyone partly from using it or requiring one party to become solely responsible for it. This can only be managed through a legal judgment.

Marriage, Divorce and Credit – Why You Should Be Prepared


Your credit rating is strictly based on statistical and numerological information about your finances pertaining to credit usage. It may seem strange to discuss marriage and divorce in connection with your credit rating.

Since your personal circumstances such as your relationship, your race and religion are not the things that are supposed to impact your credit rating, how can a marriage or divorce be of any consequence as well? You’ll find many articles on the Internet saying that the possibility of a marriage or divorce affecting your credit score is remote.

However, to the contrary, a marriage or a divorce brings about a big change in the personal life of a person which more often than not permeates to the financial aspect of things as well. Given the fact that divorce is a very likely phenomena and marriage even more so, the effect of these two life-changing events cannot be ignored as far as your credit rating is concerned. It would be prudent to plan for both these eventualities as far as your credit rating is concerned.

Your credit rating is yours alone now and forever. It is one of your strongest assets when it comes to getting loans, taking a house on rent or even getting a job. You should plan for it and protect it as a valuable asset that it is. Your credit rating is what makes credit and its usage possible for you. We all know that without the use of credit, several wonderful things in life such as owning a home, an automobile or just the convenience of using credit cards will not be possible.

The truth is that many people discover the importance of credit rating a bit too late in life. It comes as a rude awakening when they suddenly realize that they are having problems getting approved for a loan. A simple error of having missed a credit card payment 6 months back is impacting the credit score negatively. The fact is that when you are married, there is more room for such mistakes and errors when you have joint accounts or your spouse is using your credit card. Just by charging more than you normally do and carrying more balance on the card you can damage your credit rating.

Even if you think it is not required to discuss these things beforehand with your would be spouse, you yourself should be aware of them so that you know how to handle them when the issue does arise.

At the same time, you also need an understanding of how a divorce can impact your credit worthiness, and believe us when we tell you that it can. It is a part of your financial situation that gets impacted during and after a divorce. A mis-managed joint account can have long term repercussions and result in negative entries on your credit report that stay for years to come. In fact, it is ridiculously easy for something like this to happen to your credit history during a divorce. There are ways to circumvent and avoid un-necessary exposure to such events.

Therefore, in this section we will talk about how like everything else you plan for when getting married, your credit rating should be one of the things that you discuss and plan for.

Rapid Re-Scoring – Methods That Do Not Cost Money

Rapid Re-Scoring without spending extra money to update credit report

As already mentioned, there is really scoring fee involved in this process which is approximately about $30 per item and a credit report. However, these are some ways in which you can avoid spending any further money specially in gathering the required evidence to send to the credit reporting agency for re-scoring. You should always bear in mind that these methods are a wide selection of the things that you can do, they are not necessarily applicable or targeted to your need or circumstance. You should consider each method carefully and often do take the advice of the mortgage loan officer himself as well as a certified accountant if you happen to have one.

Options for raising your credit score without spending money.

Removing Excessive inquiries

Not many people worry about the section on the credit report that lists an inquiry. An inquiry results anytime you credit report is accessed by a creditor when you allegedly applied for credit. The impact of an inquiry can be as much as 5% on your credit score. However, the impact of inquiries is not very clear on the credit report. Unless excessive and a lot of inquiries have been made in a short amount of time representing the fact that you are trying to take on a lot of credit, the impact on your credit report can be minimal.

However, if you see any inquiry that was not authorized by you, you can write to the creditor who pulled your credit report and ask the reason for doing so. In order to raise your credit score you will need a letter from someone within that company attesting to the fact that the inquiry was made in error and needs to be removed. Under certain circumstances you may even be able to convince a creditor who made an inquiry on a legitimate basis. Remember, this may be the easiest section to deal with and raising your credit score every single point is going to help in the long run.

Credit card balances

Your revolving accounts which are typically your credit card accounts have the maximum impact on your credit rating. Any negative information on your credit card account such as a late payment which was 30, 60 or even 90 days late can severely affect your credit score. Not just negative information but simply a balance being reported on a credit card can affect your credit worthiness. The first thing to consider is that the balance being reported on the credit file may be different than the actual balance on your credit card as of that day. You can fax the credit card company and get a letter faxed you stating what your balance for that day is. Just by sending this letter could make a huge difference to the credit score.

Late payments

When you have a late payment being reported on your credit report, there are two possible reasons. First, it is being reported in error and you have never late on the mentioned account, secondly, you were actually rate on that account and the information is being recorded accurately.

In most circumstances it is going to be the latter reason. The fact is that a late payment on a credit card or a debt accounts such as your automobile loan or personal loan can really damage your credit score. The more recent this entry is, the more impact it will have on your credit score. Just as a reminder, the negative information on your credit report that is more recent in time impacts your credit score more than information that is old.

What you can do about the late payment being reported on your credit report is that you can write a letter to the creditor and send it by fax admitting a mistake. You should be honest direct and professional when writing the letter and try to print it on a letterhead with a professional title and designation under your name. What this letter needs to do is call on the continued customer loyalty factor in exchange for the company’s assistance. It should be noted that this method is more likely to work with a creditor with whom you have a long-term relationship. For example a bank with whom you have help banking accounts for the past several years. This method is not guaranteed to work but can in several situations. It all depends on the rest of your history with the financial institution as well as a personal relationship with any key officers.

What the letter should say just is that the you are admitting to having made a mistake with the late payment and that it was a spontaneous error and had nothing to do with your inability or unwillingness to pay the creditor. Mention how much you value your good relationship with the creditor and how you look forward to continuing association with the Bank of the financial company. Request them to kindly remove the negative payment from being reported as to the credit report as a goodwill gesture towards your continued patronage.

Collection accounts

The only way to remove a collection account without paying them off first is to have evidence to present to the collection’s agency that the original creditor was paid. A good example is medical collection accounts that have been paid by the insurance claim. Be sure to take a firm but friendly approach when dealing with a collection agency. You need them to to get fax your letter as quickly as possible and not take their normal time to update your credit report which could take 30 to 60 days.

Rapid Re-Scoring – Methods That Cost Money


Options for raising your credit score by spending money

These expenses are in addition to the fee that the credit reporting agencies charge to re-evaluate and update your credit report, which is about $30 per account.

It is a fact that if you’re willing to spend some money to quickly fix the various issues affecting your credit score, you are likely to faster and more effective results. It is obvious what you can do when you have a little money. These are the following methods that can get you a quick result with the re-scoring process.

Methods that require spending money

Pay Off Credit card balances

As already mentioned, excessive credit card balance or even an unused credit card that still has a small balance on it affects your credit score. Having a zero balance on a credit card is much more positive information that can raise your credit score quickly. Try to have a zero balance on your credit cards as much as possible. This is especially true for the credit cards that you are not using. You can pay them off, have a zero balance and continue to maintain a zero balance on those cards by not using them. It will be a good idea to tackle the smaller card balances first because it will be easier to deal with. Do try to make the payment on your card using a quick method such as doing a direct bank transfer or visiting the branch itself and making the payment. Sending a payment by check will only delay matters. You can visit your bank branch and ask for an updated statement as soon as the payment is made or ask for letter from one of the assistant managers stating that the account now has a zero balance.

This is situation where you might need to be a little insistent because the credit card company might insist that it cannot issue a letter about the updated status before the next billing cycle.

You may once again have to make a call to the customer loyalty factor and explained to them that you need to the letter for the purpose of securing a mortgage loan for yourself and your family.

Pay Off Collection accounts

It is fairly simple to understand that if you have the money, you can pay off the debt that you owe on a collection account. However, it is not as simple as that. Having a zero balance on a collection account is still not good as not having a collection account reported to the credit agency at all.

You need to make an agreement with the collection agency that you will make the payment on your collection account in exchange for removal of all information from your credit report regarding the account. This means that they will cease reporting the account and the account will be dropped from a credit report as if it never existed. Paying off a collection account is a good step in the right direction but being able to negotiate the account being removed from a credit report is more advantageous when it comes to raising your credit score. No collection agency will discuss or confirm such a request over the phone so you should usually send the letter on a fax number and a signed copy of an agreement in return.

Remove Late Payment From Credit File

Late payments cannot be removed from your credit report even if you become current on the account. However you can contact the creditor to ask if it would agree to remove the most recent late payments and re-age your account in exchange for the outstanding balance.

However, this is mostly true for late payments that have occurred by accident. If you’re currently late and have been late on a particular creditor’s account, the reason probably was that you could not afford to pay the credit in the first place. If you could you would not be late. Therefore, this tactic will only work if you can afford to come up with the money to pay off the creditor.

As already mentioned, public records are more tedious and more time-consuming to deal with. While they may not fit the purpose for the rapid re-scoring, you can make an effort to have them updated on your credit report over a long-term. It is equally important to have the correct status of a bankruptcy or a judgment reflected on your credit report.

For the purpose of a rapidly re-score, keep your focus on creditors and collection accounts. It will usually take a couple of days to get a response and to receive everything you need, such as certified letters, from the creditors. You will need to submit these letters and evidence to the loan officer who would further forward these documents for re-score to the credit reporting agencies. It will usually take 3 to 5 days for the credit reporting agencies to respond.

Remember, rapid re-scoring service is usually only offered in connection with applying for a mortgage. However, each of these tactics can also be used to raise your credit score over a longer take the time. You’ll just have to wait 60 to 90 days for the update to show on your credit report and your credit score.

Rapid Re-Scoring – What Is Affecting Your Credit Score The Most

Figuring out which information is affecting your credit score

As long as you are willing to pay the fee for re-scoring various accounts and items on your credit report, loan officers should be willing to help you. In certain cases, the mortgage company may be willing to bear the cost of re-scoring just a few accounts. This is because helping you qualify for the mortgage loan is in their benefit as well. Therefore a good mortgage loan officer should be willing to help you with this.

A mortgage company usually has a look at your middle credit score.

The middle credit score is the median between all three credit reports. A mortgage lender usually uses a tri-merge credit report provided to it by its own department or one of the third-party credit report service. The idea of rapid re-scoring is to raise your middle credit score.

Before you can do this, you have to figure out which are the factors that are making your credit score low. The law requires the score factors, the elements that make up your credit score, to be disclosed to you when you’re applying for mortgage. The most common type of factors that can affect your credit score have already been discussed and are as follows:

The most common factors that affect a credit score

  • Excessive inquiries
  • credit card balances
  • late payments
  • collection accounts.
  • Public records such as bankruptcy, civil judgment or tax liens.

However, public records are usually not a part of the rapid restore process because records such as bankruptcies vacancies cannot be addressed in a timely manner and are nearly impossible to do anything about before they are scheduled to fall off your credit report.

Assembling The Information for CRAs to Update

The only way that you can convince a credit reporting agency to update the information on your credit file in a quick manner and request re-score of your credit score, is to get direct evidence from the creditor that the information on the credit report should be updated.

Once again, it should be mentioned that this evidence and proof of updated information has to be sent by the mortgage company to the CRAs. You cannot send it on your own.

In order to make a letter acceptable to a credit reporting agency and to convince them to rapidly update or correct information on your credit report, the letter from the creditor should contain the following information.

  • It should be dated within the last 30 days.
  • It should be written on the letterhead of the creditor with contact information.
  • It should have account holders name and address.
  • It should have your account number.
  • It should have a specific and clearly stated reference to what information is to be updated on the credit report e.g. balance amount is zero.
  • Signature from the creditor’s representative.

What’s the credit reporting agency will not accept is:

  • Copies of canceled checks or money order receipts.
  • Handwritten letters.
  • Letter without contact information or a date.
  • Divorce decree.
  • Paid receipts.
  • Third-party documentation.

It is also a good idea to ask the creditor to fax all the necessary documents to you since you want to save time. Try to get in contact with the person in charge of your account who can send you the letter with his own authority.