How Do I Clean Up My Credit?

An Actual Case Study For A Real Client

One of the things I love about our websites is the ability to interact with our clients, readers, subscribers and visitors and positively enrich their lives. The thing I hate is constantly seeing just how much misunderstanding there is of the very systems that so greatly impact people’s lives.  It is very rewarding to see people learn how to fix credit on their own!  If you read one of my prior posts on our retail rent to own website, FinanceTheDream.com about, “How Do I Clean Up My Credit?”, you got a big idea and several real live examples from people just like you of exactly what I am talking about. One of our readers named Candace hit me with a bunch of questions, machine gun style and what I decided to do is answer ALL of her questions in a series of posts because obviously, if she has the questions, so must many of you. So, read on to learn more about how to get clean credit!

Here’s what she asked:

“Hi,
I have a question, I was gonna use my tax return to clean up my credit, but the right way by sending validation letters and intent to delete letters, but my question is, once its deleted off of my credit report does the score stay the same, does it go up or down even further? Also, once the negative remarks are removed does it show that I have a shorter time length of credit history? And, I bought my house a couple of years ago and when I was in the approval phase of the whole home ownership process, I had to pay up a couple of things, and come to find out I didn’t do it the right way by sending the letter thing and the items I paid up says paid but still is reporting negatively, can I get those removed also? Oh, and how do I get the account numbers from the collection agency without admitting to the debt, because on my credit report it shows x’s instead of account. Last thing I promise, how long will it take for my score to improve? I am in the middle of selling my house to buy another one WITH my husband. Hopefully in a year…..”

To sum it up, essentially here’s what she wants to know and the posts/headings where the answers can be found:

1.    What happens to the credit score when debt validation letters and the pay for delete process is used? Credit Score Range
2.    When derogatory items are removed, does your credit score go up or down? Credit Score Range
3.    When derogatory items are removed, does it show that I have a shorter time length of credit history? Debt Resolution
4.    Can I get paid collection accounts removed? Bad credit score
5.    How Do I get the account numbers from the collection agency without admitting the debt? Debt Problem
6.    How long will it take for my score to improve? Fast credit repair, Credit Score Range

These questions have very simple and easy to understand answers. The sad part is that the information is very simple and easy to understand but many people don’t know the answers and unknowingly do things that will actually hurt their credit score and slow down their credit repair process.  As an example, we had an overwhelming response to the two posts I did on:

Don’t Use Your Tax Refund To Pay Off Items On Your Credit Report!!! and,

Don’t Use Your Tax Refund To Pay Off Positively Reporting Loans!

Many people were unknowingly going to use their tax refund to pay off bad credit items reporting on their credit reports as well as good credit items that were positively reporting. In fact, I had a client yesterday who was going to liquidate funds from a 401k to pay off good and bad credit. Thankfully, we got him the information he needed before he unknowingly shot himself in the foot.

Ok, so let’s get to the answers.

Credit Score Range

Q:   What happens to the credit score when debt validation letters and the pay for delete process is used?

A:   If the account has been charged off as a bad debt and either the debt validation process or pay for delete process is successful in getting the derogatory account removed from your credit report, your score has no choice but to go up, all things being equal. (In fact, this is one of the best strategies around for fast credit repair.)What I mean by that is if everything else remains the same and you don’t do anything else that would negatively impact the credit score, the score will go up. Things that you can do that will negatively impact the score are:  charge up your credit cards so the utilization ratio is high, have numerous credit inquiries from credit card providers or other creditors other than mortgage lenders or car dealerships, have a payment show 30 days or more late, have another account charge off, etc. Unfortunately, it is impossible to determine exactly what the potential increase in the credit score range is without using a service like Equifax Score Watch. With Equifax Score Watch, you can simulate what the impact to your credit score range will be if the items is removed, paid off, paid down, or paid timely for X number of months.

Q:   When derogatory items are removed, does your credit score go up or down?

A:   When derogatory items are removed, your credit score will go up. Again, it is impossible to say how much due to the age of the derogatory account, what type of account it is (revolving, mortgage, installment loan) which is why when working on credit restoration, I always use the Equifax Score Watch service.

To see the answers to the following questions, click How Do I Clean Up My Credit?:

  • When derogatory items are removed, does it show that I have a shorter time length of credit history? Debt Resolution
  • Can I get paid collection accounts removed? Bad credit score
  • How Do I get the account numbers from the collection agency without admitting the debt? Debt Problem
  • How long will it take for my score to improve? Fast credit repair

As always, if you have any questions or comments, please leave them in the comment box below.  To learn more about credit repair, please enroll in Credit Repair College!  We will help you fix credit report issues so that you can achieve your dreams!

By the way, if you are considering getting a bad credit auto loan, check out our program!

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