Payment History – 35%
Amounts Owed – 30%
Length of Credit History – 15%
New Credit – 10%
Types of Credit Used – 10%
- We will show you how to maximize your debt ratio score, even if paying off credit cards is not an option.
- Remember that this all takes time – following the above steps consistently over a long period of time will increase your credit score and allow you to qualify for better loans and lower interest rates. Repairing your credit score does not happen overnight, so if you do these things for a few months and do not see a large increase in your score, do not give up. They are all habits that you will want to maintain throughout your life, as they will help you to keep your finances and lines of credit under control.
Most inquiries listed on one’s credit report will remain for two years. All inquiries must remain for a minimum of one year from the date the inquiry was made. Some inquiries, such as employment or pre-approved offers of credit, will show only on a personal credit report pulled by you.
Information that cannot be in a credit report
- Medical information (unless you provide consent)
- Notice of bankruptcy (Chapter 11) more than ten years
- Debts (including delinquent child support payments) more than seven years old
- Age, marital status, or race (if requested from a current or prospective employer)
The Benefits of Good Credit
- Low car insurance rates
- Low interest rate credit cards
- Qualify for a SBA loan to start a business
- More employment opportunities
- Low interest rate auto loan with NO down payment
- Rent an apartment with no security deposit
- Low interest rate mortgages
- Quality for a low interest personal loan
- Have extra money at the end of the month
Fair Debt Collection Practices Act
The Fair Debt Collection Practices Act (FDCPA) is a consumer protection amendment to the Consumer Credit Protection Act which establishes legal protection from abusive debt collection practices. The Act creates guidelines under which debt collectors may conduct business, defines rights of consumers involved with debt collectors, and prescribes penalties and remedies for violations of the Act.
The Act prohibits certain types of “abusive and deceptive” conduct when attempting to collect debts, including the following:
- Hours for phone contact: contacting consumers by telephone outside of the hours of 8:00 a.m. to 9:00 p.m. local time.
- Failure to cease communication upon request: communicating with consumers in any way (other than litigation) after receiving written notice that said consumer wishes no further communication or refuses to pay the alleged debt, with certain exceptions, including advising that collection efforts are being terminated or that the collector intends to file a lawsuit or pursue other remedies where permitted.
- Causing a telephone to ring or engaging any person in telephone conversation repeatedly or continuously: with intent to annoy, abuse, or harass any person at the called number.
- Communicating with consumers at their place of employment after having been advised that this is unacceptable or prohibited by the employer.
- Contacting consumer known to be represented by an attorney.
- Communicating with consumer after request for validation has been made: communicating with the consumer or the pursuing collection efforts by the debt collector after receipt of a consumer’s written request for verification of a debt made within the 30-day validation period (or for the name and address of the original creditor on a debt) and before the debt collector mails the consumer the requested verification or original creditor’s name and address.
- Misrepresentation or deceit: misrepresenting the debt or using deception to collect the debt, including a debt collector’s misrepresentation that he or she is an attorney or law enforcement officer.
- Publishing the consumer’s name or address on a “bad debt” list.
- Seeking unjustified amounts, which would include demanding any amounts not permitted under an applicable contract or as provided under applicable law.
- Threatening arrest or legal action that is either not permitted or not actually contemplated.
- Abusive or profane language used in the course of communication related to the debt.
- Communication with third parties: revealing or discussing the nature of debts with third parties (other than the consumer’s spouse or attorney). Collection agencies are allowed to contact neighbors or co-workers but only to obtain location information; disreputable agencies often harass debtors with a “block party” or “office party” where they contact multiple neighbors or co-workers telling them they need to reach the debtor on an urgent matter.
- Contact by embarrassing media, such as communicating with a consumer regarding a debt by post card, or using any language or symbol, other than the debt collector’s address, on any envelope when communicating with a consumer by use of mail or by telegram, except that a debt collector may use his business name if such name does not indicate that he is in the debt collection business.
- Reporting false information on a consumer’s credit report or threatening to do so in the process of collection.