Your credit score is a reflection of your creditworthiness and is dependent on the various items in your credit report. It is calculated by the different credit bureaus using complex statistical methods and data as reflected in your credit information. The higher your credit score, the better your chances of obtaining a loan or being granted a mortgage for a house.
While how the credit score is exactly computed is kept as a well-guarded secret, it’s a fact that keeping your credit record clean by paying your bills and loans on time and not applying for tons of credit cards, among others, will raise it. However, if you neglect to pay your obligations on time, default on student loans, or don’t pay your tax liens, you can expect your credit score to drop which will be detrimental to your creditworthiness. Aside from being denied loans, a low credit score will even mean failure to rent a decent apartment or cost you a promising job.
There are ten credit habits you should avoid if you want your credit report to reflect a credit score that tells potential lenders, landlords and employers that you know how to handle your finances. These are:
However, if you already have any of these so-called “killers” in your credit report and you want them removed, read on. The following paragraphs will discuss the possibilities and strategies of having these deleted from your record. (Note: The methods given in the following paragraphs are for accounts that are indeed yours. If you know that the derogatory item in your credit report is not yours, you should dispute it and seek legal remedies should that be necessary).
Part I of this report will discuss how to remove late payments, collections and charge-offs, judgments, wage garnishments, and car repossession from your credit report. The remaining five mentioned above will be detailed in Part II of this report.
This program is ideal for anyone interested in real and lasting credit improvement.
Credit Late Payments
Even if you are just a month late from paying your credit card or other loan obligations, you can see a 30, 60, or even a 100-point drop in your credit score. That is why paying your bills on time is crucial. However, if you did pay your obligations late whether out of forgetfulness or other circumstance and you want it removed from your credit report, you can try two ways.
The first method entails getting in touch with your creditor through phone and following up with a goodwill letter that basically explains why the payment was done late and then asking them to “forgive” your oversight. Now if you have had a good credit history with your lender, they will usually oblige and have the item deleted. They might not be as accommodating if your past payment history is flooded with late payments.
The second method is usually offered by some creditors when you negotiate for a removal of the late payment. They will remove the item on the condition that you will sign up for their automatic payment scheme. This is a win-win situation for both parties since the creditor is ensured that he gets paid and the debtor won’t have to worry about missing another payment date.
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