What inquiries effect you credit.

 Looking for a mortgage or an auto loan may cause multiple lenders to request your credit report, even though your only looking for one loan. To compensate for this, the score system ignores all mortgage and auto inquiries made in the 30 days prior to scoring. So if you find a loan within 30 days, the inquiries won't affect your score while you're rate shopping. In addition, the score looks on your credit report for auto or mortgage inquiries older than 30 days. If it finds some, it counts all those inquiries that fall in a typical shopping period as just one inquiry when determining your score. For FICO scores calculated from older versions of the scoring formula, this shopping period is any 14 day span. For FICO scores calculated from the newest versions of the scoring formula, this shopping period is any 45 day span. Each lender chooses which version of the FICO scoring formula it wants the credit reporting agency to use to calculate your FICO score

Break down of what effects your credit score.

There are five types of information used to calculate a FICO score at any given point in time. Each type of information counts as a percentage of a total FICO score:

Your payment history – about 35% of a FICO score

Have you paid your credit accounts on time? Late payments, bankruptcies, and other negative items can hurt your credit score. But a solid record of on-time payments helps your score.

How much you owe – about 30% of a FICO score

FICO scores look at the amounts you owe on all your accounts, the number of accounts with balances, and how much of your available credit you are using. The more you owe compared to your credit limit, the lower your score will be.

Length of your credit history – about 15% of a FICO score

A longer credit history will increase your score. However, you can get a high score with a short credit history if the rest of your credit report shows responsible credit management.

New credit – about 10% of a FICO score

If you have recently applied for or opened new credit accounts, your credit score will weigh this fact against the rest of your credit history. FICO scores distinguish between a search for a single loan and a search for many new credit lines, in part by the length of time over which inquiries occur. If you need a loan, do your rate shopping within a focused period of time, such as 30 days, to avoid lowering your FICO score

Other factors – about 10% of a FICO score

Several minor factors also can influence your score. For example, having a mix of credit types on your credit report – credit cards, installment loans such as a mortgage or auto loan, and personal lines of credit – is normal for people with longer credit histories and can add slightly to their scores.

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New foreclosure guidelines!!!

 Fannie Mae the largest purchaser of home loans has introduced new guidelines regarding foreclosures. A foreclosure used to effect you for 2 years when buying a new home or refinancing but now it will effect you for 5 years. What does this mean for you? It means that if you walk away from your home, you cant just go buy a new home in a couple years, you are going to have to wait 5 whole years.  5 years of renting compared to 2 years . No fun. It also means landlords are going to be stricter on who they rent to and also how much they charge for the apartment. With renters flooding the market rents are going to sky rocket. So make sure you are really willing to walk away from your home before you do because it might be a lot worse than you really think.

Credit Restoration Information!

Credit Repair is legal but people who are looking to repair their credit must be very careful when talking to a “credit repair expert”. There are 2 truths when it comes to repairing your credit and they are: you cannot remove everything on a credit report even though companies claim to be able to and the second is that dispute letters rarely work.

 Disputing them generally proves to be more difficult and harmful than anything else because it will reduce some of the laws you can use in your favor like the Statue of limitations law. Just as we have rules for which items we can dispute, the credit bureaus have rules for which disputes they are required to investigate. According to the FCRA, the credit bureaus are not required to investigate disputes they feel are frivolous or irrelevant.

Since the credit bureaus are for profit companies and not government agencies as many people think they are, they do their best to avoid investigating disputes because they do not make money from this practice. Interpreting the meaning of "frivolous or irrelevant" the credit bureaus can legally deny large numbers of requests for an investigation. Getting your dispute to to become an investigation becomes very difficult.

 That’s why the newspapers all have negative things to say about the practice of credit repair. Credit repair should be handled through an attorney or a licensed Credit Repair company who know the laws and not the guy down the street or the guy with the cool web page. Here is a way you can tell a true credit expert from the rest. Ask for a copy of their Surety Bond and their Business license. If they are not bonded: DON’T USE THEM! The reason is simple of why not to use them: most likely they cannot qualify for one due to a lack of experience or they have been proven not to work. A bond will generally cost at least a few thousand a month and up to $10,000 a month, so if they do have a Bond you know they have the business to back up what they are saying.

Here are some of the things that can be removed from you credit report if you know the laws…

Negative Items

• Late Payments
• Charge Offs
• Collections
• Repossessions
• Foreclosures
• Negative Settlements
• Medical Collections
• Student Loans
• Mortgage Lates

Public Record Items

• Bankruptcy
• Foreclosures
• Child Support
• Spousal Support
• Judgments
• Tax Liens

Now having listed those items, you must know each one of them has to have a reason to be taken off, you cannot just go online and dispute it. Disputes are made for things like duplicates or a paid credit card that shows a balance. What “dispute type” companies do, a consumer can do themselves if they know what they are doing. If you have a lot of older items on your credit report or things you would like to know if they could come off then give us a call and we will be happy to assist you with any questions you have. Now if you just don’t have the time or need it real fast, then you should hire a company to help you but when you do, make sure to get a copy of their bond, business license and most of all ask for proof of work.