http://www.webuildcreditinc.com/blog/rss/feedsA National credit restoration company, works with clients to improve credit profiles by challenging questionable, inaccurate data on consumer credit reports.Mon, 25 May 2026 20:10:40 -0700http://www.webuildcreditinc.com/blog/post/secrets-to-managing-your-debt-ratiohttp://www.webuildcreditinc.com/blog/post/secrets-to-managing-your-debt-ratioTop Ways to Manage Your Debt Ratio Debt ratio is the difference between the amount of debt you have charged versus the amount of money the credit card has authorized for you to use, or your credit limit. The difference is your debt ratio. This can also be referred to as revolving (credit card) credit you have available. If your credit limit is 5,000 dollars and you have charged 2,500 on the card, your debt ratio is 50%Debt ratio accounts for 30% of your FICO score, which makes it the second highest factor the credit agencies take into account when looking at your credit.Maintaining your debt ratio can make an impact on your credit score, but unlike payment history, not everyone knows how ensure their debt ratio is a positive force on your credit score. Here are a few tips for you to make sure your debt ratio is not a drain on your credit score: Maintain Your Total Credit. Donâ��t ever close credit cards if you can avoid it. The more cards you have open, the higher your total of available credit. Credit calculating software takes your TOTAL available credit versus TOTAL debt into account. Closing a credit card will decrease your overall available credit without decreasing your debt.Keep your debt even across your credit cards. It is better to have 4 credit cards with 20% debt ratio, then 1 card with 80% ratio and 3 cards with no debt. Know Your Limits Keep the balances on your credit cards as low as possible. Aim to keep all of your balances below 50% of the credit limit on that card.The FICO software ranks your credit debt based on levels. If your credit card debt is more than 75% of your credit limit, it will cause serious damage to your credit score. The next limit begins at 50%, then 25%.If your debt is high and approaching that 75% mark, call your credit card company and request an increase of your credit limit. Check Your Credit Report Regularly Look at your credit report to ensure the credit card companies have accurately reported your credit limit. If they havenâ��t reported your limits, the FICO software will read all of your cards as maxed out.Report any errors on your credit report immediately. The sooner errors are remedied, the better.Maintain communication with your credit card company. Call them if there are suspicious charges on your account or if you need to make adjustments to your payment schedule.By maintaining your debt ratio, you can ensure your credit score is as high as possible. While a solid debt ratio alone is not the only element involved in the calculation of your FICO score, it is a significant portion.Mon, 27 Feb 2017 02:28:00 -0700http://www.webuildcreditinc.com/blog/post/how-a-low-score-can-hurthttp://www.webuildcreditinc.com/blog/post/how-a-low-score-can-hurtHow a Bad Credit Score Can Hurt You While a credit score may seem like an arbitrary number, calculated by an invisible credit agency with no real bearing on your life. However, bad credit can cost your real money. To get an idea of just how much money you can lose due to bad credit, take a look at the following examples. Credit Cards If you have a low credit score, you will not be eligible for prime credit cards. These cards have the best interest rates, payment terms and credit limits, making it easier for you to maintain good payment history, thus further establishing good credit. Consumers with less then stellar credit "qualify" for less attractive credit cards or "sub-prime" cards. These cards often require exorbitant fees, monthly fees, low credit lines, or cash deposits. In most cases, these cards are difficult to maintain a positive payment record with and often fail to report your positive credit activity to the credit bureaus. A sub-prime credit card cannot only cost you money, but can also make it very difficult for you to improve your score. Car Buying When trying to buy a car with bad credit, you will not qualify for the lowest interest rates available. This often translates to $3000 to $6000 more in interest payments. This additional interest will take the form of slightly higher monthly payments. While it may not seem like a lot on a month by month basis, when calculated over the life of the loan, it will be a sizable amount.For example: A loan for $25000 to be repaid over 5 years: Credit Status Interest Rate Monthly Payment Extra Interest Paid Excellent 8% $507 $0 Poor 12% $556 $2,952 Bad 16% $608 6,062 Home Buying As you might imagine, the effects of bad credit are most evident the larger the purchase, such as when you are trying to purchase a home. For most people, a home is the largest purchase they will ever make. If you have a poor or bad credit score, you may end up paying between $2000 and $3000 of interest a year over the course of the loan, which can amount to $60000 and $100000 more in interest than if you had an excellent score.For example: A $200,000 mortgage to be repaid over 30 years: Credit Status Interest Rate Monthly Payment Extra Interest Paid Excellent 7% $1,331 $0 Poor 9% $1,609 $66,140 Bad 12% $2,057 $99,019 Mon, 27 Feb 2017 02:26:00 -0700http://www.webuildcreditinc.com/blog/post/what-makes-up-your-credit-reporthttp://www.webuildcreditinc.com/blog/post/what-makes-up-your-credit-reportYour nameYour Social Security numberYour address (and any previous addresses)Your current and past loan informationYour public record information (court judgments, bankruptcies, liens)A list of other companies who have reviewed your credit.Your 3 digit credit score (optional)While some of this information is self explanatory, some of the other aspects, especially your credit score, are a bit of a mystery to most consumers. Few people know their credit score or understand how it is calculated. Additionally, most people are unclear about how their behavior can affect their scores.The majority of people understand the basics, like failing to make a payment will make your score go down, but there are a number of complexities that trip up the average consumer. If you pay your debts on time, donâ��t carry too much debt on any one card, donâ��t close older accounts unless absolutely necessary and only apply for new credit when you have to you will generally be in good shape. However, it is important to keep yourself informed so you can maintain a credit score that accurately reflects your consumer status.Your credit score is determined by an algorithm developed by the Fair Issue Corporation (hence its other name of FICO score). Since its inception, three corporations, called â��credit bureausâ�� specialize in collecting and reporting on financial histories. Those three companies are Equifax, Experian and TransUnion. While, the exact formula used to calculate your credit score is a tightly guarded industry secret, these companies provide general guidelines about financial behavior that can affect your credit score. When calculating your score, the basic formula includes:35 percent: History of on-time or late payments of credit.30 percent: Available credit on your open credit cards15 percent: The age of your lines of credit (old = good)10 percent: How often you apply for new credit.10 percent: Variable factors, such as the types of open credit lines you haveLenders use your credit report in order to judge your reliability as a loan candidate. Your credit report indicates your ability to handle debt responsibly and will help banks decide if you are a desirable loan customer. A high credit score can help you lock in low APR rates or secure special deals on loans. A bad credit report may prevent you from securing loans and can damage your ability to buy a car, open a credit card or rent a home. A history of inability to manage your credit successfully will make lenders uncomfortable about trusting you with additional funds in the future.You are entitled to a free copy of your credit report once a year, an offer you should take advantage of. When you do receive your credit report, check to ensure the figures are accurate and act quickly correct any mistakes. This may include any clerical errors, identity theft issues or incorrect information. If your credit score is low, you should begin working on a financial rehabilitation plan, either on your own or with a certified debt councilor, to begin correcting your bad debt habits.Mon, 27 Feb 2017 02:22:00 -0700http://www.webuildcreditinc.com/blog/post/the-truth-on-credit-restorationhttp://www.webuildcreditinc.com/blog/post/the-truth-on-credit-restorationContrary to what the credit bureaus would like you to believe, credit repair does work and can work for 100% of people in most circumstances. This is, of course, provided you are getting the best advice and have an experienced professional working on your case.Any one with a credit score below 720 can benefit long-term from the advice and information provided through credit repair; however, there are times when your own limitations make adhering to this advice impossible. The two limiting factors are: (1) your financial situation and (2) the time frame within you need to reach your results. It is possible to remove anything from a credit report, even accurate items, if the creditor does not adhere to the law the outlines what needs to be done and by when. Just because you have a certain type of account removed at one time does not mean other, similar items are going to be able to be removed, even with the same circumstances. A hit-or-miss aspect exists in credit repair, because credit repair relies not only on the strategies of the person attempting to repair the credit, but also on the effectiveness or ineffectiveness of the creditors and credit bureaus in adhering to the laws. Sometimes you want the credit bureaus and credit bureaus to follow the law, sometimes you don't-it all depends on your particular situation.The reason credit repair has received such a bad name is due to the abundance of scam artists who flock to the easy money made available by people desperate for this type of service. This unfortunate reality leads the credit bureaus and the FTC to make blanket, untrue statements such as, "Credit repair does not work ever and there is nothing a credit repair company can do for you that you can't do for yourself." Given that more than 90% of credit repair companies are scam artists, promising the world and then disappearing when you pay, the credit bureaus and the FTC are forced to make such bold statements. It would be impossible for them to explain the truth to consumers without causing them to make a bad choice that would result in the getting scammed. As a result, the credit bureaus and the FTC must adhere to the "credit repair does not work" position.As I have stated, credit repair does work, but...don't let anyone tell you that credit repair is effective every time. Its success varies with the number of players in the game, some of whom never perform consistently. Even if you have a true master of credit repair on your side, you have to take into account that sometimes the other players perform in a way that throws your master of his game. Take Shaquille O'Neal. Although he has the ability to win every game for his team, there are going to be times when the other team has a formation that takes him off his game and causes his results to be less than optimal. Given that fact, you still cannot predict to any level of certainty whether or not he will perform well or poorly the next time he faces that team. Credit repair is similar. Sometimes the opposing side shows up strong, other times they don't. Even if you follow the same approach with every situation that arises when doing credit repair, your results will still vary due to the other players involved. So the next time someone tells you they can get everything repaired on your credit, run the other way, because, at best, the pendulum will swing widely both ways for the same situation.Credit repair limitations occur almost 100% of the time under the following situations. These situations make it nearly impossible for credit repair to help someone needing results within six months to a year. Please keep in mind even when you can't be helped in the short term, the advice that can be given now, if coming from a professional, can prevent you from making a mistake in the near future that may worsen your situation. Here are examples of situations where not much can be done with-in a six to twelve month period.1. If more than 50% of the negative accounts showing on the credit report appear as unpaid collections, charge-offs, repossessions, or foreclosures and you do not have the money to either pay the accounts in full or settle them. Due to the negative accounts remaining unpaid, these items will simply reappear on your report once removed. Any negatives, even unpaid accounts, can be removed-but, unless the negative account is current, paid or settled, it will simply reappear in 10-90 days.The only way to prevent this is to bring the account current by paying the past due amount, or, in the case of a collection, charge-off, repossession, or foreclosure, pay the balance in full or settle it for pennies on the dollar. Unpaid accounts that do not have collection, charge-off, repossession or foreclosure status require only that the past due balance be paid to be considered current. Unless the negative account is a public record, the only way to keep it from being re-reported is to make sure the status is "current, paid, settled, transferred or sold." In other words, if deleted, any negative account that does not show one of those five statuses will most likely get re-reported, unless the account is a public record.Public records are the only negative items that do not need to be paid to prevent re-reporting. Because they are only reported once, public records, such as unpaid judgments and tax liens, can remain unpaid and yet will not reappear once they are removed. In fact, the only time they reappear is when the initial reason for removal was the public record agency failing to respond the credit bureaus' verification request with-in the 30 day period outlined by the Fair Credit Reporting Act, in which case the credit bureau would reinsert the public record if and when the public record agency responds to the credit bureaus after that 30 day period.2. Credit repair is nearly impossible if you can't pay your minimum monthly payments and you keep adding new late payments to your report. This is a "spinning wheels" scenario that rarely yields much improvement to your credit score.In conclusion, you can repair your credit if you hire a pro and listen to his or her professional advice. The effectiveness of the credit repair depends not only on the skill of the professional you hire and your ability to cooperate with his or her advice, but also, a little luck.Mon, 27 Feb 2017 02:21:00 -0700http://www.webuildcreditinc.com/blog/post/eight-ways-to-raise-your-credit-scorehttp://www.webuildcreditinc.com/blog/post/eight-ways-to-raise-your-credit-score1. GET RID OF YOUR COLLECTION ACCOUNTS. Did you know that paying a collection account can actually reduce your score? Here’s why: credit scoring software reviews credit reports for each account’s date of last activity to determine the impact it will have on the overall credit score. When payment is made on a collection account, collection agencies update credit bureaus to reflect the account status as "Paid Collection". When this happens, the date of last activity becomes more recent. Since the guideline for credit scoring software is the date of last activity, recent payment on a collection account damages the credit score more severely. This method of credit scoring may seem unfair, but it is something that must be worked around when trying to maximize your score. How is it possible to pay a collection and maximize your score? The best way to handle this credit scoring dilemma is to contact the collection agency and explain that you are willing to pay off the collection account under the condition that the all reporting is withdrawn from credit bureaus. Request a letter from the collector that explicitly states their agreement to delete the account upon receipt/clearance of your payment. Although not all collection agencies will delete reporting, removing all references to a collection account completely will increase your score and is certainly worth the involved effort. 2. GET RID OF YOUR PAST DUE ACCOUNTS. Within the delinquent accounts on your credit report, there is a column called "Past Due". Credit score software penalizes you for keeping accounts past due, so Past Dues destroy a credit score. If you see an amount in this column, pay the creditor the past due amount reported. 3. GET RID OF YOUR CHARGE­OFFS AND LIENS. Charge­offs and liens barely affect your credit score when older than 24 months. Therefore, paying an older charge­off or a lien will neither help nor damage your credit score. Charge­offs and liens within the past 24 months severely damage your credit score. Paying the past due balance, in this case, is very important. In fact, if you have both charged­off accounts and collection accounts, but limited funds available, pay the past due balances first, then pay collection agencies that agree to remove all references to credit bureaus second. 4. GET RID OF YOUR LATE PAYMENTS. Contact all creditors that report late payments on your credit and request a good faith adjustment that removes the late payments reported on your account. Be persistent if they ref use to remove the late payments at first, and remind them that you have been a good customer that would deeply appreciate their help. Since most creditors receive calls within a call center, if therepresentative refuses to make a courtesy adjustment on your account, call back and try again with someone else. Persistence and politeness pays off in this scenario. If you are frustrated, rude, and unclear with your request, you are making it very difficult for them to help you. 5. CHECK YOUR CREDIT LIMIT(S) AND EVENLY DISTRIBUTE THE BALANCES YOU ARE CARRYING. Make sure creditors report your credit limits to bureaus. When no limit is reported, credit scoring software scores the account as though your current balance is "maxedout". For example, if you know that you have a $10,000 limit on your credit card, make sure that the limit appears on the credit report. Otherwise, your score will be damaged as severely as if you were carrying a balance of the entire available credit. Credit scoring software likes to see you carry credit card balances as close to zero as possible. If it is difficult for you to pay down your balances, read the following guidelines to maximize your score as much as possible under the circumstances:There are different degrees that scoring software can impact your score when carrying credit card balances.Balances over 70% of your total credit limit on any card damages your score the most. The next level is 50% of your balance, then 30% of your balance.In order to maximize your score without having to pay down your balances, evenly distribute your credit card balances among all of your credit cards, rather than carry a large balance on one credit card. For example, if you are carrying a $9000 balance on a credit card with a $10000 limit, and you have two other credit cards with a $3000 and $5000 limit, transfer your balances so that you have a $1500 balance on the $3000 limit card, a $2500 balance on the $5000 limit card and a $5000 balance on the $10000 limit card. Evenly distributing your balances will maximize your score. 6. DO NOT CLOSE YOUR CREDIT CARDS. Closing a credit card can hurt your credit score, since doing so effects your debt to available credit ratio. For example, if you owe a total credit card debt of $10,000 and your total credit available is $20,000, you are using 50% of your total credit. If you close a credit card with a $5,000 credit limit, you will reduce your credit available to $15,000 and change your ratio to using 66% of your credit. There are caveats to this rule: if the account was opened within the past two years or if you have over six credit cards. The magic number of credit card accounts to have in order to maximize your score is between 3 and 5 (although having more will not significantly damage your score). For example, if a card was opened within the past two years and you have over six credit cards, you may close that account. If you have more than six department store cards, close the newest accounts. Otherwise, do not close any at all. 7. OPEN BUSINESS CREDIT CARDS. Most business credit cards do not report to the personal credit report unless the person pays the card late. Given that fact, any debt carried on these cards does not hurt the credit score if it is not reported. You can carry credit card debt on these cards without hurting your credit score. Just apply for business credit cards now to start building this segment of your credit. 8. KEEP YOUR OLD CREDIT CARDS ACTIVE. 15% of your credit score is determined by the age of the credit file. Fair Isaac’s credit scoring software assumes people who have had credit for a longer time are at less risk of defaulting on payments. Therefore, even if your old credit cards have horrible interest rates, closing those cards will decrease the average length of time you’ve had credit. Use the old card at least once every six months to avoid the account rating to change to "Inactive". Keeping the card active is as simple as pumping gas or purchasing groceries every few months, then paying the balance down. An inactive account is ignored by Fair Isaac’s credit scoring software, so you won’t get the benefit of the positive payment history and low balance that card may have. The one thing all credit reports with scores over 800 have in common is a credit card that is twenty years old or older. Hold onto those old cards, trust me! Preparing credit is a slow and time consuming process. Full knowledge of your credit profile and how it represents you to creditors and credit bureaus is pivotal to full credit restoration success. Credit bureaus always advise individuals that they have a right to dispute their own credit files, but when the rights of the Credit Bureaus slow you down, you know where to ask for help.Mon, 27 Feb 2017 02:20:00 -0700