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Monday, February 16, 2009

How To Fix Bad Credit Rating

By John Cooper

There are two steps to fixing bad credit.

1.Remove negative items from your credit report.

2.Create positive credit building accounts.

Lets talk about the second part first because this is much easier. You should open a new line of credit and make monthly on time payments. Additionally pay all your current bills.

This will help build a trail of positive on time payments on your credit report. We suggest an unsecured Visa or MasterCard, however if your credit is really damaged then you may have to open a secured card.

The second step is deleting bad items from your credit report. This is by far the best way to raise a low score. If you do not remove these items it does not matter how many positive reporting lines of credit you have because the bad credit items will continue to lower your score.

However there is a lot of inaccurate information that says you can not delete an item from your credit report without waiting seven long years. This is not true.

The credit bureaus have spent millions of dollars creating this falsity. The reason for that is because it costs them time and potential profits to investigate disputes.

The credit bureaus have also created a rumor that credit repair is illegal. This is not true.

Credit repair is legal and the government has created laws to protect you and your credit report. The Fair Credit Reporting Act passed by Congress says that a mark can remain on your report for a maximum of seven years. It does not say anything about the minimum amount of time a mark must remain.

While it may not be ethical to dispute a mark you know is accurate, it is your government protected right. You will never face any legal prosecution, arrests, or fines for disputing any mark.

How ethical is it for lenders to charge you exorbitant interest rates, late payment fees, and over the credit limit fees. Also you can have 20 years of on time payments but that will not matter when you are delinquent that first month.

Often life throws a curve ball such as; illnesses, unemployment, medical bills and more. How ethical is it for you to be punished for a catastrophe for seven long years. You could have been the model customer for 20 years prior.

To summarize you dont just have to live with a low credit score you can remove the negative marks. This will help you raise your score and give you the life that you and your family truly deserve.

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