Bad Credit now what

Credit Card Companies operate a lot like Feudal Lords in the Middle Ages. Once you miss a payment or two, they jack up your interest rate and hit you with fees. It seems counter intuitive. I mean, after all, how are you supposed to pay all of these extra costs on top of the minimum you couldn’t pay in the first place?
The answer is: you aren’t. Credit Card companies are designed to profit by suckling a little bit of your income for as long as possible. They have no real interest in you paying off your full debt; their money comes from all of the fees and penalties they can levy against you.

They also rely on a ton of misinformation in order to keep you feeling powerless.

Here are some things you should know:

1. Paying off your debt DOES NOT raise your credit score. The Credit Bureau has no obligation to raise your score once you’ve paid off a debt. A negative item will often remain on your credit report even after it has been resolved.

2. The 3 Credit Bureaus (Experian, Trans Union, and Equifax) are in no way associated with the Federal Government. They are private companies with their own financial interests, and their reports are not legally binding.

3. The Fair Credit Reporting Act was passed to protect consumers from the nefarious practices of the Credit Bureaus. One of its primary stipulations is to guarantee each consumer a right to read his or her own report. It also states that if you dispute the accuracy of an item in a report, and the bureau cannot verify within 30 days, that item must be deleted.

There are a great many hucksters in the world of credit repair. I was fortunate to find my way to the Lexington Law Firm back in April of 2006. These are good, experienced people. I declared bankruptcy in 2004, and my credit score was in the toilet. For $40 a month, I paid the paralegals at the Firm to draft dispute letters on my behalf.

Within 6 months, I had 3 items deleted from my credit report. A year later, it was over 13, including the bankruptcy. During the process, I received many threatening letters from the credit bureaus, implying that it was wrong or illegal for me to be utilizing a third party credit repair agency. I ignored their strong arm tactics and was rewarded by having my credit score go up 200 points.

But more than that, I was empowered by learning about the wonderful legislation that protects our rights as consumers. In addition to the FCRA, there is the Fair Debt Collection Practices Act, and the Fair Credit Billing Act. These laws were passed with our interests in mind, and if you do have bad credit, or are suffering through collection calls, you should do your best to learn more about your legal rights.

Whether you are just a little behind on your bills, or have had your debt written off, there are options available to you. Find a reputable credit repair company that has experience and knows the law. I recommend Lexington Law Firm. Educate yourself about the true nature of credit and the Credit Bureaus. Knowledge is power. An informed consumer is a powerful consumer. The process takes time, and you need to make sure you are working with intelligent professionals with integrity. But there is no reason to allow bad credit to stay on your report or run your life.