Credit Repair Myths and Facts

Written by Jason A. Martin


There are no secrets to repairing your credit. Many shady credit repair agencies would love you to thinkrepparttar contrary. Negative items can be removed from your credit report and you can do it yourself. One does not need a credit repair “expert” or “law firm” to do it either. Whilerepparttar 111986 credit world can seem complex torepparttar 111987 average individual,repparttar 111988 basics are really simple once you know them.

Fact: You can remove negative items from your credit report.

According torepparttar 111989 FCRA, you haverepparttar 111990 legal right to dispute any piece of information with a credit bureau. Upon doing so,repparttar 111991 credit bureau then has 30 calendar days to investigaterepparttar 111992 item(s). After that time,repparttar 111993 credit bureau will either updaterepparttar 111994 item as you request or leave it alone if they proved it was correct to begin with. If you submit additional information onrepparttar 111995 dispute duringrepparttar 111996 30 days,repparttar 111997 credit bureau is allowed to take an additional 15 days. Disputes can be submitted online atrepparttar 111998 credit bureau’s site or simply sent via postal mail, which happens to be my recommendation. Disputes sent in based onrepparttar 111999 free credit report now provided under FACTA are given 45 days to resolve.

Myth: Collection agencies can call you anytime and do as they please.

To stop collection agencies from calling you, simply send them a cease and desist letter stating they are only allowed to contact you via postal mail. This ability is afforded you viarepparttar 112000 FDCPA. Collection agencies have a series of actions they must do to be in compliance. You would be surprised at just how many FCRA and FDCPA violations are committed on a daily basis by many collection agencies. Never speak with a collection agency overrepparttar 112001 phone. Conducting discussions via written form is best because you have proof.

Fact: Paying a collection account will not improve your score.

As far as credit scores go, a paid collection account isrepparttar 112002 same as an unpaid one. Your official credit score is called a FICO score. It takes into account many things such as:

  • Age of overall credit file.
  • Number of accounts in good standing.
  • Number of accounts delinquent.
  • Negative items: liens, bankruptcies, repossessions, etc.
  • Time sincerepparttar 112003 negative item was created.
  • Amount of your credit being used (utilization).
  • New account under six months old (which hurt your credit).
  • Number of hard inquiries.


Best Practices: In House Consumer Collections

Written by The Collector


1] Have a Defined Credit Collection Policy

One ofrepparttar major causes of overdue receivables is thatrepparttar 111985 business has not defined to its consumer customers and staff when accounts are to be paid. If consumer customers are not educated that accounts are to be paid on time, then chances are they'll pay late or sometimes not at all. Make sure that your company's terms of payment are clearly stated in writing to each consumer customer.

2] Invoice Promptly and Send Statements Regularly

If you don't have a systematic invoicing and billing system, get one. Many timesrepparttar 111986 consumer hasn't paid simply because they haven't been billed or reminded to pay in a timely manner. This situation usually occurs in smaller or newer businesses where they're short on staff to invoice and bill.

3] Use "Address Service Requested"

One ofrepparttar 111987 most difficult collection problems is tracking down a consumer customer who has "skipped". All businesses should be aware of a special service offered byrepparttar 111988 Post Office. Any statement or correspondence sent out from a business or professional office should haverepparttar 111989 words "Address Service Requested" printed or stamped onrepparttar 111990 envelope, just below your return address inrepparttar 111991 top left corner. If a statement or invoice is sent to a customer who has moved without informing you of their new address, andrepparttar 111992 words "Address Service Requested" appear onrepparttar 111993 envelope,repparttar 111994 Post Office will research this information and returnrepparttar 111995 envelope to you on a yellow sticker that givesrepparttar 111996 new address or other updated information. Ifrepparttar 111997 customer has placed a "forwarding order" withrepparttar 111998 Post Office,repparttar 111999 Post Office is required to forwardrepparttar 112000 envelope torepparttar 112001 customer and give you a form #3547 withrepparttar 112002 new address and charge you approx. 50 cents. This will keep your address files up to date.

4] Contact Overdue Accounts More Frequently

No law says you can contact a consumer customer only once a month. The old adage "The squeaky wheel getsrepparttar 112003 grease" has a great deal of merit when it comes to collecting delinquent accounts. It's an excellent idea to contact late payers every 10-14 days. Doing so will enable you to diplomatically remindrepparttar 112004 consumer customer of your terms of payment.

5] Use Your Aging Sheet, Not Your Feelings

Many businesses (or well-meaning people on their staff) have let an account age beyondrepparttar 112005 point of ever being collected because he or she "felt"repparttar 112006 customer would pay eventually. While there are a few isolated cases of unusual situations,repparttar 112007 truth is that if you aren't being paid, someone else is. So stick to your systematic plan of follow up. You'll soon know who intends to really pay and who doesn't. You can then take appropriate action once you know where you stand.

6] Make Sure Your Staff is Properly Trained

Even "experienced" staff members can sometimes become jaded when dealing with delinquent consumer customers. This usually occurs when they have made and broken promises for payment. Make surerepparttar 112008 staff is firm, yet courteous when dealing with them. Your collection staff could benefit from customer service training because, in effect, they must "sell" your consumer customers onrepparttar 112009 idea that you expect to be paid. Make sure that your collection staff is trained to not only bringrepparttar 112010 account current, but to also maintain good will with them.

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