FAQ Credit

Credit

Can I Repair My Own Credit Report?

Yes. Depending on your time, patience, perseverance, and complexity of your dispute, you can successfully dispute inaccurate credit report items on your own. However, credit bureaus' strategies and tactics make the process often time consuming, overly burdensome and ineffective for the consumer. Disputing items is not difficult; getting results is.

Why Would Box of Credit Disputes Succeed Where Mine Failed?

Our experience (and dedication to our clients) in working with the credit bureaus facilitates the credit repair process because we are more likely to anticipate the tactics and responses of the credit bureau. Members of our professional team of credit coaches have experience in interacting with the bureaus and creditors and have gained insight in regards to efficiently and effectively disputing credit report errors. We stay current on consumer credit laws and economic issues, and we utilize the newest technology and proven techniques to ensure successful removal of inaccurate credit report information for our clients.

How Are Credit Scores Affected During The Repair Process?

As Box of Credit is engaged in the dispute process with the credit bureaus, your score may change periodically. When disputing 'negative' information on your credit report, the credit bureaus will remove the item(s) in question until it is verified, modified, or deleted. Since we are disputing primarily 'negative' items on your report, your score may increase during the process because the negative item is removed until the investigation is over. This temporary score is not necessarily an indicator of your final credit score. (Disputing personal information such as an incorrect address or date of birth will not typically affect your credit score.) Upon completion of the dispute process, your credit report will then show the new score. Keep in mind that each credit bureau has different criteria for determining your score, which is why your score varies from bureau to bureau.

Should I File Bankruptcy?

We cannot advise you whether or not you should file bankruptcy. If you are considering bankruptcy, it is always in your best interest to get as much information about bankruptcy as possible, and consult with a local bankruptcy attorney.

Should I Pay Off My Credit Accounts?

As a consumer it is always in your best interest to pay off any balances that you owe. When disputing items and accounts on your credit report, it is always easier to pursue deletions when accounts have been paid off (zero balance). It is advantageous to pay your accounts off because it facilitates the dispute process and further collection activities are ceased. As a collection tactic, creditors prefer to invest their time and efforts in verifying negative information that still has a balance due. As you are paying off your creditors ask them to send you a confirmation letter that the account has a zero balance. Important Note: If a creditor or collector agrees to settle an account for less than the full amount, have them send you a written statement to protect yourself from further collection activity and unethical collectors harassing you for the original balance later.

Settlement Vs. Charge Off

A charge off is a credit account that you did not pay and then the creditor wrote the account off as a loss. A settlement is an account that went past due, maybe even charged off, and then you negotiate a pay off amount that is less than the full balance due. Once you pay that negotiated amount in full then the account reports as a settlement. As consumers we depend on credit bureaus to report information accurately. Unfortunately, this is not always the case. In fact, it is the minority. Seventy-nine percent of all credit reports contain inaccuracies - meaning that we all must be diligent in monitoring our credit reports and take immediate action when mistakes are discovered. In our expectations of being treated fairly, we assume that if one negative item on our credit report is considered equal to another item; the credit bureaus have to be fair and accurate when reporting the item. Credit bureaus sometimes 'generalize' and will argue that 'Settlements' and 'Charge Off' are the same, when in fact, they are not. It is up to us to insist they investigate these items and change the incorrect information, or if they cannot verify the information within 30 days, then they need to delete the item. This is one of your rights under the Fair Credit Reporting Act. We remain steadfast in pursuing these items.

What Makes Up My Credit Score?

Credit scores are used by creditors to measure the 'risk factor' of a consumer who is applying for a loan or credit line. The credit score was out in place to reflect the financial responsibility of a consumer, through past and present credit use. Creditors use the score to 'predict' how a consumer will treat their potential financial obligation.

1. Payment History - 35%
2. Amount Owed - 30%
3. Length of Credit History - 15%
4. New Credit - 10%
5. Types of Credit in Use - 10%

As a 'snapshot' of your financial history, your credit report is essentially your 'financial fingerprint' and contains information that can be grouped into the five categories listed below.

While we have the above information we still do not know the specific formula to calculate credit scores. The credit score algorithm is closely guarded by its originator: Fair Isaac Co. (also known as FICO). For more details about the factors that affect your credit score, visit our Education Center and download our e-book: What You Need to Know About Credit and/or read the article Facts About Credit Reports.

Should I Close My Paid-Off Accounts?

When reviewing your credit to decide if you should keep an account open or closed you need to consider its affect on your credit score. It is good to only have about 3-5 open credit cards so when you decide to close some of them you will want to close the accounts that were opened recently. Older accounts have more payment history and closing them usually results in lowering your credit score. However, what you choose to do with these accounts once they have been paid off is up to you.

Another item to keep in mind when you are paying off credit accounts is that credit card balances over 50 percent of the credit limit negatively affects your credit score, so try to keep your balances below half of your credit limit. Naturally, having accounts that are paid off will not hurt your credit score.

Why Was I Denied Credit?

There are many possible reasons a creditor decides to deny you credit. One scenario, for example, is that the creditor receives updated credit reports from a third party reseller and the credit report they received is not the most current and accurate report. Their report may be outdated and not reflect recently deleted mistakes or your new payment habits and improved score. When being considered for credit, by law, you have certain credit rights. For detailed information on your credit rights, refer to our Educational Center and download our e-book: What you Need to Know about Credit. Credit is increasingly used by millions of consumers to finance everything from education and houses to entertainment and business opportunities. Factors such as debt, types of accounts, and credit history are considerations for your creditworthiness. Anytime you are denied credit you will receive a letter telling you why you were denied. Make sure you review the letter and the reason and then review your credit report to make sure any mistakes are fixed before you apply for more credit.

How Is My Credit Score Affected By Box of Credit's Efforts?

Box of Credit focuses on removing inaccurate, misleading and unverifiable information from your credit profile. While this is not a direct action to improve your credit score, our actions will often affect it. Your score is partially based on your entire credit history, and since we are working to correct negative items within your credit history this is likely to have a positive effect on your scores! Also, each bureau has a different method of receiving information from creditors and not all creditors report to all credit bureaus so that will cause your credit scores to be different with each one. Since your scores can be different for each bureau as we work on your credit reports each bureau will updated differently and it will affect those scores differently.

What Are The Main Credit Bureaus?

The three credit bureaus are: Equifax, Experian, and TransUnion. The websites are www.equifax.com, www.experian.com, and www.transunion.com, respectively.

Fair Isaac is not a credit bureau. It is the company who develops and maintains the FICO score.

What Are Inquires?

Part of your credit score considers the number of inquiries made for your credit report. Credit inquiries are placed on your credit report each time a business requests a copy of your report. The Fair Credit Reporting Act (FCRA) requires businesses to have an acceptable reason for accessing your credit report. Acceptable reasons include:

To grant credit
Collect a debt
Underwrite insurance
Employment
License issuing by some government agencies
Legitimate business transactions

Each inquiry that reports can drop your credit score any where from 2-5 points. The inquiries on your credit report will remain for two years but only affect your credit score for one year.

How Can I Stop Companies From Using My Personal Information For Marketing?

More organizations are offering consumers choices about how their personal information is used. For example, many let you "opt out" of having your information shared with others or used for marketing purposes. The best way to opt out of offers and third parties pulling your information is to go to the credit bureau websites and click on "Contact Us" page and then look for the information for Opt Out.