Credit Report Repair Info

Credit report repair is an important option for many. If you've ever used a credit card, gas card, bought a car with credit, had a charge card at a retailer, then you have a credit rating. And, of course, if you've ever obtained a home loan, then it is listed on your credit report. Credit is undoubtedly one of the most important elements of a person's financial life. Obtaining the best home loan is made that much easier with a good credit score. Credit reports usually cost around $18 to $25.

Credit Agencies

There are three credit reports that actually exist, one each for each of the major credit bureaus. The three major bureaus are:

• Equifax P.O. Box 740241 Atlanta, GA 30374-0241 Telephone: 800-685-1111
• Experian (formerly TRW) P.O. Box 2104 Allen, TX 75013-0949 Telephone: 888-397-3742
• Trans Union Corp. 760 W. Sproul Road Springfield, PA 19064-0390 Telephone: 800-888-4213

How Are Credit Scores Tabulated? How Can I Do Credit Report Repair?

Good credit is certainly one of the fundamental, core elements of obtaining a good California home mortgage loan. Establishing good credit is important and its importance cannot be understated in the obtaining of a California home loan. Good credit scores also allow the borrower to qualify for the best loan programs. In areas like Los Angeles, San Diego, and San Francisco where Los Angeles home loans, San Diego mortgages, and San Francisco home loans require an enormous investment, good credit can carry the day and save the borrower a significant amount of money.

Credit Score Rankings

Credit scores range from 340 to 820, the minimum and maximum respectively. The higher the score, the better a risk the lender thinks you are. Generally speaking, scores 700 and over will get you the best loans, or as they say in home mortgage loan parlance "A-paper loans."

• 730 and up - Grade: A+
• 700 to 729 - Grade: A-
• 660 to 699 - Grade: B+ (A 660 score is adequate for some lenders to give the borrower an "A-paper" loan.)
• 600 to 659 - Grade: B and B-
• 550 to 599 - Grade: C
• 500 to 549 - Grade: C-
• 400 to 499 - Grade: D
• 340 to 399 - Grade: E

Scores are tabulated by combining all the information a credit report through a mathematical model, which in turn, forms a number that best represents the credit worthiness of a California home loan seeker. Each element of your credit report brings a certain "weight" to the calculation. Generally speaking, the structure is broken down as follows:

• 35% - Your Payment History
• 30% - Amounts You Owe
• 15% - Length of Your Credit History
• 10% - Types of Credit Used
• 10% - New Credit Tradelines

Be advised, this is not set in stone, but is I believe a good representation of how scores are tabulated. According to Yahoo, the average credit score in the United States is 678.

Key Credit Report Repair Info

Typically, the big three credit reporting agencies have significant overlap, but all three receive information from the various organizations that extend you credit. Such credit lines are called tradelines on your credit reports. The credit report is a compilation of tradeline activity, public records reporting, and payment history. The public records that are recorded on your report are:

• Tax liens
• Judgments
• Bankruptcies
• Mechanics liens
• Voluntary liens (that is mortgages, home equity line of credits, etc.)

In addition, the data of a credit report isn't only isolated to financial information. Credit reports also show any aliases used by the borrowers as well as different addresses. Generally speaking, the more tradelines you have open, the lower your credit score will be even if you are prompt in the payment of your obligations. It should be noted that the most damaging information besides a low score is a bankruptcy or a foreclosure. Next in line of credit degradation is 30, 60, and 90 days lates. These late payments shows up under a column.

The more you have, the worse it is for the borrower. The most fundamental aspect of credit reporting is for the loan agent to see whether you qualify for an A-paper loan (the best, cheapest loans), or a B, C, or D loan. If those don't qualify, Hard Money loans are the next option. The deeper you descend from A through Hard Money loans, the more expensive or high your interest rate. In fact, there is a whole cottage industry within the California real estate finance field for B/C lenders as well as Hard Money lenders.

It's essentially called Subprime loans. Subprime lenders require higher rates to compensate for their greater risk, as well as more points, but they also require usually a lower LTV (loan to value) on the property.

Typical Credit Report Information

The information on a credit report includes the following reporting information or sources.

Prepared For. This section will have the name, address, phone, and fax numbers of the specific mortgage broker requesting the credit report.

Sources. The redundant section informs the credit reviewer where the information came from: the credit bureaus along with their contact info.

Report Number. Each credit report is given its own indigenous number by the credit acquiring service. This number is needed for various reference purposes.

Borrower & Co-Borrower. The names and addresses of the borrower(s) are listed herein. The address of the borrower(s) is listed as well. (Note: If the borrower(s) has lived at their current address two years or less, the previous known address is listed.) The borrower's Social Security number, dependents' ages, ownership of current residence, whether borrowers own or rent, present employer, present position, length of employment, and current employment status are all delineated here. Now you can see why people refer it to "being on the grid." The information on the credit report is almost Orwellian.

Credit Inquiries Within Last 90 Days. If anyone has made an inquiry about the borrowers' credit within the last 90 days, this is listed here. Lenders will want to know why and if it affects the current debt ratios.

Public Records. Lists the tax liens, foreclosures, bankruptcies, judgments. Specifically, it identifies the file number, when it was filed, and whether it was satisfied. The plaintiff and the amount in question is also listed.

Creditor Information. This section makes up the bulk of a credit report. It includes open tradelines, closed tradelines, derogatory accounts. The sections and subsections show, type of loan whether revolving credit line, mortgage or home equity line of credit, or monetary loan, dates creditors reported activity, the current balance, maximum credit granted with a particular account, the date the account was open and closed, any amounts past due, etc.

The past-due tradelines are divided into groups of 30 to 59 days late, 60 to 80 days late, and 90 days or more. The most important section to the lender is the derogatory accounts. Even though there may be a derogatory, it doesn't mean the loan agent must seek a B or C loan. The first course of action is to see if it can be adequately explained and therefore removed. If not, then perhaps the loan agent must seek an alternative financing option.

Misc. Credit Facts

Do not take out a new loan, credit card loan, or auto loan when in the process of obtaining a California home loan. It will affect your debt-to-income ratios and could put a monkey wrench into the whole loan process and delay approval or even a disapproval. The rule of thumb? Wait until the loan is officially recorded before you take out the loan. (Loans in California typically record in the county office the day after the loan funds.)

Typically, a credit late is not recorded to your credit tradeline until it is 30 days past due. Most lenders give a grace period essentially for a month before they send the late information to the credit agencies.

One out of three credit reports have a mistake on them. Don't feel you have to accept it. You can petition the credit agencies to correct the mistakes. You will have to show clear evidence to prove your point. Also, be polite and patient. Rattling the saber, even if it's an egregious error, will only delay the accomplishment of your objective.

• The average score in the US is 678.
• Once you close a tradeline, it isn't always removed from your credit report in a timely fashion.
• It is illegal for anyone to obtain your credit report without your express written authorization.

Lenders usually take the middle score when verifying your credit score. In other words, they take the highest and lowest and throw them out as they generally esteem the middle score to be most representative of your credit worthiness.

Electric company, gas company, and rental apartments aren't reported to credit agencies. Personally, I've never seen that. However, to show promptness in payment of rent, a borrower can volunteer a VOR (verification of rent) or a letter from their current landlord to show their rent payment history.For what it's worth, to obtain a automobile loan, lenders usually want a 700 credit score or higher.

How Do I Improve My Credit?

How do you improve your credit? How do you go about credit report repair? The answer is simple: Make every payment on time. Period. Slowly, but surely, your score will improve. Expect a 500 score to improve to 700 status over a period of a year and a half, a 600 score to improve to 730 or above about a year at least. Don't worry about getting an 800 score. Anything over 730 is a guaranteed A-paper loan and will allow you to obtain consumer loans (or credit cards) of choice.