It can feel like a vicious cycle and often is. Getting out of debt and having financial relief may feel like an impossible task. This is how many people get their debt cancelled.
-Erik Kaplan
-Erik Kaplan
You have a credit card balance
You typically make minimum payments and rarely pay attention to the overall balance. It’s easy to get stuck in this financial trap, and long-term debt can hurt your score. As your credit utilization ratio rises, so can your credit damage.
You were denied for a loan
Loan denial alerts you to a problem with your credit or your financial situation. Use this opportunity to get the problem fixed. Your next step should be to take actions that will improve your credit score.
You occasionally forget to pay bills
Forgotten or late bills can send your credit score plummeting. You might think or hope that a small unpaid bill wouldn’t matter. Sadly, you’re probably wrong.
You have no credit history
If you’ve never had credit and don’t have a credit score, that doesn’t mean you have a zero credit score. You have the absence of a score: You’re “credit invisible.” THD Credit can help you begin your journey of establishing your credit.
You don’t know your credit score
If you subscribe to the “out of sight, out of mind” mantra just know it isn’t sustainable when it comes to credit health. This magical number says a lot about your credit worthiness. It can either save you money or cost you money. Keeping track of your scores is essential to the process of repair and maintenance.
Realizing you need credit repair is not a negative. In fact, consider the benefits and how it will positively impact your financial health in the future.
If your bank or lender thinks you are falling behind on payments, you may be receiving calls from a debt collector. These persistent calls can make a challenging financial situation even more stressful.
Understanding your debt collection rights is the first step in gaining control when you are on the receiving end of these calls.
Who is a Debt Collector?
A collector might be an individual, an attorney or a company, who typically receives a payment from your creditor for collecting on your overdue payments. This third party collector collects debts owed to your creditor.
What are Your Debt Collection Rights?
What is the Statute of Limitations on a Debt?
Every state has a statute of limitations that limits how long a creditor or debt collector can successfully collect a debt. Typically, the statute of limitations starts when you miss your first payment with the original creditor, not when the account was placed for collection.
If a debt collector tries to sue you after this time period has expired, you can raise the SOL as a defense against the lawsuit.
Can you Sue a Debt Collector?
Yes, debt collectors can be liable for trying to collect old debts. In 2011, in the case of Gonzales v. Arrow Fin. Servs., LLC, a $225,500 judgment was upheld against a debt collector who sent collection letters implying that payment would affect a consumer’s credit report. However, the debts were more than 7 years old, which by law cannot be reported on a credit report.
Additionally, a debt collector violates the Fair Debt Collection Practices Act by threatening to sue on a consumer debt after the statute of limitations has run and bars the suit.
Accounts in collections will affect your credit, which will impact any future loans or lines of credit you attempt to get. If you need help settling debts and putting a stop to harassing phone calls, give me a call or email me today.
-Erik Kaplan
The Federal Trade Commission (FTC) claims, one in four people have errors on their credit reports that could lead to lower scores and credit mistakes. Credit mistakes ending in merged reports is a whole other mess, that you definitely want to avoid.
Let’s look at the most common mistakes you are most likely to see on your credit report, and what they can mean for your financial security.
Inaccurate Personal Information
Your name, address and social security numbers are used to identify you to the “big three’ credit bureaus. Something as simple as a transposed or incorrect number on your social security number or having a similar name as a family member could result in you having a merged report.
A merged credit report is a report that has someone else’s information reported on your credit file. It is typically a mistake by the credit reporting agency or your creditors causing your information to merge with that of another.
This situation can lead to a handful of consequences including, costing you a mortgage, a job, or to pay higher interest rates.
Missed Loan and Credit Card Payments
A late payment could erase anywhere from 60 to 110 points, depending on your credit score. A common cause of inaccurate reporting happens when loan or credit card payments are mistakenly applied to the wrong account. Once disputed, late payments can be deleted by the original creditor.
Mortgage or Loan Listed Twice
Duplicate entries, or instances where a particular situation shows up more than one time, on your credit report can make it look as though you have more debt or credit issues than you really do, which can negatively affect your chances of getting a loan. This mistake often occurs when loans are serviced or sold.
Any of the above errors can create the appearance of a consumer having “too much” credit available, being over-extended, or not having been a responsible payer of his or her obligations.
As soon as you spot an inaccuracy on your credit report, gather documentation that proves the information is wrong and submit it to the credit bureau(s).
Fixing errors can be a tedious task that requires time and patience. If your not confident in your ability to take on this burden, call for a free consultation.
Working with THD Credit is a great idea to ensure your disputes are handled correctly and in a short amount of time.
-Erik Kaplan