You see it every day in the newspapers and on TV. Foreclosures are on the rise, bankruptcy filings are increasing and more companies are either going out of business or laying of employees. For many, this is a difficult time in their lives and they are unsure what their options are and which way to turn for help. This is especially true for areas of the Rust Belt such as here in Northwest Indiana.

Enter the dirtballs! Because this is a family blog, I’ll be gentle, but there are a lot of bad people out there that take advantage of those in distress. Those who would gladly steal the last dime a family has and go on to the next person in line.

Let’s talk for a minute about credit repair companies. The topics of loan modification, foreclosure rescue, debt modification and others will have to wait for another day.

Doing a Google search on “credit repair” turned up 17,600,000 entries. While most are operating within the confines of the law, there are quite a few who are not. For instance, if you see the word “guarantee” in their advertising in the form of “we guarantee to erase your bad credit”, you need to avoid them, as the Federal Trade Commission (FTC) has them on their radar. Also, if the company is charging in advance for a “set-up fee” or other fees, avoid them also. With a couple exceptions, they are not supposed to be paid until after the disputed items are removed or the agreed upon work has been done.

The other issue is not quite as black-and-white. While these companies generally operate within the law, the results they get are limited and often times very slow. For example, quite a few companies will send dispute letter after dispute letter to the credit reporting bureaus hoping that they are lucky enough to have the bureau be unable to validate the information or that the creditor does not respond in the legally allowed amount of time so that the item in dispute must be removed from the credit report. While this can sometimes be effective, it is more than likely to not be effective or even have the item be re-reported once the creditor verifies it. Continued use of this technique can get future disputes from that client labeled as “frivolous” and may be discarded by the bureaus without any action being taken.

One other problem that I will discuss is the lack of credit can also be an issue. If the company removes all or even some of the negative items by having the tradelines deleted, it can actually lower the credit score if there is no positive information on the report. It is possible that some bad credit can be better than no credit at all.

I recommend a company called USCCRA to my clients. After spending some time looking at their business plan, here is why:

• The disputes are all handled by attorneys that specialize in credit repair. They understand the laws and will dispute each individual item separately, instead of sending in multiple disputes claiming they are “not mine”.
• The attorneys have the bark AND the teeth to litigate if necessary. While it rarely becomes necessary, they are not intimidated by the huge dollars that the big companies throw to their legal teams.
• While the average client will see a 120+ point improvement in their scores in about six months, there is no “guarantee” that any item will be removed. Their warranty states they will keep working for you until you are happy with the results.
• Most importantly, they will assist the client in getting a checking account, credit cards and other forms of positive credit to help build a positive report while the negative items are being disputed. And, because you are joining an association, you have access to these and many more benefits for 12 months. 

While I could go on, I recommend that you visit the website to get a feel of what they can do. Don’t take it from me, check the site out for yourself and see what others are saying about the program.

One word of warning… you may not be a fit for this program. While other companies will take your money and act like they are helping you regardless of your situation, this program is really designed for those who have had financial issues in the PAST and are currently past them, but are being held back by poor credit scores. If you are in the middle of a bankruptcy, a foreclosure, or are unable to pay your current bills, contact me and I will try to point you in the right direction, but credit repair is not for you at this point. Once you are on the road to recovery, then credit repair can help! 

I hope this has been helpful. If you have other topics you would like to see addressed, please let me know. You can email me at scott@nwiloanguy.com.

Scott

Scott Swinford, your Northwest Indiana Loan Guy

Your source for Indiana FHA loans, Indiana FHA 203(k) Streamline loans, Indiana USDA Rural Development loans, and much more.

Credit Issues? Not an issue for us! Visit www.usccraonline.com and register to get $300 in gasoline.