It's Up to You
Do you forget that you have credit? When was the last time you looked at your credit reports in detail? Jim Kemish is the president of Sky Blue Credit Repair and an expert on credit repair. In this video, he talks about mistakes in the credit reporting system and how they might affect your life.
Credit repair is a Game with High Stakes
Your finances depend on what's in your credit report. When you apply for credit, at least one of the three bureaus will check your report. Your ability to get a loan and how much you will pay in interest will depend on what's in your report. Your monthly payment, in turn, will be based on the interest rate. Higher rates mean that your payments will be higher, and higher payments make it harder for you to save money and enjoy the security that comes with building wealth. Any legitimate credit repair company should try to fix your credit so that it meets the highest standards of lenders and makes your financial life better.
Some Wonderful Numbers
Did you know that each of the three credit bureaus keeps records on more than 200 million Americans? Each person's credit file has information about their credit cards, auto loans, mortgages, collections, public records, and more, including their history and current status. Current accounts need to be updated every month, and their accuracy depends on millions of creditors and other data providers doing their jobs right. The sheer amount of information is crazy.
How Much Mistakes Cost
Credit bureaus handle a lot of information, so it's not surprising that mistakes happen. But how do you feel about it? According to the National Association of State PIRGs, a nonprofit public interest advocacy group, 79 percent of all credit reports have mistakes, 54 percent of all credit reports have personal information that is out of date, belongs to a stranger, or is otherwise wrong, 30 percent of all credit reports have accounts that the consumer has closed but are still being reported as open, and 25 percent of all credit reports have errors that are very serious. As a person who works to fix people's credit reports every day, I can attest to the fact that mistakes are common. Is everything on your report correct? The odds are against you.
Russian Roulette
Between the 79 percent of people with mistakes on their credit reports and the 25 percent who will be turned down for credit because of those mistakes, there are a lot of people who will be put in a lower credit class and have to pay a higher interest rate than they should. Many of these people will never know that their loan rates are going up by one or two percent without their knowledge. Let's break down the numbers. There are mistakes on the credit reports of 158 million Americans, or 79%. 25 percent means that 50 million Americans will be turned down for credit because of mistakes. There are 108 million Americans in the large middle group who may be paying hundreds of dollars more each month because of mistakes in the way credit reports are made. What do you think? If you don't pay attention to what's in your credit report, you're playing Russian roulette with your money. If you are like most people, repairing your credit can pay for itself a hundred times over if you do it right.
Statistics That Don't Add Up
I've been in the credit repair business since 1989, and I've come to the sad conclusion that people with real credit problems, like those who have missed payments, fallen behind, or stopped paying on a debt, are more than twice as likely to have serious mistakes on their credit reports than the average person. In other words, the chance of making mistakes gets a lot worse for people who can least afford it. What is going on? When an account falls into a derogatory status, it is no longer in the mainstream. The creditor often moves the account to a different department. The creditor's name may be reported slightly differently, and account numbers may be changed. If the account is charged off and sent to a collector, it will almost certainly show up on your report twice or even three times. Over time, collection accounts change hands. When this happens, the start date of the statute of limitations is often lost, and the accounts continue to be reported long after they should have been closed, sometimes as if they were brand new.
Getting back on track with credit repair
Have you had real problems with your credit? Are you trying to get better from these problems? The good news is that if you know how to fix your credit, you can get rid of the mistakes on your report and get the fair chance you deserve. Do you know that you can get a free copy of each of your three credit reports once a year? Go to AnnualCreditReport.com, which is the only place where you can get your reports for free and with no strings attached. Look at the reports. Call someone who knows how to fix your credit to talk about it. Today, take charge. It's your right, and nothing can have a bigger effect on your money than this.
All content is owned by James W. Kemish and all rights are reserved.
