5 Credit Repair Hacks that Actually Work!

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People often don’t realize the value of good credit until they really need it. Typically, it’s when they attempt to buy a house or open a new line of credit that people realize their credit score isn’t quite up to par. When that happens, the gut reaction is to race to fix their credit quickly. The good news is that raising your credit score is possible, regardless of your financial situation. However, this is a process that often takes time. Rebuilding a poor credit score can take months or even years.

Use these hacks to repair your credit score:

1. Pay Down Your Balance(s)

One of the best ways to raise your credit score quickly is to pay off a significant amount of your debts. Don’t just throw money at credit cards blindly, but be strategic about how you pay off your debts. A good way to do this is to look at your credit utilization ratio. This is the amount of credit you have used against the amount of credit you have available.

Example: if you have a $2,000.00 balance on a card with a limit of $5,000.00, your utilization ratio is 40%. Most experts suggest keeping your credit utilization ratio under 30%. If you are trying to increase your credit score quickly, you will want to pay off the cards where your credit utilization ratio is above 30% first. One of the best ways to do this is to make two payments a month. If you can swing it financially, making one extra payment a month can quickly reduce your overall debt and your credit utilization ratio.

2. Raise Your Credit Limit

Since we know your credit score is partly based on your overall credit utilization ratio, a quick way to lower that ratio without reducing debt is to see if you can increase your credit limit. In using the example above, if you have a $2,000.00 balance on a card with a limit of $5,000.00 (40% utilization ratio) and your creditor increases that limit to $6,500.00, your new utilization ratio will be at a more desirable 30%.

There are some important caveats when using method. You know yourself best: if you have trouble with overspending, this might not be the best choice for you. Also, if you have missed payments or have seen a steady decrease in your credit score lately, this will likely not work for you. In these instances, your credit card issuer may see the request for more credit as a sign that you are having a financial crisis. If you are a good customer with on time payments and your score is steady, this could be a good strategy to instantly boost your credit score.

3. Become an Authorized User

When rebuilding your credit, it is difficult if not impossible to get approved for a new line of credit. One way to get around this issue is to enlist the help of a trusted friend or loved one. If this person has good credit, they can add you as an authorized user on their current credit card account. This authorized status will show up on your credit report and boost your score.

IMPORTANT: When tying your credit to another person, you MUST make sure they are responsible first. The ideal candidate is someone who makes timely payments and keeps their balance low. If you tie your credit to someone who makes late payments and carries a high balance, you could end up lowering your credit score.

4. Consolidate Your Debt

There are two different kinds of debt: revolving debt and installment debt. Credit card debt is revolving debt, where the balance changes with each new purchase and payment. The FICO formula that determines your credit score favors installment debt, like loans, because this kind of debt tends to be more stable. Thus, consolidating your credit card debt into a personal loan can really give your score a boost. Personal loans also tend to have a much lower interest rate than credit cards, so you will end up paying less money in the long run.

5. Mix Up Your Credit Portfolio

Having a wide array of different kinds of credit is a good way to boost your score.  If you find you only have credit card debt, taking out a personal loan or a car loan isn’t a bad idea. While your credit mix is only 10% of your total score, diversifying your credit can give your score that extra boost it needs to go from “fair” to GOOD. It should be noted that this is a long term approach to better credit and should not be used by those who need an instant boost for an impending big purchase or financial change.

These tips and tricks can give you the boost you need to finally achieve excellent credit. If you are struggling to manage your debts or get your credit score where it needs to be, the team at Veitengruber Law can help. We offer personalized credit repair options to fit your financial needs.

 

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Getting Nowhere with Your Debts? You Need a Debt Resolution Plan!

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If you find yourself burdened with unmanageable credit card debt and struggling to make minimum payments each month, Veitengruber Law’s debt resolution services may be the perfect option for you. Following a debt resolution plan can be an effective strategy for anyone who has experienced a financial hardship like divorce, job loss, a significant reduction in household income, or medical debt resulting from serious accident or illness. Our team is experienced in debt management solutions and creating effective debt resolution plans.

George Veitengruber is an attorney with a strong focus on finances. All of our team members understand the personal heartache people can experience from overwhelming debt. We work toward real and appropriate solutions that provide relief and peace of mind for our clients. We will sit down with you to review your income and expenses and evaluate your debt to get a blueprint of your finances. No two people have the same debt issues and there is no one-size-fits-all solution to debt issues. We provide individualized advice for each client. Bankruptcy is not the only option for people seeking debt relief, and we will never push you into bankruptcy if that is not your best option.

Debt resolution can be an excellent alternative to bankruptcy or debt settlement. After we sit down with you to get a clear understanding of your financial situation, we can create a comprehensive budget that will allow you to get a handle on your debt. We will also use that budget to negotiate with creditors on your behalf. We will work to settle on new payment terms with each individual creditor, negotiating to eliminate penalties, reduce interest rates, and secure lowered monthly payments. The goal of a debt resolution plan is to resolve your debts for less than what you owe on your outstanding balance and to create a payment plan you can more easily manage.

There are some major incentives to working with an attorney to create a debt resolution plan over other debt settlement services or trying to manage debt alone. While your overall score will still likely drop at least slightly, our debt resolution services have the potential to limit damage to your credit score. Because you can continue to pay creditors throughout the negotiation process, there is little opportunity for late payments to further decrease your credit score. Veitengruber Law can also negotiate with creditors in how they report the payment of the debt, working with creditors to ensure your credit score is impacted as minimally as possible.

Another major benefit to debt resolution is the support you get from a qualified, experienced attorney. Our legal team can use their knowledge of the financial world to negotiate on your behalf. Creditors are more likely to take an attorney seriously and an attorney can assure your creditors are working in your best interest. We know all the tricks of the trade and how to work the situation in your favor. When you work with us, you know you will receive the quality know-how and financial expertise you deserve. Our advanced knowledge and years of experience also means less time spent negotiating with creditors, ensuring that you will start paying off debt sooner rather than later.

Don’t wait to start working on a solution to your debt troubles. Call us today to arrange a free consultation with a debt negotiation lawyer. Our comprehensive approach to debt resolution will allow you to breathe easier again. We can work with you to create an individualized debt resolution plan that works for you, helping you tackle unmanageable debt and avoid further financial troubles.

Divorce Doesn’t Have to Ruin Your Credit Score!

While the act of separating and/or getting divorced from your spouse won’t affect your credit score on its own, it is likely to cause indirect damage to your finances. So, while there won’t be a giant mark on your credit report that says “GOT DIVORCED, automatic 100 point deduction,” your score can and will begin to drop after a divorce if you aren’t hyper-aware of the potential damage.

In order to take proactive steps to maintain a good or excellent credit score during and after a divorce, you first have to know what you’re up against. Some of the biggest factors that cause divorcees financial strife include:

  • Suddenly dropping from two incomes to one income
  • Joint debt that goes unpaid by your soon-to-be ex-spouse
  • Shared bank accounts that can be drained by either party
  • Spiteful actions of one spouse, like running up a joint credit card balance
  • Lack of an independent financial identity and/or credit history
  • Divorce expenses
  • Child support and/or alimony

Even if the split is something that will ultimately make you happier, the process of getting to that end goal is undoubtedly going to be stressful. It is much easier to miss a bill payment or make other financial errors when you are stressed to the max.

Why is My Credit Score so Important After Divorce?

Losing a few credit score points shouldn’t make or break anyone, right? In many situations, this may be true. However, for those people who are going through a divorce, maintaining a solid credit score is IMPERATIVE.

You may need to buy or rent, initiate utility services for, and completely furnish a new home. In order to do so, your credit must be fair to good at minimum (ideally in the upper 600s or above).

Additionally, many divorcees seek higher-paying jobs in order to make up for the second income that was lost in the split. These days, it is common practice for employers to check the credit history of all potential hires before extending a job offer. If your score tanks during or after your divorce, it may prove difficult to make even a lateral employment move.

What Can I Do to Maintain a Good Credit Score After my Divorce?

As soon as you know that divorce is in the cards, your first move should be getting a current credit report from each reporting agency. This will allow you to know precisely what debts and recurring payments are officially your responsibility as opposed to your spouse’s.

“Knowledge is power, but only wisdom is liberty.” ~ Will Durant

After you have current credit reports in hand, it’s important that you take smart action based on the information contained in your report(s). For example, you may not have realized that your spouse listed you as an ‘authorized user’ on a credit card. If the card’s balance gets maxed out due to extra expenses during your divorce and your ex-spouse stops making payments, you could be held responsible for the balance. In addition to removing yourself from any joint accounts, you should:

  • Create an amended budget using your adjusted spending limit.
  • Make it a priority to make all of your payments on time.
  • Closely monitor any accounts that you’re unable to separate immediately.
  • Get educated on the topic of good financial habits.
  • Seek the help of a financial advisor or NJ credit repair attorney, if needed.

 

 

 

 

How Much is Your Credit Score Costing You?

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Do you know how much money your credit score might be costing you? If you have a good to excellent score, you don’t have much to worry about, but if your score is in the ‘poor’ or even ‘fair’ range, your jaw will drop when you learn how much money you’ll potentially be throwing away.

Most people understand, at least on some level, that your credit score can have a significant effect on your ability to buy a house, a car, and potentially rent an apartment. A really low score can conceivably affect your potential job prospects, depending on what field you’re working in. Even if you comprehend just how far-reaching the effects of your credit score are, do you fully grasp just how much money a lower score is going to cost?

Generally, the following guideline holds true:

781-850 = Excellent credit
661-780 = Good credit
601-660 = Fair credit
501-600 = Poor credit
Below 500 = Bad credit

FICO scores are calculated by pulling information from different areas of your financial history. Smart financial decisions as well as money mistakes are both taken into consideration when formulating your credit score. Your payment history (if you’ve had any late payments and how many), how much debt you carry in relation to your available credit and income (debt-to-income ratio), the length of your credit history, the number and types of credit you use, as well as any new applications for credit – all have an effect on your overall credit score.

Every lender may potentially have a slightly different credit score chart, but for the most part, if your score stays above around 760 or so, you’ll be eligible for the best interest rates everywhere. Want to buy a car or a home? With an excellent credit score comes an excellent interest rate.

The same holds true in reverse, as well. A credit score that falls into the ‘good’ range will grant you a decent interest rate, but not the best. Maintain a ‘fair’ credit rating (in the mid-600s), and you’ll likely still be able to borrow money, but at an incrementally higher interest rate. Poor credit? Qualifying for a substantial loan will be exceedingly difficult, and if you do qualify, your interest rate will be sky high.

Just How Much Money Will a Low Credit Score Cost Me?

Ok – imagine this. You’ve maintained what you consider to be a ‘decent’ credit score – around 650, give or take. According to FICO and most lenders, your score falls into the ‘fair’ category, which means you likely made a few poor money decisions in the past, along with some responsible choices, as well.

Let’s assume you decide to purchase a home, maintain a vehicle, and have several credit card balances that you make regular payments on. When you are approved by the aforementioned creditors, you’ll receive an interest rate that may seem reasonable. However, over the course of your lifetime, the interest that accrues at your rate can add up to a SIGNIFICANT amount of money.

How Significant?

If you’ve purchased an average home in New Jersey, you’ve likely borrowed at least $300,000. Buying a car every few years tacks on an additional $120,000 – $160,000 in borrowed money. With a ‘fair’ credit score, you’ll be paying out around $285,000 in interest alone!

Borrowing the same amount of money with a ‘good’ credit score, you’d pay somewhere around $239,000 in interest – a savings of $46,000. An excellent credit score would save you even more money in interest – around $70,000.

When you break it down like this, it’s really easy to see just how important it is to have a great credit score. The savings in interest alone should be enough to motivate you to take the necessary steps to raise your score as high as you possibly can.

 

 Image credit: Jason Rogers

A Perfect Credit Score: Is it Attainable?

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If you’re the type of person who strives to achieve perfection in everything that you do, you may be wondering if it’s possible to attain (and maintain) the highest FICO credit score possible: 850.

Perhaps an even better question would be: Is it necessary? Most financial advisors and credit counseling attorneys in NJ say no, you do not need a perfect credit score. However, they most definitely wouldn’t try to talk you out of trying, if a perfect score is what you really desire. After all, it could be kind of fun to see just how high you could get – right?

While anyone with a score above 760 is going to be eligible for the best rates, some people get a thrill out of watching the causal relationship between their good financial decisions and a rising score. It’s kind of like a reward for good behavior!

What Can I Do To Get a Perfect Score?

If you want to take the Credit Score Challenge – there are a few simple rules to follow in order to get where you want to be.

  1. Keep a close eye on your overall credit utilization. In plain English – keep your credit card balances under 30% of your TOTAL credit availability. Using more of your available credit makes it seem like you rely too much on credit cards rather than cash. Each time your credit utilization percentage goes above 30%, your score will take a hit.
  2. Pay all of your bills in full and on time. This includes your credit card bills, but also all of your other monthly expenses – from your rent or mortgage to your water bill. Keep current and timely, because the alternative will get marked on your credit score and will bring your score down a few points each time you’re late.
  3. Don’t open new lines of credit unless absolutely necessary. Every time you apply for a new credit card, or a new loan, the lender will request a copy of your credit score. This type of request is known as a ‘hard inquiry,’ and the reason they’ll knock your score down is because applying to borrow money implies that you’re in financial trouble. Each time a lender does a hard inquiry, imagine a little “Ping!” going off at the FICO office. It’s a little alert to them that you may be struggling.
  4. Check your credit report often. Doing so yourself will not affect your score at all, so feel free to check it every day if you want to! The main reason you should keep an eye on your credit report as well as your score, is to make sure that you’re doing things right. If you’re not, you’ll only know about it if you check your score! It’s also a good idea to be vigilant about looking for any errors on your report. It happens all too often, and if there is misinformation on your credit report, having it removed will boost your score right away.

Honestly, credit score researchers say they rarely see a perfect credit score – and most say the highest they’ve seen is around 845-847. Even if you manage to get your score into the upper levels, the most difficult part may be keeping it there. In that range, even the tiniest misstep will negatively affect your score much more so than for those with a moderate score, because their mistakes have already been accounted for.

Whether you’re interested in achieving the perfect credit score, or simply improving upon your current number, you can always seek out the help of a professional in the credit repair field. Avoid credit repair agencies if they promise you “a completely new credit history” or a dramatically increased score on the spot. These things are impossible to achieve and anyone who promises them is using illegal tactics.

If you’d like free legal advice on how to raise your credit score the right way, and how your score affects all of your financial decisions, come out to the Manalapan Township Library in Monmouth County on March 11, 2015 at 7pm. Veitengruber Law will give an informal, hands-on, FREE workshop that will teach you short term and long term ways to raise your credit score, how to more effectively manage your money, and how to set up a budget that works.

 

Image Credit: Bruce Berrien

Where Can I Get Free Credit Repair Help in New Jersey?

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If you or someone you know is dealing with relentless creditors, unmanageable bills, outstanding student loans, or a variety of other factors that can negatively affect your credit score – you need a new plan.

You’ve probably already acknowledged that your current financial plan is not working for you, and you may be wondering what step to take first to get the ball rolling in the right direction.

“Legal Advice is Too Expensive!”

If this is the mantra that has been keeping you from getting the help you need, you’re in luck. We realize that retaining an experienced attorney can be intimidating at first! In order to make the process less formidable, Veitengruber Law has decided to provide a series of free, (yes you read that right – FREE) educational workshops throughout Monmouth County and northern Ocean County during 2015.

All of our free legal workshops are open to anyone and everyone. Please feel free to bring a friend, family member or neighbor, who may have similar financial questions or concerns, along with you. All are welcomed and encouraged to attend.

Our next event is coming up soon, so mark your calendars now. The details include:

What:   ‘Your Credit Report & How it Affects Your Financial Decisions’ – a FREE informational workshop

When: March 11, 2015; 7:00 – 8:30pm

Where: Manalapan Township Library (Monmouth County Headquarters); 125 Symmes Road, Manalapan Township, NJ 07726

Why: In a casual format, Mr. Veitengruber will address the following: the far-reaching effects of your credit report and score; how credit reports work and how to properly read and understand yours; when and how to report and correct credit report errors; short term and long term ways to raise your credit score; and how to more effectively manage your money and set up a budget. You will be provided with materials, samples, and other resources so that the workshop is interactive.

Who: Presented by George E. Veitengruber, Esq.

Cost: $0

RSVP: To reserve your space, call the Manalapan Township Library (Monmouth County Headquarters) at 732-431-7220 x 7222.

Prior to the workshop, it is recommended that you request a copy of your current credit report (and score, if you so desire). Remember: requesting your own credit report will not affect your score at all! Come out to the workshop prepared with your credit report and a list of questions that you would like to have answered by an experienced credit repair attorney at NO COST. If you do not bring a copy of your credit report, you will be provided with a sample report to work with during the seminar.

These workshops are provided as a service by Veitengruber Law because of our strong desire to help people like you get out of financial trouble. George Veitengruber specializes in credit repair – along with bankruptcy, foreclosure defense and loan modification. He also deals with issues regarding: real estate, debt collection, estate planning, contract disputes, and adoption. At the end of the workshop, Mr. Veitengruber will be available to schedule you for a free one-on-one follow-up meeting, should you have additional questions that you’d like to discuss in further detail or privacy.

Free legal advice in New Jersey? It does exist!

There is absolutely NO obligation for attending. Our only desire is that you to walk away from the workshop with KNOWLEDGE!

Image Credit: Tax Credits

Protecting Your Credit Score: A Free Legal Workshop 10/23/14

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As you have probably already realized, the numbers and information contained in your credit report and credit score affect a lot of financial decisions made in your life, both by you and others (including lenders, employers, landlords, etc).

If you are struggling financially and your credit score is suffering, there are things you can do to make significant and substantial improvements to that number. There may also be errors on your credit report which may be bringing your credit score down further.

Understanding how to read a credit report is the first step to managing your money better. If you have the desire to get a handle on your finances, but have been wondering what the next step is for you, come out to our 100% free informational workshop presented by George Veitengruber, Esq., a New Jersey certified attorney who specializes in credit repair. The workshop details are listed below.

When: Thursday 10/23/2014 at 7:00 PM – 8:45 PM

Where: Howell Public Library – 318 Old Tavern Rd., Howell, NJ   07731

RSVP: To reserve your space or if you have any questions, call 732-695-3303 or send an email to: ivyjacotlaw@gmail.com. You can also send an inquiry via this link.

To reiterate, this workshop is completely free of cost to you and its main purpose is to inform the audience about: how to properly read and understand a credit report, repairing and improving your credit score, how to report and correct credit report errors, and how to get better at managing your budget.

George Veitengruber, who practices law in Ocean Township, New Jersey, will be the presenter of this interactive legal workshop. George practices law in the areas of: credit repair, bankruptcy, foreclosure defense, real estate matters, loan modification, debt collection, contract disputes, estate planning and adoption. During the workshop, George welcomes questions in any of those legal areas as well.

Come prepared with your most important legal or financial question(s) and prepare to have them answered free of charge! Bring a friend or friends – everyone is encouraged to attend.

Image: Veitengruber Law

NJ Foreclosure – What is a Deficiency Judgement?

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Millions of Americans today are swimming in an unbelievable amount of debt. Many of them have taken appropriate steps to resolve their debt in the hope of staying afloat without an albatross weighing them down.

One effective debt resolution strategy is to file for NJ bankruptcy, which either wipes clean (Chapter 7) or reorganizes (Chapter 13) all monies owed. While filing for bankruptcy does affect one’s credit score, after 7-10 years, neither a Chapter 7 or a Chapter 13 will appear on a credit report. This gives the debtor a shot at a financial “do over,” so to speak.

Many people who file for bankruptcy also allow their home to be sold via foreclosure. Once again, while not ideal for your credit score, a foreclosure allows significantly distressed homeowners a way to rebuild their finances.

In a foreclosure, the homeowner essentially gives their home to the bank or lender in exchange for not making any further payments on the mortgage. Since the bank then has full possession of the defaulted property, they can sell it at a foreclosure auction, during which the home is auctioned off to the highest bidder.

Because foreclosure auctions involve cash payments, the house usually sells for a lot less than was owed on the mortgage. In the past, it was typical for lenders to “write off” the discrepancy between the sale amount and the amount that was still owed. Most banks felt it was bad business to chase down former homeowners who were already in dire straits, so they settled for the amount they received from the foreclosure sale and that was the end of the story.

Due to the recent housing crisis, lenders have been losing more and more money (exceeding $1 trillion), and some of them have decided to take action against borrowers who had their loans foreclosed upon.

To do so, lenders can go to court and receive a judgment for the amount of the deficiency between the sale price and amount owed on the mortgage. This judgment is called a Deficiency Judgment.

More lenders are beginning to pursue Deficiency Judgments in order to collect on money they’ve lost through foreclosures, which means that many people who have just begun to get a solid foot-hold financially will essentially be slapped in the face. Making it all the way through bankruptcy court, giving your home up to foreclosure sale, only to then discover that you still owe tens of thousands of dollars can be utterly devastating.

Many years may have passed since you’ve even given a single thought to your former home when you discover that your wages will be garnished or that your checking account has been frozen until you pay off the Deficiency Judgement.

Fortunately, there is recourse. Although it may feel like your foreclosure was a thing of the past, a Deficiency Judgement is not something that can be ignored.  You need a NJ foreclosure defense attorney on your side. Veitengruber Law is here to help you defend yourself against lenders you thought were completely in your past. Call now. (732) 852-7295.

Image credit: Dustin Gaffke