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Credit Repair Efforts That Count by Jim Kemish Opening Fresh Revolving Accounts The number one most effective credit repair strategy for anyone that has been through a period of bad credit is opening fresh revolving accounts. Nothing can rocket your scores upward, faster and farther, than a couple of new credit cards. Why does this work so well? It seems that FICO is ready and willing to reward those who prove that they are capable of a successful reentry into the world of credit. Of course you need to manage those new accounts properly. Managing Your Balance to Limit Ratios Once you have your new accounts open you must resolve to manage them in a meticulous manner. And this involves more than just making your payments on time, although that too is critical. As urgent is the way you manage your balance to limit ratio. This is the relationship between your balance and your account limit as they are reported to the credit bureaus. For credit repair purposes you should try to use less than 20 percent of the available limit. Becoming an Authorized User Another phenomenal credit repair technique that is capable of producing dramatic credit score improvement is the tried and true method of becoming an authorized user on a credit card that belongs to a friend or family member that has excellent credit. The key to success, and the factor that will determine how much of a score boost you get, lies in three criteria: the age of the donor account, the payment history, and the way that the donor manages their balance. The best accounts will be older than three years, have never had a late payment, and have a consistently low balance. Stomping Out Bogus Collections A phenomenon that has grown into a virtual plague in recent years, and one that can be effectively contained by credit repair, is the prevalence of inaccurate collection accounts. These accounts may include debts that were previously paid or settled but have somehow come back to life and often referred to as zombie debt or zombie collections, debts that belong to another person, and even those resulting from identity theft. These can be challenged and removed through credit bureau disputes and debt validation under the FDCPA. Scrubbing Errors And let us not forget the most traditional, reliable, crowd-pleasing mainstay of credit repair, the credit report clean up. This amounts to sending letters to the credit bureaus to challenge all of the derogatory information that you believe to be inaccurate. Credit reporting errors are massively common, and for many people a few months of disputes can cause a near complete credit report transformation. Patience may be called for, as the bureaus can be stubborn and may put up unfounded resistance, but stand your ground, repeat your efforts as needed and you will be amazed at the results. Consulting an Expert When it comes right down to it, you may be best off hiring a credit repair service to guide you through the credit maze, and to manage the more mundane day-to-day tasks involved in the process, like sending and resending the dispute letters to the bureaus. Credit improvement can be critical to your financial well-being and must be done properly. If you find yourself confused or at a loss just reach out for help.   © 2010 Jim Kemish is the president and founder of Sky Blue Credit Repair, a leading credit repair service. Sky Blue Credit has been dedicated to providing intelligent customized credit solutions since 1989.

 

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