How to Improve Your Credit in 2010

Your credit rating is more important in 2010 than any other year in recent memory. There is less available credit than any other time in recent history. Credit card companies launched a massive wave of cut backs. You may have noticed your available balance was slashed overnight.

It is now even more difficult to be approved for a home mortgage. In order to be approved for a mortgage today, you must now have a minimum credit score that is 40 points higher than a few years ago and, if you are hoping for reasonable rates, you will need a minimum score in the high 600′s.

You can rest assured that it will be almost impossible to obtain new credit in 2010, especially if your credit score isn’t up to par.

What this means is that you need a plan to get your credit in top shape for the new year.

I spent several hours last weekend writing down my financial goals for 2010, which included my FICO score goal of 775.

I hope that you have decided on some financial goals for yourself. Once you have made a list of goals, you will need a plan for obtaining success. Erasing negative items from your credit report and improving your FICO score should be included in your overall strategy. A formula for achieving these goals follows:

Credit Strategy #1: Questionable Negative Items Should Be Deleted From Your Credit Reports

You should immediately attempt to remove any questionable late payment, repossession, collection, charge off, bankruptcy, or other negative item, by disputing the information.

To accomplish this, you can use the dispute form letter which you will find here.

Sometimes, items such as judgments, charge offs, and repossessions are particularly stubborn to remove from your credit report. As these items have a tendency to be a bit more “sticky,” you may require something more forceful than a standard dispute letter.

You might consider a process called “debt validation” where you demand that the original creditor validate a debt. (It’s a lot different than disputing with the bureaus – yet super effective for removing collections and charge offs.)

It is probably best not to attempt debt validation on your own. I tried to do it myself and failed miserably. In fact, I did such a poor job that the creditors just ignored my correspondence altogether.

Credit Strategy #2: Build Good Credit

The good news is that this is easy to do if you already have an unsecured account. Keep paying those accounts on time. In fact, I suggest setting up an auto payment system so you never slip up. Plus, this saves postage so you are saving twice!

However, if you don’t have an unsecured account, like a MasterCard or Visa, it can be a bit more difficult. If your credit score is in the 500 range, it will be hard to obtain an unsecured card.

Credit Strategy #3: Stay the Course

Don’t lose sight of your goal and what you want to accomplish. Rebuilding your credit will take time. The sooner you get started the better. It is wise to keep track of your credit score by maintaining a detailed log. Begin your log by noting your credit score as of today’s date and tracking it as you rebuild good credit and as questionable negative items are removed. If you are successful with your goals, your credit score should increase each month.

Don’t become down-trodden if things don’t work out the way you think they should. Different strategies may be available to tackle an issue.

We raised our credit scores from the upper 500 range to 745 and 763 in under six months and got approved for our dream home. See proof of our credit repair success at www.creditforcouples.com

Obtain Your Credit Report Today

Requesting a copy of your credit report is easy and is the first step toward rebuilding your credit. Read on to find out how to obtain a copy of your credit report and to learn some of the benefits of reviewing your credit history.

A credit report will help you rebuild your credit and this is the most common reason people request a copy of their credit report. A person’s financial history is listed in its entirety on their credit report. The entries will include identifying information, payment history, and credit accounts. A quick review of your credit report will let you know if all of the information recorded is accurate or if there are some inaccurate or false entries. Any inaccurate or false information listed has already affected your credit score.

You can dispute any inaccurate or false information you discover on your credit report. To do so, you will need to send a dispute letter to the credit bureau requesting the correction of the disputed item. The credit bureau then has 30 days to obtain verification of the recorded information. If the credit bureau does not receive verification of the disputed entry, it must delete the entry in its entirety. If this happens, your credit score should increase.

Credit reports are also helpful for finance and budgeting purposes. Obtaining your credit report allows you to view your credit status in one neat, concise report. A credit report can allow you to determine if you should work to consolidate your debt and can assist with prioritization of payments.

Identity theft is another reason for requesting a copy of your credit report. By obtaining a copy of your credit report you will be able to compare your knowledge of your recent credit transactions against what has been reported to the credit reporting agency. Identity theft is a very real concern and threatens a person’s credit worthiness in addition to their financial situation.

Your credit report can be obtained several different ways. There are internet companies that offer copies of credit reports and you can contact one of these companies. Alternately, you can contact one of the three major reporting agencies – TransUnion, Experian, and Equifax – for a copy of your credit report. Pursuant to Federal law, these major credit reporting agencies are required to provide you with a copy of your credit report, free of charge, once every twelve months. To request a copy of your free credit report, you can call Annual Credit Report at (877) 322-8228.

It is wise to obtain a copy of your credit report. Request yours today and when it arrives, sit down and review it for any inaccuracies so you can begin to rebuild your credit.

Free 19 Page Collection Agency Deletion Guide at www.MidlandCreditDebt.com.