On November 3, 2015 I published a log and referred to a former client of mine whose credit was ruined when he purchased items with his credit card and had to return them. He contacted the credit card company by phone and asked them to rescind the charges which they neglected do. When he subsequently refused to pay the charges the credit card company posted his account on his credit report as delinquent. His credit was then ruined and he spent months trying to correct the problem.
Big news!! Federal regulators and Congress are pressuring the major credit bureaus to adopt more inclusive scoring models into their systems and include non banking forms of credit. They are proposing that items such as rent and utility payments be included in the formulas, not just mortgages, car loans, and revolving credit devices like credit cards. The goal of the proposed legislation is to expand the scope of the scoring system so that individuals and families that don’t use revolving credit as much can have a better opportunity to qualify for mortgages.
In my many years of working in and around government I have been continually frustrated with the maze of bureaucracy and its constant growth. When I look at how many State and Federal agencies are listed in the various directories I often wonder how and why they were conceived and what the people who work there actually do!!
A credit report is like a thermometer. It reflects a credit profile at a point in time. Depending upon your credit history it may contain both a positive side and a negative side. In order to significantly improve or maintain a credit score, both sides must be dealt with equally.
A husband and wife in their late fifties come in to the office with a problem. All of a sudden their interest rates in their credit cards went up without warning. They were generally frugal people who used the cards conservatively and couldn’t understand what happened. I pulled their credit report and found three unpaid medical bills. The bills were from tests the husband had submitted to as part of treatment for an illness. I don’t understand, the husband said, I thought my insurance had covered those tests!!
Last week I opened my monthly statement from my Discover card account and made an interesting discovery. Those of you that have this card know that Discover now monitors your credit score monthly and prints the number on your statement. So I looked at the credit score on my statement and immediately noticed that it had dropped thirty points from the previous month.
In our previous blog we talked about how your credit info can be mixed with another person’s credit history in your family if they have the same name. Actually, they don’t have to be related to you as long as they live close to you. For example, in the same community of even in the same county.
In my last article I quoted chapter and verse of the Fair Credit Reporting Act (FCRA) that pertains to the dispute process. Before you get involved with disputes the three major credit repositories and the bureaucracy of the credit industry you should be familiar with the federal laws that explain your rights as a debtor. The other two are the Fair and Accurate Credit Transactions Act (FACT) and the Fair Debt Collections Act. They form the basis of your rights as a debtor and the procedures for exercising those rights.