A company that I recommend over and over is Merchant Express. I recommend them for many reasons:

-Merchant Express allows for multiple forms of credit card processing: Internet Processing, POS terminals, Wireless (cell phone or standalone terminals), Phone processing, Quickbooks processing, and software for your PC or terminal.  This makes it possible to accept credit cards for so many people.  Whether you are mobile and use a wireless terminal or your cell phone, if you are at someones house and use their phone or if you are able to set up a computer at a fair.. you can accept credit cards. It is a well known fact that people buy more when they can use their credit cards!

-They are in their 12th year of business.  This shows they are a stable company which is important.They were one of the first companies to offer merchant services to internet business owners.

-They offer bank merchant accounts, which I feel is the best way to go.  Going this route can save you a large chunk of money.

-Every person I have asked says they feel like they were given excellent customer service and were helped whenever they needed assistance. This is important when choosing a merchant account provider.

-They have one of the highest merchant account approval rates. They do not insist on perfect credit for approval and this is important for those who have been in the credit rebuild process.

-They have great fees rates! If you have dealt with credit card processing in the past, you know that the fees can add up. Merchant Express has very good rates.

-Merchant Express accepts Mastercard, Visa, American Express, Discover and bank debit cards!

If you are in the  market for a merchant account, you seriously should consider Merchant Express.

The following info below is taken directly from their website.  It should answer any questions you may have about their service.. and notice.. they offer a 30 day money back guarantee!!!!

Credit Card Processing Solutions

There are various ways to process credit cards. You can process using the Internet, a point of sale terminal, computer software, a wireless device, or you can just use a telephone.

Internet – Using the Authorize.Net payment gateway, this is this is the most popular and flexible method of credit card processing. You get a virtual terminal which gives you the ability to manually process any credit card order yourself anywhere – as long as you have access to the internet. And if you also have a website, Authorize.Net is the perfect choice as it allows you to automatically process credit card orders from your website in real time, 24 hours per day. We offer free Authorize.Net setups on all Internet accounts. Click for more details >>

Point of Sale Terminals – This is the most popular method to process for store-front locations where the credit card is going to be physically present and swiped, although you can also use terminals for card not present where the transaction is ‘keyed’ in. Terminals come in all shapes and sizes, and most have built in printers. We carry the most popular state of the art terminals from Hypercom, Lipman Nurit, and Verifone, all at bargain prices. Most communicate via a standard phone line, and some communicate using an Internet connection where no phone line is needed. Click for more details >>

Credit Card Processing Software – We offer three different software packages for both Windows and Macintosh computers. Software is the perfect option if you already have a desktop or laptop computer. The advantage of software, is that it keeps an electronic copy of all transactions, allowing you to do searches and print reports. Software can be used for ‘keyed’ transactions and with an optional usb swiper it can also be used for card present swiped transactions. We offer free JPOS software on all retail merchant accounts. Click for more details >>

Wireless Processing – We offer several state-of-the-art wireless options including software and terminals. These terminals use a wireless network to communicate instead of a phone line. And because they operate using a rechargeable battery system, they can be used virtually anywhere. Wireless terminal also provide the ultimate in flexibility and can be used for both ‘keyed’ and ’swiped’ transactions. Click for more details >>

Quickbooks – For all Internet accounts using Authorize.Net payment gateway, you can download all your transaction data directly into Quickbooks. This is a great time saver and is a great solution for Internet businesses that also use Quickbooks. The Quickbooks download option is included free on all Authorize.Net payment gateway accounts. Click for more details >>

Phone Processing – This is a terrific option for a business that does not do many transactions in a month. No equipment or software is needed. All you do is call a toll free 800 number and process a transaction using the telephone keypad. What could be easier that that? Click for more details >>

Customer Comments
“I just wanted to tell you that, I have worked with many companies before in getting various accounts set up for utilities, lease space, credit cards, office accounts, etc and I have never worked with someone who was so nice and helpful and answered my emails so darn quickly before. Its nice to see good customer service!”

M. W.
Overland Park, Kansas

Negotiating a settlement on a debt does not have to be something you dread. Most people find it frightening and put off the call or writing the letter for weeks or months or years out of fear.  Do not let the fear stop you! Creditors are well aware of the situation our country is in and the financial difficulties that millions of consumers are facing. There are entire departments set up dealing with only negotiations so realize you are not the only person who will be calling or writing and explaining your situation.

First Things First

You need to carefully analyze your budget and determine the amount of money you can pay. Resist the urge to budget more than you can pay for. You need to realize that you can only do what you can do. Got that?

If you owe $3000 on a card but the best you can pull up is $750 than you prepare to offer $750 and explain why this is the best you can do.  In fact, it can be argued that you should offer even lower so you have somewhere to move up to but this is a personal choice. Bottom line is you can only do what you can do.

It is not unusual to settle a debt for 30% of the amount owed, especially if the debt is owned but a debt collector. They, generally, purchase the debts for pennies on the dollar and even 30% is a profit.  Also, the older the debt, the easier it is to settle.  You should never agree to pay more than 70% of the debt.  A good starting point is 30-50%.  Less if it is all you can afford to pay.

It is always best to arrange for a lump sum settlement vrs payments but in some cases you must try to settle with payments.  I don’t advocate payments because if you can’t maintain them, you have reset the clock for credit reporting.

Now. Do you have your figures wrote down?  Have you carefully looked to make sure this is what you can afford and pay?

Making Contact With Creditors/Collectors

It is no secret that I do not advocate any contact with creditors or collectors via the phone. The reason is simply you have no proof of any agreement, conversation etc when you talk on the phone. You can record who you spoke with and the time of the call but the rest can become a ‘he said, she said’ argument and we all know how those go!

Mail your request if at all possible.  If you must call, check the laws in your state and see if it is legal to do a one party recording of call.  This would mean that as long as one party of the call was aware of the recording, recording the call is legal.  That ‘one’ party would be yourself.  If it is not legal, see if it is legal to record the call IF you disclose this to them.  In this case you would simply say ‘I want to inform you that I am recording this call and if you continue the conversation with me, you are ok with this recording’.

You should simply and briefly explain that you want to settle the debt; however, you are in a position that you can not pay the amount in full. I would not go into long, drawn out explanations but don’t hesitate to explain just how hard it is for you to make any payment (if this is true) and why you can only make the payment you offer.

I am writing in an attempt to settle the debt owed to you.  Unfortunately, at this time, I am unemployed. It is impossible for me to pay the debt in full but I have carefully reviewed my budget and can pay you xyz.

I realize this is not an optimal solution to resolving this debt but with my situation, this is the absolute best I can do.  I am unable to borrow money from anyone and without a job there is just no other option for me.

I am willing to mail this payment within 10 days of a response from your company, on letterhead, that you agree to settle this debt, in full for xyz.

Make whatever letter you send your own. Explain as you feel you need to but you want to get across to them that you simply can not pay more than you offered.

The Response

If you have decided to call the collector or creditor, you must be a person who feels confident in handling the back and forth banter. You may be threatened. You may be told that they can’t settle for that low of an amount and you either figure out how to pay more or you get sued etc. Be prepared for threats.  If you feel this is the direction of the call, you can politely say ‘I’m sorry we were unable to work out an agreement but I provided you with the best I was able to do-thank you for your time’.  Be prepared to end the call.  Do not take it personally!  They are doing their job. You can always call back in a few weeks or days and you will get another agent who can possibly help you.

If you have sent your request via mail, wait for your reply. Be prepared that you may not receive a reply and if you do not, simply mail another letter and state this is the second attempt I am making to settle this debt.  However; if you do receive a reply of acceptance, simply mail of a check or money order by the date you agreed to.  If you are given a counter offer, you need to realize you can re-counter the offer.   It is my opinion, that you should never settle for more than 70% of the original debt.  I would always shoot for 50% max but you will need to do what feels right for you and based on what you are able to do!

If the creditor just refuses the offer, simply wait.  Give it some time and resend a letter with your offer again. You will have a new rep handling the issue and they may be willing to accept it.

What If I’m Trying to Settle to Avoid Court?

If you are being sued and the debt is yours, first make sure the debt is within the SOL. This is very important.  Many times people are sued and settle when the lawsuit had no legal standing.  And before you think ‘oh they will win a suit so they won’t settle’ you are wrong!  Even when a judgment is entered, that doesn’t mean the creditor is going to be able to collect.  If they need to garnish wages, it costs them and it takes time. It takes manpower to do the work. They would much rather settle than proceed with the lawsuit. In cases such as this, you are likely to need to settle closer to the 70% mark for a lump sum payment.  You still do not start out that high.  Offer them low and let the negotiations build up. Again, expect resistance and expect even lies and threats.  If they reply with ‘Oh well we can garnish your wages so why should we settle’. You should calmly reply. ‘Yes, I am aware that you can but I am also aware that takes time and effort and energy and if I move or start a new job, the process is delayed.  It would be much better for you to receive a lump sum payment up front and avoid all court costs and hassles down the road’.  Even if they appear to not hear you, trust me-they do!  They will play their hard ball game anyway because it works so often!  Consumers back down far too easy.

Tips To Remember in Negotiating A Debt

NEVER expect to settle a negotiation in one attempt. It may happen and if so, that is wonderful but chances are it takes time to bat the hardball back and forth before they will give.  Their goal is to force you to give by using fear tactics. Maintain your ground and play the game and do not be afraid to say ‘I’m sorry we could not come to an agreement’.

Start your offer low-30%.  If you want to just settle in one attempt, you can offer 50% but make it clear this is the only offer you have to give and it is accept it or not.

Above all else, remember their tactics. They will lie to you and they do it every single day. They will stretch the truth and say just about anything. While some things can be true, you can bet the bulk is not. Their scare tactics work and they work everyday.

Maintain your cool. The person you are dealing with is the one who holds the power and if you blow your top and are hateful, you will not get anything at all. Be nice and polite and vent your anger after you hang up the phone.

Finally, negotiation can work. It works every single day.  You should, almost never, have to pay full amount.

If you have questions, feel free to comment and I will respond with detailed answers.

Good Luck and Negotiate, Negotiate, Negotiate!

Have you ever ordered your credit reports and seen the little codes on your credit report and wondered what they mean?  Here is a guide you can refer to when reviewing your credit report and evaluating if it is reporting correctly.

This information is broken down by Credit Reporting Agency (CRA’s).

EQUIFAX – BEACON Score Codes

39 – serious delinquency
38 – serious delinquency, and derogatory public record or collection filed
34 – amount owed on delinquent accounts
33 – proportion of loan balances to loan amounts is too high
32 – lack of recent information on installment loan accounts or lack of installment loan accounts
31 – too few accounts with recent payment information
30 – time since most recent account opening is too short
28 – number of accounts established
24 – no recently reported revolving balances
23 – number of bank or national revolving accounts with balances
22 – accounts not paid as agreed, public record, or collection agency filing           (FORECLOSURE)
21 – amount past due on accounts
20 – length of time since derogatory public record or collection is too short
19 – too few accounts currently paid as agreed
18 – number of accounts with delinquency currently or in the past not paid as agreed
17 – no non-mortgage account balances or  non-mortgage balances not recently reported
16 – lack of recent revolving account information
15 – lack of recent bank revolving information
14 – length of time accounts have been established
13 – time since delinquency is too recent (or unknown) or trade narrative reported
12 – length of time revolving accounts have been established
11 – amount owed on revolving account is too high
10 – proportion of balances to credit limits is too high on bank revolving or other revolving accounts
09 – too many accounts recently opened
08 – too many inquiries last 12 months
07 – recent payment history is too new to rate
06 – too many consumer finance company accounts
05 – too many accounts with balances
04 – too many bank or national revolving/open accounts
03 – too few bank or national revolving/open accounts
02 – level of delinquency on accounts
01 – amount owed on accounts is too high
O – beacon not available, no recently reported account information
FA – number of inquiries adversely affected the score, but not significantly

TRANS UNION – EMPIRICA Score Codes

42 – length of time since most recent consumer finance company account established(**factor not currently in use)

41 – no recent retail balances (**factor not currently in use)40 – derogatory public record or collection filed
39 – serious delinquency
38 – serious delinquency, and public record or collection filed

36 – payments due on accounts (**factor not currently in use)
31 – amount owed on delinquent accounts (**factor not currently in use)

30 – time since most recent account opening is too short
29 – no recent bankcard balances
28 – number of established accounts
27 – too few accounts currently paid as agreed
26 – number of bank revolving or other revolving accounts (**factor not currently in use)
24 – no recent revolving balances
23 – number of bank or national revolving accounts with balances

22 – serious delinquency derogatory public record or collection filed             (FORECLOSURE)

21 – amount past due on accounts
20 – length of time since derogatory public record or collection is too short
19 – Date of last inquiry too recent
18 – number of accounts with delinquency
17 – no recent non-mortgage balance information
16 – lack of recent revolving account information
15 – lack of recent bank revolving information
14 – length of time accounts have been established
13 – time since delinquency is too recent or unknown
12 – length of time revolving accounts have been established
11 – amount owed on revolving accounts is too high

10 – proportion of balances to credit limits is too high on bank revolving or other revolving accounts
09 – too many accounts recently opened
08 – too many inquiries last 12 months
07 – account payment history
06 – too many consumer finance company accounts
05 – too many accounts with balances
04 – lack of recent installment loan information
03 – proportion of loan balances to loan amounts is too high
02 – level of delinquency on accounts
01 – amount owed on accounts too high

00 – no adverse factor
MODEL NOT SCORED: INSUFFICIENT CREDIT message occurs when a credit file does not contain
a trade line opened for at least 6 months and trade line updated within the last 6 months.

FA – in addition to the factors listed above, the number of inquiries on the consumer’s credit file has adversely affected the credit score.

MODEL NOT SCORED: DECEASED message occurs when the subject’s Social Security Number matches the Social Security Administration’s deceased Social Security Number file, or is reported as deceased by a credit grantor.

EXPERIAN – FAIR ISAAC Score Codes

40 – derogatory public record or collection field
39 – serious delinquency
38 – serious delinquency and public record or collection filed
37 – number of finance company accounts established relative to length of finance history

36 – length of time open installment loans have been established

33 – proportion of current loan balance to original loan amount
32 – no recent installment loan information

31 – too few accounts with recent payment information

30 – length of time since most recent account established

28 – number of accounts established26 – number of revolving accounts

25 – length of installment loan history
24 – lack of recently reported balances on revolving/open accounts
22 – account(s) not paid as agreed and/or legal item filed                            (FORECLOSURE)

21 – amount past due to accounts
20 – length of time since legal item filed or collection item reported
18 – number of accounts delinquent
17 – no recent (non-mortgage) accounts balance information

16 – insufficient or lack of revolving account information
15 – insufficient or lack of bank revolving account information
14 – length of time accounts have been established
13 – length of time (or unknown time) since account delinquent
12 – length of revolving account history
11 – current balances on revolving accounts

10 – proportion of balance to high credit on bank revolving or all revolving accounts
09 – number of accounts opened within the last 12 months
08 – number of recent inquiries
07 – Unable to evaluate recent payment history

06 – number of finance company accounts
05 – number of accounts with balances
04 – Too many bank revolving accounts

03 – Too few bank revolving accounts

02 – delinquency reported on accounts
01 – current balances on accounts
Exclusion Messages

9003 – Experian/Fair Isaac Score Not Available Due to Lack of Credit History – The Profile report does not contain any trade lines which have been open for at least six months

9002 – Experian/Fair Isaac Score Not Available Due to Model Exclusion Criteria – The Profile report does not contain any trade line which satisfies both of the following:
1.   Status date within the last six months, or a balance within the last six months if the status code is not “11″ (“Current account”)
2.   Does not contain disputed information

9001 – Experian/Fair Isaac Score Not Available Due to Report of “Deceased” Status – The Profile report contains a subscriber transaction with a status code of “21″ or an association code of “X” indicating the consumer is deceased

9000 – Experian/Fair Isaac Score Not Available Due to System File Size Parameters – The Profile report contains more than 100 subscriber trade and inquiry transactions

• be currently employed

• be 18 years of age

• reside in the US

• complete and submit our secure online application

• not have any prior accounts with Crown Jewelers or it’s affiliates

C-Credit Card for Bad Credit-score at least 560 and you must not have recent negative items.  These are what I would consider your last choice option.  Just about every single card for very low credit will come with many fees or extremely high interest.  Read this post about First Premier. They used to offer a card with a $300 credit limit and it would come with over $250 in fees!  Now with the new credit card law coming into effect in Feb 2010, they are not allowed to charge more than 25% in fees so to still earn the same money-they are charging 79% interest.  And here is the deal.. they will get millions of people sign up for that card.. because they don’t know of other options.

The sooner you begin to actively start to rebuild your credit, the better. After 6 months of paying on time, you will see a rise in your score or if you still have negative information actively reporting, will at least minimize the damage.  Either way, it is best to start NOW.  No Credit Credit Cards are an important start. ]]> http://www.comebackcredit.com/no-credit-credit-cards/feed/ 0 http://www.comebackcredit.com/credit-repair-tips-to-improve-credit-scores/ http://www.comebackcredit.com/credit-repair-tips-to-improve-credit-scores/#comments Mon, 25 Jan 2010 03:33:52 +0000 admin http://www.comebackcredit.com/?p=83 Credit Repair Tips To Improve Credit Scores

Credit Repair is something every consumer can do on their own, however; the consumer needs to do it right and take their time and ensure they understand the process.  There are many people who attempt the repair and make their situation worse because they dive in and don’t learn what items should be disputed and what items should be left alone.  Do thorough research.  There is also a new site that I am, anxiously, awaiting it’s launch and sounds like it will be an incredible one stop, step by step learning site on credit repair. You can sign up to be notified of their launch here. This is their blog but the sign up form is listed there and you will be notified when they launch.

Learn the steps and you can improve your credit scores within a very short amount of time.

Don’t Wait To Start To Rebuild Your Credit

No matter how bad your credit is or how many negative items are currently reporting, you need to start getting positive information added to start to Improve and Rebuild Credit. Even if your situation is so bad that you may not raise your score, you will still be minimizing the damage to your score.

Credit cards are a very powerful weapon you can use to start to rebuild.  If your credit score is less than 580 and/or if you have current negative items, you are very unlikely to get any lender to give you an unsecured credit card. This means you will be limited to a secured credit card.  You can read more about a secured credit card on this post and also see 3 options for them that do not have annual fees.

Now you may be tempted to wait until some negative items are older or until things seem a bit better but I encourage you to think about this differently.

1-Whenever you open a new account, it has a negative effect on your credit score. That negative effect will last about 6 months and then you get a decent score improvement and will continue to add positive points to your credit score from that point on.

2-The older the account gets, the more value.

So waiting does absolutely nothing to help you.  By starting now, you are actually helping your score much more in the long run.

Now What Do I Do?

Now that you have moved forward and got a secured credit card, you need to handle it in a certain way to have the most positive impact on your credit score.

Keep your balance under 30% of your credit limit.  If you open a $300 dollar secured card, you should never have more than $90 on it at any given time.

There is a little wiggle room here.  If you ever need to use your entire balance, it is true your credit score will take a hit but the good news is that it isn’t long lasting.  When you pay it down, your  credit score will bounce right back up.  If you have maxed out your cards and are at a point where you need your score to boost up, make sure you pay it down 60 days before you need to see the score increased.  The reason is because not all lenders report every month, some report every other month so you need to allow time for it to reflect the new balance on your credit report.

It will also be hard for you to judge the impact of a maxed out card vrs a low balance but in some cases that can affect your credit score by 150pts!

Maybe you have no intention of actually using the card but you really need to use it periodically. Even if you use it and send off a check the same day.. use it regularly.

How Many Credit Lines?

For the best credit score you should ultimately have:

• 2-3 credit cards
• Car loan
• Mortgage

I realize a car and a mortgage may be way down the line but everyone has to start somewhere.  Get your credit cards, use them wisely, give it some time to show you can handle the debt and get your credit score above 600 and you are more likely to then add a car loan.  Pay on that and your score will go up even more and you can now move on to your mortgage.

Statutes of Limitations Can Change The Entire Ballgame

First read this post which will explain the Statute of Limitation and its importance.

Briefly the Statutes of Limitations (SOL)  limit how long a debt is considered legally collectible. In most cases, all debt is out of SOL long before it is due to fall off your credit report. The time limit varies by your state and the above link will show you the SOL for each state.

If I Pay My Collections Will I Improve My Credit Score?

Not once single ounce.  Once an account goes to collection the damage is done.  It doesn’t matter if you pay it or not. The exception to this is if you are in the market for a mortgage. When you are approved for a mortgage you can not have outstanding debt. There is usually an exception for medical bills. Your mortgage lender will tell you what you need to take care of.

Also note the Statute of Limitations again.  If your type of debt is out of SOL, it is considered legally uncollectible.

Read this for more information on paying off collections.

This post does not cover the dispute process that can improve your credit score. You can read more about disputes here and here..

Credit repair is doable but again, be careful and do your research on all steps to make sure you do it correctly. There is a lot of bad information floating around the internet.

Before reading it is important to note that you should always check with your state to verify this information.  I believe it is correct but always double check.

The Statute of Limitations is how long a debt is considered collectible by law and a time line for when creditors can sue you.  You should know that every single day people pay on debts that they are not required to by law. The do so because they think it is still valid. They may see it on their credit report and assume “It is my debt and I need to pay it”.  While the moral side of you may believe the debt should be paid, by law once out of statute of limitations you co not need to pay this and can not be ordered to pay it.  Now the previous sentence is a bit tricky. A creditor or collection agency can take you to court and can get a judgment IF you do not show up and defend yourself.  It is as simple as bringing paperwork that shows the Statute of Limitations over.

For many people, having this knowledge is a great burden taken off their shoulders and they can move forward.  The SOL runs from either the day of your last payment or the date payment was demanded from you.

If you are contacted by a collection agency after the loan is out of Statue of Limitations, you can simply write them and tell them your account is outside of the SOL and to please cease any contact.  They may write you one more time to say they will cease contact but that is it.

Remember.. if you are sued you NEED to show up in court and defend your self by presenting the SOL’s for your state or they will get a default judgment against you and you can’t fix that later.

The chart below shows the State Statutes of Limitations for various kinds of loan agreements and is for all states.

What Defines An Oral Contract: A verbal agreement is one that is considered a legal and binding agreement.  However it is not easy to prove it in court.  This is when you make a verbal agreement to borrow some money and repay the money.

What Is A Written Contract: This is a written document that both  you and the lender both sign.  This can be a very formal document or a crude one you just wrote on a napkin.

What Is A Promissory Note: This is where you agree to pay a loan as listed in a written contract. In a promissory note, the payments and interest and spelled out in detail.  A mortgage is an example of a promissory note.

What Is An Open-ended Accounts: These are account with revolving lines of credit. Meaning you have a certain limit that you can charge up or pay down and charge again.  A credit card is always considered an open account.

I am often asked “What is a secured credit card and should I get one?”  Secured credit cards have their place.  They are not the best thing as we all know but there are times when you have to start somewhere and secured cards are a great place to start to rebuild your credit.

Even if you wish to live without credit cards, you need to realize that there are times when you need to have a credit card such as renting a car, buying anything online etc.  Having a credit card that is used correctly will also help you raise your credit score and therefore help when the time comes to buy a home or a car.

If you have poor credit, no credit or are recovering from a previous bankruptcy, a secured credit card might be your only option.

When you get a secured credit card, you will be required to deposit money as collateral.  The amount of money you deposit will be your credit line.  If you deposit $300, you will have a $300 credit line. You can always add more money to increase your credit line.  Usually between 9-12 months the bank will review your account and if you have paid your payments on time and are in good standing, the bank will convert your account to a regular credit card and refund your deposit.  They will also usually increase your limit. If you feel a secured card is for you, you may have a few questions:

• Where Do I Get A Secured Credit Card? If you are a member of a credit union, call them and ask if they offer a secured card. Roughly ½ of all credit unions will offer a secured card.  If not, you can try one of the places shown at the end of this email.
• What Are The Charges?
  Every secured card is different and this is something you should look at.  If you look at my list below, the top 2 do not have any fees associated with the account while the bottom two do have fees.  You should also view the terms and conditions when you go to their site and evaluate them closely.  You don’t want to get a secured card that has so many fees it takes your entire deposit.
• Do I Have To Deposit Money?
  Yes you do. That is the whole concept here. They give you a credit card and report to the CRA’s. This will build your credit. Remember when your credit is bad, you have no credit or are recovering from bankruptcy many places will not give you a chance until you prove you can handle a credit card.  This is the purpose of the secured cards.  You will pay into it what you want your limit to be. Some secured cards do have a minimum such as $300.
• Do All Banks and Credit Unions Offer Secured Cards.
  No they do not. About ½ of all credit unions will offer them but the industry is changing.  Some credit card issuers are offering some subprime cards with a low limit such as $250 but then charging interest rates as high as 79%. The $250 credit limit comes with fees and an incredibly high interest.  Secured cards are a good choice if you can put the deposit in because you will get that money back when the account converts to a unsecured card rather than the fees being added to the card and being lost money.  In many cases, the secured card is the only option.
• Are there any problems to watch out for?
  There always is.  Do your homework and evaluate fees.  Some cards will give you credit but then say you have to buy an insurance policy worth x amount of dollars.
• Do They All Report To The 3 Credit Bureaus?
  No they do not, although most will.  This is important because the whole purpose of these cards are to rebuild credit.  If they don’t report, you aren’t gaining anything.  The cards I have at the bottom of this post all report to the CRA’s.
• When Will It Be An Unsecured Card?
  The average time is one year.  I have been hearing complaints from those who have Bank of America secured card that they are not getting approved for the unsecured card even with regular payments and being on time for the entire year as they still look at your past credit history in their evaluation.
• Now What Other Things Do I Need To Do?
  Never charge your card higher than 30% of your available balance.  30% of your credit score is based on your credit utilization and staying under 30% will give you the optimal benefit to your credit score.

Secured credit cards are not the best and no one wants to have to use these to get going but they are often the only choice you have to begin to rebuild your credit. Go into with an open mind that this is a necessary step and something you need to do for a year.  It isn’t that bad and can’t be worse than how things have already been for you.

Before you know it, you’ll be on the road to good credit and happy that you took this first step.

These are all 3 secured cards that do report to the 3 credit bureaus. Double check before you apply that they do not have annual fees.  As of the time of this post, none of them have annual fees.  Also notice the Platinum Zero card carries a 0% interest.. not just an intro interest rate but lifetime.  Even the other one only has 11% interest which is great for a secured card.  These are very good options.

Not only do you need a good credit score to get a credit card, buy a car or house, you will pay a much higher interest on these purchases if your credit is poor.  It is becoming increasingly popular for employers to even check credit as part of the application process.

Here are some ways you can ensure you have a good credit score.

• You need to establish credit.  It is better to have both revolving and installment credit.  Revolving credit is like a credit card and installment would be a mortgage or car. You may have heard horror stories of people who racked up thousands of dollars in debt in credit cards and then couldn’t pay them and now you want to avoid that trap. The truth is that it is about how you manage your credit cards. You don’t need several credit cards, you don’t need an enormous credit limit, you simple need one or two that you use sparingly to show you can handle the credit.

• Pay On Time – This is vital. 35% of your credit score is based on your payment history.

• Don’t Charge Over 30% on Your Cards – 30% of your credit score is based on your credit utilization.  To have the best positive impact on your score, you really need to keep your balance under 25-30% of your available credit.

• Keep Checking Your Credit Reports – Your credit needs to be protected and you are the only one who knows what should be on the report and what should not.  Almost 30 million people have been affected by theft identity over the past 5 years.  And more than 70% of credit reports contain errors. You don’t need to obsess over it but you should check your reports annually.

When you start your journey of rebuilding your credit, one of your first steps is your credit dispute.  You will write a letter that lists, in detail, all items you find that you need to dispute. You will briefly explain why the items doesn’t show on your credit report.  The FCRA requires the Credit Reporting Agencies (CRA’s) to investigate your dispute and if the lender can not verify the accuracy of the account within 30 days, the CRA must delete the account from your credit report.

Here is the credit dispute process step by step:

• Mail your letter certified mail, return receipt requested. (make sure you keep a copy of everything you send them
• The credit bureau receives your letter with your credit dispute. They must sign for this and now you have proof of when the 30 day time limit is reached.
• The CRA starts your dispute file. They are required to keep documentation of their efforts and all of the documentation you may have sent them.
• The CRA forwards your dispute information to the lender.  You may think the CRA spends a lot of time determining how to handle your dispute but reality is your disputes are handled so quickly and pushed through the system.
• The lender is now given 30 days to respond to the dispute and to verify the information they are reporting.
• If the lender verifies the information is correct, you will get a response from the CRA saying the tradeline is verified.  If the lender fails to respond within the 30 days, the CRA must remove the entire tradeline from your credit report.  The lender may also update information that is incorrect.
• The CRA will send you a notification of items that are verified, updated and deleted.

Now, here is the point where you will need to evaluate your next step. The lender may not have provided proof to the CRA and you may need to be more diligent and file the dispute again.

Remember the CRA’s receive thousands of disputes per day. They do not have the time to carefully evaluate each dispute and the process is largely automated. It is unreasonable to expect the process will be handled accurately and completely the first time so don’t be taken aback when something you know is incorrect is verified.  Just start again and move forward.

The process of rebuilding your credit takes time but can happen with persistence. If you need to file a credit dispute more than once, this is very common so don’t feel you are ‘unlucky’.  Just move forward and you will see things drop off or get corrected.

It is so easy for people to judge others who have Credit Problems. They may have a Clean Credit Report and have never faced a life circumstance that turned your financial world upside down.  But you can’t think about that nor worry about it. Whether you used your credit cards with reckless abandon or you faced a horrible situation such as being laid off, divorced or a medical problem-it is ok.  There is a chance to fix your credit in the near future.  If only these individuals would learn not to spend money that they do not have then their finances would never reach a state of ruin. It is too easy to be on the outside looking in and offering these simplistic explanations. There is so much more to the story.

Why should you repair your Credit Problems?

There are several reasons why you really need to be proactive and start to begin the process of getting a Clean Credit Report.

1-Saving money on interest – When you have a low credit score, you will pay more in interest on all loans you have. This can add up to thousands and thousands of dollars in even one year.

2-Lower Insurance Rates – Do you realize that when you have a low credit score, you pay more for even auto and home insurance?  Part of the underwriting process is to check credit and it is an automatic higher premium.  Even if you have a perfect driving record, you will pay more!

3-Higher Security Deposits – Cell phone companies, utility companies, internet companies etc will check credit to determine a deposit.  The worse your credit is, the higher a deposit you will have to pay.  Usually after 12 months of on time payment, you will get your deposit back.

4-Paying Cash – There is nothing wrong with paying cash for everything and this is a goal to shoot for but what happens when the car breaks down or you have an emergent need and do not have the cash available?  With a low credit score, you will be unable to qualify for credit. You should always have an emergency back up and this is a huge reason to correc those Credit Problems and shoot for a Clean Credit Report.

5– Purchase Power – Lets face it.  Having bad credit either makes it impossible to purchase a car or house.  It can even make it impossible to rent an apartment! Why continue to deal with that vrs just starting the credit repair process?

6- Positive Factor – Think of how much better you will feel when you have great credit and don’t have to always worry about what may happen next.  This is huge.

Well Then Where Do I Begin?

Read the posts here on Improve Credit and this one on Credit Disputes.  It will help guide you in the right direction to start on the path to having a Clean Credit Report and ending your Credit Problems.