Credit and Collections

The mere mention of the phrases “online debt collection agency” or “debt collector” is enough to strike fear and loathing in the hearts of many consumers who are struggling to stay current on their monthly bill payments. No one wants things to deteriorate to the point at which they are being hounded by an online debt collection agency, and if you know your financial positions is becoming precarious, you have noting to lose by contacting your creditors to see if you can arrange an easier payment schedule.What To Watch Out ForYour credit score will be reevaluated any time a collection agency reference appears on your credit report at one of the three major credit reporting agencies. Fair Isaac, the company which developed the mathematical formulas by which credit scores are compute, has determined that consumers who have a history of making late payments are very probably going to continue to make them in the future.So if you are late on even one monthly payment (regardless of the reason) it will have a negative effect on your credit rating, and if you fall behind so much in your payments that your loan accounts are turned over for debt collection, you will feel the negative effects for a very long time.How Long Do I Have To Deal With This?An online debt collection record can stay on your credit history for as long as seven years, dragging down your credit score no matter how faithfully you pay your bills in the meantime. As time progresses, the weight it is given when your score is computed will diminish, but as long as it is there you will be penalized when you apply for more credit. Lenders will classify you as a higher risk borrower (which could be seen as a fair debt collection issue in itself), and you’ll pay the price in higher interest rates on those loans for which you are approved which is all the more reason to get that debt collection off your reports ASAP.

If you have just been denied a loan based on low credit scores you are probably wondering how do I fix a ding on my credit score? Well keep reading because the article below will give you a overview of what you need to do to clean up your credit and boost your FICO scores using simple credit repair methods.How To Remove Negative Credit With Self Credit RepairThe very first thing that you’ll need to do is to secure a up to date copy of your credit report and look it over for mistakes and negative information. In most cases the negative information will be late payments, judgments and collection accounts. Errors are generally incorrect loan payment records. If you are unsure where to get a copy of your report you can get a free one or buy them directly from the reporting bureaus websites.When you have compiled a list of the incorrect and negative information its time to dispute it. This process is called self credit fixing and is quite easy. all you have to do is write a credit dispute letter telling the bureau that you disagree with the information on y our report.Under Federal law they will have to get in touch with  the original account issuer and ask for documentation proving the information. The original account issuer has 30 days to provide that proof. If they fail to prove the information correct in that time period then the negative mark will have to be taken off of your report and your FICO score will improve as a result.