YourCreditReport.ca: credit reports, credit cards, fixing your credit and personal bankruptcy in Canada » Miscellaneous

How To Dispute Something On Your Credit Report

info — Sat, 25 Sep 2010 22:08:14 +0000

Have you ever wondered how to dispute something on your credit report? If you have, you are not alone. This a very important question and it is a question that’s frequently asked. Your credit report is the key to obtaining credit, whether it is to buy a home or purchase a car. Your credit report has valuable information that identifies the way you manage your financial affairs.

Things you’ll need:

* Credit reports
* Completed dispute letter
* Evidence (i.e. cancelled checks, receipts, etc.)

1. Review your credit report annually. This helps you identify credit problems early and helps you dispute something on your credit report early before they become a major issue. Under federal credit laws, you are able to obtain one free copy of your credit report annually from the three credit bureaus. Therefore, contact the three credit reporting agencies–Equifax, Experian and Transunion–and take advantage of the free report.
2. Know your credit report legal rights. If your credit report is incorrect, there are steps to dispute something on your credit report. Per the Fair Credit Reporting Act (FCRA), you have the right to submit a request to the credit-reporting agency to remove any inaccurate information.
3. What happens if you find erroneous information on your credit report? If you find erroneous information on one credit-reporting agency, chances are the other reporting agencies have erroneous information as well. Therefore, check the three credit reporting agencies to make all the information reflected is complete as well as accurate.
4. Send a dispute letter via certified mail with a return receipt requested form. The best way to dispute something on your credit report is in writing. Send a dispute letter to the credit bureau and the creditor; the letter is your documentation that you did dispute something on your credit report. If you have documentation to substantiate your claim, include copies of the documentation and keep the originals. Documentation you may submit includes cancelled checks or a payment receipt. Make sure to include your name, complete address, dispute information and the reason you think the credit report is inaccurate. You might want to consider enclosing a copy of your credit report and highlight the information in question as well.
5. What happens after you send the letter to dispute something on your credit report? After you send the letter, the credit bureau has 30 days to investigate the dispute and respond to the issue. The response is generally in writing and it indicates the results of the investigation. Any inaccuracies are sent to the original company who provided the information. The provider who submitted the information reviews the information and sends their response to the credit-reporting agency. The credit bureau then returns the results of the investigation to you and indicates the results along with an updated report if credit report dispute resulted in changes.

If you want to dispute something on your credit report, be proactive and follow the steps indicated. Remember, erroneous information on your credit report will cause you financial hardship.

Get bill collectors off your back – legally.

info — Tue, 06 Feb 2007 18:54:16 +0000

Sometimes, the formal and legal declaration of personal bankruptcy is the best way to go when you’re “snowed under” with bills, and you just can’t see your way clear to survive. Actually, bankruptcy allows you to make a fresh start. Generally, it takes only a small amount of money, a careful evaluation of your assets and your liabilities.

In many cases, a lawyer is not necessary. If you have very few assets, mountains of debt, and not enough income to meet your obligations, then your best bet is almost always the filing of straight bankruptcy. What you’ll need is the proper forms “S3010 Bankruptcy forms, for an Individual Not Engaged In Business.” These can be purchased from any full-line office supply store, especially in an area serving attorneys’ offices. You’ll need to know which district you live in for Federal Court purposes – so look in the white pages of your telephone book under U.S. Government – Courts – and take down the address of the nearest U.S. District Court. Check it out to be sure that your residence is in this court’s jurisdiction. You then fill out the forms you purchased, listing all of your creditors – those with priority being listed first – meaning those who have extended credit to you against some sort of security or collateral, followed by those who have extended credit to you on just your signature or reputation.

You must be sure to list all of your creditors because any that you fail to list, will be able to sue you and collect even after the bankruptcy has been adjudicated. At the same time, be sure to include the names of anyone and everyone you may have co-signed a note or a loan for, as well as anyone who may have co-signed for you. The laws governing personal bankruptcy vary in all states, but generally, a bankruptcy judgment will not take away the house you live in, basic home furnishings, a car that’s necessary towards your gainful employment, nor the tools of your trade. Check these things out to be sure against the list of items regarded as the necessities of life by your state.

When you’ve got all the forms filled out, and notarized, you take them to the Clerk of the U.S. District Court in your jurisdiction. You pay the clerk $50, and from there, you’re home free. The clerk notifies your creditors, and reminds them that being as you’ve filed bankruptcy papers, they cannot bother you about your debts anymore. However, they are invited to your hearing. Usually they don’t show up, because by that time, you have very few, if any, non-exempt assets left that they are really interested in. But, whatever assets you do have that are nonexempt, will be sold by the Court to appease your creditors. Any money realized from these sales is then added to the total amount of money you may have turned over to the court at the time of your filing, and divided equally amongst your creditors according to priorities. After all of this has taken place, and usually about 3 months after you’ve been adjudged bankrupt, you can start all over again to incur debt, pay bills and establish a new credit rating. However , you should be especially careful about talking with your old creditors because they may attempt to maneuver you into signing a “reaffirmation” of your old debt. The thing to do is to be sure that you carefully read anything you affix your signature to, and don’t agree to pay on any debt that has already been discharged through your bankruptcy!

In some bankruptcy filings, it is definitely advantageous to hire an attorney to represent you. This is especially true for people who have assets such as real estate they want to protect, and/or people who have been operating home-based businesses or been accused of fraud. Remember this, if you decide to process your bankruptcy without a lawyer, then it is your responsibility to fill out all the necessary forms accurately and completely, and every bit as precisely as if you had paid an attorney to do it for you. Leaving out a creditor’s name or address or forgetting a loan that you co-signed for, will surely bring on litigation against you even after your bankruptcy has been adjudicated. Be sure you understand all the papers, ask the Court Clerk for advice, and if you run into problems, then take it in to an attorney.

Besides the regular bankruptcy laws, there’s also a little-known and little-used method of getting reorganized with your debt, particularly when you’ve got a steady job and just need more time to straighten your indebtedness out. This is the wage-earner’s provisions of Chapter XIII of the Federal Bankruptcy laws. Basically, these provisions allow you to make new arrangements with your creditors and pay off all your debts over a new 3-year period of time. When you filed for indebtedness relief under the provisions of this law, nothing is recorded permanently on your credit record. You get to keep all your assets, but you must pay off all your debts.

But, so long as the Court grants you relief under these provisions, and you pay your creditors according to the repayment schedule agreed upon by the Court, your creditors cannot bother you. Even if they have begun a suit against you, once the Court has given you relief, they cannot touch you! Once you’ve filed under these provisions, your creditors are immediately restricted from even contacting you, and get only what the referee or trustee doles out to them. Often-times, if a creditor threatens to sue you, the most effective thing you can do is to tell him frankly that if he sues you, you’ll have no other alternative except to file bankruptcy papers. In many instances, this will cause him to take a second look and to do whatever he can to assist you in paying him the money you owe, but over a longer period of time, and at smaller monthly payments.

The absolute bottom line is that your creditors know only too well that if you do file for bankruptcy, their chances of receiving even half of what you owe is practically nil. Thus, it’s in their best interest to do everything they can to help you to continue making payments on the amount you owe, regardless of how small those payments may be. When a creditor does sue you, and gets a judgment against you, he can then get a court order directing the sheriff to seize your personal property and sell it, with all monies realized going to the creditor to satisfy your debt. When they see this about to happen, many people connive to make themselves “judgment proof.” In other words, they hide their assets or move them out-of-state before the sheriff or Marshall arrives. This is illegal, but is done as often as not. Many creditors will attempt to “garnishee” your wages.

This is done by getting a court order directing your employer to set aside part of your wages or salary every pay period and turn it over to him. First, of course, he has to find out where you work; and even then, in most states, there are limits set relative to how much a creditor can garnishee for your wages. If you have no job, and no visible assets, or you live in a state where your wages cannot be garnisheed, your creditors actually have very few ways of ever collecting from you. Many techniques used by creditors and collection agencies are illegal.

A creditor or agency can write letters to you; call you once a day in quest of a payment; and even knock on your door to ask about a payment. but he is forbidden by law to harass you or invade your privacy, or use deceptive means to get you to pay your bills. He cannot use foul and abusive language over the telephone, tell anyone besides you the reason for his phone call, inconvenience you or in any way threaten your job or your reputation in the neighborhood where you live. Still, the best idea for reorganization and settlement of your debts when you find yourself in an untenable position, is in-person visits and explanations of your situation with your creditors, and a desire to explore other possible ways of mutual satisfaction without involving collection agencies or bankruptcy.

Give it a try – it’s a lot easier than most people realize.

New educational credit videos

info — Mon, 22 Jan 2007 19:19:05 +0000

As we look to develop the site to offer more useful information to help those with credit questions and issues, we’ve now added some useful credit education and debt management videos. We trust these will be helpful to you and we will be adding and changing things as we go along.

We appreciate your support and please feel free to contact us with any additional suggestions you may have for the site.

Credit Cards – Can You Do Without Them?

info — Thu, 04 Jan 2007 03:34:34 +0000

By Terry Rigg

As we all know credit card debt is out of control. The credit card debt is currently $8400 per household at an average annual percentage rate of 14.7 percent. In fact, about 18% of all consumer spending is on credit cards and is expected to reach 30% by 2006.

If you pay your credit cards off each month or don’t mind paying the interest they charge, by all means use them. However, entirely too many households are experiencing serious problems paying their bills because of their credit card debt.

Why do most people have credit cards? I believe that it provides a buffer just in case something comes up that they don’t have the cash to cover. At least that’s the original thinking.

In reality, once you have a credit card it is much easier to use than it is turning loose of your cash, even if you have the cash to pay for it. Also, we buy a lot of stuff with credit cards that we wouldn’t normally buy if we had to use real money.

I have nothing against credit cards. They are handy and can provide some very valuable rewards like frequent flyer miles. However, in many cases the rewards are over shadowed by the interest charged.

I like cash much better. You don’t have to sign anything and when you pay for something that’s all it will cost you. No interest, no bills, no late fees and no penalties.

There are no special secrets to saving money to use for the things you need, however, there are a few tricks that many use.

Two of the best known, but underestimated, is saving your change or the dollar bill savings plan. Most people don’t believe that these will provide enough money to do any good.

When my wife and I first started saving our change we were surprised that we could save about $75 a month just by emptying our pockets and purse at the end of the day. Believe me, at the time, I wasn’t making much money and $75 seemed like a lot especially because we didn’t miss it at all.

The dollar bills savings plan is just as simple. You never spend a dollar bill. If you buy something you simply use a larger bill. At the end of the day take all of your dollar bills and put them in a jar or box. It adds up quick.

There are a lot of ways to save money to avoid the need to use your credit cards but the key is to make it as simple as possible. Another important element is to think of that money as your “Crisis Fund” and not to be used to pay for your pizza on Saturday night.

The answer to the question posed in the title of this article is “Yes, you can do without your credit cards.”

You need to remember, when you use your credit cards you are using your future income not only to pay for the items you buy but also the interest and other charges. Since these charges can add up quickly you need to think long and hard before you buy anything with a credit card.

Terry Rigg is the author of Living Within Your Means – The Easy
Way http://www.homemoneyhelp.com/ebookadpage.html and editor
of The FREE Budget Stretcher Newsletter and Budget Stretcher
web site http://www.homemoneyhelp.com. He has 25 years of
experience counseling individuals and families concerning their
personal finances.

Is it ethical to try and remove legitimate bad credit?

info — Wed, 13 Dec 2006 06:47:38 +0000

Yes! One of the best explanations of that is the following article written by Jayson Orvis, Attorney At Law:

“Credit Repair” has not been kind to the American consumer. In fact, the phrase is synonymous with fraud. This is the stigma we face as we offer a membership wherein the client is offered an alternative to “credit prison.” Because the nasty reputation of credit repair sometimes washes over into our space, we are often called upon to defend the ethics of our service.

Despite the disrepute which taints credit improvement, our service is clearly analogous to the service provided by a defense attorney. The credit report is no more than an allegation. Unfortunately, most citizens never challenge that allegation. By enlisting the Law Offices through N.A.C.A. to their defense, our clients employ us to enter a plea of “not guilty.” We take an affirmative defense; we offer a reasonable alibi and leave it to the bureaus to substantiate their allegation. If the bureau claims to have investigated and affirmed the allegation, we appeal the decision. Eventually, we find that most credit report allegations are at some point untenable and are removed.

Removing record of a negative credit account, which did actually exist, is undoubtedly ethically sound. We belong to a fundamentally capitalistic civilization and the credit bureaus capitalize on consumer information. Unlike our legal system, the bureaus take no oath to truth, equity and the common good. No American has the moral obligation to support any business venture or corporation, much less a corporation which may well destroy their financial life. The information tended by the credit bureaus is ethically “up for grabs.”

The credit bureaus would maintain every piece of credit information forever if it weren’t for federal law which has directed them to remove most items after seven years. In essence, the credit bureaus themselves practice credit repair, basically at the seven year mark. If it is right to remove accurate credit accounts after seven years, why would it be wrong to do so in less time?

In relationship to the consumer, the credit bureaus do not concern themselves with the impact of the information. This information often misrepresents the credit worthiness of the consumer. By tagging good citizens as “deadbeats” the bureaus damage the creditors, the economy and, most importantly, the individual. Several policies and techniques employed by the credit bureaus appear most abusive to the American consumer; these we cite as justification of our opposition to the present credit reporting system.

Seven years (10 years for bankruptcy and some court accounts) credit bondage punishes the debtor unjustly. At no point have the credit bureaus ever conducted a study determining seven years to be the point of deadbeat rejuvenation. The seven year mark is entirely arbitrarily. In fact, Dr. Bonnie Gution, adviser to President Bush on consumer affairs, remarked, “…it is our understanding that computer models that predict credit worthiness find most information that is more than two years old nonessential.” Based on experience with our clientele, seven years is truly too long. Within a year or two, most consumers completely recover from an economic crisis. For the remaining five or six years, they are left hobbled—forced to rent homes, pay outrageous interest on high risk auto loans, forgo the convenience of credit cards and pay cash for every expenditure. By expelling the consumer from the credit loop, the economy suffers. Our clients come to us on the financial upswing. If they can afford our membership, they are most likely on the way back to financial abundance. These are consumers fully recovered from crisis, re-engaged to financial responsibility and anxious to reenter the credit economy. For them, we offer a deserved parole from the credit prison which they entered as their financial world fell apart.

The credit bureaus have not been able to maintain reasonable accuracy in their credit profiles. The bureaus claim an error ratio under 1 percent. In reality, studies conducted by neutral third parties have determined the credit report error ratio to be closer to 40 percent. Unfortunately for the consumer, the credit bureaus choose to err on the side of negative information. As our clients’ files have passed through our offices, we have noticed a high incidence of file mergers—the worst kind of file error. In a file merger, the credit of another person with a similar name is spread onto the file of the innocent bystander. Oddly, the credit bureaus fiercely resist correction of these obvious errors. We have found the only way to prompt them to revision is through a lawsuit.

Credit reporting makes up only a small portion of the revenue which the bureaus claim each year. The databases really pay off in the sales of information. From generic target marketing lists to invasive personal investigative inquires, the bureaus cull a pool of information larger than any in the civilized world. The end loser is the consumer who values his privacy. The horror stories keep coming about individuals whose jobs have been lost, insurance cancelled, reputation ruined by sloppy collection and dissemination of personal information. This does not include the mass irritation experienced by consumers forced to wade through the reams of junk mail. Privacy is a thing of the past—and the blame can be firmly placed on the credit bureaus.

America is not the only country in the world whose economy utilizes consumer credit. Other countries, such as Great Britain, extend credit based on the individual’s present credit standing. a grand-scale revision of the credit reporting system in the United States would not throw our economy into chaos and distress. Until that day, we should feel comfortable that the removal of negative credit accounts before the seven year mark isn’t unpatriotic, it’s not unfair and it’s not unethical.

Payday Loans = Costly Cash

info — Wed, 06 Dec 2006 22:35:41 +0000

“I just need enough cash to tide me over until payday.”

“GET CASH UNTIL PAYDAY! . . . $100 OR MORE . . . FAST.”

The ads are on the radio, television, the Internet, even in the mail. They refer to payday loans – which come at a very high price.

Check cashers, finance companies and others are making small, short-term, high-rate loans that go by a variety of names: payday loans, cash advance loans, check advance loans, post-dated check loans or deferred deposit check loans.

Usually, a borrower writes a personal check payable to the lender for the amount he or she wishes to borrow plus a fee. The company gives the borrower the amount of the check minus the fee. Fees charged for payday loans are usually a percentage of the face value of the check or a fee charged per amount borrowed – say, for every $50 or $100 loaned. And, if you extend or “roll-over” the loan – say for another two weeks – you will pay the fees for each extension.

Under the Truth in Lending Act, the cost of payday loans – like other types of credit – must be disclosed. Among other information, you must receive, in writing, the finance charge (a dollar amount) and the annual percentage rate or APR (the cost of credit on a yearly basis).

A cash advance loan secured by a personal check – such as a payday loan – is very expensive credit. Let’s say you write a personal check for $115 to borrow $100 for up to 14 days. The check casher or payday lender agrees to hold the check until your next payday. At that time, depending on the particular plan, the lender deposits the check, you redeem the check by paying the $115 in cash, or you roll-over the check by paying a fee to extend the loan for another two weeks. In this example, the cost of the initial loan is a $15 finance charge and 391 percent APR. If you roll-over the loan three times, the finance charge would climb to $60 to borrow $100.

Alternatives to Payday Loans

There are other options. Consider the possibilities before choosing a payday loan:

When you need credit, shop carefully. Compare offers. Look for the credit offer with the lowest APR – consider a small loan from your credit union or small loan company, an advance on pay from your employer, or a loan from family or friends. A cash advance on a credit card also may be a possibility, but it may have a higher interest rate than your other sources of funds: find out the terms before you decide. Also, a local community-based organization may make small business loans to individuals.
Compare the APR and the finance charge (which includes loan fees, interest and other types of credit costs) of credit offers to get the lowest cost.
Ask your creditors for more time to pay your bills. Find out what they will charge for that service – as a late charge, an additional finance charge or a higher interest rate.
Make a realistic budget, and figure your monthly and daily expenditures. Avoid unnecessary purchases – even small daily items. Their costs add up. Also, build some savings – even small deposits can help – to avoid borrowing for emergencies, unexpected expenses or other items. For example, by putting the amount of the fee that would be paid on a typical $300 payday loan in a savings account for six months, you would have extra dollars available. This can give you a buffer against financial emergencies.
Find out if you have, or can get, overdraft protection on your checking account. If you are regularly using most or all of the funds in your account and if you make a mistake in your checking (or savings) account ledger or records, overdraft protection can help protect you from further credit problems. Find out the terms of overdraft protection.
If you need help working out a debt repayment plan with creditors or developing a budget, contact your local consumer credit counseling service. There are non-profit groups in every state that offer credit guidance to consumers. These services are available at little or no cost. Also, check with your employer, credit union or housing authority for no- or low-cost credit counseling programs.
If you decide you must use a payday loan, borrow only as much as you can afford to pay with your next paycheck and still have enough to make it to the next payday.

Credit Insurance: Is It for You?

info — Wed, 06 Dec 2006 22:34:57 +0000

The next time you apply for a mortgage or personal loan, you may be asked if you want to buy credit insurance, or it might already be included in your loan proposal. Credit insurance protects the loan on the chance that you can’t make your payments. Credit insurance usually is optional, which means you don’t have to purchase it from the lender. In fact, the Federal Trade Commission (FTC), the nation’s consumer protection agency, says it’s against the law for a lender to deceptively include credit insurance (or other optional products) in your loan without your knowledge or permission.

There are four main varieties of credit insurance: Credit life insurance pays off all or some of your loan if you die.Credit disability insurance, also known as accident and health insurance, makes payments on the loan if you become ill or injured and can’t work. Involuntary unemployment insurance, also known as involuntary loss of income, makes your loan payments if you lose your job due to no fault of your own, such as a layoff.Credit property insurance protects personal property used to secure the loan if destroyed by events like theft, accident or natural disasters.

Shopping Tips
Before deciding to buy credit insurance from a lender, think about your needs, your options, and the rates you’re going to pay. You may decide you don’t need credit insurance. If you do, credit insurance can be an expensive form of insurance. For example, it may be less expensive and more practical for you to get life insurance than credit insurance. Before deciding to buy credit insurance, you should ask:

How much is the premium?
Will the premium be financed as part of the loan? If so, it will increase your loan amount and you’ll pay additional interest, and more for points (if points are on your loan).
Can you pay monthly instead of financing the entire premium as part of your loan?
How much lower would your monthly loan payment be without the credit insurance?
Will the insurance cover the full length of your loan and the full loan amount?
What are the limits and exclusions on payment of benefits – that is, spell out exactly what’s covered and what’s not.
Is there a waiting period before the coverage becomes effective?
If you have a co-borrower, what coverage does he or she have and at what cost?
Can you cancel the insurance? If so, what kind of refund is available?

Before you sign any loan papers, ask the lender whether the loan includes any charges for voluntary credit insurance. If you don’t want credit insurance, tell the lender. If the lender still pressures you to buy insurance, find another lender. And review your loan papers carefully to be sure they have been drawn up correctly. Lenders can’t deny you credit if you don’t buy optional credit insurance – and if you don’t buy it directly from them. If a lender tells you that you’ll only get the loan if you buy the optional credit insurance, report the lender to your state attorney general, your state insurance commissioner or the FTC. Consumers should ask these same questions about other extra products offered with their loan, such as auto or shopping clubs, home or auto security plans, and debt cancellation products.