The trouble is not only with mortgage scammers; it also stems from credit bureaus not being diligent with checking accuracy of negative information in credit files. Another common problem with credit bureaus is the practice of medical payments, not paid by insurance companies on a timely basis, that are allowed to be sent to collections.

Then, of course, there is the bankruptcy laws that were recently changed ; these laws give no relief to credit cards while causing tens of thousands to lose not only their credit cards but also their homes. Next are the credit card companies that are lowering credit limits when credit scores go below a certain point; this loses debt to credit ratios causing scores to drop yet again and putting people into a credit tail spin with no hope of recovery any time soon. There are many more factors involved that are causing this Perfect Storm of a Credit Hurricane to hurl peoples lives and fortunes into the hands of big business and the banking system.

(A side note: do you know the definition of “Mortgage”? It’s Latin for death contract, a thirty-year death contract. Heck, we have heard of 45, 50 and 100-year death contracts. You can leave a legacy of debt for your children to keep paying.)

Fun stuff.

A home foreclosure on your credit report is a very costly thing as there are probably additional lates, multiple lates, consecutive lates, collections, etc, that are all causing your scores to not only drop like a rock but, additionally, secure a very low score for a very long time. There does comes a break to your credit score after 2 years, but the negatives stay for 7 to 10 years unless you work with a legitimate credit repair company, one that uses attorneys, to remove the negative items.  This can get you back on track with life with the ability to start moving forward once more.

The credit bureaus, under oath after a subpoena have openly stated that negatives on a credit report have no significant financial consequence other than financial gain for them.

The question then to ask is: “Why, then are they imposing 7 and 10 years for negatives that only cause pain and suffering, combined with added financial burden, to American consumers?”

What a scam they are to the American people. Congress should shut them down or, at the very least, require a revamping of the whole system to clean up the mess that credit bureaus have created with their total negligence of responsibility for accurate reporting and verifying that accuracy.

Ok, time to get off the soapbox and calm myself before moving on.

I think you get the picture. You, the little, average, normal American, are being punished way before you are found guilty without a trial or admittance of guilt. You are required to pay, over and over again for the credit bureau sin of not report accurately.

Well, I am doing something about this. I am here to tell the world about how to manage credit PLUS overcome the challenges faced by the credit industry and their injustices to the American people all for the sake of greed.

Please educate yourself on this issue; take precautions to learn all your can about credit and credit management. In the long run, it will save you tens of thousands of dollars, or more, because you educated yourself.

Heck, it could save your home, your car, your life, because you learned the secrets of credit.

There is a way to stop the madness and get you into a position of financial strength again quickly. Consider this… when you make a list of all your debts to put into bankruptcy, pick the best 1 or 2 credit cards you have plus your home and car and decide what you can afford to pay for. Keep these out of the bankruptcy and put all your other debts into the bankruptcy.

The plan is to keep these accounts active and working, paying on time and pay them down so that you have good accounts in good standing even though you have a bankruptcy on your credit file. You will find that you will bounce back from a bankruptcy as quickly as 6 months rather than 2 or 7 years.

Of coarse, using a reputable credit repair company will assist in getting the negatives off your credit reports quickly. Oh, by the way, there are only a very few credit repair companies that can remove bankruptcies, foreclosures, repossessions, and even collections quickly and efficiently.  We endorse only one.

A client was telling me of a situation he ran into and wanted to know what kind of an effect it could have on his credit score.

Well the situation was a $110k line of credit which had a balance of 96k.  This particular credit line was rated R-1 paid as agreed.  A perfect rating, right?  or was it?

Unfortunately we see this kind of thing all the time…”but wait” you say, this is a good thing!  Well, upon further investigation I found out this was actually a home equity line of credit, which makes sense.  I mean how may visa cards do you see with a 110k credit line?

Let’s look at this a couple of ways.  First thing is it’s a home equity line of credit so it’s tied to real estate which makes it a mortgage, right?  Well, yes, it is a mortage albiet a line of credit which by definition means revolving, right?  so is the R-1 rating correct or should it be M-1?

Survey says…it’s a Home Equity Line and while you don’t see this all the time the correct rating should be a mortgage shown as a Home Equity Line

When a creditor rates this line of credit as revolving or R-1 the FICO scoring system eats this alive because it sees 96K owed on a 110K available credit line so this person MUST be in trouble and might take a big hit to the credit scores.

When it is rated as a mortgage or Home Equity Line then FICO understands this is against real estate and grades it based more on payment history and not as heavily in the amount owed area.

So, then the question becomes “Why would a creditor do this?”  The answer is to keep your scores suppressed!  I know the truth can hurt but the reality is most creditors giving a home equity line do not want this line paid off.

Ok, so if they don’t want the line paid off then what’s the best way to keep these deals on their books?  You’ve got it!  By suppressing your credit scores, through misreporting, your options can become limited in what you might be able to do.  If your scores are suppressed you might not be able to get a mortgage refinance or another credit line at better terms so…..

It’s not fair but it is life and how most creditors play the game.  Fighting back is your right so if you find your HE Line of Credit rating like this it very well could be costing you money!

Be Bold!

Herschel Bentley

Currently, the states are enacting laws that allow them to put a lien, collection or judgment on your credit report in order to get you caught up on this debt.  It will be very hard to get a loan, buy or even rent if you are not current with these bills.  Plus this will stay on your report for 7 years or longer if not caught up quickly.

The solution is perhaps not as related to credit repair or credit management but to seek a better paying job and/or reduce debt so you can get caught up.

Remember that child support is for your children and this is the most important thing in your world.

My advice?

Do whatever it takes to get child support paid, and paid on time, as it will be a thorn in your credit report side until you do.  Once it is paid off, you can hire a reputable attorney service that deals in credit repair and get the judgment off your credit reports, thus giving you a clean slate to work forward on.  I only recommend one attorney firm that actually does this.  See my special blog on credit repair companies and who is reputable.