Unplanned debtor’s bankruptcy is a common sight leaving many lenders to consider whether or not to stop lending money to borrowers. Uncertainty in an existing credit bubble affirms this thinking among lenders to loan out or set up new lines of credit for new & aged clientele – fearful of unwanted credit crunch and caught up by lack of liquidity to finance non-performing loans.
Insure against sudden loss of employment.
Who is at risk? A creditor inherited the risk of delinquency from a borrower who cannot continue servicing a mortgage loan, unable to pay up a credit card debt, or inability to finance unpaid liabilities. A debtor owned the risk of defaulting such as loss of a job, being unemployed for many months, borrowing from one bank to repay other sources, or lack of financial planning.
A sudden financial crisis, recalling the Global Financial Crisis in 2009, sent a sharp increase in rate of unemployment and many consumers found themselves not being able to perform usual routine in servicing incomplete debt repayments. This caused a spiral chain reaction to banks who cannot afford costly overnight lending (prime) rates too.
Common sights of mortgage foreclosures, appearance of debt collection agencies, influx of cheap credit repair companies, are occurring at a rapid rate. You don’t want to be seen dealing with debt collectors at your home demanding for unpaid debts or encountering aggressive credit repair companies trying to market “hot” credit repair fixes.
Therefore, it is wise to plan in advance of unforeseen economic dangers. You may invest in a personal savings plan via an insurance company or a bank. The savings association deducts your savings directly from your company’s monthly wage scheme (without you needing to lift a finger). Alternatively, you may sign up for a 401K retirement savings plan and the procedure does not differ much from a monthly savings benefit plan.
Look for a reputable credit repair company.
Once you insured against a sudden loss of employment, the next step is to protect your financial health. This could be done by searching for a prestigious credit repair company. It is not difficult to manage your current bad debts being listed by your creditors but the lack of time & resources might be of great hindrance.
A reputable credit repair company does cover most credit related problems faced by a typical debtor. Firstly, you need to ensure a few factors in determining the credibility of a credit repair agency:
- Operating or Franchising license – any credit repair firms have to prove their existence by showing you a certificate of incorporation and license number.
- Length of operations – the longer a credit repair company operates, the higher the credibility of operational procedures.
- Debtor’s portfolio mix – an agency has to be able to produce at least one-year worth of applied efforts on prominent debtor’s solutions.
- Modes of payment – an indicator as to how many vendors & merchants trusted their organization’s existence, the more types of payment the more reliable a company is.
- Comprehensive set of debtor’s solutions – the firm has to demonstrate its competencies in improving a credit score, fixing bad objects & deletion in a credit report.
Although this is a non-exhaustive list for debtors, you may take this as a reference when building your personal criteria in searching for a reputable credit repair company. It does consume time in setting up a fixated framework but it’s a one-time limited effort that could be used to find & match many prominent credit repair companies.
A lookup at your local directory listing may not be sufficient. There are established and new credit repair agencies being set up on a yearly basis – directory listing might not be updated with the latest info. Do call a local credit bureau for more information about high quality credit repair companies offering a wide range of debtor’s solutions that suit your needs.
Do an individual credit report fix.
How to fix my credit report? Before paying for aggressive credit repair solutions, ask again, do you really know what is required to fix your credit report. If the answer is a no, chances of getting conned into signing up for several unrelated credit monitoring services increase. Do not attempt to apply for affordable debtor’s solutions if you are unsure on the types of credit fixes needed!
Firstly, you ought to learn how to read a complete credit report. You’re eligible for at least one free annual credit report and up to 3 credit reports annually. Reputable credit bureaus such as Experian, Equifax and Transunion offered good credit reports to consumers looking to fix their fico scores.
There are many ways to check your credit score. Some commonly known methods are; an online credit score check, formula in credit score calculation, asking a financial planner to build a personalized credit scoring model, or hiring a credit score company. There is no right or wrong answer in inquiring a soft credit check.
Note: Different credit scoring agencies used different scoring models to determine your current score.
Understanding the importance of you to do an individual credit report fix is obligatory. It shows that you’re adopting a proactive attitude in familiarizing with bad information & items being listed in your credit report.
Hire established credit repair companies.
After learning how to fix your credit report, you may proceed to hire established credit repair companies. The chartered agency has to provide you with a broad spectrum of solutions targeting debtors in repairing a bad credit report or filing for credit dispute errors. In the end, the goal is to win a credit dispute & a complete cleanup in your credit report – being free of errors.
An established or prominent credit repair company can be costly. If you opt for an affordable credit repair service, fixing several bad objects & removing certain bad information, it’s prudent to fully understand on the procedures of clearing up your credit report. Confidence in listing out bad objects for deletion does help in obtaining a cheaper credit repair rate.
For a complete one-stop debtor’s specialist center, most consumers chose to invest in established credit repair agencies. Such services offered a broad coverage over many debt management techniques as well as having the right connections to boost an individual’s credit score.
Credit shield against identity theft.
Much paid efforts often seemed successful but in reality, failed miserably due to one major concern known as loss of personal identities. Many debtors performed the right ways in handling professional credit repair while criminal syndicates stealing your identities to obtain a maximum liability tenure. You’ll be left in a bad state when creditors issued lawyer letters and suing you to debtor’s bankruptcies (when you don’t have an idea of the problem)!
Here are some common identity theft frauds for you to apply a credit shield protection:
- New home mortgages – a regular credit check does ensure fishy items such as unknown mortgage loans at longer tenures than your home residence.
- Credit card signups – didn’t apply for new credit cards recently, this should be a trigger of credit card frauds.
- Receiving legal letters from payday loans – payday loan services issued quick cash for consumers but not applying for such services raised alarm bells.
- Getting several credit files – each individual only has one profile and additional files are subjected to stolen personal identities.
- Payment for foreign asset classes – one major problem is on outstanding debt repayments for foreign assets that don’t belong to you!
Reviewing the above “fearful” financial complications, it’s prudent to secure at least a defensive mechanism such as a credit card insurance, a credit protection or a credit shield.
Do not be a victim of identity theft. Your credit file might be in danger if you’re exposed to the public or internet. Never put your credit info for sale, divulging your credit card details online, or apply for shady credit repair companies.
Good to know about guidance: full scale credit guard protection.
In the end, you’re fully responsible for your credit file. When something bad happens, you will be liable for some financial losses and faced a decrease in reputation. Most organizations such as local & foreign banks, credit repair companies, and credit bureaus invest in cyber security defenses to ensure full privacy and confidentiality. You too have to adopt crucial measures by investing in a full scale credit guard protection.
Quote of the Day: “Buy a credit shield plan today – KIG Hall [2013-2018]”
» What you need to know about a credit report: Beautify your credit report nicely!
» What you need to know about credit repair: Know whether a claim is right or wrong!
» What you need to know about a credit card: Spend within your financial means!
» Pros & cons of a credit repair: Advantages and disadvantages of credit repair!
» Dos & don’ts of a credit repair: Dos and dons of a credit repair!
This article was originally published on February 24, 2014. It has since been updated.