Why Credit Repair Hasn’t Helped You In the Past.

If you haven’t worked with a credit repair company in the past, you probably know someone that has. We’re also willing to assume that the overall experience was more than likely distasteful at best. Truth be told, this is what lead to the creation of Tru Path Credit. After 40 years of combined real estate experience, the Tru Path co-founders said, “enough is enough!”. The credit industry is fraught with corruption and confusion because everyone benefits from the general public not understanding how their credit score works or is calculated.

As unfortunate as it is, the story of credit repair typically follows some type of slight variation from this: “I paid that $#$%* company $139 every month for 12 months and my score is the same as it was when I started!”. Regardless of the dollar amount or length of time they spent, the results rarely shine through in a big way.

NEWS FLASH: Traditional credit repair companies and their pricing models are structured to take advantage of consumers. The consumer doesn’t understand how their credit score works and a “paralegal” tells them for a low monthly fee, they can work on getting negative items removed from the consumer’s credit report. The elements of the scenario are convincing and sound official and the consumer really doesn’t know where else to turn, so they pull the trigger and enroll in the program.

The Problem is: traditional credit repair companies are able to drag out the dispute process for a long period of time, disputing 3-5 negative items per month. They’ll dispute the accounts that are oldest first because they know they’ll be the most likely accounts to be deleted. These deletions make it appear that they are doing a great job, however the accounts being deleted in the beginning are the accounts that bring the least value to the client in terms of point value. Because the consumer doesn’t understand how the dispute process works or how their score is calculated, credit repair agencies are able to string them along, month after month collecting their fees and providing little value to the consumer, unbeknown to them.

“I paid that $#$%* company $139 every month for 12 months and my score is the same as it was when I started!”

The Solution is: a credit repair agency that puts consumer education at the top of the list of priorities. At Tru Path Credit, not only do we handle the dispute process in a quick and organized way, we also provide you with an action plan. The client action plan consists of the following items that can immediately have an impact on scores when followed:

  • Specific credit Do’s and Don’ts.
  • Cedit best practices and ideas on how to implement said practices.
  • Collection negotiation guides.
  • How to manage their revolving accounts and how to maximize their point value from each trade line.
  • Highlighting missed opportunities and areas of their credit file where they may be forfeiting points.

Once there is nothing more that we can do on the dispute front, we outline all of the remaining accounts with balances and coach you on how to negotiate and settle. We also provide you with the order in which they should be addressed or not addressed at all for that matter (Caution: credit score calculation may not be as intuitive as it seems). Bottom line, if we’ve done our job, we should never have a repeat client. The Tru Path philosophy is centered around education and producing the greatest results in the shortest amount of time in order to receive referrals and recommendations from our happy clients.

Put your mind at ease knowing that you’re working with a company that truly has your best interests in mind. We want to set you up for success, sooner rather than later so that you can share a surprising credit repair story with your friends, family and co-workers that might be looking for help too.

What is an Inquiry?

Know the effects of someone “pulling” your credit.

You’ve probably heard the term “inquiry” before and you may be wondering exactly what that means and how it affects your credit score. If you want to maintain a healthy credit score it is imperative that you understand how inquiries work. Not only do they affect your credit score in a potentially big way, there are also different types of inquiries and knowing the right questions to ask when you’re applying for credit can help you save points when considering credit or loan applications.

An inquiry occurs each time a potential creditor looks at your credit report. This is more commonly referred to as, “pulling your credit”. When this occurs there are two different types of credit checks: a “soft inquiry” and a “hard inquiry”. The difference between these two types of inquiries is that a soft inquiry doesn’t affect your credit score where a hard inquiry does.

A soft inquiry is an solicited inquiry that is done without your permission, but it does not affect your credit score. To further explain, when you receive a credit offer in the mail, the company that sent it to you did a soft inquiry to determine whether or not you are possible candidate for their services. This is done to help them ensure that they are marketing their products to the right people. **WARNING**This does not mean that you will qualify for any credit offer you receive in the mail. You will still want to use a careful approach when applying for credit.

A hard inquiry on the other hand affects you much different. In this case you’ll actually lose 7 points on average! Now, that may not seem like it is that much, however, you’re going to lose those points from all 3 bureaus! AND you’ll have to spend the next 2 years recouping those lost points. Can you see how these inquiries can potentially add up very quickly and reek havoc on your score for a pretty significant chunk of time?

Now that you know a little bit more about inquiries, you might be wondering, “why on earth does it hurt my score so much when people look at my credit!?” In order to really understand this, you have to put yourself in the shoes of the individual/institution that is taking into consideration whether or not they should loan you money or issue you credit. The best way to do this is to think of it on a much more personal level. Imagine your friend Bobby comes and asks you if he can borrow $500 from you. You tell him you’ll think about it. You tell your friends Sally and Jared at lunch the next day that Bobby asked if he could borrow some money from you. Turns out, Bobby asked Sally and Jared if he could borrow $500 from each of them too! Bobby might have a good reason for needing the money, but he also appears to be desperate. This may lead you to question whether or not you should loan Bobby the money out of fear that you might not ever see it again.

Inquiries are a relatively small blemish on your credit report. However, too many of them can get out of hand quickly. You should always take into consideration each time you have credit pulled if it is worth it to your overall credit score. It is ideal to have 0-3 inquiries on your credit in a 2-3 year timespan. Anything more than that you should probably take into closer consideration before applying.

Paying That Collection Could Hurt Your Credit Score

Timing is everything when it comes to handling collection accounts.

If your credit score is suffering and you have collection accounts with balances, they may seem like the first items to address for a quick boost. While paying these accounts off seems like the logical and intuitive solution, depending on your strategy, this could potentially hurt your score.

You’re probably more confused now than you were when you started reading the article. In fact, the exact words going through your head right now are probably something along the lines of, “how on earth could my credit score possibly drop when I pay off a collection account!?” This is a fair question and undoubtedly is causing confusion and frustration among many consumers.

In order to explain how paying a collection account can hurt your score, you need to understand how a collection affects your score in the first place. When a collection account first makes an appearance on your credit score, you can expect to lose anywhere between 10-50 points. The points lost due to a collection account should not be underestimated. Not only do they affect your overall score, they are also extremely debilitating when it comes to qualifying for financing options. As with most negative items on a credit report, the more recent the activity is, the more it will negatively impact your scores. Many collections will continue to report, month after month, until it is paid or settled. This means that your score is suffering a little more with each month that the collection exists on the report.

As time goes on, the creditor or collection agency may stop reporting the collection status to the credit bureaus. If this is the case and it has been a while since your collection has reported, you have likely gained some points back as the last reporting has become less recent. However, any type of activity with this account could trigger the collector or creditor to report again. Paying the collection off to a $0 balance is included in the type of activities that can trigger the reporting to start back up again. When this happens, regardless of the balance on the account, it will still register as a brand new collection, causing your score to drop.

Now you’re probably a little more frustrated than you were when you started reading. Now you’re thinking, “if I paid the collection off, why would it still be on my credit report in the first place!?”. To answer that question, a creditor or collection agency is legally allowed to report a collection for the entire amount of time that the Statute of Limitations states, even if it is reporting a $0 balance. This is because creditors and lenders want an accurate display of your payment history. If you’ve had a collection in the past, even though it is paid, creditors/lenders want to be able to see what your financial behaviors and history look like. Which if you think about it, is a fair and reasonable request. If you were loaning out money, you’d want as much information about the spending habits and payment behaviors of those that you were loaning money to. Access to this information would ultimately lead to the decision of whether or not you were willing to accept the risk.

Ultimately, the goal of this post is to illustrate that not everything about your credit score is as intuitive as it may seem, regardless of how logical it sounds. Paying off a collection account at the wrong time could be the difference in qualifying for a mortgage loan or not. However, when you work with a team of credit experts, you’ll be able to address accounts like this at the right time in order to improve your chances of qualification.

All the Credit Repair No-No’s

Common Mistakes People Make When Trying to Repair Their Credit

One of the most frequent questions we get is, “Can I fix my own credit?”. The short answer is, yes. The more complicated answer is, there is a lot to know about credit scores, how credit works, communicating with credit bureaus and how it all relates to your own personal credit situation. If you’re not familiar with how it all works and how certain actions can affect your score, you can actually do more damage than good. While there are plenty of things you can do to help improve your credit situation, there is also a laundry list of things that you should avoid at all costs.

Don’t Contact Your Creditors without Consent

If you’re in the process of disputing items on your credit report, contacting your creditors at the wrong time is great way to set you back in your efforts. Many people get the idea that trying to settle debts or negotiating with creditors while their disputes are in progress is a great way to kill two birds with one stone. While this seems like logical reasoning, this can often times lead to detrimental setbacks in your credit repair process if you’re timing is off.

Don’t Open New Lines of Credit

If you are working on increasing your credit score, it is important to realize how a new line of credit affects your credit score in the short-term and the long-term. That being said, if you’re looking to qualify for a mortgage loan within the next 60 days and need points, this may not be the best course of action depending on your situation.

Don’t Rack Up More Credit Card Debt

Many people view their credit limit as the amount of money they have readily available to them. While this has some truth to it in a sense, it isn’t the proper way of thinking when it comes to establishing credit worthiness or managing your finances. Maximizing your score requires you to show how responsible you are with your finances. Rather than spending more, start by paying down balances that you currently have. Overall, keeping your balances low and maintained will lead to a higher score.

Don’t Pull Your Credit While Disputing

Without a doubt, it will be a temptation to pull your credit while you are in the dispute process. Fight the urge to pull your credit report repeatedly in order to check on changes in your score. It is going to feel like you are working endlessly to clean up our credit and to improve your score, but pulling your credit report will only deduct points you’ve worked so hard to get back. Remember that patience is most certainly a virtue when it comes to restoring your credit.

Don’t Make Late Payments

​Making a late payment is one of the most detrimental things that could happen while you are working on repairing your credit. More often than not, late payments occur due to forgetting about the payment due date rather than a lack of funds. Avoid unnecessary late payments by setting up automatic bill pay where you can. Your credit score reflects how responsible you are with your debts and your ability to repay what you have borrowed. If setting calendar invites or reminders helps you to be more responsible, by all means, do it.

While this list can help you improve your credit score, it is by no means all-inclusive of what is required to repair a credit score. At Tru Path Credit, we are committed to providing quick and efficient service brought to you by 20+ years of credit repair experience. Teaching you how to improve your credit score for the future is our priority. We offer our services at an extremely competitive price and alleviate you from the headache of making mistakes commonly made by those who choose to repair their own credit. Click the button below to learn how to get started today.

What is a Secured Credit Card?

Learn the Difference Between Secured and Unsecured Cards and How They Can Help Your Credit Score.

If you’re working on improving your credit score and having a hard time qualifying for credit at the same time, this blog post is for you! This situation can be an extremely frustrating one, but we are here to help you through it. You may be asking yourself, “How can I possibly build my credit if I’m not even able to qualify for a credit card?”, and that is actually a great question. Our goal with this post is to explain the difference between secured and unsecured credit cards along with how and when they can benefit you.

When most people think of credit cards, they think of cards that offer cash back, travel incentives, air miles, interest free periods, etc. These credit cards are actually unsecured credit cards, which means they do not require cash collateral in order to obtain them. That being said, if you have good or acceptable credit, you have a better chance of qualifying for an unsecured card. However, if you have poor credit, you become a higher risk customer in terms of paying back your debts, therefore qualifying for an unsecured card can be extremely difficult, if not impossible, depending on your credit situation.

If you find yourself in the latter situation, with poor credit or no credit, it is not the end of the world. While a secured card requires a collateral deposit, the good news is that anyone can get a secured card as long as they are able to pay said collateral deposit. Typically you can find secured cards at the same institutions you can find unsecured cards starting at $300 for your deposit. Once the deposit is paid, your secured card works just like an unsecured card. You will incur interest if you don’t pay off your balance on time, your credit will be affected in relation to how much of your limit you spend, etc. The main difference is simply the deposit you put down up front in case you don’t pay off your debt.

After you have paid the deposit, the next step is understanding that the amount you pay for the deposit is also your credit limit for that card. For example, if your deposit it $300, then your credit limit is $300. Simple. The harder part is managing that available credit responsibly. Understand that getting a secured card is to help build your credit to a score that will help you qualify for an unsecured card. Many institutions will actually transfer your secured line of credit to an unsecured line of credit once you are able to qualify. That being said, having low balances and paying off your balance at the end of each month are the behaviors that will over time increase your score, regardless of whether it is a secured or unsecured credit card.

Credit scores are like fingerprints; every single one is unique and requires different action. It can be extremely difficult to determine what to do next or what to do at all if you are stuck with poor credit. At Tru Path Credit, we have the art of credit repair boiled down to a science. If you need help with your credit, click here and we will get you started on your path to great credit with a unique action plan based on your situation.

How Much A Late Payment Affects Your Credit Score

One of our most frequently asked questions is, “how much does a late payment affect my score?”. Unfortunately our answer is the same as a lot of our answers, “it depends”. While there are multiple factors that determine how much your score will be affected by a late payment, it is certain that your payment history is one of the largest variables of your overall credit score. Therefore, it is critical that you try to avoid late payments at all costs.

Unfortunately, late payments still happen for many different reasons. Regardless of why it happened, it is more important to know what to consider and potentially do if it does happen. The first factor to consider is how delinquent the payment was. Late payments are reported to the credit bureaus as 30, 60, 90, 120 and 150 days late. If the payment has still not been paid off by 150 days, the creditor will most likely charge it off or send it to a collection agency. While a late payment hurts your score, you can recover from it quicker by getting caught up with the payments that you missed. However, once it is sent to a collection agency or becomes a judgement, you no longer have the ability to become current on the account and your credit score will suffer even more.

The next thing you’ll want to consider is how many accounts on your credit report are delinquent. The more late payments you have on your credit report, the more your score is going to suffer. As with most items negatively impacting a credit report, the longer it has been since it occurred, the less it is going to affect your credit.

Recency is typically the largest factor when it comes to late payments. One recent late payment has the potential of hurting your credit more than several late payments in the past. Once again, it all depends on your overall credit situation. The best thing you can do with a recent late payment is to bring the account to a current status by making your missed payments. If you have never been late on a payment, it is worth reaching out to your creditors to explain what happened and ask them to forgive this occurrence. This helps in a lot of situations if your history with the creditor is and has been in good standing otherwise. The worst thing that could happen is that they say no, but it is a worth a try to get it removed.

Two widely “unknown” facts about late payments:

The higher your credit score is, the more points you will lose due to a late payment. Yes, you are penalized more when you have displayed better credit habits. While this doesn’t seem fair and isn’t necessarily intuitive, it does give you more incentive to protect your credit score and make sure that you never get a late payment.
If you have a certain number of late payments within a certain timeframe, you may experience a cap on your score for 12 months or more, keeping you from being able to qualify for a mortgage loan until you can display a consistent change in behavior.
Now that you understand the severity of a late payment impact, the best thing you can do is stay on top of your payments. If that requires you setting up auto-payments, reminders or calendar events every month, do it. The time it will take you to set these up will be worth never having a late payment on your record. Be sure to check out Tru Path Credit’s Education Center to learn more about what you can be doing to improve your credit score.

Qualifying for a Mortgage Loan

Learn What You Need to Consider When You’re Ready for a Home Purchase

If you are looking to purchase a new home, unfortunately, it isn’t as simple as anyone ever hopes it will be. That being said, you can definitely avoid a lot of mistakes and setbacks if you do your research beforehand. The loan process can be quite strict and there are both loopholes and deterrents that you will want to be aware of as you start the home-buying process.

When you set out to purchase a new home, one of the first decisions you are going to have to make is whether you want a fixed-rate or an adjustable-rate mortgage. While there are pros and cons to each of the choices it is important to understand your options down the road once you have made a decision. There are actually many different factors to consider when making this choice, but as it pertains to credit, it is important to understand that choosing an adjustable-rate mortgage to save money on payments in the beginning in hopes to refinancing into a fixed-rate down the road, isn’t a guaranteed option. If your credit score takes a hit for any reason during the initial phase of your ARM, refinancing at a lower fixed-rate might not be possible. The best thing to do is to consult with your lender about how long you plan to stay in the home in order to help determine your best option.

Once you have made a decision on adjustable vs. fixed-rate, you’ll then have to determine whether you fit better into a government-insured (FHA, VA, USDA/RHS) loan or a conventional “regular” loan. This decision is slightly more cut and dry in the sense that you’ll most likely fit right into one option rather than the other based on your current financial/credit situation. One thing to keep in mind with this option is that conventional loans are not insured by the federal government, whereas the government-insured loans are, hence the title. If you are trying to determine which type of loan, here are some requirements you will need to be aware of in terms of credit acceptance:

  • FHA (Government-Insured): There are several benefits of going the FHA route including, but not limited to, a smaller down payment requirement, easier approval, more flexible credit guidelines along with several other benefits that don’t pertain as much to your credit score. That being said, in order to qualify for an FHA loan your credit score must be a 500 or higher in order to qualify. However, if you want to qualify for the option of the 3.5% down-payment, you are required to have a 580 or higher. Now those are the FHA guidelines, but you’ll also have to meet your lenders guidelines too. This can come to a surprise to many during the pre-qualification process, but there are still many lenders out there that will require a 620 or higher even though FHA requires a 500. This may seem like a setback, but in reality, it is still a heck of lot easier to qualify for an FHA loan rather than a conventional loan.
  • VA (Government-Insured): The credit requirements for a VA loan depends on the lender, but a 620 or higher is typically what you will need in order to qualify. In addition to a qualifying credit score, you will also need sufficient income and a Certificate of Eligibility (COE). One of the greatest benefits of a VA loan is that there is no down-payment requirement.
  • USDA (Government-Insured): A USDA loan is not as common as the other government-issued loans. One of the reasons being that it is only available in rural areas. The credit requirements for a USDA a slightly higher than other loans, where most lenders are looking for a 660 score or higher.
  • Conventional: A conventional loan requires a 640 credit score or higher. These loans are initiated in the private sector and have no government backing or approval. The main reason for choosing to go with a conventional loan is to avoid the cost of mortgage insurance. However, this is only an option if you are able to put 20% or more down on the home. If you have less than 20% to put down on the home, you’ll be required to pay PMI, at which point you have to determine the difference of this cost versus the extra mortgage insurance cost with an FHA loan. PMI is typically much less, but you’re also putting a lot more than 3.5% down on the home. Generally speaking, if you can’t put down 20% or more, the FHA typically pans out to be the better option.

Regardless of what type of loan you are looking to qualify for, it is important to remember that the higher your score is, the more you are going to save on interest in the long-run. That being said, getting the bare minimum score might get you into your home, but it is not saving you any money or putting you in a better situation for all of your future financing. TruPath Credit is here to help you get a qualifying score and to take you to the next level of your credit potential. Give us a call today at (385)419-0878 to learn how to get started and qualified as quickly as possible.

Can’t Afford Credit Repair?

Why you can’t afford not  to repair your credit.

Do you find yourself saying that you can’t afford credit repair? If so, this post is to help you find some potential savings that might allow you to change this mindset. It is our experience, that the majority of those that “can’t afford credit repair” are the same group of people that can’t afford to not repair their credit. We’re willing to put a wager on the reason you feel that you can’t afford the cost of credit repair is because you’re paying extremely high interest rates on your financing and it is ultimately sucking the lifeblood out of your monthly budget. It’s true: repairing your credit may take some additional money, but unless you’re able to establish a savings plan in order to afford these necessities, you may be digging yourself a deeper hole.

We know that saving extra money when you’re barely making ends meet may seem overwhelming and impossible, but there are some areas that you can consider before you make the determination that credit repair is out of the question. Here are 7 areas of your life that you may be able to explore potential savings:

  1. Cell Phones

We’ve reached a time where many of us feel as if we can’t live without our smartphone. In fact, many households are including their children on their monthly plan as well, driving that overall monthly cost up. We can all agree that cell phones and smartphones make our lives a lot easier, however, this is an easy category to trim the fat for the short-term in order to achieve our long-term goals. Consider how many phone lines are included on your monthly bill and determine if any of them can be eliminated for the time being. It may be convenient for your child to have their own cell phone, but surely, everyone around them has a phone that they can borrow in order to check-in with you.

  1. Monthly Subscription

In addition to cell phones, our technological advancements have provided all types of entertainment and luxury that are offered for relatively small fees every month. The problem is, those monthly subscriptions add up really quickly and some of the accounts that we pay for are such a nominal fee that we forget about them and don’t even use them. Take a minute to look at your bank statement over the past 90 days and see what is being debited over and over and determine whether or not there is anything you can eliminate. Keep in mind that “Netflix and Chill” might be an activity that is worth sacrificing for the next 6 months in order to for you to reach your financial goals.

  1. Cable/Satellite Subscription

We’re not going to lie. This is a big one! We understand the comfort in being able to snuggle up on the couch after a long day’s work and winding down to your favorite show or watching your team play on Sunday after the long week. This is one of the hardest amenities for people to part with as well as one of the most expensive line items on a household budget. Often times, the difference between you achieving a better credit score and a better overall financial position comes down to eliminating this expense. Get creative, find new activities that are cheaper or free in order to fill your time.

  1. Dining Out

There is definitely an element of convenience when it comes to going out for a meal. The bad news is, you’re pocketbook takes a beating in exchange. Get into a better habit of preparing weekly grocery lists, packing lunches and planning dinners is what it will take in order to eliminate this enormous cost.

  1. Transportation

There are a lot of factors you can consider when it comes to transportation costs. How many vehicles do you have in the family? Are all of them being used? Does your vehicle get good gas mileage? What is the cost of the licensing and registering the type of vehicle that you have? What is your primary mode of transportation? Do you carpool or utilize public transportation? Pick away at some of these questions to determine if there are any cost savings available to you.

  1. Routines and Habits

Consider your routine throughout the day and if there is a daily or weekly expense that maybe isn’t necessary. Do you buy a coffee every morning on your way to work? Do you buy a soda at the vending machine on your lunch break? Do you pack your lunch for work or do you dine out every day? Analyze where you’re money is going and determine what can be eliminated. Odds are, whatever it is, it will most likely benefit your pocketbook and your health. Win! Win!

  1. Energy Costs

Sometimes making small adjustments can add up to huge savings! Did you know that you can save up to 3% on your gas bill for every 1 degree lower that your thermostat is set to in the winter? In the summer you can achieve the same savings on your power bill for every 1 degree higher the thermostat is set. Some small adjustments and an extra blanket could help retain some extra money in your bank account each month.

Reach out to us with any questions or click on this link if you’re ready to schedule your free credit consultation. 

 

Credit Repair Is For Everyone

Good Scores and Bad Scores All Have Room for Improvement

Talking about your credit situation has become somewhat taboo in our culture. It is one of those things that most people simply don’t feel comfortable talking about with others. The truth is though, whether you have really great credit or really poor credit, there is more often than not, room for improvement. When you understand the savings that come with a credit score better than the one you currently have, you’ll realize that credit repair isn’t just for those with poor credit; it is for everyone.

The easiest way to illustrate this is simply, the better your credit score is, the more money you are going to save in interest. If you understand loans and balances, you know that in most scenarios, there are two portions of your payment. One portion is the principal, the actual amount borrowed to you, and the other portion is interest, how banks and financial institutions make their money. If you have a better credit score, you’re showing creditors that you are more responsible with paying back your debts and managing your money. That being said, your creditor is going to charge you less in interest because you aren’t as much of a risk as someone who has a credit score lower than yours. Pretty simple to understand, yeah?

Now, taking that knowledge and applying it to your own credit situation, most likely there is room for improvement. The fact in the matter is, if you could save even more money on interest with a better credit score than you have now, it makes sense to always be improving your score. Right!?

Unfortunately, “credit repair” has established a negative connotation in our society, which simultaneously drives people away from educating themselves or getting help simply because they don’t want to be labeled as someone who needs help with their credit. However, the truth is, there are very few people that understand credit well enough to obtain an 800+ credit score. This isn’t because they aren’t responsible with their money or don’t pay their bills on time. It is simply because your credit score is made up of many different variable, many of which aren’t as intuitive as you would think. The only way to always be improving your score is to continue educating yourself and learning how to build credit correctly.

At Tru Path Credit, whether you have great credit or poor credit, we treat everyone like family! We are here to help you out of tough credit situations and to equip you with the tools and assistance you need to establish, repair or build your credit. No matter what your credit score is or the situation you find yourself in, we have the tips, tricks and knowledge to help you continue improving to help you save money in the long-run. Click the button below to learn how to get started today.

Revolving Credit

What It Is and Why It Matters When it comes to credit, there are different types and they all make up different parts of your overall credit score. Having an understanding of the differences and how they work is essential to building and maintaining your credit score. Revolving credit is a type of credit that […]