Hi Mike,

I just read over your guide to credit repair. I read it after the fact, but thankfully I followed everything you stated in your site on credit repair. My husband and I rent a home, which has just been offered for us to purchase. Our landlord is upside down on her mortgage and the price of the home is too good to pass up, considering where we live. We live in the Bay Area and the home price is about $250K. There are amazing deals right now with all the short sales and foreclosures. So, my immediate reaction was excitement and then realized that our credit was so bad, I didn’t think it could happen.

So I took on the task of cleaning up our credit reports. We each had 7 negative items on our reports. My husband’s FICO score was 577 and then when I got him a high fee credit card it dropped to 560. My credit score was 527. So I made it my full time job to clean it all up. I bought a binder and dividers. Each divider represented a different collection agency. I wrote down in each section the collection agency, the amount owed, the date of last activity to see how old it was for leverage and a few other miscellaneous items. I then began calling. I paid many of them immediately and some I extended out a little bit, as we still need money to live on. We still need to pay our regular bills. I finally got to the two largest accounts which were over $1000.00. I was able to get a loan from my father, negotiated a settlement with one of the collection agencies but the other was very stubborn. I just needed it off my credit report or at least paid, so I decided to pay it. We get a security deposit back when we buy the home, which will go to pay off my father for lending me the money. I started this credit repair three weeks ago and as of August 14th, 2009, our credit reports will be all cleaned up with nothing outstanding. Oh, I left a couple accounts alone because they are over six years old and my lender said they weren’t going to focus on that. They were just too old and too small.

I checked on Credit Karma, which provides TransUnion’s credit score for free. My husband’s credit score went from 560 to 601 in two weeks. This was exciting. I also disputed a couple items and when I did, noticed some of the collection agencies had deleted items, despite saying they wouldn’t. I was quite excited about this.

Our lender said he will re-run our credit reports in 30 days to see what they look like. Our goal is to have the home by November 15th, so we can take advantage of Obama’s tax incentive of $8,000.00. It is the middle of July right now and I am done. I wanted to tell you that you can have success and it can happen in less than a year if you persevere. Granted, most of our collections were not large amounts, but enough of them lowered our FICO score. Mine ha gone from 527 to 537. I do have a MasterCard which is also high fee based. I got it almost two years ago and have never been late on it. They continue to raise my limit. My problem was that I hovered around the high limit, which doesn’t look good on your credit. I have decided not to use the card anymore. I have brought the card down from a $750 limit to $630.00. I am working towards a zero balance or close to it. I have set up online payments for the next few weeks of $50 per month to lower the balance on the card. I know this will help my scores.

I just want to know, is there anything else I can do right now? I do write letters to the collection agency, along with proof that the debt has been paid, via my online bank statement. I request them to notify the credit bureaus and to delete the item from my report. I’m aware they don’t have to, but I still try. I then write a letter to each of the three credit bureaus disputing the entry. I attach proof of payment and ask them to delete the entry. I know they must contact the collection agency to see if the debt is valid. However, this may be so much work that they just refuse to do it since they have my money. I’m just trying to be pro-active in all of this.

I finally see a light at the end of the tunnel. I truly believe that we will be buying this house now and the November 15th deadline is clearly going to happen for us. If you have any feedback, that would be great.

Sincerely yours,

Robyn K.

Hi Robyn,
I am glad you did what our site recommends. Most people think that there is some credit repair miracle out there, and find out quickly its takes what we teach, along with what you have done yourself to make progress. I always recommend to everyone to make sure you have good credit reporting on your credit report. You will typically need a couple of credit cards and maybe an installment loan. Make sure you don’t close out any good credit cards. This will lower your credit scores. You should never close out good credit. If anything you should charge small amounts on your cards and pay them off every month. Its sounds to me the only thing you might be lacking is more credit. You can access all of this through our site. We provide credit cards and loans that will help improve you scores overtime. Also pull your credit report regularly and make sure that the collection companies are reporting your settlements on your collections to the credit bureaus. This is a common problem, you pay off the collection and they don’t update with the bureaus.

In regards to asking the bureaus to delete a debt that was recently paid, I personally believe your time could be better spent. A collection will stay on your credit report for 7 years from collection date. Normally a credit bureau will not remove a paid collection if it’s within that time frame.

Keep up the good work and I hope you get your Dream home in the Bay area……

Mike Clover

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