I am a former Mortgage Consultant that now owns my own Credit Repair company. I wanted to pass on this top ten list to everyone. Although some people question the credit repair industry as a whole I have helped many people legally repair their credit report. Anyway below is a great top ten myths list.. Enjoy! On the surface, using these services seem to make so much sense you would assume everyone in the mortgage originating industry would be using these services. So the question is, why not? First letâ??s outline the top 10 reasons loan officers give for not using these services and then letâ??s examine them in greater detail. â?¢1) Credit repair doesnâ??t work! â?¢2) Credit repair makes a clients credit worse. â?¢3) When negative items are removed they come right back on. â?¢4) Removing old negative items does not improve score that much. â?¢5) I repair clientâ??s credit myself. â?¢6) It costs too much, my clients canâ??t afford it. â?¢7) Almost everyone I work with has great credit. â?¢8) I donâ??t trust people in the credit repair industry. â?¢9) The process takes too long and is a waste of time. â?¢10) Unless I can do the loan this month, I really donâ??t care. Credit repair doesnâ??t work! OK, so here is the bottom line, it does work! When you go on the internet and do a search on credit repair you will see links to a number of websites providing information on credit repair. If you have gone to these websites you know there are a couple of things repeated over and over again. The first is that accurate information cannot be removed from your credit report. Moreover, do not let anyone tell you that it can be. Secondly, there is nothing a credit repair company can do for you that you cannot do for yourself. What you may not know is that these web sites are created or financed by the credit bureaus. So why are they spending money on these websites? The credit bureaus make money each time credit information is pulled. People with low scores or damaged credit have their credit pulled dramatically more often than those with good credit. Credit bureaus are fundamentally opposed to credit repair companies for one simple reason, it costs them money! The credit bureaus hate us and our clients love us. We do not dispute that the client has these trade lines; we simply take the creditors and credit bureaus to produce the information that they must have to verify the debt. More specifically, they must prove that everything is exactly accurate. If they do not have the documentation or something is being reported incorrectly, by law they must remove it! Knowing the specifics of the ever-changing laws is crucial. Now if the consumer knows the ins and outs of the laws as well as we do and has years of experience doing this work day in and day out they could possibly get the same results. They can also represent themselves in a court of law, do their own taxes, and sell their own homes. But they hire attorneys, accountants, and realtors everyday to get the job done most effectively and as fast as possible. Credit repair can make a clients credit worse. This is a common misconception. People often mistake credit repair for consumer credit counseling service. Nothing can be further from the reality. Consumer credit counseling almost always shows as negative on a consumerâ??s credit and credit score and should not be mistaken as credit repair done by a reputable credit repair company. When a credit counseling agency sets up a 12-36 month payment arrangement between a consumer and a creditor they are actually setting up 12-36 months of late payment history for the consumer. Even if the client makes the payments arranged by the consumer credit counseling service on time, those payments are reported to the credit bureaus as late payments. Our primary focus is credit score improvement. This is done by removing negative items on the clientâ??s credit report as well as educating the client on how to use credit to positively affect the credit score. The value of our advice can last a lifetime. When negative items are removed they come right back on. After we have removed negative items from a credit report it is always possible that the original creditor can re-report the negative item. However, this is rarely the case. Given that the original creditor generally will only hold the debt for 4-6 months, they do not waste time or the money to check on these items and re-report them. What typically happens is that the debt is sold or transferred to a collection agency which will re-report them in an effort to pressure the client to pay the debt. When this occurs we can go back and dispute the items under the same dispute that removed them in the first place. Removing old negative items does not improve the score that much. This is another common misconception that is totally untrue. While it is true that negative information is weighted meaning the older it is the less negative impact it will have on the credit score. Common sense should tell us, the very fact that this information remains on the credit report for 7-10 years means it is affecting the score in a negative way until it is removed from the credit report. I repair my clientâ??s credit myself. Consider this, as a loan officer you are paid to originate loans. A simple business concept called leverage dictates that the way to make the most money is to spend your time doing the things that generate the most income for your business. For you that means meeting with clients and taking applications. Show me a loan officer who processes their own loans and Iâ??ll show you a loan officer who does very few loans. Focus on the things that pay you the most money for the time you spend doing them and delegate the other tasks to people who are proficient at those things. How many times have you spent hours trying to repair someoneâ??s credit only to be unsuccessful or to have them go somewhere else to get the loan? It costs too much, my clients cannot afford it. Given the tremendous impact credit score has on a personâ??s overall financial life, the question really should be, how can your client afford not to contract with us? Credit affects your clientâ??s mortgage payments, car payments, credit card payments, as well as auto and homeowners insurance, and the list goes on. If we improve your clients score 50-100 points how much can you lower their monthly mortgage payment? Generally speaking, however much you are able to lower the mortgage payments we can assist the client in lowering the cost of their monthly obligations by an equal amount. So, if you lower the mortgage payments by $250 per month we can probably lower the other bills by $250 a month for a total of $500 a month. This is $6000 every year because of credit! Almost everyone I work with has great credit. A few years ago I would have looked upon this as a legitimate objection; today this statement is simply disingenuous. The reality is, if you have been in the mortgage business for 10 years or more you are seeing more bad credit reports than you probably ever have. With the coming changes in the bankruptcy laws this trend will only increase. Currently over 79% of people in the market for loans are candidates for sub-prime mortgage products. We can fix these broken people for you while you are doing other more productive things. When they are fixed you will be one of the first to know by our auto-matic notification systems. You now have a client who thinks you walk on water as well as have another transaction that otherwise may have been a â??no deal.â? I donâ??t trust people in the credit repair industry. Every industry has people who do not operate in the most professional manner. In addition, a lot of the negative stigma in the credit industry about credit repair companies is hyped up by none other than the credit bureaus themselves. Think about it for a minute, if a consumer dispute by a consumer or a credit repair company is going to add overhead to the credit bureaus operations and if the dispute process is successful, then the consumer will not be applying for credit as often because they do not need it as much, with this reducing the credit reports sold by the credit bureaus, is it any wonder that the credit bureaus would create bad press about credit repair companies. The process takes too long and is a waste of time. There are many credit repair companies who only work on 1-3 negative trade lines at a time, one bureau at a time, until they are removed. If the client has 20-40 negative trade lines which is not uncommon, this could take 2-3 years. Given this, we understand why you might feel the process takes too long. The best credit repair service will go against all three credit bureaus and an unlimited number of negative items at no extra cost to the client. Unless I can write the loan this month, I really donâ??t care. Generally, people who make this statement will not be in the business very long. That being said, we do understand why loan officers feel this way. The constant pressure to produce can be unbearable. So let us address this question with honesty. The reality is, in certain situations we may be able to bring the score up in 30-45 days to get a loan done. Bear in mind if it can be done we are uniquely qualified to get it done. The goal of service is to increase the scores 50-100 points in 90-120 days. This may allow you to do a band-aid loan today and guarantee a second transaction in the future. In addition, the long term loyalty this can create between you and your client will keep them coming back for life and referring you to all their friends, family, co-workers, etc â?¦ All the Best! David Frizzell Dispute Assist
