REBUILDING YOUR CREDIT

Rebuilding your credit is possible, but be prepared, because it takes time.  You must be really committed to rebuilding your credit as in many cases it can take years.  The good news is that if you take the right steps, your score will start to increase immediately.  Once it is over a 700 score, you will be considered to have excellent credit.  From there on, you can keep your excellent credit for the rest of your life.

 

My personal experience.  I share this story to give you hope and encourage you to make the commitment to rebuild your credit.  In 1999, I purchased an apartment building with the idea of refurbishing it and selling the units as condominium units.  I was familiar with this type of law and thought it would be a great investment.  I purchased the building and immediately, I started to go over budget.  The building was in worse condition than anticipated.  There were a lot of plumbing issues which created a lot of water leaks.  Those leaks created financial problems as the water bills were much higher than expected.  There were other unexpected expenses and I started to lose money.  I lost a total of $300,000 by the time I sold the building.  I had two vehicles repossessed as a result and my primary home fell into a foreclosure proceeding.  I had to sell that too so that I could rebuild.  I owed credit cards.  Some of them sued me in state court while others wrote off the debt.  I tried all sorts of credit repair companies which I discovered were mostly scams.  If I could have filed a chapter 7 bankruptcy, I would have recovered my credit faster, but I couldn’t [being a lawyer it creates issues with the Florida Bar].  So, I started the process and it took years [about 5 years].  As I got out of debt and rebuilt my credit, I realized this was the area of law I was destined to practice.  I became a consumer attorney dedicated to help other consumers find their path and get out of financial problems.  I discovered that ALL financial problems have solutions.

If you are ready to make this commitment, here are some things to get you started:

  1. Balances on your accounts

    This is a big one. If you are trying to save money and become prosperous, you can’t be in debt, especially credit card debt.  It makes sense– if you owe money, you are in debt and not prosperity.  Of course, there are certain debts which are investments – like a home or student loans.  Additionally, since we live in Miami or Florida, you’ll need a car.  Usually, a decent car will include a loan.  So, the first step is to reduce your debts, but what if they have already been written off or charged off?

 

  1. Collection Accounts

    These are accounts that have been written off or charged off. In these cases, I recommend that you review your financial situation with a credit lawyer.  Sometimes, settling the account is the way to go and other times, its best to just wait.  Why would one wait?  Well, after 5 years of the date of last payment, under Florida Law the credit card company can no longer sue you in court to collect.  That means if you start paying them, even little by little, it re-starts the clock exposing you to a law suit after the statute of limitations had expired.  The other reason to discuss this with an expert is because after 7 ½ years, the entire account comes off your credit report.  Many times, debt collectors will “re-age” the account and try to place it on your credit report again.  This action is a violation of the Fair Debt Collection Practices Act and the Fair Credit Reporting Act.  This means that you, as a consumer, are entitled to have the information deleted and paid compensation.  There are statutory fines awarded to consumers.  In those cases, our firm handles the case on a contingency basis and our firm does not ask our clients for any fees up front.  We are compensated by the debt collectors or companies violating the law.

 

  1. New Credit:

    This is a factor many overlook.  To rebuild your credit, you need to develop a good credit history on new or established accounts.  This means it is helpful to open new credit cards using a secured deposit.  This is offered by many banks and it is helpful if you initially try at your local bank.  As an example, if your checking account is at Bank of America, Citibank, or Wells Fargo, try opening a secured credit card with them first.  Since you already have a checking account with them, you have a better chance of being approved.  If approved, I suggest starting with a $500 deposit.  The key is to use this account for something small and pay it at the end of the month in full.  As an example, use it to pay for your gasoline and then pay the balance in full at the end of the month.  Do not use the card for anything other than gasoline.  If you have open credit cards, you can use them the same way I have mentioned above.  If you already own a home or car, it is critical that you do NOT pay late.  This will hurt your score dramatically.  Additionally, if you are being denied credit, stop having your retail credit report pulled and contact a credit lawyer.

The purpose of this article is to provide consumers with an introduction on how to rebuild your credit.  Through the years, I have learned that each person has their own individual financial portrait.  Some consumers should pay off their credit cards and some consumers should just wait.  For other consumers, a bankruptcy is the best option.

The key is that as consumers we understand the importance of our credit score.    When we ask for a loan, the determining factor on whether we will be approved or not is our credit score.  Our credit score will also determine what interest rate we will be offered.  The higher the interest rate, then the higher the monthly payment.  Keep in mind it’s for the same loan.

Our goal is to help you find financial freedom and prosperity.  It starts with you being willing to make a long term financial plan and commitment.  If you have questions, please feel free to contact us.

Samira Ghazal can help!

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There are various situation we see with clients.   Lets look at each:

  1. Bad Credit: In this type of situation, our clients have accurate credit reports, but have bad credit. No matter how bad your credit history is, we can assist in improving the score by various methods. Bad credit happens to many of us. This can be the result of an illness, business failure, or some other reason. The point being is that at some point this client had good credit, but now has lost that good credit and wants to improve their credit score. In these cases, we review the credit reports with the clients and see what options they have to improve their credit score. Sometimes, filing a bankruptcy Chapter 7 is the fastest and best way. For others, that may not be an option. Another solution is to “liquidate” some of that debt by negotiating settlement agreements. In some cases, we are able to settle and seek that the derogatory information be deleted.   Sometimes, there may be a judgment and that can be vacated and dismissed. Each case is an individual fact pattern and deserves individual attention. We believe in not only helping clients recover their credit, but to learn how the system works. Once they recover their credit, it our hope that they will know how to keep good credit for the rest of their life. Credit Repair Miami is thorough, and stays on top of the tedious work that makes credit repair happen.
  2. Inaccurate Credit: In this type of situation, there is information appearing on your credit report which does not belong to you. Sometimes client’s have an account which was opened and it does not belong to them. Sometimes, client’s have a collection account and they don’t owe any money, but it appears on their credit report. Sometimes, client’s have a common last name, like Garcia, and there is information that belongs to another person with a similar name, similar address, similar social security, or similar date of birth. In these cases, we represent our clients free of charge and seek reimbursement of all attorney’s fees and costs from the defendants. Under the Fair Credit Reporting Act, a consumer is entitled to have their attorney’s fees and costs paid by the party reporting the mis-information. The consumer is also entitled to receive compensation for financial losses and “pain and suffering”.
  3. Identity Theft:

    In this type of situation, some how the client’s personal information has been compromised and used without the permission or consent. Many times, there are various credit card or other accounts opened without the client’s knowledge. This usually comes to light because the client has been sued on an outstanding debt or is receiving collection letters/calls.   Additionally, the consumer’s also have a potential claim for invasion of privacy. Companies are responsible for protecting your information and are not allowed to pull your credit reports without your permission. Under the Fair Credit Reporting Act, a consumer is entitled to have their attorney’s fees and costs paid by the party reporting the fraudulent information or the unauthorized pull of the credit report. The consumer is also entitled to receive compensation for financial losses and “pain and suffering”.  

  4. Impermissible Pull:

    In this type of situation, a company has pulled your credit without your permission or authorization. This often happens are part of the identity theft, but some companies may pull your credit report in error. In these cases, the client is entitled to compensation and to have the inquiry removed.   Under the Fair Credit Reporting Act, a consumer is entitled to have their attorney’s fees and costs paid by the party pulling the credit report without permission. The consumer is also entitled to receive compensation for any financial losses and “pain and suffering”.

 

In any of the four situations described above, or a combination thereof, our firm is available for a free initial consultation.