Consumer Credit Information
CYB would like to give you some helpful hints on how to deal with the burden of
For starters, don't believe everything those "quick fix" credit repair services
say they can do for you. In many cases they don't or can't deliver everything they
advertise. Remember the saying: "If it sounds too good to be true - it probably
is." As we become an increasingly credit-based society where many financial transactions
are done on credit, a good credit standing is quickly becoming one of the most important
aspects of our lives. Our credit standing is one of the only things that is free
to us and is under our complete control.
In most states only attorneys or licensed, not-for-profit credit counseling agencies
can provide you with real assistance with budget planning (debt repayment plans)
and help you to achieve financial freedom. High spending on credit has been compared
by many to illnesses such as alcoholism and gambling. There are now many counseling
groups, which are equipped to deal with out of control spending habits. You should
contact your local government or hospital for information on counseling services
that may be available in your area. The following are some additional suggestions
that CYB recommends to help you start to relieve your financial burdens.
1. If you are being pursued by a collection
agency, it is always better to contact them immediately, rather than ignoring them.
Usually, contacting the collection company right away is the same as still dealing
with the original creditor. In most cases, the collection company will not report
your account to a credit bureau for the first 30 days. If you can resolve the situation
with a payment or payment plan at that point, there is a good chance you will avoid
being reported to the credit bureaus. Each collection company has different arrangements
with their original creditor, so be sure to ask the collection company if the account
has been or will be reported and ask if you can make an arrangement to pay beforehand.
2. If a past due bill is still owed to
the original creditor and has not yet been placed with a professional collection
agency and you are having difficulty in paying the full amount due, the same philosophy
as tip #1 applies. Do not ignore the creditor and do not send in partial payments
without first working out a payment arrangement. Often, the original creditor will
be more than happy to set up a payment plan to assist you in paying your debt. In
some cases, if you have absolutely no means to pay the full amount, they may even
be willing to settle your debt for less than the full amount of your outstanding
3. If you are beyond the point of dealing
directly with the creditor or don't feel comfortable doing so, you can contact a
not-for-profit credit counseling agency. These services will usually offer counseling,
workshops, education and, most importantly, debt repayment plans. In most cases,
these services are offered for free or for a small fee based on your income. If
you do decide to use one of these organizations, make sure to find out and confirm
that they are properly licensed.
4. You may have heard advertisements
for various debt reduction companies. These companies are usually for-profit organizations
that are paying high advertising fees, often in the hundreds of thousands of dollars.
Of course, their customers are the people who actually pay for those advertisements.
If you are truly serious about reducing your debt, you should probably avoid dealing
with anyone whose main goal is to make a profit.
5. Refinancing a home can be a helpful
way to pay down debt, but be very careful when choosing a lender to refinance with.
You could run the risk of losing your home if you don't keep your payment plans
in force. It is our suggestion that you have a qualified attorney review any refinancing
application thoroughly before you sign it. CYB is currently in the process of developing
relationships with some high quality refinancing sources. Check with us in the near
future for more information on this important subject.
6. Remember to continue to make payments
to creditors, unless payments are being made through your credit counseling company.
By continuing to pay your debt monthly, or according to your agreement with the
creditor, you will protect your credit rating and avoid any lawsuits and judgments
7. Every consumer has the right to give
a written statement to all three of the major credit bureaus. So if you have reasons
why you were late or delinquent due to certain circumstances such as loss of job,
divorce, death or any other hardship, it is our advice that you put the reasons
in writing as a statement to be attached to your credit reports. This will let future
creditors understand why you may have had late payments in the past.
8. You are your own best source for repairing
your credit. Follow some of the helpful hints recommended here to eventually get
all of your debts paid. Once that is done, you can contact the creditors directly
and explain why you had problems paying them. Always follow up with a letter to
the creditor and make sure you keep a copy and send it via certified mail / return
receipt. Keep a file of those letters for future reference. When applying for new
credit, it is always best to be honest and upfront regarding your credit history.
Have your file of letters handy to demonstrate to any new lenders your efforts and
commitment to keep yourself free of debt. In many states, you can receive a free
copy of your credit report from all three major credit-reporting bureaus. In the
states where this is not free, there will be a very nominal fee.
Experian / TRW
P.O. Box 2002
Allen, TX 75013
P.O. Box 105496
Atlanta, Ga. 30348-5496
P.O. Box 1000
Chester, PA 19022
Remember it is always better to resolve a situation through communication, rather
than putting up a "defensive wall."
Call the creditors or the collection companies and resolve your debt problems