By Michael L Baker, Sr. Mortgage Loan Officer
I have a potential client that I had an initial phone conversation with today. He said his credit had taken some hits after his divorce. He then said he was considering hiring a “credit counseling” service to help him clean up his credit.
His question was “Is this a good idea?”
The short answer is no.
The long answer is…
In my experience most of these companies are scams. They’ll take your money and leave you with the same credit mess you were already in, with nothing to show for all the money you spent on them trying to help improve your credit.
Fixing your credit isn’t necessarily hard. However, it can take some work, persistence and it definitely helps to have a plan.
Below are 4 tips to get you back on the right track:
1. Pay your credit accounts on time each and every month. No. Matter. What.
2. Do not EVER close any of your credit accounts. Higher credit scores are derived from several factors and one of them is the longevity of your accounts. If you close out that Discover card that you’ve had since college then your oldest account is gone too. That’s not helping you.
3. Pay down your debt. You want all credit accounts paid down to under 50% of their high limit. So if you have a credit card account with a $1,000 limit, get the balance below $500 ASAP! Ideally keeping that account below 10% of the high limit is ideal (or $100 in this scenario).
4. Get your free credit report and look for any irregularities or potential pitfalls. It’s important to stay on top of things before they fester. Like a $100 medical collection that you were unaware of. But don’t stop here. If you have never looked at a credit report before or don’t have years of experience looking at credit reports like I do, don’t take this on by yourself. After years of looking at credit reports I can quickly show you what you need to do to fix any credit issues or irregularities.
These are just the tip of the iceberg. If you’d like to discuss your specific situation in detail give me a call at 913-735-5363. My consultation is free of charge. My company pays the initial credit report fee and foots the bill to help you rebuild your credit, so there is no cost to you.
Sound too good to be true? It’s not. We realize by doing this for you we get a client for life! Our ultimate goal is to put you in a house and a mortgage at the end of the day. It’s a win-win for everyone!