Credit Repair

Credit Repair: Credit scores make the world of consumer debt go round. The maximum is 850. Let’s just say that mine was, um, a little lower and felt a need for credit repair help as I sat down to write my hardship letter in pursuit of a loan modification. I wasn’t able to afford my ballooning mortgage, and missing payments send your score into a freefall. The good news: A loan modification, on its own, does not require credit repair and won’t sink your score. Credit repair advice starts with the basic understanding that a credit report deducts points for every “bad” item in your history -- having too much debt, applying for new debt, not paying your bills on time. Know that lenders don’t like to give money to borrowers with credit scores less than 620, sometimes more. Even when borrowers with such low scores do qualify for loans, they’re forced to pay exorbitant interest rates. (That was me.) So my hardship letter was an explanation of where my finances had been; a loan modification was about where I wanted to go to repair credit. Improving my mortgage terms was a good start to credit repair, but not a cure-all. For true credit repair, it’s about ADDING points to the credit score -- subtracting and not adding debt, paying bills on time etc.