Did you know that making small changes on a credit report–and how you use your available credit lines–can make big differences in your scores?
Here are 10 things every consumer should know about credit:
1. Paid tax liens can be removed.
Paid (Released or satisfied) federal tax liens can be deleted from a credit report and all other public records within 30 days.
2. Some unpaid tax liens can be deleted.
Federal tax liens can also be deleted if they have balances of less than 25k with on time payments to the IRS.
3. Add authorized users to increase scores.
Adding authorized users can increase credit scores in as little as 3 weeks for free! No fees and no credit checks. Best of all, they cannot be denied.
4. Fix inaccurate or additional personal information.
Ninety-percent of credit reports have additional personal information that is either inaccurate or dated. Make sure your credit report is showing accurate information. If there is inaccurate information showing, there are typically phone numbers associated with credit agencies directly on your credit report. Call and set it straight—it will be worth the time.
5. Add secured cards.
Adding secured cards can help improve the credit profile and ultimately help a borrower get a loan approval. This needs to be structured a certain way but is extremely effective within a couple months.
6. Keep balances below 30 percent of available credit.
Credit card balances should be below 30 percent of credit all the time. If you need more credit, get more trade lines (lenders like to see 3-5 trade lines).
7. Consolidate student loans.
If student loans are in default, they can be consolidated and transferred to the U.S. Department of Education. This will make a huge difference in score and overall approval strength.
8. Put burden of proof back on creditor.
Collections and charge-offs are deleted at roughly 70 percent. They generally don’t have the documentation to support the account properly and our system puts the burden of proof back on the creditor.
9. Limit credit inquiries.
You should only have seven inquiries a year. Anything more than that can affect the score.
10. Setup automatic bill pay.
If you’re not good at paying bills on time on a monthly basis, set up direct withdrawal of the fixed payment accounts. Every creditor offers this option and it can turn a terrible payer into a perfect credit consumer for the rest of their lives.
Marc Demetriou, CLU, ChFC is a branch manager and mortgage consultant at Residential Home Funding Corp. – Bloomingdale Branch. He recently was named a Five Star Mortgage Professional for superior customer service and professionalism in New Jersey Monthly magazine (March 2017). In 2014, 2016, and again in 2017, Marc was selected as one of the top 100 mortgage experts in the United States by Mortgage Professional America Magazine on their “Hot 100” list and was just named as one of the Top 1% Mortgage Originators in the United States (Mortgage Executive Magazine, Winter 2017 edition). He is a mortgage and reverse mortgage expert with over 11 years of experience in the mortgage industry, and over 25 years in the finance and banking industries. He can be reached at (973) 492-0117 or firstname.lastname@example.org.