Just How Much Does Bankruptcy Cost

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Problem:

My work keeps me traveling from place to place. I have set up an automatic payment system with my bank since it is not possible for me to take care of all the bills. My bank made a payment to the creditor in May 2011. However, the post office returned the money to me. I was living in France for nearly 1 year. So, I didn't have any knowledge about this thing.

I came back to the country in May 2012. I applied for a credit card a few days ago. My

application was rejected straightway. The reason was my poor credit score. I checked my credit report. My credit score was only 200. My credit score was 698 in February 2011. Now, my credit score has dropped by so many points.

The credit card company didn't receive any payments for nearly 1 year. They have even blocked my card. I don't blame them. They have sent countless letters at my address. I was not there Real Estate Attorney In West Loop IL the country for 1 year. So, I didn't receive these letters also. The credit card company has also charged additional interest rates on the card.

After making several calls to the credit card company, the late fees have been taken care of. Please tell me what else I should do to raise my credit score.

Solution:

Your circumstance actually reveals that disadvantages of the automatic payment plan.

Previously, people used to send checks to the creditors. People used to notice when they didn't receive bills by chance.

Things have changed now. People opt for the automatic payment system. They think that their bills are taken care of. Nowadays, people don't notice or check anything until they get into serious problems.

It is not convenient for everybody to go back to the old system of making payments through checks. So, online payment system is here to stay. However, this doesn't mean that people shouldn't check their bank statements.

You should have checked your account statements online. Then you would have understood that the credit card company didn't receive any payments for so many months. Your credit score wouldn't have dropped by so many points.

You said that your credit score is only 200. This is an extremely low credit score. Something is not definitely right about your credit score. A credit score below 600 is considered low. I am referring to FICO score here. A credit score of 300 is also impossibly low. Either there are some mistakes or a different credit scoring system has been used in your case. Spend around $20 to know your actual FICO credit score once.

It is good that the credit card company has removed the late fees. Now, you have to work hard to make your credit report perfect. For that, you need to check the accuracy of the information that is there on your credit report. You can get a free copy of your credit report if you request for one. This is because the credit card company has rejected your application.

It will be better if you pull credit reports from the 3 credit reporting agencies since you're facing credit problems. You can get comprehensive information from the 3 credit reports. Next, find out if corrected information (late fees that have forgiven by the credit card company) has been published on your credit reports. If it is not there, then you need to send a letter to the credit bureau where it is written that the credit card company has withdrawn the late fees.

You can apply the same process to delete the other negative items on your credit report. It may be the case that the other credit card companies also didn't receive any payments. You've to send letters (received from other credit card companies) to credit bureaus also. This would help you correct the information on your credit report.

Keep it in mind that only inaccurate information on your credit report can be eradicated. If a credit card company has refused to forego the late payments, then that information can't be changed or deleted in any way.

It'll take many months to clean up your credit report. However, the sooner you clean your credit report, the better for you.