Credit Repair Kit For Dummies
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Repairing your credit and keeping it in good standing is easier if you know what’s in your credit reports. Get a free copy of each of your credit reports every year and promptly correct any errors.

Improving your credit also involves understanding how your credit score is calculated and how you can increase your score. If your credit is in trouble because you’re overextended or behind on payments, you have strategies at your disposal to help you get back on track.

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How to get your credit report from the big three credit bureaus

Examining your credit reports closely is important because the reports may contain errors, and those errors can affect what interest rates you receive, what jobs or promotions you get, and how much you pay for insurance. You want to correct any erroneous, incomplete, or out-of-date information as quickly as possible. Reviewing your credit reports regularly also helps you spot identity theft early. Here’s the contact info for the big three credit bureaus:
  • , P.O. Box 740241, Atlanta, GA, 30374 (phone: 800-685-1111)
  • , P.O. Box 2104, Allen, TX, 75013-2104 (phone: 866-200-6020)
  • , 2 Baldwin Place, P.O. Box 1000, Chester, PA, 19022-1000 (phone: 800-888-4213)
You’re entitled to at least one free copy of your credit report each year from each of the three bureaus — more than one if you’re unemployed. Whether you get a copy from one bureau every four months or all three at once, you can order your free annual reports from the , P.O. Box 105283, Atlanta, GA, 30348-5283 (phone: 877-322-8228).

How to handle an overdue mortgage

Falling behind on your mortgage payments can put you in a financial bind and, in the worst-case scenario, lead to foreclosure. It’s essential to act quickly, even if you’re uncomfortable doing so. Fortunately, you do have options to help you if your mortgage is past due. Here are some ideas to consider:
  • Call your lender or mortgage servicer immediately if you’re going to be late with a payment. The worst thing you can do is nothing. After you’re late, your grace period disappears, so a foreclosure action may be two weeks closer than you think.
  • Contact a HUD-certified counseling agency for more options. Contact the , , or . A HUD-certified counselor can advise you for free, help you work with your mortgage servicer, and refer you to local resources that you may not know about.
  • Don’t allow your mortgage to become 90 days past due. Partial payments may not be accepted after 90 days.
  • Think twice about strategic default. If you owe a great deal more on your mortgage than your home is worth and you’re considering walking away from your home, research the many negatives before mailing in your keys.
  • Find out your alternatives to foreclosure. Find options at the or .
The Further Consolidated Appropriations Act of 2020 included tax relief when a lender forgives mortgage debt. It replaced the Mortgage Forgiveness Debt Relief Act. In brief, taxes may be forgiven on mortgage debt that is discharged in 2021, provided a written agreement was entered into in 2020. Although not everyone is eligible, if you qualify, you and your spouse can avoid taxes on up to $2 million of forgiven mortgage debt. No one wants to pay taxes if they don’t have to! The offers more information on this important act for homeowners.

What makes up your credit score

and . The FICO score is better known, but VantageScore is gaining in usage every year. The components and weightings that are used to calculate credit scores are different for each model. Knowing how the scores are computed enables you to take actions to maximize your score.

  • FICO
    • Payment history (35 percent)
    • Amount and type of debt (30 percent)
    • Length of time you’ve been using credit (15 percent)
    • Variety of accounts (10 percent)
    • Number and types of new accounts and credit increase requests (generally in the last six months or so) (10 percent)
  • VantageScore
    • Total credit usage, balance, and available credit (extremely influential)
    • Credit mix and experience (highly influential)
    • Payment history (moderately influential)
    • Age of credit history (less influential)
    • New accounts (less influential)