It happens to many people sooner or later: a financial challenge knocks you down and your credit goes down with you. How can you stop the descending spiral of financial collapse? The good news is: while it does take some time and effort, even the worst credit can be salvaged and be well above average again within 12 months! This special report details strategies that will get you back on a positive financial track and help you rebuild your credit quickly.

2.  Many people experience a financial challenge that
destroys their credit.
 The good news is that even the worst credit can be
salvaged and put your credit score well above average
within 12 months.
 Here is a plan that will get you back on track.
Introduction

3.  Credit scores range from 300 to 850.
 A good credit score: around 680.
 There are five (5) components to your credit score:
How Your Credit Score is Calculated
• 35% of credit score
• Based on timely
payments
Payment
History
• 30% of credit score
• Based on credit
utilization
Amounts
Owed

4. How Your Credit Score is Calculated Cont’d.
• 15% of credit score
• Based on how long
accounts are open
Length of
Credit History
• 10% of credit score
• New accounts lower
your credit score
New Credit
• 10% of credit score
• Establish varied types
of credit
Types of
Credit

5.  People end up with credit woes for one of two reasons:
 Aim to have at least $500 in your emergency fund.
Start Your Emergency Fund
Not enough
savings to
weather
financial issue
More debt than
income could
support

6.  Consider whether the following things are really
necessary:
Limit Your Spending and Create a Budget
Multiple Cars
• Consider car
pooling
• Realize savings
in gas,
maintenance &
loans if you have
one car
Cell Phone
• Not as utilized in
emergencies as
most people
think
• Eliminate land
line and keep
pre-paid cell
phone

7.  Consider whether the following things are really
necessary:
Limit Your Spending and Create a Budget
Cont’d.
Internet
• Can be a
distraction
• Utilize free
Wi-Fi in public
places if you
need to use the
internet
Eating Out
• Average family
spends 40% of
income on
eating out
• Visit grocery
store more

8.  Start thinking about other things you could potentially
minimize or remove from your expenses.
 Use easily accessible and free resources available to
help you develop a realistic budget.
 Review your budget weekly and you'll be well on your
way to fixing many troublesome money habits.
Limit Your Spending and Create a Budget
Cont’d.

9.  Consider your free time now that you have eliminated
things like cable TV or internet access.
 Spend free time generating additional income by getting
paid for doing something you enjoy.
 It doesn't need to pay a lot to make a significant
difference. This is especially true if you've given up an
activity that costs money for a new activity that earns
you money!
Increase Your Income

10.  There are 2 basic strategies to eliminate debt:
Eliminate Your Debt
“Some debts are fun when you are acquiring them, but
none are fun when you set about retiring them.”
Ogden Nash
Eliminate
Debt
Pay debt
with highest
interest rate
Pay debt
with
smallest
balance

11.  The only debt you should have is debt to generate
income, like a mortgage on a rental property that
provides a positive cash flow.
 Avoid creating new debt while you’re busy eliminating
existing debt!
“It is the debtor that is ruined by hard times.”
Rutherford B. Hayes
Tips for Eliminating Debt

12.  There are three components to rebuilding credit:
Rebuild Your Credit
Minimize negative info
Have negative data
removed
Create new credit

13.  Two main factors help to minimize negatives:
Rebuild Your Credit – Minimize Negatives
Pay on
Time
Pay
Down
Balances

14.  Rebuilding will take some time, but if you're aggressive,
you can eliminate any negative information on your
credit report, even a bankruptcy.
Rebuild Your Credit:
Have the Negatives Removed

15. 1. Get a current copy of your credit report.
2. Analyze your credit reports.
3. Write letters to the credit bureaus disputing the
information.
4. Send the letters by registered or certified mail.
5. Keep excellent records.
6. Wait.
7. Review your results.
8. Take the next step.
9. Repeat.
Rebuild Your Credit – Steps for Having
Negative Information Removed

16.  The Fair Credit Reporting Act stipulates that you can
receive a free copy of your credit report from Equifax,
TransUnion, and Experian every year.
 https://www.annualcreditreport.com is the official place to
get your free copies.
Step 1. Get a Copy of Your Credit Report

17. Step 2. Analyze Your Credit Reports
 Negative information in order of seriousness:
• Bankruptcy
• Foreclosures
• Repossessions
• Loan Defaults
• Court Judgments
• Collections
• Past Due Payments
• Late Payments
• Credit Rejections
• Credit Inquiries

18. Step 3. Write Letters to the Credit Bureaus
Disputing the Information
Do not send letter electronically. Mail a physical letter.
Include name on account & amount owed.
State that you are disputing the accuracy of the
report.
Include name, date of birth, address, social security
number, and a copy of your driver's license

19. Step 4. Send the Letters by Registered or
Certified Mail
 This is important as you will need proof of when the
letters were received by the credit bureaus.

20. Step 5. Keep Excellent Records
 Keep copies of all your letters, the responses you
receive, and the receipts from your mailings.
 Also keep detailed records of any phone conversations.
At a minimum, you should record the time, date, to
whom you spoke, and what was discussed.

21. Step 6. Wait
 After the credit bureaus receive your dispute, they are
required to do the following:
Respond to all
disputes within
30 days.
Transmit to the creditor
all relevant evidence
submitted by the
consumer
Send written notice of the
results within five days of its
completion; include a copy of
the amended credit file

22. Step 7. Review Your Results
 There are only three possibilities:
The item has
been removed
You don't get a
timely response
The item comes
back 'verified'

23. Step 8. Take the Next Step
If no response
after 35 days:
Send letter
that they did
not comply
with the law
Request that
disputed
accounts be
removed
If returned
‘verified’:
Ask for info
about method
of verification
Make request
via phone

24. Step 8. Requesting Method of Verification
Call reporting
agency
Get number from
report
Give them reference
number
Ask for method
of verification per
FCRA Section
611(a)(7)

25. Step 8. Requesting Method of Verification
Cont’d.
If agency cannot
confirm they verified
with original creditor:
Ask for phone
number for
original creditor
Call original creditor Ask for records

26. Step 8. Requesting Method of Verification
Cont’d.
If original creditor
cannot provide
records:
Ask for a mail
copy under new
FACTA Act
If you are sent
records, review them
If original creditor
has no records,
take next step

27. Step 8. Requesting Method of Verification –
Next Step
Inform the credit bureau that they must open another
dispute.
Give the name and number of the person who you spoke
to at the original creditor.
Call the credit bureau back.
Tell them the original creditor has no records.

28. Step 8. Requesting Method of Verification –
Next Step
If they still refuse:
Send the information via certified letter along with an
intent to sue letter.
If credit bureau refuses:
Inform them you will sue for willful non-compliance under
section FCRA 616.

29. Step 9. Repeat
 If you are unable to remove items from report, re-submit
dispute with any of the following reasons:

30. Step 9. Repeat, cont’d.
• I didn't pay late that month.
• Incorrect amount
• Incorrect account number
• Incorrect original creditor
• Incorrect charge-off date
• Incorrect date of last activity
• Incorrect balance
• Incorrect credit limit
• Incorrect status - there are about 20 of these.
• Incorrect highest credit usage

31. Credit Repair Companies
Research to find a
reputable
company.
The process
takes them
longer than it
takes you.
Fees are
usually set per
a certain
amount of work
each month.

32. Debt Settlement
 If you're way behind on your unsecured debt (credit
cards) payments, it is possible to have it reduced
dramatically by debt collectors.
 Did you know that debt collectors are authorized to
accept less than the full amount as payment in-full?
 This amount can be as low as 25%.
“Ten million dollars after I’d become a star
I was deeply in debt.”
Sammy Davis, Jr.

33. Suing Credit Bureaus
 If credit bureaus are in violation of the law, they can be
fined up to $1,000 per violation. They are rarely willing to
go to court; they will almost always settle just before
going to the judge.
 The trick is, you have to show up to court. The credit
bureaus will always show up, just to see if you show up.
 Rest assured, they will settle 99% of the time and agree
to remove all the negative information.

34. Create New Credit
Secured credit cards
Secured loan
Variety of credit
• Credit limit =
Amount of Deposit
• Get a secured loan
with your collateral
• Get a secured loan,
secured credit card
and store card

35.  Having bad credit is usually either the result of bad
decisions or not having an emergency fund to take care
of a financial challenge.
 It is important to remove the cause(s) of your credit
woes. This likely means you need to increase your
income and decrease your debts and your spending.
 Establish your emergency fund, even if it's just $500 to
start!
Conclusion

36.  Focus on removing the negative items from your credit
report.
 Get new credit, no matter what it takes, and guard that
credit with your life.
 Get started now! The sooner you start the sooner you
reap the benefits.
“Who goeth a borrowing. Goeth a sorrowing.”
Thomas Tusser
Conclusion

37. We hope you enjoyed your Special Report!
Curtis Roese is an experienced professional with extensive experience in
personal finance and small business matters. Curtis writes and
publishes articles, courses, guides and special reports on his personal
finance blog.
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