Rapid re-scoring is the act of removing negative aspects of a credit report in a very short period of time, usually within two to three business days. I like it, keep talking…
Rapid re-scoring is very different from the fraudulent services that frequent our television sets. We hear fix your credit promotions on the radio, on the television. These ‘let us fix your credit’ commercials and infomercials seem to think if they bombard us, we will begin to think they are legitimate and honest approaches to repairing credit. They are not, there is always a catch. The manner in which their commercials are done give us the impression that they have been sanctioned by the three major credit bureaus, Equifax, Experian and TransUnion. These companies word their advertisements to make us think their credit repairing is rapid re-scoring, they are not.
Rapid re-scoring can work for you if you meet certain criteria. First of all, rapid re-scoring companies will not fix or repair something on your credit report unless it legitimately needs to fixed. For example, suppose you have been a victim of identity theft and there is a credit card account that you did not open showing up on your credit report as 30 days late. Under normal circumstances it could take 6 months to over a year to clear this matter up and get it removed from your credit report. Meanwhile, this identity theft item has lowered your credit score to 650. Let’s say you’re closing on new home in 30 days. With a credit score of 650, your mortgage will be approved, but your interest rate will be 7% instead of 5.7%. You ask your mortgage lender to contact a rapid re-scoring company to have that credit card account removed from your credit and you ask them to re-calculate your credit score. Three days later, your credit score is now 780 and you qualify for a mortgage loan of 5.7%. A credit score of 780 will lower your monthly mortgage payment by $130. Without rapid re-scoring your monthly mortgage payment would be $130 more. Over thirty years that is a savings of over $45,000.00 in interest.
So, who should use rapid re-scoring? Those with FICO credit scores of 600 – 650 (and lower) should check in to rapid re-scoring, especially if you are planning to apply for a mortgage loan within the next few months.
However, it would be much better to try and fix the problems yourself a good six months before you even apply for a mortgage loan. This is because a rapid re-scorer cannot get negative items, such as late payment notations, or items that are in dispute removed. A rapid re-scorer also cannot improve your credit score if your problem is too much debt that you simply cannot pay off today. A rapid re-scorer can only improve your credit score if the creditor admits to a mistake or agrees to remove specific information. For example, you might owe a big balance on a credit card that is negatively affecting your ability to get a lower mortgage interest rate. You can pay off the credit card electronically today and have a rapid re-scorer get your credit score recalculated within 72 hours rather than waiting for your payment to show up on your credit report a month or two later.
A rapid re-scorer requires evidence to complete the rescoring process. For example, a creditor may have sent you with a letter admitting their mistake and that the account being reported as yours really isn’t yours and they intend to remove it from your credit history. Or, a creditor might admit that an account was fraudulently opened in your name by a thief and has agreed to remove it from your credit report. Although a rapid rescoring company usually requires that you provide proof, some rapid re-scorers may contact the creditor directly and obtain the proof for you.
It is also important to remember that a rapid re-scorer cannot fix all problems within 72 hours as they often claim in their advertising. Sometimes it might take them a week or two, but in any event, it is always more faster than fixing credit report errors the traditional way — by mail, waiting a month or two for changes to occur in one’s credit report before a new, improved credit score can be calculated.
There is a cost for rapid re-scoring. It could be as low as $25 for each up to as much as $100 for each item. A small price to pay if it means the difference between renting and home ownership. Rapid rescoring companies do not advertise, so they may difficult to find. The best way to locate a rapid re-scorer or a rapid rescoring company is through a mortgage broker. Mortgage brokers can be your best friend if your credit score is not what it should be.
Again, it is better to improve your credit score at least six months before you apply for a mortgage loan. To get the process started, order your free credit reports now at http://www.annualcreditreport.comand start working on correcting errors and paying off debt before you even apply for a mortgage loan. You can also order your three FICO credit scores at myfico.com for a small fee.
Be sure to tune into our radio broadcast, Improving Your Credit Worthiness every Wednesday on WSIV 1540 AM from 2 – 2:30pm. To schedule a seminar or workshop for your family, organization, group or church call us at 315-446-4668. We also conduct empowering, wealth building workshops. Visit our website at: http://www.yourcreditworthiness.org. You may also contact us via email: info@yourcreditworthiness.org.
