14 Feb

How to Clean up Errors on your Credit Record

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Posted by: Jeff Parsons

There is recourse if you’re at an impasse with a credit granter over an unpaid debt. You can ask the credit bureau to intercede on your behalf. By:Ellen RosemanPersonal Finance Columnist, Published on Tue Feb 12 2013
 
Scott Smith, 24, is an MBA student. He’s proud of paying his bills on time and having an excellent credit record. So, he was surpri…sed to find his credit score had plunged when he checked in with the two Canadian credit bureaus. There was a new “derogatory” item from a collection agency acting on behalf of Cogeco, a telecom supplier.
 
Seems there was an unpaid debt arising from the cable TV box he had rented as an undergraduate and tried to return in 2010. He didn’t know the package hadn’t arrived by mail.
“I’ve now paid the balance in full, but the damage to my otherwise sparkling credit record appears to be done. This blight cannot be removed from my credit history for six years. Cogeco seems unwilling to delete it,” he said.
 
There is recourse if you’re at an impasse with a credit granter over a debt. You can ask Canada’s two credit bureaus, Equifax and TransUnion, to intercede on your behalf.
When I forwarded Smith’s email to the credit bureaus, TransUnion deleted the Cogeco account within two days and Equifax within two weeks.
 
He was smart to check his credit record before applying for a loan. With a low score, he could have been turned down by a major bank and forced to go to a lender with a higher interest rate.
 
Here are the Contact Numbers for both Equifax Credit Bureau & Trans Union Credit Bureau:
Equifax: 1-(800)-465-7166
Trans Union:  1-(800)-663-9980
7 Feb

5 Steps to Staying out of Debt!

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Posted by: Jeff Parsons

By:Karin Mizgala and Sheila Walkington Published on Sun Feb 03 2013

In this excerpt from Unstuck: How to Get Out of Your Money Rut and Start Living the Life You Want, Karin Mizgala and Sheila Walkington offer ways to stay out of the debt trap.

 

1. Know why you want to be debt-free. Imagine how good it will feel to be debt-free and the freedom or choices you will have once you are out of debt.

2. Make paying down debt a #1 priority: Making paying down debt a #1 priority doesn’t mean it’s the only priority you have, but it does have to be a priority because it’s not going to happen on its own. You might have credit cards and lines of credit that are just sort of revolving — you pay them down, you run them up, you pay them down and run them up, but in actual fact you’re not making any progress. Or you might just be paying the interest on your line of credit, but nothing towards the principal. We like to call this the ‘never-never plan’ because unless you start making extra payments, the debt will never be paid off.

3. Make debt reduction systematic. Decide on a fixed amount you will pay each month (or per payday) towards your debt, then set this up as an automatic payment with your bank. By making the payment automatic there will be no debate or wiggle room when it comes to paying the amount you decided on.

4. Keep a running tally: Track the balance on your debt each month. Make sure it is going down. When you see it go down, you’ll think twice about racking it back up. If you have several different debts — credit cards, a line of credit, student loans — take a tally, let’s say on the first of the month. Track your balances at the beginning of the month, and then again at the beginning of the next month. This will keep you honest and show how much progress you’ve made or whether you need to revisit your spending habits.

5. Shop around for a lower interest rate: Reduce your interest rate by all means. You may be carrying a balance on your credit cards at rates up to 19 per cent to 25 per cent or more so see if you can get a lower rate on your credit cards or perhaps transfer the balance to a line of credit to reduce your interest costs.

 

Excerpted from Unstuck: How to Get Out of Your Money Rut and Start Living the Life You Want, By Karin Mizgala and Sheila Walkington.