What is credit repair?

Credit repair is the process of improving your credit score. Bad credit is the major factor for people not being able to finance their consumer or home purchases. It can also be a process of disputing or fixing discrepancies shown on your credit report in the credit bureaus. A credit must be able to show proof of the existence of a debt. If they can't, they must take it off of your credit report.

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What is a charge off?

A charge off is an accounting method that allows a company to remove a bad debt from the company balance sheet. This can be utilized when a bad debt is clearly no going to be paid by a debtor. Charge offs provide several advantages for a company. It eliminates the appearance of the line item on the income statement for the corporation. This would mean that the bad debt does not appear as net income on the financial records of the company and would not be subject to taxes. The people that handle the accounting, no longer have to spend time dealing with it.

As a debtor, a charge off would be a negative mark on your credit report and would impact your credit score greatly. It is in your best interest to try to negotiate or pay the bad debt off. You can contact a lawyer or a debt negotiator to try and help you if you are not comfortable doing it yourself.

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What is the Universal Default Rate

The Universal Default Rate in relation to the financial services industry allows a lender to change the term of a loan from the normal terms to a new default term. Typically a default rate will be activated when loan payments are missed or a loan goes into default. The term is most associated with credit cards in that when a consumer fails to make a payment on a credit card, interest rates can soar to over 30% in some cases. Once you are in a default rate on a credit card, there is not much you can do to get out of the high rates. You may want to consider doing a debt consolidation program. Once you enter a debt consolidation program, your interest rates will be reduced, over limit fees stopped as will as late fees.

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What is the Fair Debt Act?

The fair debt collection practices act of 1977 is a federal law that outlines what creditors and debt collectors can get on you. It is specific on how debt collectors and bill collectors can communicat with you at home and at work. These collections agencies rules are designed to protect the debtor from abusive debt practices and harassment, trick and illegal debt collection tactics.

More on the Fair Debt Act

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What is a judgment

A judgment is simply a legal document stating the reason for a judges or judicial decision. They are written by a singe judge. In a court of law they require the repayment of a debt, the court has the authority to place a lien against the debtor's real property as collateral for the judgments creditor.

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What is CCCS

CCCS stands for consumer credit counseling services or debt management. You will also sometimes see it written as CCC. Essentially it is the same thing. A debt management company is a third party that will help you restructure your repayment of debt in a more manageable manor. Typically a debt management company will help you lower interest rates, stop late and over the limit fees. Most debt management companies design plans to have you out of debt in 5 years or less.

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What is debt settlement?

Debt settlement is essentially the same thing as debt negotiation. Debt settlement is a process by which you negotiate your charge offs and collection accounts to get out of debt or avoid filing a bankruptcy. Creditors do want to work with you to resolve your debt issues. In fact they will often times take less than what you actually owe them just to close the account out quickly. Debt settlement can be performed by a third party debt negotiator or an attorney. Typically you can save anywhere between 40 and 60 percent of what your original balance was.

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