see this all the time," Feldman says. " A person has a $100 doctor
bill and they say, 'I'm not paying it out of principle.' I say,
'Throw your principles out the window, it's going to cost you thousands
on your mortgage.' "
the amount of outstanding credit is important even if you've never
been charged a late fee, says Victor Benoun, a mortgage broker and
author of the book, Your Castle, No Hassle.
think if we pay all our bills we should have perfect credit," he
says. "That's not always the case. Say you have 10 credit cards
and they all have credit of $5,000," he says. "If you have the maximum
on all of them, even if you pay them all perfectly, you'll have
a lower score than someone with lower balances or fewer cards."
not always easy, Benoun admits, in a market in which consumers are
encouraged to use credit for even things such as gas and groceries.
If you're shopping for a mortgage, though, how you handle your money
makes a real difference in the kind of loan package you can qualify
a judgment has been paid, will it be automatically removed from
a credit report?
no. According to Don Taylor, one of Bankrate.com's financial experts,
"The judgment will remain on your credit report for seven years
from the filing date."
says that according to Experian's
Web site, "Federal law specifies how long negative information
may remain on your credit report. To prevent past errors from haunting
you forever, most negative information must be erased after seven
years. This includes late payments, accounts that the credit grantor
turned over to a collection agency and judgments filed against you
in court -- even if you later paid the account in full."
it possible to insert an explanation to a credit report?
are two types of comments you can put on your credit report, according
to Don Taylor, a Bankrate.com financial expert. One is an explanatory
paragraph that tells prospective lenders and employers about why
you had trouble managing your credit in the past. Lenders are more
influenced by your current payment history than they are by your
reasons for past difficulties. The statement will stay on your credit
report for seven years unless you write in to request that the statement
be removed from your credit report.
second type of consumer comment is a statement of dispute. If the
creditor and the consumer can't agree on the consumer's account
status, the consumer's statement of dispute and the creditor's statement
of the account status will both show up on the credit report. This
type of statement is an important consumer right protected by the
Fair Credit Reporting Act.