Credit repair is something many people need, yet it remains a mystery to most. What’s the first step to fixing bad credit? How do you check your credit score? Are the negative items on your credit report legitimate?
MyMortgageInsider.com talked with Blair Warner, CEO and founder of credit repair firm Upgrade My Credit, about these issues and much more. Whether you want to keep your credit score healthy, or repair your broken credit, this video is for you.
Topics covered are:
- How and why to check your credit
- Common errors found on credit reports
- Credit reporting law and how it benefits consumers
- Managing debt/building credit
Tim: My name is Tim Lucas with MyMortgageInsider.com. I’m here interviewing Blair Warner, CEO and founder of Upgrade my Credit. He has a professional credit solutions firm out of Arlington, Texas and he’s gonna talk to us a little bit about fixing your credit and also what you can do to keep your credit healthy. How you doing Blair today?
Blair: I’m doing fantastic. It’s actually really hot today down here though.. it’s over a hundred in Texas, so..
Tim: Yah. I wouldn’t know how it’s like here. We’ve got a max of about 70 today. I mean ah,
Blair: Oh Men!
Tim: East Seattle Area in Bellevue. So ah, we’re enjoying the overcast skies right now. I’m looking outside right now where the green trees and the overcast skies. So it’s pretty nice. I can’t complain.
Blair: Well, I can. Down here. But only for couple months. It’s pretty nice.
Tim: Yah. I gladly changed places about January with you guys I’m sure.
Blair: Yah, that’s right!
Tim: So I wanna talk to you a little bit today about fixing your credit. Your firm is all about repairing people’s credit, getting stuff off credit report that they don’t deserve and managing the things that they may deserve which we’ll talk a bit about later but I was reading on your website, you have a pretty amazing story about how you became a SEO and founder of Upgrade my credit. Would you like to talk a bit about that?
Blair: Yeah. I appreciate that. Everybody has a story and I enjoy telling mine just because I hope it can be an encouragement to people. I was going along with my life doing something else, completely different—different industry and everything and then my wife was diagnosed in 2000 with stomach cancer and in 2003 she did pass away. But it’s now been 10 years. Because of that situation, after we got over a period of grieving and adapting, of course, to all that had happened; I began to look for something as a single father of four kids. I began to look for something that allow more flexibility and time and so forth and what I ended up in was doing some real estate investing—flip few houses, rehab a few houses and then being out there in the real estate world. I met a mortgage lawn officer that we ended up starting a mortgage company together. He got his broker’s license and I got my lawn officer’s license. This is back before the national licensing testing so all I gotta to do is go to Texas State License and we were blown and gone, doing mortgaging and everything until as everybody knows, things blew up in 07 and 08 in the mortgage crisis and credit crunch and so we had some decisions to make. I’m giving you the real short version. But we have some decisions to make. And we ultimately decided to close down our brokerage firm and my partner went to go work for Wells Fargo and I decided to start a credit company– Upgrade My Credit. And part of the reason I decided to that is I wanted to stay in the industry somehow. But I’ve also been helping our clients when our mortgage company was insistence. I was kinda designate the guy that was kinda help people who needs some credit work or some credit help before they could qualify for a loan. I’m pretty good at it so I decided to start a credit repair company. Since then, I got certain certification at taken some classes and conferences and built a brand new business and I love it. I’m still in the same industry. I still have the ability to help people… acquire their American dream of getting their house and I love it. It’s great.
Tim: It must feel pretty good to help people with their credit I know. It’s like having a loan officer experience in my past, just ah, that disappointment that you have to tell somebody when you pull your credit and you have a 550 score or something. You’re like, “you’re a nice person, nothing personal”. But there’s no way in the world you’re going to qualify for house at this point. So it must feel pretty good to be able to upgrade people credit as your company’s name entails. Most people never see their credit report until they do apply for their loan which was my experience as a loan officer. They’re really surprised because maybe they went to freecreditreport.com or something and pull their credit and they said they have a great credit score. But then they go to a lender, they have the lender pull their credit and it’s horrible, they have no clue or they have never seen their credit report before. How would you suggest somebody goes about checking their credit before they actually need to?
Blair: Well, it’s a very important part of the whole credit management process. A lot of people take that for granted right now, that they can just go pull their credit online or check. But as well I used to, before the fair credit reporting came in to distance, you would sit across the table from the loan officer and they would turn you down or tell you if you’re accepted or not accepted and you never got a copy of your credit report. They didn’t give it to you to take home and there’s nowhere online for you to get it. One of the things that the fair credit reporting does is for the consumers guarantee that at least one a year. They can get a free credit report. And the only true free credit report is annualcreditreport.com. That’s the only one that’s really free. But you don’t get to score. It does help if you wanting to look and see what’s on there or so forth, but people still need to know what their score is and that’s where all these other online site popped-out. Some of the problems, freecreditreport.com and so forth.. the one that we use is privacyguard.com. They can get on there, they can pull all three credit bureaus, see their reports and they get three credit scores. The difference is those credits scores are not the FICO scores that the lenders use. So again, still only a gauge for what their score might be. It’s called the vantage score and FICO score. So they really need do to know what their FICO score is and they really getting ready to buy a house or car. The best thing that they really need to do is still to go to a lender, a mortgage lender and let the mortgage lender pull it for him. But if you have a good vantage score, you probably got a pretty good FICO score, if you have a bad vantage score you gonna have a bad FICO score. Not of that much, it just won’t be accurate.
Tim: Alright. And that is really important to know that before you walk in and become surprise. So let’s say a person goes to their lender, their mortgage buddy and here she pulls her credit report and they find out that they have some dings on their credit report that they didn’t know about or maybe they did know about but weren’t aware how much was affecting their score. What’s the first step they should take at that point?
Blair: Well again, I refer back to the fair credit reporting act which gives them the right to dispute, investigate, question. Unfortunately the credit bureaus do not have to verify anything that the creditors report to them. All the big three credit bureaus do is just take information that creditors send to them, put it to nice report then send it out. So they don’t verify. It can be completely wrong. So as a consumer, if you find some stuff on there that’s wrong, that’s inaccurate, that maybe not even yours.. cause it happens. Sometimes John Senior’s stuff is on John Junior’s report vice-versa. I have this one guy come in to me once and said he and his sister’s sole security number were off just by the last number only and a lot of her negative stuff was being reported on his credit report. So that happens, if you find that the stuff is on there that you need to challenge, you have the right to do it and you can.. I can go on later about how to do that but you need to be proactive about it because again the bird proof is on the consumer not on the credit bureaus.
Tim: Sure. What are the areas that you most often see on somebody’s credit report?
Blair: Well. Most stuff on credit bills… I mean, this whole thing about ‘that’s not mine’ which is very common way to a lot of credit repair companies. These few things just dispute everything and say ‘that’s not mine, that’s not mine’. And hoping to get the low-hanging fruit. Most stuff is, I have found that does not fall in the category is ‘that’s not mine’. Most stuff falls in the category is really yours but it’s got some sort of error. Most common errors that I see are two things: One, medical, this is very often medical that’s being reported is being recorded erroneously. For example, sometimes people think that their insurance company is supposed to pay for something and it didn’t and then now it’s being reported as collection and it shouldn’t be, because it’s supposed to be paid by the insurance company. Another thing that I see is how it’s being recorded. So for example, let’s say that you have a cable bill that you did get behind or you did get in collections but they tag along all these fees and all these penalties and interests. Instead of being a hundred and seventy nine dollars, now it’s four hundred and seventy nine dollars. Well, that’s wrong. You have the right to dispute that. And at least to get that back down to the correct amount of hundred and seventy nine before we even start along with it. So those are the most common type mistakes. The other one might be related to divorced couples and stuff that was being reported for the acts and now it’s being reported on both and all that kinda mess. That’s a whole another story.
Tim: Yeah. That could be frustrating. There’s a lot of borrowers who had medical collections and that’s just a lot of time and that’s a really sad story about how they came down with some kind of medical event that really wiped them out and really destroyed their credit. Really unfortunate. So glad you’re working with people with that stuff.
Blair: Tim, I’ve seen an $8 medical collection before and it affects their credit for one little $8 collection from some medical thing that the insurance didn’t pay. It’s crazy. You’re absolutely right.
Tim: Yeah. Pretty ridiculous. You talked about into a little about the laws that are affecting people’s credit scores and credit reports. You mentioned in your websites that there’s up to 240 laws that go along with making sure that credit reports are correct and so would you go maybe one or two of the most major laws that people should be aware of?
Blair: Well, the body of laws that govern recording in my business, pretty much are the fair credit reporting act which governs how creditors can report to credit bureaus and how their credit bureaus can aggregate that information and report it so forth and gives the consumer rights. The other one is the fair-debt collection practice act which governs collection companies and how the rules how they can collect billing errors and when they can call you very detailed. Of course we mentioned the medicals. HIPAA laws have to do with how medical information and whole privacy stuff related to medical.. how that can be reported. There’s auto-repossession laws. Rest the govern mortgage reporting and foreclosure and so forth. So those are some of the group bodies of laws that govern all that.
Tim: Great. It’s definitely good information. Glad there’s expterts out there who know how everything works because people don’t want to go through 240 laws which are probably hundred of pages long. So thank you for making that sacrifice for the rest of us who have no desire to dive into that subject. You saying on your website an interesting thing is one of your goals is to free people from the bonds of debt. Are you completely anti-debt or do you just want to help people manage a certain amount of debt?
Blair: You know there are a lot rumors out there that just talk about being debt-free and paying cash for everything and if you’re born a…I have a brain freeze… whenever you have a trust-child.
Tim: A Trust-Fund Baby?
Blair: A trust-fund baby! Yeah. That’s the word I’m looking for. If you’re a trust-fund baby and you can pay cash for everything sure you wash your debt. If you’re able to get out of college and wait until before you start buying major things like houses and cars. Maybe you can do that. The reality of it is you’re gonna have to have a little bit of debt—a mortgage, a car maybe and the only way to build that up is you gonna have some credit bills. So you start small and so I’m not anti-debt. That’s why I chose those words carefully, freeing from the bondage of debt because I’m not against debt. But you don’t want debt to control you, you wanna control your debt.
Tim: Yeah. That’s one of the frustrating things that I dealt with some customers that they have completely paid cash for everything.. good on them but without a credit card or some kind of credit history, it’s really hard to get them approved for a loan because without any history you don’t how they’re gonna behave in the future. Some companies won’t take non-traditional credit reports – like ‘show me your past 12 months utility bills and put them together for you but those are always tough to do and I appreciate your view there and just having a little bit of debt that’s not controlling you but you’re controlling it. I love that philosophy so thank you for that.
Blair: You hit something on the nail.. what lenders say is, “Why shall I lend you money?” That’s the basic question. How they can lend you money if there’s not any history at all. So you gonna have some history.
Tim: Yeah. And so as somebody does history. Going back to the derogatory items.. On your website you say you wanna clear errors off people’s credit. What if they have derogatory items on their credit and are truly deserved. They went through bankruptcy. What are steps you take to make sure that you are being ethical in clearing some of these items off?
Blair: Well, one of the first things I do, is I do exercise for the clients I exercise their right to investigate every single item on their credit report. Even if it’s yours cause we’re not saying it’s not yours. But what we wanna do is we wanna make sure, it’s being recorded correctly. Everything down to the last penny, or the correct amount or the start date or the date of last activity or it says you were 30 days late 3 times or maybe you felt like it was only 2 instead of 3.. so one of the things we do is that we investigate just about every single derogatory. The first step is that I send out letters and say show us documentations related to this, show us that this is the correct date, show us that this is the correct amount. So if the credit bureaus or the creditors can’t do that within 30 days, they got 30 days to verify, then they’re supposed to delete it because it’s illegal according to the fair credit reporting act again. It’s illegal for them to report something that is accurate or unverifiable.
Tim: You maybe a little bit bias here but what are some reasons that somebody should come to you.. a professional rather than trying draft letters all around and send them in to the credit bureaus?
Blair: Well, for one thing, the credit bureaus get 20,000 disputes a day across US. Human beings don’t read that every single one.. optical character recognition.. read and computerized. There are ways that you can draft the letters and their departments where you can send them to that will have a greater chance of a human being reading the letter. The second thing is that, you know you’re right, the individual could probably send that first letter. All you’re doing is saying, “I think there’s some areas in this I didn’t really start this account on January 1st 2008.. please verify this”. The question is when that letter comes back, what’s the next step and that’s where most people including myself. forgotten this business with not knowing what to do. And so, some of the advantages is that with our experience and understanding of the industry and the laws, we kinda know the process of how to take it to its fullest extent until we achieve what the borrowers are trying to achieve which is a cleaned up credit report.. an optimized credit report and increased score overtime.
Tim: So in short, leave it to the professionals if things get a little hairy..
Blair: well, that. And the learning curve they’re gonna go through so just speed. I mean what might we be able to do in 6 months would take an individual 2 years. So you’re right. Absolutely.
Tim: Right. So, going back tracking a little bit. What are some things that somebody can do today to make sure that they never need a professional service like yours? How do they keep their credit healthy?
Blair: Well, if you have good credit right now to keep from getting worse and having bad credit, the common sense answer is always make your payment on time. Make sure you have enough credit. There are people that have one mortgage, one car, one credit card and they’re never gonna get in 700 credit scores with just that. So they need to make sure they have enough credit going on. Find yourself right now with bad credit in the 500s or in 6 or 7. It’s never too late to start making your payment on time today. I mean, you might have been 30 days late 3 months ago in April but you can start today by never being late again. And what that would do is FICO looks at the most recent 12 months and then after that, the next 12 months of the most recent 24 months more than any other period of time. So the further you get away from that last derogatory mark, the less effect it’s gonna have on your score and definitely won’t get you a 24 month out. And a 30 day late could have a significant impact on your score. If it’s more than just late, in which people have been in judgments and collections and tax liens and stuff like that. Be honest with you, I think it would just be too complicated for people to do it themselves. Call someone like me and let us analyze your credit report and we’ll give you some advice and feedback.
Tim: Well, it’s a great advice. I appreciate you talking with me today Blair. Two websites for everybody watching, check out: MyMortgageInsider.com . That’s a website about mortgage and real estate.. learn how to buy a home, refinance it anything you want to do with real estate and also upgrademycredit.com which is Blair’s website, you can read more about Blair’s philosophy, what he does, how he does it, and how you can contact him. And just to clarify Blair, you are a nationwide company and you can take anyone from across the nation and fix their credit
Blair: Yes absolutely. The fair credit reporting act and the credit repair organization act. So if you’re licensed in the state where your corporate is so you can do business nationwide. It can be done.
Tim: Great! So anybody from across country, call Blair if you have credit problems, questions, give him a call. He’d love to talk to you.
Tim Lucas (NMLS #118763), Contributor/Editor
Tim Lucas is a mortgage writer with over 11 years of experience as a loan originator, processor, and team manager. Get a live rate quote for your home purchase or refinance at MyMortgageInsider. Visit Tim on Google+, Twitter, and Facebook.