In this episode, hosts Rashad Bilal and Troy Millings sit down with credit expert Shonda Martin to debunk common myths about improving credit scores, trade lines, credit repair, and late payments. Shonda shares valuable insights and actionable tips for managing and improving credit profiles.
Shonda addresses the myth of buying trade lines as a way to boost credit scores. She emphasizes that while it may temporarily inflate credit scores on platforms like Credit Karma, the FICO algorithm does not always credit these trade lines. Additionally, the anti-abuse law enacted in 2009 aimed to prevent individuals from overusing trade lines to manipulate their credit history. Shonda advises against purchasing trade lines and encourages exploring other strategies to build a robust credit profile.
Delving into credit repair, Shonda expresses caution about certain tactics, particularly the approach of falsely claiming that an account is not yours. She explains that this is the worst type of dispute, as credit bureaus can easily disprove it. Shonda guides viewers on the ethical and legal methods to challenge accounts on their credit reports, emphasizing the importance of requesting validation for negative accounts such as collections and charge-offs. By following the FCRA guidelines and asking for a proper investigation, individuals can increase their chances of successfully disputing inaccurate information on their credit reports.
The discussion extends to the long-term impact of late payments on credit reports. Shonda clarifies that late payments remain on credit reports for the duration of the account's presence and exert a significant impact on credit scores. She advises individuals to seek goodwill adjustments from companies for genuine mistakes, as forgiveness for a late payment can lead to its removal from the credit report. Moreover, she highlights the concept of "eleven on-time payments" being needed to counteract the negative impact of a single late payment. Shonda offers practical advice for individuals to mitigate the effects of late payments on their credit profiles.
As the conversation unfolds, Shonda provides actionable insights and debunks prevalent myths in the realm of credit management. Her expertise and pragmatic approach empower viewers to navigate the complexities of credit scores, trade lines, credit repair, and late payments.
Join EYL as they dismantle credit myths and equip you with the knowledge to make informed decisions about your financial well-being.
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