Consumer credit counseling often works as a way out to your financial problems when you’re knee deep in debt. It is a really helpful option to lower and handle your debt burden and you don’t have to file bankruptcy to escape creditors and collection agencies.

How does consumer credit counseling work?

Consumer credit counseling helps you rebuild and reinstate your credit by designing a debt management plan that you can afford. Obviously, it’s not an instant solution and you wouldn’t be able to achieve ideal credit immediately. However, it can be sufficient for repairing your credit and giving you financial independence.

Consumer credit counseling agencies normally work in the following ways:

Initially, they would evaluate your current financial situation to find out how bad your debt condition is. Not all conditions can gain from consumer credit counseling.
If your condition is suitable for consumer credit counseling, the agency would help set up a reorganization and repayment of your bills with your creditors.
The credit counselor would also educate you on credit. This might be most essential for you since knowing about finances and credit would help you remain debt free for the rest of your life.
How can a consumer credit counseling agency help you?

Consumer credit counselors can help people who are experiencing problems paying their bills learn how to handle their finances and lower debt. Nevertheless, if you’re very deep into debt, then counseling mightn’t help you make sufficient progress to become debt free. In this kind of a situation, bankruptcy might be the only option left for you.

Helping You Build up Credit (http://www.businesscreditbible.net)

You’re a good candidate for credit counseling if you:

Can’t make the minimum monthly payments on your credit cards
Are being constantly called by creditors and collection agencies
Always make delayed payments on at least one of your bills
Have already attempted to figure out a repayment plan with your creditors but have been declined
If you select a consumer debt counseling agency, they would first assist you by evaluating your finances. Skilled counselors would help you make a plan after considering your income, debt and expenses. They would also train you on how to pay off your bills and cut down on your expenses and give you tips on money management skills.

The second step is debt reorganizing and repayment. The agency would talk to your creditors and negotiate a new repayment plan that you can manage. The creditors might willingly lower your interest rates and monthly payments since they know that if you file for bankruptcy, they’d receive nothing. As soon as the repayment plan is decided on by the creditors and counselors, you just have to make a single payment each month to the agency. They would distribute this among your creditors and the disturbing calls would cease. If you follow the repayment plan sincerely, you can achieve debt freedom within 2 to 4 years.

Finally, you would get credit education from the agency. It might be enticing to hop this step since you’re no more chased by creditors, but you should stick with it. Financial knowledge is the key to remain debt free. You would learn how to handle your income and expenses. The counselors would make you familiar with budgeting and debt management and you would know how to use credit prudently.

Paying off your bills with the help of consumer debt counseling can help you boost your credit score.

What we need to do now is start working on our credit so we can get rid of some of the bumps and bruises we have gone through. If you had a credit card or two that you couldn’t afford to pay and they got charged off or maybe a personal loan that you had a couple late payments on. In these situations there is still hope, you could easily within days get this negative information removed from your report… The problem is so many companies suggest credit repair and just take your money and leave. However if you are facing credit problems there is still hope.

There is also other ways to recover or improve your score such as paying on time, don’t allow your balances to be over 35-45% for example if you have a $1000 credit card do not let it get over $350 or else it will look like you cannot use your credit wisely. Stay tuned for many more tips coming soon.

This blog post has information that part of me thinks that I should not put on the blog but another part of me says that people must to be aware. CPN stands for Credit Profile Number or Credit Privacy Number, or pretty much what ever the “credit guru’s” that sell them choose to call them. The following is a report that I gave out for free a while back, but I see that these CPN guys are still at it and I have a couple customers emailing and calling me with questions.  The following is in the context of an ebook because that is where I took it from.

DISCLAIMER

Intended for informational purposes only

Read the following page very closely before you start.

The information provided in this E-book is not intended to be considered legal advice in any way. This is simply to show you HOW companies are obtaining Credit Privacy Numbers or Credit Profile Numbers. In no way do we encourage anyone to use the following information.

Any misuse of this information is fully your responsibility. If you should choose to create a CPN that is your decision alone and in no way do we encourage anyone to do so. It is not illegal to have a new number for business however, but what is done with this number can be  illegal and that, again, is why this is only for informational purposes and is not sold in an attempt to scam, cheat or defraud any creditors what so ever.

The Truth about CPNs.

For those of you who do not know, a CPN or SCN is something that is being sold on the internet under the pretence of creating a new credit file.

This report is meant to expose the truth about CPN Numbers, more commonly referred to as credit privacy identification numbers! or Credit Privacy Numbers and  recently I have seen something called an SPN which is even more absurd. .Many people like you, read on the Internet about CPN numbers that offer a new start by giving you a brand new credit file.

Let me start my saying that most believable lies are based on some truth. Here is the only thing in the stories about the advent of CPNs that are true. Social Security numbers were not created for credit building purposes. They were created for identity purposes and technically, you are not required to use your social security number for building credit. This is something that many credit repair companies site as the reason for a CPN. What they do not continue to say is that NO LENDER’S credit application has a space for an alternative number. When applying for personal credit, all lenders require a social security number. If you have a lender that allows you to knowingly submit a CPN please let me know.

When the credit bureaus decided to use social security number to as one control to indentify an individual’s credit file, they needed a creative way to get your social security number into their database. Now, acquiring the entire database of social security numbers from the social security administrations is actually illegal because there are a number of privacy laws that will be broken so an alternative system has to be developed and this system has ridiculous flaws.

The system that was created is this:

When you first apply for credit, a file will automatically be created. WOOHOO. Genius. Now let me explain in a little more detail what I mean by this so you will have a clear idea what I am talking about. Let us say that you were born in 1991 and you are one of the lucky ones where your credit was never used by your family before you turn 18(yes it happens). So you now turn 18 and you want to go out and apply for your very first credit card or bank account. When the lender requests your credit for the very first time, they get a response that reads something like this “No Record Found”. Now if they go back 2 minutes later and request information on you again, they will get a response that reads something like this, “Insufficient Credit”. What does this mean? It means that the simple pull of your credit had created a new credit file. WOW. Exactly, I am sure you feel like I do.

Now, you will think that if you use a social that is already issued and used for credit, the bureaus will pick this up immediately. That’s not the case. I have seen cases where individuals buy a CPN and use it for months before the two files merge. Now what do I mean by the two files merging? At some point, something triggers the computers that the credit bureaus use to finally realize that one person is using two files or two people are using one number. At this point, all the credit from both files will be merged. There is no way to know if your old credit and the new file will merge or your new file and the previous owner of that number will merge.

In some cases you can buy a CPN from one of these frauds that was not issued to anyone and you will think that that is a good deal but this is the issue with that. First, let us understand  how social security numbers work. The first three numbers is created through some sought of charge to identify which state the SSN was issued. The second two numbers are suppose to indentify the year it was issued and the last four numbers just go in a sequence. Now let me give you a real life scenario that happened to clearly understand how these SSNs work.

When I first came to the US a number of years ago, I came to go to school. Being an immigrant means that I did not have a SSN so I had to be issued one. The international student association organized for all the international student to go at the same time. We then realized that all our social security numbers were one after each other. Who would have known that 10+ years later, this will give me insight on how SSNs work. So my friend’s social was 218-61-1000(an example), mine was 218-61-1001 and the others were 1002, 1003 and so on. Thinking back on how SSNs are issued, this situation showed me two things:

1. When these “Credit Gurus” aka Frauds, tell you that you need a social that’s issued in the year you were born, that’s wrong. You simply need a social issued in a year after you were born.
2. I better understand the sequences. 218 are socials issued in Maryland and 61 indentifies the year it was issued and the last four simply increase in order.

Now that we know all this you may want to know how SSNs are validated and viewed. So we know that due to various privacy laws, the banks and the credit bureaus cannot have the database of SSNs and names. So how do sites like ssnvalidator.com “validate” your so-called CPN? They do this through public information. The Social Security office publishes a list of sequences that are used in every state and the year that they are used. Because I know that 217-61-XXXX was issued in 2001 I checked to see if these sites are correct and they are. They simply use the public database of public information that the social security administration issued. Another way to test this is to go to one of those sites and put in 222-22-2222 and they will spit out a year and state they were issued. Also, the only way they can tell you if a social was not issued to anyone is it is a number in which the sequence isn’t used yet. The problem with these numbers is that some banks also check your ssn with the public information database. So most of these so-called CPNs that are being sold that pass the first basic scan by the banks are actually someone else’s social. This is a HUGE issue because if/when the two files merge, the person who owns that social will see all the accounts and tradelines on your file and now the word will be out.

The Inside Scoop on the Ads

I just want to touch quickly on many of these ads that are out there. You may see ads on craigslist or backpage that read like this, “Get a CPN with a tri-merge report. Only the pros will give you proof”. Or something like, “Receive a new credit file with a $500 Visa or Master Card and a $100 store card”.

Lets first talk about ad 1: “Get a CPN with a tri-merge report. Only the pros will give you proof”

A tri-merge report is basically a credit report of the new number. If they are using any service to pull credit in order to create the credit files, they automatically get the tri-merge report. Now any mortgage broker and most loan officers out there have access to such a system, so it doesn’t take a genius to produce a report. If the person are even more fraudulent, they can do something as simple as creating the number out of thin air, then use all the information provided and apply for any credit card on the internet. That will automatically create a file. Then, if they had a tri-merge report in pdf formal(as they usually come), they can use a pdf editor to create a fake clean report and send it to you via email.

Ad 2

When you are offered a credit card with the file you assume that everything is on the up and up. That’s not the case. The person selling you the file simply uses this new credit file created and applies to a bank that offers credit to people with no credit history. So basically these guys are first creating a file by pulling these numbers, name and address from some source and then applying for a credit card. This is all done in as little as 15 minutes and are selling these dangerous numbers on the internet for $500+. I know for a fact that most of the cards that are being offered are from Capital one, which is sad because if there are more and more fraudulent applications that are being approved everyday, they will stop giving credit to people who actually want to start establishing credit.

My final conclusion and suggestion is that we should stick to the basics and build business credit. We should not try to overstep the law in anyway.

Marc

In doing some investigation, I discovered 2 things. He was in Maryland when he opened the accounts and the statute of limitation for debt in Maryland is three years. So technically they cannot take legal action against him. Then there is the Fair Debt Collection Practices Act, which requires that debt collectors and attorneys stop phoning you at home and at work once you ask them to stop. So he simply asked the rep not to call back and he has not gotten a call since. This does not mean that they may never call, or the account will not be sold again, but you should know your rights and exercise them.

Mike

I applied to Citi for a staples business credit account with a 4 year old corp, where the highest trade was $2500 and the are only 4 tradelines on the business credit file, and got approved. It was not an instant approval and it was not for much. I applied Friday night, and called in yesterday. They put me on hold for about 15 minutes, so I was sure that I would be denied. Low and behold, approval for $500. It’s not great but its better than nothing right?

I sit here looking at the two credit files and I am trying to see what could have been the deciding factors. Now, corp 1 has 8 trades with a 10K high and corp 2 has 4 trades with a $2500 high trade. Corp 1 is even listed as making 2.3 million in revenue and corp 2 only is listed as $930,000. Both corps are 4 years old. The only big difference I see is that corp 1 has $7500 owed and corp 2 only has $100 owed. Although there is no debt to income/revenue ratio that affects your business credit score as there is in personal credit, I suspect that the underwriters use this as a deciding factor. This is the only logical explanation I can come up with in this situation.

Marc

A few months back I mentioned that staples was tightening up because I had a similar situation but come on now. Has anyone else have this experience?

I post these experiences so that we can all learn and get a feel for whats going on at different times. I also got some heads up on some changes on some cash accounts, but that will come later. I try my best to keep up to date with the changes in the business credit world.

Marc

1. Simply ask for the Late Payment to be removed on a Goodwill basis.

The idea is simple and it works well but there needs to be some merit in your request. You must have some sought of positive payment history in the past and you must give a sincere reason for the late payment. You have to remember that people read these letters and they can make a change once convinced. This is probably the easiest and most effective way to get a late payment removed from your personal credit report. A goodwill request to remove a late payment may look something like this:

Dear Sir/Madam,
During the last month or so, I have been forced to pay a number of unexpected doctor’s fees and car repair expenses due to a small automobile accident that I was involved in. This forced me to have to make a tough decision and make my payment to the ************* account a bit late. As you can see in the past, I have been consistently on time with my payments and this is a  bad time for me to get such a report on my credit report as I plan to apply for a mortgage in a few months. This late payment may cause me to get a higher interest rate on the mortgage. I am kindly asking that perhaps out of goodwill, your agency would consider removing the late payment from my report.
Sincerely,

Joe Shmoe

Many people have late payments on their report and do not realize how they much this hurt your report, both with your FICO and also when underwriters make credit decisions based on your report. Goodwill letters work very well because it is an angle that isn’t usually taken by the average person trying to clean their credit.

2. Request for the Late Payment to be removed by offering to sign up for automatic payments.

I read this a couple years ago and a website that slips my mind right now. I recently called a friend of mine who owns a credit repair agency to get his take on this method and he confirmed that he has used this in the past as well. Apparently, creditors frequently offer to remove late payment entries if you, in exchange, agree to sign up for automatic payments. So in many situations, you can make the suggestion and the creditor may agree. I really like this idea because it works out well for both parties: the creditor can ensure future payments will be made on time, and you don’t have to ever worry about missing another payment.

3. Dispute Late Payments ass an inaccurate entry.

For any of you guys who have disputed items on your credit before, this is pretty straight forward. In many cases there are inaccurate late payments placed on your account for what ever reason, and disputing these usually drop off very quickly.

Many occasions occur when creditors have difficulty verifying specific information, such as late payments on your account. It also takes time, effort and man hours to verify this information and in many cases they simply don’t waste the time to verify something this small, so they simply grant the request.

I hope this helps you guys. I think that we should all take small continuous steps to clean up our credit as using both personal credit along with business credit will give us more credit available when needed. The more credit the better (if you know how to use it)

Mike