When you have a negative mark on your credit report, it can affect your ability to make certain purchases. When you have poor credit due to having negative information on your credit report, you may find it difficult to buy a car, rent an apartment, purchase a new home, or even take out a loan.
Oftentimes, creditors will see these negative items as evidence of irresponsibility and financial insecurity. This makes those with poor credit undesirable candidates for credit cards and loans, which can make it even more difficult to buy the things that you want.
When you have a foreclosure on your credit report, then it drastically affects not only your credit score but also your entire financial future. Think of your credit score as your financial reputation. When you have a foreclosure or any other kind of negative mark, then it could potentially ruin your financial reputation.
Let’s take a closer look at how foreclosure affects your credit score, as well as how to have a foreclosure removed from your credit report entirely.
A Foreclosure’s Impact On Your Credit Score
The impact that a foreclosure has on your credit score depends entirely on your credit standing before you were hit by the negative mark. The higher your credit score, the greater the impact will likely be on your credit score.
You can expect a foreclosure to decrease your credit score by approximately 100 points or more, according to a 2011 FICO report. It can take up to 7-10 years for your credit score to recover, and most of the time, it will take a professional credit repair expert to get a foreclosure removed from your credit report sooner than that designated time frame.
After 7 years, a foreclosure will result in a derogatory mark on your credit report and should automatically fall off of your credit report. If it doesn’t, you can dispute the credit report error and have the credit bureaus remove the foreclosure from your credit report to avoid any other credit score consequences.
How To Rebuild Your Credit Score After A Foreclosure
To repair your credit report after having a foreclosure, you must go through a series of steps. The foreclosure process is one that can wreak havoc on your credit report since it will appear on your credit report after 30 days from the point of the foreclosure.
Just because a foreclosure remains on your credit report for 7 years, it doesn’t mean that you have to wait until the 7-year mark to make your credit repair moves. You can offset all of the negative marks on your credit report by adding more positive information. You can start by making on-time payments, slowly paying down your debt every month.
Make sure to use 30% or less of your credit limit, ensuring that your credit utilization ratio is balanced. You could also look into getting a secured credit card or credit-builder loan to help you repair your credit and regain your positive financial reputation.
File A Dispute With The Credit Bureaus
Review your credit report and identify any inaccurate information. Highlight the items on your credit report that you wish to dispute with the credit bureaus. Make a copy of your credit report and write an in-depth, comprehensive letter to all 3 credit bureaus – Experian, Equifax, and TransUnion.
In your dispute letter, you should include a brief explanation or description of what you want to dispute and why this information is inaccurate. Creditors are required to correct any inaccurate information on your credit report within 30 days of your request. If they neglect to respond to your request within 30 days, then your derogatory marks are automatically dropped from your credit report.
Having negative items removed from your credit report is the best thing that could happen since it erases all history of negligent or irresponsible financial behaviors. This will help your credit score steadily improve over time and before you know it, you’ll be well on your way towards having financial freedom and stability.
If you don’t have a foreclosure removed from your credit report, the foreclosure stays on your credit report for 7 years from the date of the beginning of the foreclosure. You don’t want anything to stay on your credit report for that long, especially not something as serious as a foreclosure!
Hire A Professional Credit Repair Expert For Credit Help
To help you have a foreclosure removed from your credit file, it’s recommended that you ask for expert help. Hiring a professional credit repair company can help you free up your time to focus on more important matters, like work, family, friends, and life itself.
Let the pros handle your credit repair endeavors so that you don’t have to worry about a thing. At My Credit Advice, our experts are ready to help you. We’ll help you go through your credit history to determine the best course of action to take when rebuilding your bad credit.
Don’t let derogatory information have a negative impact on your credit score any longer. Let us help you get to where you want to go in your financial future. We’ll help you secure your good credit and regain a positive financial reputation.