If you want to erase bad credit from your report, do you specifically know how? Or, do you know what some of the negative items mean? Take the following quiz and see if you comprehend all there is to know about erasing bad credit from your report.
(1) You’re wanting to apply for a bad credit auto loan. Besides your credit score, what are the key factors that a lender considers on your report?
(a) The types of credit cards you’ve opened and the number of inquiries.
(b) The amount of time you’ve had a credit history and the number of accounts you’ve opened.
(c) How many open charges you have and the amount of your debt load.
(d) Your payment history and how much you owe.
Answer: (d) Although the other aforementioned factors play a part in the decision-making process for a loan, your payment history and the amount you owe have a significant influence on your score as well as whether or not you’ll qualify for a loan.
(2) Which of the following items can be erased from a credit report?
(a) Tax liens
(b) Garnishments
(c) Inquiries
(d) All of the above
Answer: (d) All of the above. In addition, you can also remove foreclosures, bankruptcies, civil claims collections, late pays, repossessions, and charge-offs.
(3) Is it true that you can erase bad credit legally from your report by filing bankruptcy?
(a) Yes. But only if you file Chapter 13 Bankruptcy.
(b) Yes. You can erase bad credit fast by filing either Chapter 7 Banktruptcy or Chapter 13 bankruptcy.
(c) Yes. But first you must file a “Statement of Affirmation” before this can be done.
(d) No. Bankruptcy will not clear the debts from you file. In fact, the bankruptcy will be added to your Credit Report further indicating to a lender of your inability to pay. Therefore, it’s important to secure the services of a mediation company such as a Credit Repair service if you want to erase bad credit of any kind from your credit report.
(4) If someone wants to go through a Consumer Credit Counseling Service in order to improve their score, how long will it take for them to see an improvement with respect to their overall credit report?
(a) Consumer Credit Counseling Services can give you the assistance to pay down your debts in a matter of 60 to 90 days.
(b) A Consumer Credit Counseling Service can assist you in management of your debts so you can remove most items in 30 days and see an improvement in your score.
(c) Simply by signing up with a Consumer Credit Counseling Service will automatically boost your credit score.
(d) Often times, if it’s shown that you have gone through a Consumer Credit Counseling Service for help with debt management and credit counseling, this will reflect negatively on your score. It’s better to learn how to erase bad credit before taking this measure.
Answer: (d) Unfortunately, many lenders will look at the fact that you had to obtain the help of a Consumer Credit Counseling Service as a negative. This is also viewed as such on your credit report.
(5) What items below can’t be erased from a credit report?
(a) Incorrect personal information
(b) Medical bills.
(c) Student loans.
(d) All of the above.
Answer: (c) If you don’t pay off your student loan, it’s normally a difficult item to erase. This, specifically, applies to government-backed student loans. Only by going back to school or through a loss of income can you lessen the burden of paying such a loan back. A private student loan can be forgiven if you file bankruptcy and have the bankruptcy removed from your report.
How’d you fare? There’s no easy solution to erasing bad credit nor can you erase bad credit for free. There’s always some kind of price you have to pay. However, if you’re diligent, you can improve your report and, as a result, your future financial security.