If you've been trying to figure out how to do consumer credit repair, there are five major C words to lenders. Those major areas are character, capacity, capital, collateral and conditions.
Character
Your financial trustworthiness is character. It's great if a lender knows you or your family personally. This is more often determined by your credit score. Whether you've made payments on time can play a big part here.
Credit cards especially report 30, 60 and 90 day delinquencies to the credit reporting agencies. Each negative entry counts against your credit score. If it's not already there, you'll want your report to show all accounts in good standing to repair your consumer credit.
Capacity
Capacity is your cash flow. You have to have enough money to handle the debt you're asking for. They look at your income and expenses for each month. Lenders rightfully want to make sure you have enough money to make the payments.
Capital
Capital shows that you know how to manage money long term. It's a look at your net worth. Lenders don't want to give money to people who need it. They want to lend to people who have shown to be able to use it wisely to build up more assets. That's a better lending risk for them.
Collateral
Collateral is something to secure the debt. Typically, loans are secured by property such as real estate or vehicles. If there's something to get back should you default on the loan, there's less risk to the lender.
Conditions
The conditions are market and economic conditions outside your control. With the recent economic recession, lending guidelines have become more strict.
This can also apply to your local bank. If a banker is having a bad day, that's a potential condition that could affect whether you're approved or not.
Character, capacity, capital, collateral and conditions are the five areas to focus on when you're looking to repair consumer credit. - 31377
Character
Your financial trustworthiness is character. It's great if a lender knows you or your family personally. This is more often determined by your credit score. Whether you've made payments on time can play a big part here.
Credit cards especially report 30, 60 and 90 day delinquencies to the credit reporting agencies. Each negative entry counts against your credit score. If it's not already there, you'll want your report to show all accounts in good standing to repair your consumer credit.
Capacity
Capacity is your cash flow. You have to have enough money to handle the debt you're asking for. They look at your income and expenses for each month. Lenders rightfully want to make sure you have enough money to make the payments.
Capital
Capital shows that you know how to manage money long term. It's a look at your net worth. Lenders don't want to give money to people who need it. They want to lend to people who have shown to be able to use it wisely to build up more assets. That's a better lending risk for them.
Collateral
Collateral is something to secure the debt. Typically, loans are secured by property such as real estate or vehicles. If there's something to get back should you default on the loan, there's less risk to the lender.
Conditions
The conditions are market and economic conditions outside your control. With the recent economic recession, lending guidelines have become more strict.
This can also apply to your local bank. If a banker is having a bad day, that's a potential condition that could affect whether you're approved or not.
Character, capacity, capital, collateral and conditions are the five areas to focus on when you're looking to repair consumer credit. - 31377
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Find out how to do your own credit history repair without an agency. Visit www.creditrepairsecrets.org for free credit advice.
