Thursday, February 24, 2005
More bad advice from CREDITWRENCH
If you read the advertisements and message board postings of CREDITWRENCH CEO Bill Bauer, one of the misinformed pieces of advice he hands out is "a paid collection is no better than an unpaid collection."
That's the type of misleading information that people who are in the credit repair business would like you to believe.
Unfortunately, people who fall for such nonsense find out the reality when they go to buy a new home, a new car, or attempt to get anything other than maybe a secured credit card.
All lenders calculate a debt to income ratio (DIR) when considering how much you can borrow. This simply means how much debt do you have vs. how much income you have. If the ratio is too high, you won't get the loan no matter how high your credit score may be.
If you have an unpaid collection on your credit report, they must calculate that as part of your debt, pushing your ratio higher. If it is a paid collection, it is not considered a debt, therefore your ratio would be lower than if it were unpaid.
CREDITWRENCH CEO Bill Bauer stating that a paid collection is no better than an unpaid collection is false and misleading.
That's the type of misleading information that people who are in the credit repair business would like you to believe.
Unfortunately, people who fall for such nonsense find out the reality when they go to buy a new home, a new car, or attempt to get anything other than maybe a secured credit card.
All lenders calculate a debt to income ratio (DIR) when considering how much you can borrow. This simply means how much debt do you have vs. how much income you have. If the ratio is too high, you won't get the loan no matter how high your credit score may be.
If you have an unpaid collection on your credit report, they must calculate that as part of your debt, pushing your ratio higher. If it is a paid collection, it is not considered a debt, therefore your ratio would be lower than if it were unpaid.
CREDITWRENCH CEO Bill Bauer stating that a paid collection is no better than an unpaid collection is false and misleading.
