Welcome to The 5 Star Credit Presentation and Introduction

Please follow along with the notes below

  • Who we are 
  • What we do
  • Why we are successful
  1. 5 Star Credit – www.5starcredit.com
  2. 13 years in business
  3. 213-923-9999 or 866-720-FICO
  4. chuck@5starcredit.com
  1. Paid vs Unpaid
    1. Dates of last activity
      1. Renewing dates of last activity
        1. Reaffirming – confirming you owe the debt
        2. Speaking on recorded line about the debt
        3. Paying collections without a deletion letter
        4. Negotiating the debt on your own
        5. If they get you to reaffirm the debt the statute of limitations starts over for 4 more years
        6. Date of last activity is usually with the original creditor unless you reaffirm the debt
      2. What you should do instead
        1. When someone says they are on a recorded line – “I do not speak to people on recorded lines and please do not call me again”
        2. Don’t acknowledge your name, your account, the amount. DO NOT HAVE ANY WORDS WITH THEM AT ALL EXCEPT FOR THE WORDS ABOVE.
        3. Then hang up – add their phone number to your contact with a note to NOT ANSWER
      3. Statue of limitations in California
        1. 4 years from legitimate date of last activity, you cannot be sued, UNLESS YOU REAFFIRM THE DEBT
        2. 7 years after ORIGINAL date of last activity, it comes off credit report unless it has been reaffirmed
        3. When the creditor sells it off (charge-off), they no longer have any rights to the debt. They have to turn it over to the collection agency. If they have a commission deal with the collection agency, then the debt still remains with the original creditor
      4. When creditor gives or sells debt, both the creditor and the collection agency can be on the credit report
      5. If the first collection agency sells the debt, they must take their name off the credit report immediately but might not show up until the next reporting period
      6. If we are able to get a collection removed from your report, the money is still owed. It is just not reporting (same for charge offs)
    2. Ask about Medical Collections
      1. Medical collections do not get reported to the credit bureaus until they are 6 months old
    3. Settled vs Deleted
      1. Settled – pay less than what is actually owed
        1. If you enter into a settlement agreement, your credit report takes two hits
          1. Date of last activity renews
          2. Credit report will say “Paid for less than previously agreed upon”
          3. Both a & b will cause you to lose points and cause your score to go down
        2. Deleted – when the creditor will remove all negatives from that account from your report
          1. if you pay a collection without a written agreement to delete it before payment, your score will drop
          2. if the creditor will not give you a letter to delete, then I will tell you what to put on the back of the check.
            1. If the creditor deposits the check with this information included on the back of the check, it is considered an implied contract and it must be deleted
  1. Paid vs Unpaid
    1. Paid – paid the collection after its already been charged off.
      1. Apply the same rules for deleting the account with collections
    2. Unpaid – when the debt is still owed after the chargeoff
  1. Mortage lates – Can cost 80-100 points from your score in the first few months of that late payment
  2. Credit card and automobile loan lates – can cost 35-50 points in the first few months of that late payment
  3. As the late payment gets older, it has less effect on the score
  4. It is very important that you do not get new lates, because if we have raised your score, the new lates will cause your score to go down again
  5. Late payments show up on the credit report 30 days after the due date
  1. Are not actually reported to the bureaus. They are given to a 3rd party that is responsible for reporting to the credit bureaus.
  2. If we are able to get a public record removed, it generally does not come back onto the credit report. The reason is 3rd parties do not re-report
    1. Exception is tax liens and judgements
  3. Types of public records
    1. Judgments –
      1. can last for ten years and must be renewed within 9 years and 6 months
    2. Tax Liens –
      1. Statute limitations – 10 years from filing date
      2. State
      3. Federal
    3. Child Support
    4. Alimony
  1. Hard inquiry – when you are actually applying for new credit
    1. Cost 4-5 points on report
    2. Stays on report for 2 years
    3. Only affects the score for one year
      1. So creditors can see how much credit you are trying to get
    4. Only do one inquiry per month for any credit cards
      1. Every credit card inquiry is a separate inquiry – no 45 days
    5. Big Ticket items – 45 days
      1. Cars
      2. Boats
      3. Mortgage
      4. Land
      5. RVs
      6. Airplanes
  2. Soft inquiry – monitoring your credit or an existing creditor is checking on you
  3. We use Identity IQ for all of our clients
  1. You only need 3 – 5 credit cards for an optimal score
  3. Credit cards can be closed by you or the creditor
  4. Can be closed due to inactivity on the card
  5. If the card is closed in any way, your score will go down
  6. To increase your credit score, you should ask for increases to your limit 4 times per year
  7. Reducing annual fees
  8. Secured credit cards
  9. *See authorized users below*
  1. Chapter 7
  2. Chapter 11
  3. Chapter 13
  1. Student loan consolidation
  1. Must focus on positive credit as well as negative credit
  2. Our Company Credit Cards-Authorized Users
  3. Our Payment Process
  4. No form Letters
  5. If an item is removed and it later reappears, we will dispute it again at no extra charge
  6. If they call you at work or anywhere and you have asked them not to call – $1000 fine for each call instance
  7. Escrow payment Strategy – for collections that must be paid in order to close escrow
  8. Strategy for paying down credit cards in order to raise score
  9. Legal shield
  10. Credit alert vs credit freeze
  11. Two types of credit scores
    1. Fico
    2. Vantage

For Additional Information Check Out Our FAQs (Frequently Asked Questions)