Clayton James

Recently I began writing a book about the Credit Reporting Industry and Credit repair after the encouragement of associates and friends.  Through Trial and error, as well as online communities through sites such as Credit Boards: http://www.creditboards.com/ , I was able to piece together a clear understanding of how to legally remove derrogative credit entries on my credit report.  To a lot of Americans, credit reporting agencies, FICO© scores and credit reports in general are still an obscure subject, not to mention Collection agencies who can be very intimidating.  It was through my own experience with Collection Agencies that I began to seek a means of defending myself.  I would recieve harassing phone calls from collectors with GMAC auto finance, Asset Acceptance, NCO financial, and others after a job loss nearly 7 years ago.  I was supporting me and my former spouse and we were both trying to get an education at the same time.  I recived harassing phone calls almost daily from representatives from GMAC telling me I was a horrible person and I don't deserve the vehicle i was driving. They told me I was a criminal for not paying for a vehicle and I should take it to the dealer for voluntary reposession.  While the representative made me feel worthless, I knew that there had to be something illegal about this kind of treatment. And there is.

I also recieved calls from collectors from a check cashing place telling me they were going to press criminal charges against me for not paying a debt and that I was writing bad checks.  Some of the many tactics that collectors use to intimidate and scare you into giving them your money.  If a collector were to call you out of the blue for a debt that you may or may not owe, how do you even know it is valid or that the charges they are claiming are the right amount?

I am hoping to finish my book in the coming months, have it proofread and ready for print soon after. I will be offering it at a discounted rate through my website so check back frequently! You can also add yourself to my mailing list for updates.

 Below is part of the introduction. Please note this material is copyright protected under international copyright laws.

Introduction

All I can remember my grandparents saying when I was a child about finances and credit was to never get a credit card and to save my money. I never really understood why they frowned on credit, especially since my grandparents had numerous credit accounts. It was unfortunate for me to not have had parents (or grandparents for that matter) that were able to teach me about the intricacies of credit and how it impacts the world in which we live.  I would painfully come to understand this approximately 2 years after my 18th birthday.

A few weeks after I turned 18, I began to exercise my right as an “adult” by applying for a department store credit card. We all know how persistent Department Store Salespersons are about making sure we save big money by using their card, but the Salesperson didn’t have to pressure me much after asking me, “Are you over 18?” I wanted so to be treated like an adult, and this was one more step in validating my adult-hood. Being that I was employed since age 15, I had a good some of money saved up. I was, in my mind, somewhat of a credit-responsible and credit-worthy individual.  All that would change when I was sent a letter about 7 days later telling me that I was declined an extension of credit due to an insufficient credit history. I was disgruntled by the letter and asked my grandmother, who had raised me since diaper-hood, why they would not give me a credit card. She scolded me for applying for credit, told me to throw the letter away and stop trying to get myself into trouble.  Where she saw trouble, I saw a new jacket that I didn’t want to dish out money for all at once.  So I tossed the letter and waited a few weeks and re-applied.

I repeated this process about 4 times over 2 months, until one day I opened a slightly stiff envelope from the department store.  Approved, $300 limit.  Bingo!

I was surprised they approved me, but I wasn’t about to question it: I was the proud owner of a $300 department store credit card which I promptly flashed to my friends. My cousin applied and to my surprise he was approved as well.  After buying the jacket that I wanted, I started making payments as the bills arrived in the mail.  When I enrolled in college and received my differed student loan, I also applied for my first VISA™ card.  I saw a banner ad for a student visa online and after applying, I was instantly approved for a $600 credit limit and I would receive my card in a week.  6 months into being 18 and I had already attained nearly $1000 in unsecured credit.
About 1 week before I graduated High School I had a small fender bender. The car I was driving was one of those hand-me-down-from-grandma I-don’t-like-it-but-it’s-better-than-walking kinds of cars and it was very unreliable. Fortunately, I had an incredibly gracious Aunt and Uncle who, for a graduation present, offered to help me get a newer car.  About a year later I was involved in a car accident because a lady did not yield to me at a controlled intersection and my car was totaled. Her insurance cut me a large check, where I promptly went car shopping. The car I ended up with was twice my current car payment, but I liked the car and they said I had good enough credit and qualified for a really good 14% interest rate with an auto finance company.

By this time I had begun my second year of college, married my high school sweetheart and started to work for a great telecom company. I was making more, and spending more: the number of credit cards increased along with the balances and 1 month before my 20th birthday I lost my job. My credit cards started going unpaid along with the myriad of other bills I had acquired between me and my wife (and most of them were in my name) and since I was the only one working it was especially hard.  I was getting behind in my car payments and at one point had become two months behind I began getting calls from the finance company’s collection department and the woman on the other line was ANYTHING but pleasant. She badgered me about how I didn’t deserve this vehicle and I was a horrible person for not paying on time. I told her I would pay for what was owed in 2 weeks (a lie), and to stop insulting me. After she hung up on me, I called a family member and asked for a loan for 2 months of car payments that were due plus the one that was coming up in a few weeks. Before I got the money, I got calls daily from the same woman demanding that I return the car or she would call the sheriff and have me arrested for grand theft auto.  I told her I would not return the car because I was getting the money to her as I promised.  Just a couple weeks after I wired the money to the finance company, bringing me current, they involuntarily repossessed my car. It really hit the fan at this point.

After this my credit was in shambles for nearly 2 years. Anything unexpected that popped up like a parking ticket or a high cell phone bill I simply let go to collection. My student loans defaulted, insurance went unpaid (oh, the stupidity of youth) and I gave up. What were they going to do? Report it on my credit report? Call me all day long and insult me like the woman from auto finance company did? It wasn’t like they could do any more damage so when I got calls and letters from collection companies I told them it was going to be like squeezing blood from a turnip with me. It really was.

I had considered Bankruptcy but the total amount of money I owed was not astronomical and didn’t seem worth it: I was just simply insolvent and there was nothing I could do.

About 2 years after my car was repossessed, I came down with Appendicitis and was rushed to the emergency room. After they removed my appendix, I stayed in the hospital for 1 day and was released.  I got a call from the hospital billing department and at that time I was uninsured and unemployed. After telling this to the person over the phone, I was told I would be covered under charity care for my medical expenses and that I should receive some information about it in the mail.

About 6 months later I got the opportunity to work for one of the leading telecom companies in Seattle, Washington. I was offered a generous salary with excellent benefits including 401k and company stock.  I was at a point in my life where I began saving money and was able to finally pay my bills and what a great feeling that was. My financial bliss wouldn’t last long.

I was employed about a year when I received a call from a collection company saying they were seeking payment of upwards of $9000 dollars for services received at the hospital where I was treated for Appendicitis.  I was surprised, and told the collector that I was unemployed when that happened and was given charity care by the hospital to cover the expense of the surgery.  They said that I did not receive any charity care benefit and that the collection agency had purchased the account from the hospital and I was to begin payment immediately.  I refused and told them they need to get their facts straight with the hospital because I owed nothing.  The calls stopped.

About 2 months later, I started to get curious about my debt and really wanted to start paying it off so I gathered up some old mail, pulled my credit reports and started to take my debt seriously. When the reports arrived, I was shocked.  I had about 25 negative reporting items in my report and 3 items that were reporting positive. The ones that were positive were car loans that were paid off by my insurance company and one of my student loans (to my surprise). My total showed to be outstanding debt was around $20,000. The report had instructions on how to dispute items I didn’t feel were accurate, so I called up and just disputed everything negative. A month or so later I got new reports and to my surprise a few things actually disappeared. What they were, I have no clue because I was not documenting anything at that time. I just started calling the companies I owed money to, gave them my account number and told them I wanted to start paying down the balances.

At the same time I started reading: books on credit, online forums, credit laws and such.  Some of the people I had become friends with happened to be loan officers or worked for banks and finance companies so I started asking around for advice. What I found was a lot of contradicting information but also a lot of useful information. I had made it a point to try to weed out the facts and get to the bottom of things and find out what my rights were: what my legal and protected civil rights were. These collection companies and creditors can’t all be big and powerful, there had to be some sort of control as to what they can and can’t do. This was war! …And the weapons that I chose were the FCRA and the FDCPA.

Table of Contents

 Introduction

1 All is Fair in Love and War

A Few Rules Before You Begin
A Brief History of Credit and Debt
Introduction to The Fair Credit Reporting Act
Introduction to The Fair Debt Collection Practices Act
Another Useful Tool: The FCBA
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2 The Nitty-Gritty: Your Report and Score

It’s Simple! … Or at least getting one is!
How the information gets there
The Breakdown
Inquiries
Your Credit Score: What the FICO?

3 No Credit? It Really Is Catch 22!

Myth: You need credit to get credit
Fake it ‘Till You Make it: Authorized Users
Secured Credit Snowball Technique
Person to Person Lending Through Prosper.com
Myth: NO Credit = Ignorance
Beware Hard Lending
If They Deny You, It’s Not The Final Word
Honesty really is the best policy

4 Protecting Your GOOD Credit

A Few Rules Before You Begin
A Brief History of Credit and Debt
The Fair Credit Reporting Act
The Fair Debt Collection Practices Act
Another Useful Tool: The FCBA
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 Stay tuned for the rest!