Alright, the three days have passed and I hope you are ready for part two of my Step-by-Step tutorial on how to repair your personal credit report easily and efficiently. As I mentioned earlier, most of you have already have attempted to repair your credit by using the "shotgun" approach and disputing each and every item on your credit report. If you choose to do this first, that is certainly your preference. As you know, with the "shotgun" approach, you would contest each and every item on your credit report and if the credit bureau cannot verify the account, it will be DELETED off of your credit report. But what happens if the information comes back VERIFIED? For most of you, this would be the end of your credit repair and you would just go on living with this negative information on your credit report. Well, if you "reasonably believe" that the information is not accurate or you do not remember opening this account, my tutorial is for you! Ok, enough with the background information, its time to get down to the nitty-gritty.

The secret weapon is called VALIDATION OF DEBT. Think of it this way: Even if you suspected that you may owe a creditor some money, and a collection agency contacted you and asked for the creditor's money, would you just hand over the cash? No. No one would. You would first ask yourself some questions like....How do you know if this collection company actually is collecting for the creditor; What legal documents do the collection agency have to prove that they have the authority to collect for the original creditor; How much is the actual debt that is owed; What payments have been made on the account; Do you really owe the creditor the money or was it another party; Where is the original contract showing you owe the creditor.

There is a federal law that gives you the RIGHT and the LEGAL AUTHORITY to request a Validation of Debt from anyone collecting money that is not the original creditor. The federal law is called the Fair Debt Collection Practices Act (FDCPA). Anytime a third party is attempting to collect a debt for an original creditor, they are subject to the FDCPA. Original creditors are not. To give you an example, lets say SAM (collection agency) is trying to collect a debt on the behalf JIM (original creditor). SAM contacts you and tell you that they are collecting a debt for JIM. Well, since SAM is not the original creditor, SAM must follow the laws of the FDCPA. If JIM was attempting to collect the debt from you himself, he would not be subject to the laws of the FDCPA. What this all means is that anytime a third-party is attempting to collect a debt for an original creditor, YOU have the LEGAL RIGHT to ask them to Validate the Debt.

What MUST the collection company do to Validate the Debt? The collection company must provide proof that they own the debt or have been assigned the debt; account statements from the original creditor that show how much the debt is, how much is owed, interest payments, etc; copy of the original signed contract or application. They must show proof positive that you owe the debt. It's not sufficient for them to send you a computer generated printout of the debt owed. They must send you copies of the actual documents you request. So when you send a letter to a collection agency to VALIDATE A DEBT, they must provide you this information pursuant to FEDERAL LAW!

Now, with all that said, you may be asking yourself "what happens if the collection agency cannot validate the debt"? DRUMROLL PLEASE: The Collection CANNOT report the debt to the credit bureau. PERIOD. You heard right! If you mail a request to a third party/collection agency to Validate a Debt and they cannot provide you with the actual documents that prove you actually owe the debt, THE DEBT CANNOT BE REPORTED ON YOUR CREDIT BUREAU! Whew! That was a long a detailed explanation of the most secret arsenal in credit repair. I know you must have hundreds of questions and situations and I would love to give as much advice as needed. In my next blog, we will continue to go more into the VALIDATION of DEBT and I will give you a letter that you can use. I will also show you how you must send the letter to the collection company and why. If I receive any specific questions, I will also address them in my blog. I love the mortgage business and since CREDIT is the focal point of this business, I try to educate others, as much as I can, in this area. I will continue to post every three to four days so I hope you join me each time and use these steps to repair your personal credit report. As I said, this is a STEP-BY-STEP tutorial and I will hold your hand the whole way! Even when it gets bumpy or roadblocks appear, I will continue to hold your hand to the finish line. See you in three to four days.