Introduction Phoenix Company Credit Repair

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    This preface will explain how this book came about. It will also give you
tremendous insight into how I learned about the credit industry while researching the
internet, books, and working with Mark as we collaborated to create this book. It
provides an overview of the operation and the misconceptions of the operation of the
credit industry, how it affects your life, and what you can do to counter the problems it
may have caused for you.
    Originally, like most everyone whose credit score has been affected by the
recession and who desperately needs to have it repaired in order to save their assets, I
started checking out credit repair. It was pricy so I purchased a book and planned to
do it myself.
    I was raring to get going as soon as it arrived. I desperately needed to improve my
credit score so I’d be better prepared to qualify to refinance my house and business in
order to recover from the devastation my finances suffered when the banks closed
down making loans.
    The book I purchased was of little help even though it purported to have all the
tools I would need in its kit. It purportedly had everything I would need to go about
improving my credit score, including a CD with a variety of letters ready to send. The
book was a big disappointment.
    First of all, I was annoyed that most of the chapters in the book were not even
about credit repair. It included subjects like, “How to use credit responsibly”, “How
to build a credit history”, and other useless subjects that had no bearing on repairing
my credit score problem. What I needed to know was how to fix my problem –
increases my credit score - and I needed to know how to do it now!
    I had received too many calls from credit repair companies, legal firms and other
companies. They were strong on offering hope, but none convinced me they were
worth the investment. I felt uncomfortable about hiring any of them. I could not risk
paying out hundreds and even thousands of dollars for hope.
    I met Mark through a referral from my barter club representative. I called Mark,
whose company was a member of my barter association. It felt safer paying for the
service Mark was offering in barter dollars than cash.
    For those of you not familiar with barter, a barter club or association is a business-
to-business, cashless marketplace, which trades goods and services without the use of
cash. You offer your products or services and get paid with barter-dollars. You can
use your barter-dollars to buy products and services from other club members. No
cash changes hands.
    I had barter-dollars that I could afford to spend. I figured if Mark didn’t perform I
could complain to my barter association representative and she would set things
straight; refund my barter dollars and goodbye Mark.
    One day I’d received a call from my credit card company offering to settle my
account for 30% of what I owed. It was exciting to think the bank was offering me the
opportunity to eliminate 70% of my debt, but I didn’t have any money to take
advantage of the offer. I called Mark to get his opinion about the offer and he

explained that all was not lost. I could possibly do better if I waited until the account
was charged-off and sold to a collection company.
    He also warned me that I would have to pay income tax on the money I did not
pay to the credit card company. The credit card company would write off the
difference and send me a 1099c for the amount they wrote off. Now, I would owe the
IRS a percentage of what I had saved as if it were income. This could easily amount
to twenty-five percent of what I had just saved. Worse yet, I would be trading a non-
secured credit card debt for a debt owed to the IRS. They play by their own set of
rules. Not paying the IRS can be very fatal to your ass-ets!
    Mark went on to tell me how to settle with a collection company should the
creditor sell my delinquent account to a collection company. He told me how the rules
would change – greatly in my favor - and what to expect. He sounded like he really
knew what he was talking about.
    My interest peaked because much of what Mark was sharing with me I had not
heard before. It certainly was not in the book I’d purchased on credit repair. I learned
more in that twenty minute call than all the other credit repair and information books I
had read or got from internet callers who claimed to know how to solve my problems.
Call it insider information!
    Insider perspectives were not readily available in any books I read or websites I
browsed while doing research on how to increase my credit score. Either no one
wants to write about real credit score repair or they have not done ample research.
    About that same time I read an article in the LA Times regarding a woman whose
house, after years on the market, had finally sold. She got $360,000 from the proceeds
of the sale. Like any prudent person she deposited the check into her bank account
until she could figure out what to do with the money. A week later her bank was
declared insolvent and the amount of her money that was not covered by FDIC
insurance was “confiscated” (for lack of any better word that I can think of).
    In a moment she lost $130,000 of her money. The money that was not covered by
the FDIC insurance had been transferred to the bank’s account to be used to pay off
the bank’s bills. The money was never lost. She did not spend it. It merely
disappeared into the bank’s account because that’s the law! Had she been aware of the
risk she was taking depositing the whole check into one account in a recession period
with all the problems the banks were having she could have made other arrangements
to protect her money. She would have known How to Save Her Ass-ets in a recession
situation. In a normal operating economy it would have been highly unlikely for her
bank to have failed.
    This prompted me to contact Mark and ask him what he thought about teaming up
to write a book about credit score repair. He said he had started to write one several
times, but was never able to stick to it to finish it. Mark said, “I’d love some help. I
have a lot of information to share. I need someone who can bring the mass of
information together.” I have many years of technical writing experience and he has
many years of credit score repair experience so we were a good match to get a book
    That night I eagerly spent hours browsing the internet for information while I
waited to receive what Mark was going to send to me. I searched on keywords that I’d
read in the credit score repair books I’d purchased. I printed out over 500 pages of

notes from internet websites in the next few days. There is a goldmine of information
available on the internet and it is always fascinating mining it.
    However, while the internet has a wealth of knowledge, gleaning it and making
sense of it is another issue. For some reason the people who give away free
information do not make it easy to find as you sort through their websites. Their
objective seems to be to dangle bits of information to get potential clients’ attention.
Make it appear you are an expert so people will hire them. I would later learn that
none of them offered the real insider story that Mark and I have put together in “Real
Credit Repair”.
    I begin to create a “storyline” to explain the credit industry; how it affected
people’s lives, how to deal with the credit system, and how to survive in this economy
where the almighty credit score has become so almighty important. The more I
learned the better I got at mining new information. I went into information overload!
    I finally got a draft together and sent it over to Mark. I called to discuss some of
the notes he emailed back and then he lowered the boom on me. “What you’ve
written is the way the system is supposed to work,” he said. “It’s the way the agencies
would like everyone to believe it works. What we need to write about is how the
system really works. Most people have no idea how it really works.”
    He started sending me information about how agencies and the system worked
from an insider perspective. What we discussed over the next few days was awesome
to say the least. Our simple how-to book was turning into an expose.
    Exposes are something to stay away from, but I have to admit I felt a bit giddy
with the prospects of turning out a really significant book on credit repair and the
hurdles that curtail you from returning to a solvent financial lifestyle after the
recession has destroyed your credit score.
    The realization that the book had not captured the real story coming at a time when
I’d assumed the book was about finished made me a little angry with Mark. “Why
didn’t you tell me this in the beginning?” I asked.
    “If I had told you I doubt you would have believed me. The information you
found on the internet you believe to be true. I’ve had lawyers and accountants for
clients and they didn’t believe me, so I wouldn’t have expected you’d have either.”
    I had some apprehension that what I’d written did not quite hang together, but
figured if there were any technical errors Mark would catch them and let me know
how to fix them. As he explained it, the problem was I’d accepted what I’d browsed
and read at face value because I found the same information on so many corroborating
sources. My storyline had a few problems that I could not explain, not good, but I was
willing to accept that this was the way the system worked. When I learned that the
system did not work as described the shortcomings of my storyline began to make
    I would now have to rewrite the book practically from scratch in order to
incorporate the new elements of the new credit industry story that Mark had now
provided. “There is an old axiom at work here,” Mark said. “One has to arrive at the
truth on a gradient of experience and understanding.
    In “Real Credit Repair” we present the confusion and misconceptions fostered
about credit reporting, how the systems of the credit industry actually work, and how
they are rigged to work against the consumer mainly because it costs too much to

make them work the way they are supposed to work. If there ever were a “Matrix” in
regards to how you think it works and how the system actually works, this is it.
    There is a uniform message from the entire vertically integrated credit industry
system - from the creditor who tells you it is all about your FICO score, to the retailer
who buys your credit score from the Big Three agencies, to the agencies’ charging
their data furnishers to file data and verify data they have previously furnished when
there is a dispute – it’s all about the agencies making lots of money.
    The media seems to front the illusion that the credit industry is somehow
protecting you. Reality is, “The agencies are large for profit companies. They are
dedicated to consolidating files on as many people as possible. They sell personal and
financial information to any one who is willing to pay the price.”
    Here is a good example of the media practice of perpetrating the concept that the
agencies are helping you. I got this from a website Other then
this disparaging comment, the website purports to provide beneficial information on
credit reporting. I will say that it contains the most readable information of all the
websites I browsed. However, Mark and I take great exception to the following
statement; it reeks of agency propaganda!
    If companies you do business with refuse to report to one or more of the
    credit bureaus and/or do not report the maximum credit available, take your
    business elsewhere. And let them know why you are moving on. Companies
    who lose customers because of their irresponsible business practices need to
    hear from you.                                 – Privacy Rights Clearinghouse
    Any invasion of your privacy, especially when it deters you from gaining access to
credit, insurance, or a job is not doing you a service. When you are having problems
keeping up with your payments and companies are reporting this to the agencies and
the agencies are reporting it to the world, this is certainly not of any service to you.
    So, why would anyone stop doing business with a company that is not reporting
your problems to the agencies? And why would someone write that these companies
are acting irresponsible? Industry propaganda?
    “Real Credit Repair” is an expose by an industry insider on what has been done to
you by a faceless machine. The agencies who are selling your credit and personal
history to whom ever wants it, and making billions of dollars a year at your expense, is
not our idea of “Doing you a service”.
    The best we can do is provide some guidance on how to counter the damage
caused by the agencies or may still cause to your life by reporting your delinquent
payments and other derogatory information. You do have the right to lead an
unencumbered life free of intrusion into your personal business. However, if you
cannot keep your personal life private you can at least learn to protect yourself from
the damage an invasion of your privacy can do to you.
    When you read the same things about how the credit reporting system works in so
many places it begins to appear that the entirety of the media is bent to sell the credit
reporting industry’s line on how the agencies would like the world to think credit
reporting works. It may possibly be because they have not taken the time to do a little
digging, but the information is there and readily available for anyone to read.
    The agencies are not being sneaky. They are doing what they do above board as
we have gleaned a lot of facts for this book from their websites. It’s the
misconceptions of the operation and misleading information that are causing
problems. This is the real problem. For example, when bank representatives tell you,
“The law requires us to report your delinquent account to the agencies” are they telling
you this because this is what they have been told to say? By whom? Why not tell the
     It isn’t so, but people believe bank representatives just because they are bank
representatives… we guess. Saying that the law requires them to report your accounts
to the agencies tends to give data collection an air of authority. The discouraging thing
is neither the agencies nor the government are going out of their way to make it clear
that all reporting is purely voluntary. Maybe if more people understood that there is
no law they would rise up in rebellion and demand that unauthorized credit collection
be outlawed.
     You would think that an industry that so greatly affects our lives would be better
understood by the public. Some say the companies that operate it do not want it
understood. As I will said, I have found no indication that they are being secretive.
It’s just that no one bothers to find out what is really going on. The misconceptions
are so readily accepted that the credit industry’s operation is not questioned.
     My greatest surprise of all the things I learned was that the law does not force
credit card companies to report my credit card payment status to the consumer
reporting agencies. The card companies do this voluntarily. This was so surprising
that I asked Mark to confirm and reconfirm this several more times, because I just
couldn’t believe it. Why would companies volunteer to go through the trouble of
reporting data? When I later learned that they also have to pay to report data, this blew
my mind!
     Frankly, it wasn’t until Mark sent me a copy of a comment brief that he got from
the Consumer Data Industry Association website that I finally was willing to believe
him. There in black and white the industry insider confirmed this ugly truth for me;
it’s all voluntary!
     There was a lot I’d have to rewrite to incorporate the new facts Mark provided.
The second writing was written with my eyes wide open. It is so important that you
understand that the consumer reporting industry has become so powerful they can get
just about every company in the country to report all the things about you that would
be better left private.
     Granted that while your personal data serves to build a national system that greases
the operation of the credit system, we feel the end does not justify the means. We feel
this way because the system unfairly destroys lives in a mechanistic manner regardless
of an individual’s particular issues and circumstances. When a man cannot get a job
only because of his credit score, he asks, “What does my credit problem have to do
with my ability to perform at a job at which I have thirty-years experience?”
     This recession brings our point to the forefront of importance of this fact. We all
need to reevaluate the value of the consumer reporting agencies; credit system vs. the
value of our individuality and our right to privacy.
     Maybe credit approval does not have to work so quickly and efficiently to still be
just as effective. Maybe we could live with a few days of waiting as a tradeoff for
having our privacy. Maybe we need to go back to credit approval being a more

personal thing between creditor and borrower; where we are granted or denied credit
on the basis of a face to face meeting with the credit analyst.
     Maybe all the game playing with credit scores has reached the point where credit
reporting is no longer practical; where one company creates new software to counter
the operation of another with total disregard to what it is doing to consumers. It has
gotten to the point that little is real about credit reporting any more as there are so
many flaws and errors in the system!
     This recession has devastated many peoples’ lives; this is a real fact. They have
become the victims of the recession not because of their wrong doing, but because of
the wrong doing of others’ greed and the system that has failed us. Do the victims
need the consumer reporting agencies’ pointing out their misfortune? Is it fair to the
victims that they are being further penalized because their credit score has been
ruined? It has become a “Catch 22” that one is not afforded a fair chance to deal with
and work their way out of their predicament without the added stress imposed by the
agencies’ automated credit scores.
     Hopefully what Mark and I have put together will give you a chance at reinstate
your credit score. Possibly we will help you to “Save Your Ass-ets in a Recession” by
buying you the time you need to save what you have spent a lifetime earning. It is
our sincere hope and wish that what we have done here makes a difference in your

                                   Table of Contents

                                        Title               Page
Preface                                                      i
Table of Contents                                            ix
Disclaimer                                                  xvii
Introduction                                                xix
Chapter 1                                                   1-1
Consumer Reporting Agencies
Federal and state laws establishing control of agencies      1
Major national consumer reporting agencies                   4
Local and industry based consumer reporting agencies         6
 Medical and prescription drugs                              7
 Residential and tenant history and evictions                8
 Check writing history                                       8
 Employment background checks                                8
 Homeowner and auto insurance claims                         10
      •   Public records                                     10
      •   Opinion molders database                           11
      •   Dunhill International Lists                        11
      •   National Change of Address service                 11
      •   Locatable Address Conversion System                11
      •   Children                                           12
      •   Supermarket clubs                                  12
      •   Product warranty cards                             12
      •   Automatic phone Number Identification              13
      •   Casinos                                            13
      •   Direct Media List Showcase                         13
      •   National, regional and local criminal databases    13
      •   Dun and Bradstreet and other business agencies     14

    •   KnowX                                                         14
    •   Non-agency type sources of personal information collection    14
    •   Google, Yahoo                                                 15
    •   Genealogy                                                     15
    •   Trip Advisor and other websites that accept public opinions   15
    •   Mailing list companies                                        15
Consumer Data Industry Association                                    16
Data furnishers                                                       16
Data furnishers voluntarily furnish data to the agencies              18
Defining accuracy in reporting data                                   22
Credit reporting companies                                            22
Chapter 2                                                             2-1
Credit Report
The purpose of the credit report                                      1
Types of credit reports                                               2
 Consumer credit reports                                              2
 Educational credit reports                                           2
 Bureau credit reports                                                2
Free annual credit report                                             3
Purchasing your credit report                                         7
Warning about purchasing your credit report                           7
Specialty consumer reporting agency reports                           9
International credit reporting                                        9
Credit report contents                                                10
Credit report legal restrictions                                      12
Adding accounts to your history file                                  13
Statute of limitations on credit report listings                      13
Reading and understanding your credit report                          14
Credit report inquiry – access to your credit report                  15
Personal information included in a background check inquiry           17
OFAC inquiries – economic sanctions                                   18
Limitation on inquiries                                               18

Opt-out – Security lock on inquiries                            20
Credit report errors                                            21
Responsibility for accuracy on data in credit reports           24
Making corrections to your credit reports                       25
Your credit score                                               26
The Equal Credit Opportunity Act for Women                      27
Marriage and your credit report                                 27
Divorce and your credit report                                  28
Summary of your rights under the Fair Credit Reporting Act      30
The Federal Trace Commission                                    32
Federal laws regarding consumer credit                          33
Chapter 3                                                       3-1
Credit Score
Credit scoring systems – FICO, FAKO                             3
Scoring differences between agencies                            5
Purchasing your credit score                                    6
Objectives for maintaining a good credit score                  7
Credit scoring                                                  9
Credit score perspective                                        10
Credit history file component categories and scoring values     10
 Payment history (30%)                                          10
 Amount owed types of accounts open, status of accounts (30%)   12
 Length of credit history (15%)                                 14
 New credit (10%)                                               14
 Types of credit in use (10%)                                   14
 Credit inquiries (10%)                                         15
 Dispute and credit score repairs processed (0%)                19
 Stability (0%)                                                 19
 Personal information (0%)                                      19
Problems with credit scoring                                    20
Fair Isaac Corporation, FICO 08                                 23
Chapter 4                                                       4-1

Credit Report Maintenance
The necessity for credit report maintenance                         4
Aspects of the credit scoring algorithm                             5
 Payment history                                                    5
 Pay down maxed-out accounts                                        6
 Delinquent accounts                                                6
 Account balance vs. account limit                                  9
 Account balances vs. total available credit on all accounts        9
 Account balances vs. income                                        9
 Do not pay off your accounts monthly                               9
 Keeping all accounts with balances open                            12
 Keeping old accounts open                                          12
 Opening new accounts and mix of accounts                           12
 Opt-out accounts when interest is increased                        12
 Student loan impact                                                13
 Judgments, bankruptcy, tax liens, repossessions                    13
 Limit acquiring new credit                                         14
 Debt to credit ratio                                               14
 Rejection explanations                                             15
Rapid rescoring                                                     16
 Credit report analysis software                                    16
 Make quick corrections to credit reports                           18
Accurate Credit Rapid Rescore Service                               20
Getting started with credit report maintenance                      20
Classic dispute process - overview                                  25
e-OSCAR - overview                                                  26
Legal actions for getting corrections made to your credit report    27
Professional services                                               30
Imaginative methods for improving your credit score                 30
Chapter 4.1                                                        4.1-1
Credit Report Maintenance – classic dispute
The classic dispute                                                 2

Submitting a dispute                                             3
Dispute processing                                               6
Possible results of a dispute                                    6
Continuing with the dispute process after a rejection            8
Professional dispute                                             9
Chapter 4.2                                                     4.2-1
Credit Score Repair – dispute verification processing e-OSCAR
Dispute processing according to the FCRA                         1
Dispute processing today with e-OSCAR                            2
Incomplete verification process                                  5
Check for errors that reappear on your credit report             7
Analysis of the problems with e-OSCAR dispute processing         7
The law protects you                                             10
Chapter 5                                                       5-1
Planning & strategy for Credit Repair
Timing and strategy                                              1
Financial evaluation                                             2
Compile a list of all your debts                                 3
Prioritizing bill paying                                         3
Determining how much you have to apply towards credit debt       4
The effects of late credit card payments                         6
Dealing with creditor when you cannot make payments              8
Decreasing costs in order to pay off debt                        10
Legal rights of servicemembers                                   11
Places to go to get money to make payments                       11
Funding sources – grants                                         15
Chapter 6                                                       6-1
Credit Score Repair
Basic things to know about credit repair                         2
Be proactive about credit score repair                           3
Timing strategy for credit score repair                          3
The stratagem of dispute                                         3

Removal of derogatory credit report items                                4
Techniques for improving your credit score                               7
Credit score repair the way the pros do it                               10
Professional dispute strategy                                            14
Is it ethical to remove legitimate accounts from your credit report?     16
Chapter 6.1                                                             6.1-1
Credit Score Repair Processes – FCRA analysis
Chapter 6.2                                                             6.2-1
Credit Score Repair – dispute verification #1
Persistent dispute method for removing difficult to remove items         5
Submitting a dispute                                                     6
Chapter 6.3                                                             6.3-1
Credit Score Repair – file a security lock – opt-out
File a security locking of your credit report – opt-out process          2
Chapter 6.4                                                             6.4-1
Credit Score Repair – debt validation #2 with creditors
Responses                                                                1
Legal ramification of he Debt Validation #2 process                      3
Dispute Validation #2 Letter                                             5
Aspects of a Debt Validation #2 letter                                   6
Legal foundation for Validation #2                                       11
Chapter 6.5                                                             6.5-1
Credit Score Repair – inquiry sweeping
Inquiry sweeping letter via agencies                                     2
Inquiry sweeping directly with the data furnishers                       3
Chapter 6.6                                                             6.6-1
Credit Score Repair – debt validation #2 via the agencies - notice of
validation violations
Chapter 6.7                                                             6.7-1
Credit Score Repair – dispute validation #3 – statute of limitations
Statute of limitations                                                   3
Statute of limitations and how it works                                  8
Understanding credit reporting and the Statute of Limitations            5

Statute of Limitations for debts - table                          5
What the statute of limitations does not do                      11
Chapter 6.8                                                     6.8-1
Credit Score Repair – inquiry sweeping via agencies
Chapter 6.9                                                     6.9-1
Credit Score Repair – dispute verification #1
Chapter 6.10                                                    6.10-1
Credit Score Repair – filing in small claims court
Assessment of your suit                                           2
Legal assistance                                                  6
Procedure for filing a small claims suit                          6
Pretrial hearing                                                  9
Getting prepared for court                                       10
The trial                                                        11
Chapter 6.11                                                    6.11-1
Credit Score Repair – sue in upper division Federal court
Chapter 7                                                        7-1
Professional services
Credit professional – warning!                                    1
Consumer credit counseling aka debt management services           2
Debt consolidation                                                4
Settlement services                                               4
Credit repair companies                                           6
What to do if you have a problem with a credit repair service     8
Chapter 8                                                        8-1
Settlement with Pay to Delete
Debt settlement types                                             2
Settlement procedure with creditors                               3
Account charge-off                                                3
Settlement warning – income tax consequences                      4
Income tax – tax relief programs                                  4
Settlement procedure with collectors                              6
Pay to delete                                                     7

Disputing an account in collection                                 9
Debt settlement professionals                                      9
Chapter 9                                                         9-1
Collectors and collection companies
Accounts sent to collection                                        1
Dealing with creditors before an account goes to collection        2
Dealing with creditors and collectors - Loose lips sinks ships!    3
When you contacted by a collector                                  5
Removing derogatory collector listings                             6
The law requires collectors to validate debts                      8
Service persons and collectors                                     9
The law will stop collectors from harassing you                   10
Litigation of a debt                                              11
Settlement of a debt                                              12
Fair Debt Collection Practices Act – overview                     12
When your rights have been violated by a collector                13
Recording phone conversations with collectors                     16
Statute of limitation and collection of a debt                    19
The Federal Bankruptcy Act, Chapter XIII – Wage Earner Plan       21
Chapter 10                                                        10-1
Divorce and Credit
Chapter 11                                                        11-1
Women and Credit
Chapter 12                                                        12-1
Medical Insurance When You Are Terminated
Appendix A - Agency Dispute Responses and Codes                    2
Appendix B - FTC Library of Credit Reporting Acts                  4
Appendix C - Identity Theft                                        8
Appendix D - Financial Breakdown of Experian                      13
Appendix E - Glossary of Terms                                    16
Appendix F - Bibliography                                         23

    Mark and I have been careful to make it clear that some of the topics we have
included in our book are of questionable value and have potential risks. Some
approaches and process we found and included may possibly skirt the law or they may be
just plain too “imaginative” to venture using. We included these topics because we have
been bombarded with these questionable approaches by very convincing telemarketers.
They sound so confident of their approaches to re-securing your solvency that it is
tempting to hire them.
    Desperate people may be inclined to use desperate methods to save their assets.
Including these topics serves to give you some insight and an educated opinion so as not
be tempted to be taken in should you be approached to use them. Most of the credit
repair solicitation and other types of calls I got these past two years offered a lot of hope
with their schemes. However, hope will not put your finances back in order.
    We have tried to offer useful information on how the financial system works, how
you fit into the system, and what you need to know to better protect your assets. We have
included techniques and methods that you can utilize to improve or restore your credit
score, and things you should understand about bankruptcy, taxes, and foreclosure as they
relate to your credit report and credit score. Hopefully the information we have provided
will enable you to weather the storm of this recession.
    We may have missed some topics. There is so much information on credit repair and
the credit system that conceivably we would never get done writing this book if we
waited until we had it all in the book. The credit environment is so rapidly changing and
fluid right now that what it is today can be completely changed tomorrow by new laws or
further economic changes. If you have some additional subjects that you would like
covered please email us and we will try to include them in the next update of the book -
     We want to make it very clear that we are not attorneys or accountants and
     the material presented here is in no way intended to be legal advise, legal
     counsel, financial planning service, investment advise, tax advise, debt
     counseling, consolidation service, nor do we accept any responsibility for
     actions persons may take based on the information provided in our book. If
     you find something of use check it out with a CPA or an attorney before
     implementing it.
    Mark suggested at one point that maybe we should include in our disclaimer that this
book is for entertainment purposes only. I felt that was going a bit too far in trying to
protect ourselves against suites. I hope that anyone who for any reason will not feel they
have to take their anger to that level. We have done our best to create a book that, if not
yet totally complete, it at least provides necessary leads from which you can find more
detailed information.
    If you decide to use any of the information contained in this book it will behoove you
to consult with an accountant, attorney, or other professional in a specified field to obtain
their professional opinion, advice and guidance. We tell you this not because we do not
believe that what we have written is accurate, but because we feel you should be prudent
enough to want to make sure you do the job right.

    The information in this book is provided to you on the basis of what Mark knows
about the credit industry from years of working in the credit industry. It is based on our
own personal encounters with the credit system. Much of the information comes from
browsing hundreds of websites of legal and financial experts. Some of the information
has been claimed to have been successfully used by others. Some of the ideas are straight
forward and some are somewhat complex.
    While we have tried to be very careful in our writing and we have tried to verify what
we could, we cannot in good faith state that all of the things in this book will work for
you under your unique circumstance. In some cases, the information in this book
requires a better understanding of the law, accounting, banking, debt collection, or one of
the professional fields related to a topic.
    Mark’s experience in the credit industry has brought to the book some interesting
insider information. Most books and websites tell you about how the system is supposed
to work or as Mark describes it – consumer reporting agency propaganda! Mark tells
you about how the system, in fact, does work based on his many years in the credit
industry. As I mentioned in the preface, the real operation of the credit industry is
shocking! It’s all about money!
    It was our endeavor to introduce you to the topics that may be of use to you. Even if
you do not use our information, in all cases, you will at least be better informed for
having read this book. Should you decide to hire a professional to do the necessary repair
work on your finances you will be able to ask the right questions to determine if they are
qualified to do the job for you.


     The LA Times, March 2009, printed a shocking and depressing story about a lady
     who had lost a lot of money when her bank was declared insolvent. She had finally
     sold her house and received a check for $360,000. She deposited the check into her
     bank account until she could figure out what she was going to do with the money.
     A week later the bank was declared insolvent and she lost $130,000 (the amount
     not covered by FDIC insurance). Her money didn’t just suddenly evaporate into
     thin air. It was not lost or spent, but merely shifted over to the bank’s account to be
     used to now pay the bank’s debts. This may sound preposterous and it is, but it is
     true. This is the way the financial system works. Knowing the rules would have
     saved this lady her $130,000.

     The LA Times, May 1, 2009, Mortgage Reduction Bill fails to pass the Senate. “…
     Democratic leaders were furious to see bankers lobbying against consumer
     protection measures after Congress had approved enormous sums to shore up the
     financial services industry. “I am sick and tired of being asked to give billions to
     these banks,” said Senate Whip Dick Durbin (D-Ill.), who threatened to oppose any
     further industry bailouts. “If they [the banks] have no sympathy for homeowners
     facing foreclosure, I don’t have any sympathy for them.” - Can you believe that a
     senator could make such an insensitive statement!

    We are witnessing a global recession like none ever before seen in history. While in
the past individual countries have had economic downturns, we have never seen all the
countries in the world experience an economic meltdown at the same time. The impact
of this magnitude may take decades to reset economies back to what they were before the
world economic collapse.
    Some people will come away from the collapse of financial systems much richer,
some unscathed, but many will be financially affected in some way or possibly
devastated beyond what they can recover over the rest of their lifetime. Millions of
people all over the world are going through hell trying to save the assets they have
worked to build over their entire lifetime.
    The pathetic thing is most people – people like you - who have been hurt by the
collapse of the financial system are not in their dismal situations because of anything they
have done. You have acted responsibly, you worked hard to get where you are, you paid
your bills on time, and you put aside what you could for your children’s education, a
special purchase, and your retirement. And now it’s gone. You are a victim of the
financial system’s greed and its intent to fleece America and the world.
    Many victims have lost everything they own while helplessly watching the vultures
pick up their assets at pennies on the dollar of their real worth. You watch helplessly as
those most responsible for the global recession are imbued with huge amounts of
taxpayer’s dollars. You, the victim of greed, are told that for one reason or another you
do not qualify for a share of the bailout. What hurts even more is reading about the
lavish parties and the extravagant living of the financial moguls, now that they have

assured the security of their own assets through their government friends, lobbyists, and
    The question foremost in your mind is, “Is there anything that I can do to save my
assets in this recession? This is obviously why you purchased our book.
   Point one; your major obstacle to overcome is time. Eventually the economy will
   recover and this recession will become only a bad memory. We have gone through
   downturns in the economy several times in the past few decades. This one will also
   eventually pass on.
   Point two; to buy time you need access to money. Hopefully you will be able to
   juggle bill paying to stay out of foreclosure and bankruptcy long enough to see the
   turn around in the economy, get your job back, increase sales, etc.
   Point three; one of your major hurdles for survival may well be your credit score.
   Our financial system has become so dependent upon the credit report and credit score
   that it seems no one believes the system can function without it.
   Point four; the curious thing about the credit reporting system is that it is flawed and
   no one seems to care to fix it. Credit reporting is all about compiling and selling
   information. It is not about creating an adjunct system that serves to make this a
   better world in which we live.
     You purchased this book because it promised to show you how to do credit score
repair like the professionals. We stated that the other books on the market do not offer
this insider information; the real power of credit score repair. This is what we started out
to write about when Mark and I got together. And we will deliver on that promise.
     However, before we get into credit score repair it will help you to be more effective
in doing credit score repair if you have an understanding of how the credit reporting and
related industries function or rather why the systems are not working as they should.
     The history of credit reporting started off on a bad foot back in the late 1800s. The
first company had gotten a bad reputation based on its collecting and selling information
that was not directly relevant to true credit reporting and analysis. In addition to relevant
financial data they also collected data about consumer’s personal lives and habits.
     Okay, I’ll concede that knowing a person is a sexual pervert or an alcoholic may have
relevance on their creditworthiness or whether you would want them as an employee,
however, there are a lot of people who have created industrial empires regardless of their
perversions and drinking habits.
     The credit reporting industry has grown into four major national agencies with
numerous sub-corporations, along with a couple thousand smaller local agencies. In
addition there are thousands more companies engaged in some sort of consumer data
compiling and reporting in just about every industry; everything from the prescriptions
we take, the groceries we buy, to the car we drive and our driving record, even the
magazines we read and the type of toothpaste we buy. It is all recorded someplace.
There is no aspect of our lives that some organization is not busy examining and
compiling data about us and selling it in some form. It’s all about money!
     I have listed just a small sampling of the many ways in which companies are
compiling data about us. Most of the ways I suspect are so intrinsic that few people even
realize what is really going on. For example, did you really think manufacturers needed

all the information they request you to put on their warranty cards? Do you really think
that your grocery store club card is only about discounts? In reality, they are about
collecting information about you that can be sold. Even though there are many
companies that do the same thing as the national agencies, collect personal data, it is little
known that few of these companies are governed by the laws that were written with
respect to the four national consumer reporting agencies. These companies operate
     If this is not scary enough for you, computer technology is now enabling the varied
data collectors the ability to share the data they specialize in collecting. They cross
correlate data to build an even better electronic representation of who you are.
     Credit reporting, whatever its nature, was allowed to go unrestricted for decades.
However, for all of the reasons behind the Federal and state governments finally creating
laws to control credit reporting, it is interesting to note that the laws are not definitive
enough to clearly define all aspects of the laws’ intent. When I questioned claims that the
laws state such-and-such and could not find this information, I was told to examine the
intent of the law. Does the law state something or doesn’t it! This is more to the point.
     More important is the inability of the Federal Trade Commission (the major
government organization for governing the credit reporting agencies) to audit this
humungous industry as put forth by law. Possibly the level of manpower that would be
required to audit all of the consumer data collection and reporting activities would be
beyond the government’s capabilities. Thereby, the industry is pretty much left to police
itself; or does it?
     There seems to be a fine line between the agencies obeying the laws vs. doing the
economically affordable minimum required to meet the intent of the laws. Companies,
from the consumer reporting agencies, to the creditors that voluntarily furnish credit and
other data, they are all in business to make money; lots of money.
     It costs money to provide free credit reports and to process corrections to the data
they have compiled in their databases. This eats deeply into profits. If it weren’t for the
Federal Trade Commission and Federal and state laws it is questionable if the agencies
and their flock would be at all concerned with consumers’ rights.
     The burgeoning credit score repair industry is taxing the credit reporting system as
the need for credit score repair in this recession has spawned a fast growing desperate
customer base. This has caused the agencies to find economical alternatives for handling
the onslaught of disputes. Like the attempt to try and help people through the recession is
overwhelming the credit reporting system, the response to this new attack has created
methods that are likewise just as devastating to the operation and credibility of the credit
reporting system.
     It is interesting to note that while things could have been done and could still be done
to make credit reporting into a very viable and much less intrusive service, the scenario
we see is predicated upon companies finding as many ways to use compiled consumer
personal information to make as much money as the imagination of the companies
marketing managers can conceive.
     Compiling data for the purpose of selling it in a great number of entrepreneurial ways
is what credit reporting is really all about. Credit reports and scores are only one product.
Selling information for sales leads, employment screening, apartment rental screening,
are a very small sample of the many, many ways that compiled databases of personal

information are being used. Big Brother is truly able to watch us, now. It finally has the
vast empire of data furnishers supplying the system with data and powerful computers to
do the job that Orson Wells envisioned.
    As I wrote this last paragraph I couldn’t help but think about the Cold War spy
movies I have seen where the Russian KGB encouraged voluntary data furnishing and
then compiled and abused the use of personal data they compiled. I do not mean to infer
that credit reporting is an industrialized version of the KGB. I’m only likening the
agencies to the intrusion of the KGB into Russian citizens’ personal lives and its affect on
controlling peoples’ lives.
    Credit reporting agencies primary use of data is to make billions of dollars. However,
there is an aspect of control as the collective bodies of companies compiling data for their
respective money making purposes cross correlate the data in their databases. This data is
being used to evaluate your getting a job, buying insurance, obtaining credit to buy a
house or a car or even get a low limit credit card that enables you to function in a credit
conditioned country.
    I happened to watch an old Robert Redford movie, “Sneakers”. It’s was about
gathering information on US citizens. The bad guy says, “War it no longer about guns
and bullets, it’s about information and knowing how to use it to control people.” Maybe
my thoughts about the old KGB movies are not that far off base.
    Just about everything written about credit score repair focuses on something called
the dispute; you dispute data on your credit report. In actuality dispute is only one of ten
processes that the professional credit score repair professionals use to improve their
clients’ credit scores.
    To begin with there are two aspects of credit score repair we will be examining in the
book. There is getting items on your credit report corrected which may or may not have
any effect on your credit score; we will refer to this as credit report maintenance. And
there is getting as many as possible derogatory items removed from your credit report in
order to improve your credit score; we call this real credit score repair.
    The use of the dispute has overloaded the system’s ability to manually process
disputes as creditors have been doing it for years. The first step was to cut corners in
processing disputes as the workload grew. As the system faced becoming overwhelmed
new software was implemented to automatically respond to disputes. Now, rather than
taking fully documented disputes, reviewing them, and making the necessary corrections,
software is simply verifying that the data that is already in the agencies’ databases is ‘as
reported’; in essence saying that the Xeroxed copy matches the original.
    Just as software was created to serve a financial system that was growing too
unwieldy to function with humans analyzing the ever growing number of credit
applications, software was developed to automatically process disputes. Experian has
introduced e-OSCAR; an automated dispute verification software program. The new
software is a very profitable product. However, it is questionable if the software is doing
a fair job at processing disputed information as it does not have the capability to analyze
fully documented dispute packages. You might say, “It goes through the motions of
processing a dispute.”
    With automated verification, fully documented disputes no longer need to be
reviewed with the objective to compare what the consumer has submitted with what
creditors have reported to the agencies in order to verify a dispute. Mark’s company has

experienced, and there are many letters posted on internet websites complaining that the
agencies are not getting incorrect data corrected.
    Looking at the system from the commercial credit repair side, it is much too
cumbersome to gather and submit fully documented dispute packages that contain proof
that the information on the credit report is in error. It is much easier for consumers and
credit repair company professionals who understand the law to greatly reduce their effort
by putting the burden of proof that the information creditors reported to the credit
reporting agencies is accurate; ergo verify it!
    However, as the objective of credit score repair is to get derogatory items removed
from clients’ credit reports correcting data is neither an issue nor a concern. Accurate
derogatory items are no less damaging to your credit score than inaccurate data. The
catchall is that you are hoping the company that reported the data to the consumer
reporting agencies, that you want removed from your credit report, will be so overloaded
processing disputes that your dispute will not be answered within the legally required
time frame. If this happens you get a ‘get out jail free’ card; your data is automatically
removed from your credit report with no further effort. Well, actually it doesn’t happen!
    The intent of the laws governing credit reporting was for you to be able to document
an error and it would be reviewed and corrected. The problem is that the system has
become overloaded, even more so now during this recession with credit score repair
taking the stand of ‘Dispute It’ as its main theme. The credit reporting system is fraying
under this new onslaught of activity.
    The endeavor to obtain the highest credit score is mandated upon the growing
reliance on the three digit credit score number that can improve or destroy the value of a
consumer’s life. It has come down to the credit report and the credit score. A bad score
and/or questionable data on your credit report can make the difference between your
getting a job or insurance, as well as many other aspects of life being upset.
    Which brings us back to our objective for writing this book; what can you do to
protect yourself throughout the rest of this recession? What hope do you have to save or
salvage the assets you have earned over your lifetime? The answer is, learn how to
defend yourself. Just like taking a martial arts self-defense class to learn how to
physically defend yourself, there are things you can learn do to defend yourself against
losing your assets. One of the things you can do is protect your credit score. Your credit
score can deny or qualify you for loans, get better interest rates, and get a job or
                                 Information is POWER!
                             Learning how to use this Power
                          Will enable you to protect your assets.

    Learning the ins and outs of loan settlement and loan modification negotiation, and
understanding the workings of the credit reporting system will prepare you for the fight
ahead. I keep hearing after-the-loss-stories; what people could have and should have
done, but like me, there was no way to know what would have worked and what was
folly before I got deeply involved in writing this book.
    For the millions of recession victims that have found themselves in situations
seemingly beyond help the most important thing for them right now is TIME. You need
time to find a new job or get your old job back when your industry returns to some

semblance of normalcy. You need time to find some source of financial help to enable
you to better weather this financial storm and eventually recover from the recession. You
need time for the stock market to rebound enough for you to afford to cash out and pay
bills. You need time for the government to pass legislature when they come to realize
there are victims who still need its help that have been overlooked for one reason or
     “Real Credit Repair” is a compilation of the works of hundreds of experts in financial
and legal fields who offer enormous amounts of information on their internet websites. It
also includes a wealth of information based on what Mark and I have learned through
first hand experience and what Mark has learned as an insider working credit score repair
on thousands of client cases.
     It took a lot of rewriting and clarification of internet information to create “Real
Credit Repair.” Most of the internet sources were reluctant to give away too much
information. Many internet web sites scattered bits and pieces throughout their web sites.
Most put up just enough information to impress browsers that they might be experts in
their fields and should thereby be trusted, but often did not give enough or concise
enough information to be of any real use.
     In any case, much of the technical information contained in this book is not original.
It was gleaned through hundreds of hours of browsing the internet, books, technical and
news articles, and conversations with individuals. I have liberally sprinkled excerpts from
reports, articles, and other tidbits of information I found that express what we want to say
about the credit reporting industry. Some of the items are from government and
recognized authorities in this field, which adds some authority to this book. It is not just
Mark’s and my comments and opinions.
     The glossary lists most of the source references we used. You could gather the
information contained in this book by yourself if you want to spend hundreds of hours
browsing and assimilating information and then turning it into a readable and more
important an understandable and useful format.
     We have brought together in one volume a clear picture of how to deal with credit
score repair. Unlike other books that are filled with conceptual approaches, endless
examples of how others have dealt with their financial situations that require you to
interpret to figure out how they apply to your specific situation, we have striven to create
a book that provides comprehensive (yet easy to read and understand) explanations of
how the credit industry works and specific “How To” instructions for accomplishing your
objectives – “Real Credit Repair.”
     We have avoided enlarging our book with fluff (wordy explanations) and filler
(subjects not pertinent to the issues at hand, clipart, big line spacing, etc.). We are
offering real world information in the most concise manner possible that will enable you
to learn how to strategically fight to save or salvage what is left of your assets and your
financial and emotional life.


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