By Jamal Denman
Most people, including those who did well in school and are college educated, go through life giving little thought to their personal credit score. Even less time is spent on monitoring, managing, or figuring out how to improve one’s credit rating.
The only time many of us do so much as inquire about our credit score is when we are in the process of making a large purchase or attempting to establish a line of credit. For those of us who do not have a high enough credit score, the chances of being approved are slim to none, and the process of figuring out and addressing what is having a negative effect on your credit score can be rather time consuming.
Classes on personal credit management are not required in high school or even college. There are few learning institutions that even offer such a course.
Three years ago, Andre Johnson, a credit consultant, helped co-found Credit Restoration Services LLC, a credit and financial management services company. After more than 17 years of working as a corporate accountant, as well as going through a personal experience of having to deal with issues that affected his credit rating, Johnson decided to make a career change.
Going through the process of repairing his own credit, then subsequently doing the same for some close friends and family members, made him realize
that personal credit management was not something he or many others have been educated about. During the time period Johnson grew up, he remembers that “cash was king. Everything was about cash; nobody knew anything about credit, so I wasn’t taught about credit.
“I’m a college-educated man; I didn’t learn credit in college. I didn’t learn anything about credit in high school.” And that was the experience of someone who went to school for accounting.
“They taught us about lenders of credit through a bank,” Johnson says, “but [learning about] the credit scoring system itself, [and] how to build credit accurately and correctly, that never happened.” These were the main motivators behind Johnson teaming up with a couple of business associates and starting Credit Restoration Services.
According to Johnson, your credit score affects more than just your ability to purchase a home or secure a loan. Having a low credit score has a financial impact on many other aspects of life.
“Insurance pricing modules are more heavily based off of your credit score than your driving record. You could have a really good driving record and a low credit score, and you’re going to pay more for insurance than a person with a poor driving record and good credit,” Johnson claims. He says that companies are making hiring and promotion decisions — even the amount of a security deposit when leasing an apartment — based on credit scores.
Johnson says it is important for people, especially those in African American and immigrant communities, to understand what can affect credit scores. For instance, many are unaware that settling a debt with a creditor can have a negative effect on your credit rating by not only decreasing your overall score, but also increasing the time period the debt will legally be reported on your credit report. In addition, you could be liable for paying taxes on the forgiven amount.
“We actually teach our clients how the FICO credit scoring system truly works, and exactly what they need to do in order to constantly have FICO adding points to their score so they can raise their score and maintain high scores over the duration of their life,” Johnson explains.
Credit Restoration Services provides credit and financial management services at a cost they claim saves their clients $151 to $1,651 compared to other credit restoration service companies who do not provide the additional services they offer.
“We not only do the credit repair where we’re disputing the items, but we also do healthy budgets and money management… We truly believe that money management and good credit go hand in hand. When you mismanage your money, there’s a good chance you’re going to mess your credit up at the same time,” Johnson says.
Credit Restoration Services also offers a debt-reduction program, which Johnson says does the equivalent of filing for Chapter 13 without actually having to do so. They also monitor the actions of creditors and credit bureaus to ensure consumer rights are not being violated during the process.
For more information about Credit Restoration Services LLC, contact Andre Johnson at 651-342-6218, [email protected], or go to www.crs850.com.
Jamal Denman welcomes reader responses to [email protected]