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It Was a Dark and Stormy Night

It was a dark and stormy night and the rain beat frantically against my window as if it were trying to escape by squeezing through the glass and into the shelter of my office. It had been a long day and I was drained, like a bank account sucked dry by credit card payments. 
 
I put my feet up on my desk and my eyelids started to droop. I had almost drifted off when the raucous ring of the phone caused my eyes to jerk open. I fumbled for the phone. The voice that greeted me when I finally found it was frantic … scared…  
 
You’ve got to help me, Budget Guy! I’m being stalked and I’m scared to death!!  
 
Stunned, I could only stammer something about calling 9-1-1. After all, I’m not Austin CSI! What could I do?
 
No, you don’t understand, BG! I’m being stalked by my credit score. I went to buy a car and the best interest rate I could get was 12%! They said my credit score wasn’t high enough for the really good rates. And then the interest rates on my credit cards went up … because of my credit score. Now I hear that credit scores are part of the insurance rates someone gets and my car insurance just went up!  Help me!! What can I do?!  
 
 
A long sigh escaped my lips. I’d seen this type of thing before, and it’s never been pretty. I pulled out my calculator, loaded it with fresh batteries and set it on the desk in front of me … just in case. I began to talk about credit scores, keeping my voice calm and soothing.  
 
 
First, I explained that credit scores are based on data in your credit reports. And most credit reports have errors in them (79% according to one study), with 1 out of every 4 causing significant damage to the person’s credit score. So the first step is to get your reports and make sure they’re accurate.
 
Wow – That’s pretty scary! But, hey – I can do that! Get reports, find errors, fix errors … Boom! Done!!
 

      The voice was calmer. Good. Maybe I wouldn’t have to resort to my calculator after all. But I knew my caller needed to face up to reality. Getting errors fixed in your credit reports isn’t easy and it takes time. The credit bureaus don’t have any incentive to make sure their data is correct. Your best bet for help? The Consumer Financial Protection Bureau.    

It has everything you need to get your credit reports cleaned up.  
 
 
Okay. So it won’t be as easy as it sounds. What ever is? Is there anything else I can do?  
 
 
Time to put my caller to the test. So I asked, “Ever been late on paying any of your credit card bills?   
 
 
I’m late every now and then. You know how it is … things come up.   
 
 
Do you have high balances on any of your cards?  
 
 
Not that it’s any of your business, Budget Guy, but yeah, I’ve got some pretty good balances on some of my cards. So what! Doesn’t everyone?  
 
 
Uh-oh. My caller was starting to get testy. I reached for my calculator again as I explained that credit scores are based primarily on your payment history and on the amount you currently owe.
 
 
So it’s really pretty simple:  
 
 
Hey – BG – I just had a brainstorm! I’ll go get another credit card. That will increase my total credit but it won’t have any balance. So that will take care of that part of my problem. Even better – I’ll find me one of those balance transfer offers and that’ll save me on my interest charges. Gotcha on that one, BG – bet you wish you’d thought of it!   
 
 
Slippery character, this one. Trying to avoid dealing with the real issues. Time to lay it on the line.  
 
 
 
“One minor problem, my friend – if you’ve run up the cards you have now, what makes you think you won’t end up running up your new card? Not to mention all of the ‘gotchas’ those balance transfer offers are loaded up with.  
 
“Look, you’re not the first person that’s tried to game the system. You might make it work for a little while, but then it’ll come back and bite you and you’ll be worse off than you are now. You’re not being haunted by your credit score, you’re being haunted by your own choices! If you’re not ready to own up to that…  
 
 
Whoa – okay, okay! You’ve made your point! I wish there was an easier way, but like they say, there’s no free lunch. If I’m honest with myself, I guess I really knew that all along. Thanks for telling it like it is, BG.   
 
 
“You’re welcome. Sorry to be so harsh, but there aren’t any shortcuts. Start with getting your credit reports and work it from there. And keep my phone number handy – I can walk with you on this new journey.”  
 
 
As I hung up, I put my calculator away and my feet back up on my desk. Sleep came easy.