Foreclosure impacts you in numerous ways. Along with the loss of a home, the foreclosure impacts your credit record. Poor credit can lead to struggles with borrowing money, finding housing, and qualifying for employment.
What Is a Credit Report?
A credit report is a document that gives a detailed look at your credit history. There are four primary areas in a credit report.
- Your personal information (social security number, current, and past addresses, legal name[s]);
- Your borrowing history regarding credit cards, mortgages and car loans, and other accounts;
- If you ever faced bankruptcy, eviction, foreclosure, or other legal actions related to finances on your record; and
- A list of companies or individuals who have checked your credit history.
Essentially, a credit report is a thorough handprint of your borrowing track record.
How Is a Credit Report Used?
Primarily lenders and employers use credit reports. Lenders want to determine whether you are a person to whom they should extend credit or lend money. Employers generally use the report to gauge your level of responsibility. The report can indicate whether you have had difficulty paying bills on time. It also helps ensure that you do not have substantial debt that you may later have trouble paying.
A credit report is also used to create a credit score. Credit scores range from 300-800 points. A higher score indicates stronger credit. Credit scores, like credit reports, help determine your creditworthiness. A score under 600 is generally considered poor. A foreclosure may lower your credit score by at least 100 points.
Why Is Good Credit Important?
Good credit provides you with more opportunities to borrow money and qualify for jobs. A credit report is often accessed when you attempt to purchase items, secure credit cards, find housing, or apply for work. For example:
- If you need to borrow money to purchase a car, you will need an automobile loan;
- When buying a home, most individuals receive credit in the form of a mortgage loan;
- To rent an apartment, you often need to demonstrate strong credit;
- When you obtain a standard credit card or store credit card, the company gives you credit by issuing you a card;
- For some potential employers, you will need a good credit report to be considered for a job; and
- Good credit provides you with a higher general credit score.
A lack of good credit can hinder your ability to accomplish some very important goals.
How Long Does a Foreclosure Stay on My Credit Report?
Foreclosure generally involves a lender taking a homeowner’s property because the homeowner failed to make agreed-upon payments. A foreclosure stays on your credit report for seven years. After seven years, it should fall off of your credit report.
Will a Foreclosure Significantly Impact My Credit?
Having a foreclosure on your record will impact many aspects of your life. A foreclosure indicates poor credit history and can be very harmful. Your ability to borrow money to purchase a home, buy a car, and even get specific jobs will be limited.
Can I Avoid Foreclosure If It Has Started?
Since foreclosure is extremely harmful to your credit, it is vital to hire an attorney immediately if you are facing foreclosure. An experienced defense foreclosure attorney may be able to stop the foreclosure. If a foreclosure is on your credit report already, you should still contact an attorney. They can try to have it removed from your record more quickly than the seven-year time frame.
Vantage Group Legal Services Can Help You Regarding a Foreclosure and Your Credit
Foreclosure and its impact on credit is a complicated legal and financial matter. Vantage Group Legal Services focuses on foreclosure defense. A lawyer dedicated to defending individuals in these types of cases is the best person to assist you. Vantage Group Legal Services will assign you an experienced network attorney that is the perfect fit for your situation.
The network attorney, along with Vantage Group’s staff, handles all aspects of your case. Vantage Group Legal Services is a unique company in that they are a group legal services company, not a law firm. Their knowledgeable team is ready to help you with your legal needs.
Vantage Group Legal Services will provide you with a free no obligation, free consultation. Contact them by calling (773) 938-4747 or fill out a form on their website.