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Cleaning up your credit report is actually quite easy, but requires an investment in both time and money.

Document everything! If you settle an account and it's now paid in full, you need to get your written confirmation from the creditor as your proof to the credit agencies and underwriter of payment in full. The same holds true with repayment plans. Document it!

Before you establish any new payment plan on any type of collection account, you need to review these arrangements with your lender, broker, and banker to insure they do not affect your chances to buy a home now (unless of course, you don't mind).

Tax Liens And Judgments

The easiest step begins with tax liens, back child support, and judgments. Settling these accounts is almost universally required and will increase your credit score...no ifs, ands, or buts about it!

In instances where the amounts are significant, establishing a repayment plan will allow you to qualify for an FHA Loan, VA Mortgage, or Sub Prime loan, but will have no positive impact on your FICO score.

Revolving - Installment - Medical

For these account types, the most important date you can look at is the "date last reported." If the last reported date is older than two years on a debt, settling this account may indeed have a negative initial impact on your FICO score, taking 90 to 120 days or more to recover from. Don't settle this old of an account "pre-contract" without first reviewing it with your lender, broker, and banker.

Revolving Charge-offs - Ignore duplicate listings from multiple collection agencies. Focus on the most current owner of the debt. If the date last reported is within the last two years, settle these accounts as cheaply as possible!

Installment Charge-offs - Ignore duplicate listings from multiple collection agencies. Focus on the most current owner of the debt. If the date last reported is within the last two years, settle these accounts as cheaply as possible!

Other Charge-offs - These include cell phones, utilities, etc. You should again ignore duplicate listings from multiple collection agencies. Focus on the most current owner of the debt. If the date last reported is within the last two years, settle these accounts as cheaply as possible!

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