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The Credit Book By Sam Sky


thecreditbook Welcome to Ask Mr. Credit Card.com. Every Sunday we review a personal finance or credit book. This week it’s The Credit Book by Sam Sky.

A bit of background: Sam is the Debt Negotiation / Credit Restoration expert that we recommend most often to the readers who send in questions about their debt. We did a radio interview with Sam a while back, and I was really amazed by his level of knowledge about credit reports and debt negotiation.

Needless to say, I was really excited to get my hands on his book. I wavered for a minute when I picked it up, because it contains a little bit of language. However the language is mostly directed at scummy banks that take advantage of people every way they can. So, I understand the righteous anger. We get a lot of letters from people whose banks and credit card companies are treating them unfairly.

Language aside, the book got interesting quick. Sam begins with a basic bit of education, and then moves right on into more advanced topics. Here’s an excerpt:

Ever Been Turned Down For A Bank Account?

There are many types of ocnsumer reports. Some of the most popular reports that a consumer is going to come into contact with are the following: Dunn and Bradstreet, Experian Business Report and Check Systems.

Check Systems is a consumer report which is strictly used among the banks in an attempt to protect banks from allowing individuals with a past bad check writing history to open an account and leave a tornado of damage with more bad checks being written.

Most people aren’t aware that you are entitled to a free copy of your Check Systems consumer report, and you can dispute and remove negative items off of this report.

Check Systems has a policy that attempts to force you to deal directly with the banks and pay them back directly.

Pardon the pun, but they bank on the fact that you will fel useless and not know how to contact Checks Systems. They will not give you their Check Systems address, and they keep all information as secretive as they possible can.

That actually sounds a lot like the FICO score formula to me. For something that has such financial importance, it’s awfully difficult to decipher how it’s computed.

It doesn’t surprise me that Check Systems would try to prevent you from contacting them either. When we put together our Guide to Challenging Items On Your Credit Report, it was difficult for us to find the addresses for the three main credit bureaus too.

These agencies do not want you to contact them. Disputes are a headache for them. Never mind that it’s our credit scores that suffer when incorrect information gets listed.

A Consumer Report has no legal validity although it’s treated like gold. It is not a legal document.

The credit report is not a true reflection of your credit. It can not be used as such in a court of law. It is just a consumer report.

A smart person will utilize this to their benefit, while others will have it utilized to their detriment.

Your good credit isn’t on your credit report – Car insurance, medical insurance, water bill, electric, health club, rent, etc. Your bad credit doesn’t have to be on there either!

This really is an important point to understand. Your credit report is not a legal document. Nore is it an accurate representation of how you pay all of your bills – only some of them. Many, many companies only report negative information to the credit bureaus, never positive. So, it’s possible to pay your bills on time every year for five years, and never have that positive payment reported. Then the first time you have an emergency and you are late, the late payment will show up on your credit report.

Our credit reports belong to us, not the credit bureaus. The credit bureaus keep those records on behalf of the banks that use them, but your report belongs to you. What’s on it is your responsibility.

Most people’s credit reports contain inaccurate information. Period. Chances are if you check all three of your credit reports you will find information that is incorrect. Bad information that lowers your score needs to be removed.

When you understand that your credit reports belong to you, and what goes on them (or off them) is your responsibility, it opens up a whole new world. Credit reports require at least once yearly maintenance, if not more often. Regular maintenance also helps to prevent identity theft.


The MIB, better known as the Medical Information Bureau, is the consumer reporting agency that contains your medical information and past history. If you get turned down for insurance because of a pre-existing condition, it’s because this report contained negative information. The good news? It belongs to you too, and you can have things added, or removed as you need to.

Work the system, don’t let it work you. Neglecting your consumer reports only hurts you in the long run, it never helps. If you could count on everything to be accurate 100% of the time, then you could possibly say, “Well, I was late on those payments, and now it’s on my credit report, I won’t let that happen again.” However, sometimes it’s even possible to have someone else’s bad accounts listed on your credit reports. It’s never 100% correct. You do have to maintain and update all of your consumer records. Otherwise you will never know if it’s your mistakes that lowered your score, or a reporting error that disqualified you from a better interest rate.

So, which inaccuracies are you legally allowed to challenge on your consumer reports?

If the information on your consumer reports falls under any of these categories, then you have the right to have it removed:

You have a legal right to have that consumer reporting changed or updated, but you also have a right to have it removed completely for being less than 100% accurate.

For now, if you want to know more about how to challenge information on your consumer credit reports, you can check out our guide. Next week we’re going to take a look at Sam’s specific hints and tips for doing this, and see if we can pick up any new information that might be helpful.

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Thanks go out to these carnivals for featuring our articles this week:


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