[sointa]

I will like to know what is derogatory trade and is it bad or good?

[bushg]

That word usually means bad. If you call a credit counselor I'm sure they will help you sort through it .

[DaveyJones]

Derogatory credit means "bad credit". It is something that usually will have a special section within a credit report for a quick view by lenders or creditors. Depending upon what type of derogatory credit is on the credit report, some lenders will view the derogatory information in a different way then the other creditors. All derogatory credit should be addressed so you can have more choices and options for financing in the future. I have been in mortgage banking for almost 14 years, and lenders share some common thoughts on this, but have increased the latitude regarding derogatory data on a credit report when making lending decisions. Fannie Mae, for example, just changed their policy on collections that are still open on a credit report as of 5/19/2007. Their NEW policy is that unless a collection on your credit report jeapordizes a first lien position on your house, it does not have to be paid... regardless of how much it is! Granted, I don't know why you are asking the question, but the basics are this... derogatory credit is bad and you should make every attempt to resolve it, but it still doesn't mean you can't get financing for something... there are far to many financing options for anything these days... just depends on what interest rate you would pay since a side effect of a poor credit rating is higher interest rates or less approvals on the money you may request. Hope it helps.

[justicematters]

I will like to know what is derogatory trade and is it bad or good?

Davey answered your question a bit better than the first post but take into mind that derogatory cred also means that a report was made against you that conflicts with your statements to who ever you had owed people money too. What I do not agree with is that davey is saying that you should make every attempt to resolve it. If anything, demand that the reporting center disclose full particulars about the issue

[DaveyJones]

First off, I agree with that entirely. When I stated a consumer should make every attempt to resolve derogatory credit, in no way was it implied that a consumer should open their pocketbook and arbitrarily pay a debt in that status. What the statement meant was simply that every consumer needs to take action... ie, make an attempt, to resolve derogatory credit by investigating at the repository level with Equifax, Experian, and TransUnion. NEVER pay something simply because it is "bad credit" on your report, but rather make every attempt to determine why it is there. If it truly is your derogatory credit, by all means deal with it or it will not go away for years... is it really worth it to wait 5-10 years for a bad item to fall off over a few hundred dollars while you miss better rates on everything you want potentially? If it truly is NOT your credit or a mistake, there are many remedies within the system... although a "far from ideal" system. The FCRA (Fair Credit Reporting Act) has set forth standards that creditors and reporting agencies must adhere to. These rules and laws were created to help you "make every attempt" to resolve issues around your credit.

The bottom line is that it is less than favorable information that will negatively impact your credit score. Having been in lending for over a decade, I can say you will find a lender that does NOT use the scoring system in their determination of whether you get a loan or credit card, etc... the extreme minority. Virtually ALL creditors and lenders use it to mitigate risk. Good luck trying to simply tell a potential lender you are "investigating the issue" or "it is a mistake", etc... Won't fly unless you are getting money from a local smalltime bank where a handshake is all you need... not the world we live in anymore. Although the system is built around this one, antiquated, in-accurate system, it is the best we have to date. Make every attempt to resolve the item and provide the documentation to support it... you will eventually have to show the proof to someone if you want the better rates and terms. I can give you a loan through many channels and your derogatory credit MAY not even matter... but many more times than not, it is the difference between a lender saying "yes" or "no". Handle them...