| Finance

McClatchy Newspapers (MCT) - The days of buying a house _ credit score unseen _ are over.

Just a few years ago, homebuyers borrowing through the Federal Housing Administration did not have to have a specific credit score, which is a number credit bureaus calculate and lenders use to consider someone's "creditworthiness."

"It was more of a common sense approach," said Ryan Weis, founder of Square One Credit Restoration Inc. in St. Louis. "They looked at the last 12 months and if you were paying bills on time."

Now, the financial turmoil on Wall Street and the coinciding housing crisis on Main Street have forced lenders to tighten standards. Never before has good credit been so important.

That's where people like Weis come in. He brings 10 years of mortgage lending experience into his new credit restoration service, which he established in May.

"Primarily what my company does is we try to go directly through reports with people," Weis said. "People have seen credit reports before, but to most people, it doesn't make a whole lot of sense. They are not very easy to someone who doesn't read them all of the time."

Weis said creditors will look through a consumer's financial transactions and activities from the past seven to 10 years. He said they will even look at applicants' accounts that are open or closed.

Weis' Square One Credit Restoration provides debt negotiation and settlement work, reviews clients' current banking and recommends where to open new accounts.

"Our goal is to decrease finance charges that the consumer pays," he said. "And the way to do that is by getting the highest credit rating possible."

Vicki Jacobson attempts to educate consumers about building a healthy credit history. The one-time employee of the Consumer Credit Counseling Service in St. Louis is now president of the Foundation for Credit Education, also in St. Louis. Her service has similar goals as Weis' and is free to any nonprofit credit counseling agency. The foundation has been working closely with the National Consumer Law Center in addressing student loans. She said she strives to help those who help others, but consumers also need to understand what it takes to create sound credit.

"It takes time to build up a credit score," Jacobson said. "I think now, with credit, it is going to be more difficult to obtain."

Weis' service will go through clients' credit report and to make sure every detail is correct. He has found statistics that cite 60 percent to 70 percent of reports contain errors.

"It seems like a rather large number, until you understand how the credit reporting system works," he said. "Some people understand that banks pay to get this through the credit bureau. They also make money every time a bank reports someone's payment history to a credit bureau because they have to pay a fee to do so."

But many times when an account goes into collection or the collection is paid, the bank will pay the fee for the last transaction to show that the account is satisfied or that there is a zero balance, Weis said.

Individuals can inform a credit bureau if they find mistakes.

"I think it's going to continue to increase the amount of customers that we help because as the minimum score requirements increase, in turn, the percentage of population that needs help increases," Weis said.

"It's a real challenge," Jacobson said. "It all depends on time, time to build and time to have a credit history. It's a little bit of a catch-22, for some consumers. It does take time.

"Nobody is looking out for the consumer better than the consumer can," she added. "When consumers get into trouble, they need to know what is in their means."

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© 2008, Belleville News-Democrat, Belleville, Ill.