Posts Tagged ‘loan’

Tips for a better credit report and score

October 20th, 2008

To get a good credit score the first tip is to pay your bills on time. It does not matter how bad your credit history is you must pay all your bills on time. This will help build a positive payment history on your credit report. This is the second most important factor when calculating your credit score.

It also matters how much time has passed between derogatory items on your credit report and when your score is calculated. After an amount of time, allegedly four years, negative items on your credit are not weighed as heavily. Thus it is very important for you to build a positive payment history.

The next tip is to remove any inaccurate information. Unfortunately our credit reporting system has many flaws. Often a divorce will result in bad credit. The divorce judge will divide the debts between both parties. Then if one of the parties defaults on a loan, even though they were court ordered to pay, it will be reported on both parties credit.

You can also have bad credit due to a lender mistake. It happens all the time, where the amount due changes and due to a mistake on the lenders side you are never notified and keep making your regular payments. Yet the whole time your credit is being ruined with derogatory marks.

You can also have a negative mark due to stolen identity, or just a credit reporting error. These are very common, where someone somewhere makes a mistake but your credit pays the price.

These are all inaccurate marks on your credit report. You should dispute and remove all of these marks.

Congress passed legislation to protect people just like you that find themselves in this situation. The Fair Credit Reporting Act says that inaccurate information must be removed.

To dispute an inaccurate mark you can hire a credit repair service. They will draft a dispute letter and send it to each credit bureau that is reporting the inaccurate listing. Or you can do this compose a letter yourself, however you should know that credit bureaus often do not conduct investigations based on one dispute letter.

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Is this financial crisis partly our fault

October 12th, 2008

Everywhere you turn you see the news talking of a plunging stock market, business bail outs and record number foreclosures.

Initially my thoughts are “What has this financial system done to us?” but on second thought, are we not intelligent enough as a society to have avoided financial collapse?

Just because a greedy bank tells you that you qualify for a mortgage ,did we not have enough sense of our own to know it was outside our budget? Did we consider the monthly payment for 30 years and factor in a slow economy or job loss?

These are the questions that one cant help but ask as it proves even more, now than ever- that we as a society are so undereducated in finances.  Financial literacy should be at the top of the governments list of things to do yesterday. If you cannot teach a person to be responsible with their finances then you should expect disaster.

Remember the term “Buyer beware? “That should not only go to avoiding scams, but the buyer also need be- aware. Aware of your finances, your family structure, your ability to manage your debt, retirement, your credit reports. Consumers often close their eyes and hope for the best and the result can be disastrous.

While it is the american dream to own a home, unfortunately, not everyone is capable of doing so. There is a huge responsibility that comes with homeownership that goes far beyond the application approval. We as consumers should have known better. We should have seen this collapse coming because of the sheer volume of sub prime loans that were being handed out to literally every Tom, Dick, and Harry. Default was inevitable. Couple that with an unstable economy and disaster was at our doorstep.

Now was must reap was we sow and work our way through this financial collapse. I have no doubt in the spirit of Americans and we will survive- but maybe this time around we will take responsibility for our own finances and not leave it in the hands of Wall Street and greedy lenders.

We need to take responsibility for our own future. Manage our jobs, our retirement, our credit reports, our debt. We cannot expect the government to take 100% of the blame in this financial mess. If it had turned out good, would we blame them then? If your home’s equity were up 10% would you be shaking your fist at the greedy bankers?

Did big brother charge up your credit cards and remodel your home for you? Did big brother tell you to buy two gas guzzling SUVs and eat out all the time? We all know there is a lot of blame to go around. No one got into this alone. People were in a feeding frenzy with easy loans and easy credit.

We helped  to get ourself into this mess and now we must help to get out. We cannot sit back and wait for handouts or for the market to fix itself. We need to start fresh and take inventory of our financial fitness and begin anew. Sure, we’ll see challenges all along the way but a slow and steady focus on the problem will win in the end.

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Court orders credit bureaus to clean up consumer credit reports

October 4th, 2008

We just covered this issue again last week in the members area. Old zombie debts that just live on and on, often outliving you. Our credit system is very unforgiving. If they don’t get you for 7 years from the bankruptcy, they’ll try to get you for another 6-10 through erroneous reporting, either on the suppliers end or the credit bureaus end.

It’s a vicious cycle and is it a wonder people give in and hire credit repair attorneys?

This court order is going to make some consumers and credit repair agencies very happy- and make their jobs easier when it comes to deleting negative trade lines that were part of a bankruptcy.

The issue is millions of debts that were included in a bankruptcy are being reported incorrectly as delinquent or past due with a balance. The debts, however, should be listed as “included in bankruptcy” with a zero balance. This can have a major impact on your credit score.

According to the WSJ; Erica Noe of Burke, Va., says an old debt on her husband’s credit file cost them their home — in part because it prevented them from being able to refinance their interest-only adjustable-rate mortgage last year. Her husband, Kenneth, had filed for Chapter 7 bankruptcy in 2002; in that proceeding, the court discharged his prior debts. Nevertheless, they were unaware that a previous $7,000 credit-union loan remained on his report, pulling down his credit score for several years.

“We thought that once we filed for bankruptcy, it would go away,” says Ms. Noe. “But it didn’t. It affected everything.” The 31-year-old nurse says they didn’t find out about the error until they tried — but failed — to refinance their mortgage. When the rate reset, the Noes’ monthly mortgage payments shot up by about $1,000; they lost their home to foreclosure last November. “It was a snowball effect,” she says. “Unfortunately, everything just kind of worked against us at the same time.

“I tried to fix the error on the report by calling the credit union and telling them to stop reporting,” she says. Currently, their lawyer, Robert Weed, is filing a separate lawsuit against Equifax and the credit union. Equifax declined to comment on an ongoing suit.

A recent court order requires the three major credit-reporting bureaus — Experian Group Ltd., Equifax Inc. and TransUnion LLC — to clean up the credit files of millions of consumers who have filed for Chapter 7 bankruptcy. The problem: Old debts, which are typically forgiven by the courts in a bankruptcy filing, are still being reported as active on many consumers’ credit reports.

The changes could be particularly important to borrowers now, as consumer credit tightens across the board. It is perhaps more important than ever for people to make sure their credit scores are accurate and as high as possible.

This ruling is expected to clean up the credit files — and potentially boost the credit scores — of an estimated six million to 10 million people who have filed for Chapter 7 bankruptcy but still had errors in their files, according to plaintiffs’ attorneys. Consumers with so-called zombie debt — old loans they may have paid off years ago that can resurface when an aggressive debt collector erroneously demands payment — are also likely to get some relief, if those debts also were discharged under Chapter 7 protection.

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How this credit crisis will affect you

September 21st, 2008

I’m a credit expert by trade, so needless to say, I have pretty good credit. I’ve worked hard to build great credit and maintain it. No matter what happens with my finances, I’ve always made my credit a priority.

If someone told you, what you did today was going to affect you for the next seven years, would you think twice before doing it? I know I would but many people just don’t think of their credit in this way. They think about “now” and not “later”. Well, later is here!

With the recent credit crisis in the country, even those with really good credit are going to feel the pinch. Banks are tightening up their purse strings and for good reason. Major financial institutions are collapsing all around us. NINJA loans have ruined our economy and deregulation of big banks has collapsed the finance industry.

Just when we thought it had gotten as bad as it could with record breaking foreclosures, it got worse. Much worse. If you thought those feeling the pinch were people who got themselves into mortgage trouble and you were safe, think again.

People with good credit, even great credit are going to be affected by this downturn. Reports this week claim that getting even simple loans whether secured or unsecured is going to be much harder. Now, more than ever, you need to start thinking about the state of your credit. Even if you’ve always had pretty good credit, now you must shine.

This is especially true if you’ve got credit card debt. It wont be so easy to transfer balances to other lower rate credit cards to save some money. Lenders are going to proceed with great caution and that’s going to affect you personally.  Those with poor credit are really going to be in a bind. Even a simple payday loan wont be so simple. People are going to find there are few resources to turn to for their lending needs.

Now is the time to do an audit of your credit. Make sure you’re ready when the time comes to apply for a much needed loan, line of credit or refi.  The credit repair field is going to be booming! While the FTC gives us some great tips to fix our credit, unfortunately people don’t bother until they need credit. Now is the time to clean up your credit so it’s ready to roll when you need it.

Get your credit reports, grab a cup of coffee and start that audit. Look over all three credit reports and highlight any problems you see. Make a plan to send investigation letters to these questionable items and by all means, don’t apply for needless loans. Those hard inquiry’s will only lower your credit score further. Wait until you are in a good position before you apply for a loan. Don’t waste the inquiry, especially now.

Clean up your credit the best you can then make a solid plan to refi, get out of debt or purchase a big ticket item.

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Need a job? Get into the best paying field in the industry right now

September 19th, 2008

And what is that industry you ask? Debt collectors. While the economy is whirling with bank collapses, record foreclosures and high gas prices, one thing remains solid. The debt collection industry. Even the IRS is advertising collection jobs on Google. Paid ads!

With over 969 billion in credit card debt across the country, the debt collectors are filling a supply and demand of bad debts.  A debt collector can earn up to 100k a year in salary and bonus. Think of the demand that’s out there right now.

80 million people are paying off medical debts, students can’t pay their credit card bills, and complaints about bill collectors are on the rise.

Everybody is affected by this looming recession and someone’s got to go after the debts. Banks are writing off record numbers of failed loans and with a tighter bankruptcy law, it isn’t so easy to escape your debts. With new bankruptcy provisions, debtors have to complete a debtors education course, prove they cannot pay their debts back and overall, go through a lengthy process. This causes pause with consumers, so they wait it out.

Eventually the debt collector comes knocking and you will be found. Just yesterday I had a friend call me and tell me her father, who is 70, received a note from his neighbor. The note said to call back Mr. Jones at ABC collection agency. She asked me if this was legal and if it violated his privacy. I explained to her that using a Haines Criss Cross guide to find a debtors “nearby” is a common tactic of debt collectors and isn’t illegal as long as the debt collector doesn’t reveal the nature of the call. In other words, the debt collector cannot discuss the debt with the neighbor but is allowed to leave a message. Humiliating in deed but affective. He was mortified and embarrassed and will probably now return their call to avoid further contact with his neighbors.

Debt collectors know this is a ripe time to cash in on all of our bad luck with this crushing economy and make a fortune in commission and bonuses. What’s frightening is that just about anyone can be a debt collector, and thus, be privy to your financial information. Take a look in your local classified ads. There are offers everyday for highly motivated people with no experience to make a career in debt collections. Imagine someone having access to your credit reports and checking account information along with your home address. I’m surprised there isn’t more identity theft in this field than there is.

Lots of debt collectors are shady characters to say the least. Sure, there are many professional debt collectors with a college education who decided to go into this recession proof industry, but there are also a lot of really bad people taking on jobs to collect debts and those people will stop at nothing to make a fortune off collecting debts.

I know this firsthand, being a debt collector myself for 10 years. I worked with some really shady characters when I took on jobs at local collection agencies. These people would harass debtors nonstop and some went as far as taking the debtors phone number home with them to continue the harassment after work!

There’s very little internal regulation of these actions because debt collection firms roll employees in and out at a constant pace and cannot control what a debt collector does after hours or in private. To someone like me, who knows how some of these employees operate, it’s a frightening scenario.

Now with a failing economy we are going to see a sharp rise in complaints about debt collectors to the Federal Trade Commission and local Attorney General offices. I’m sure there are many lawsuits on the horizon.

If you plan to go into debt collections, remember, these debtors are people just like you and me who have fallen on hard times. I think a diplomatic approach with sensitivity is a much stronger practice to follow while collecting debts. I know it worked for me.

The majority of people not paying their bills aren’t doing so simply because they’re deadbeats. They can barely fill their gas tanks, buy groceries and pay their mortgage. We are all impacted by this economy so I hope collection agencies are enforcing stricter practices and offering good solid education to their debt collectors on how to collect debts in a legal, ethical manner.

If you do find that you’re being harassed, you need to take action quick to stop it. I’ll talk more about that in my next post.

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Do it yourself credit repair | Easier than you think and cheap!

September 16th, 2008

You can improve your creditworthiness and get legitimate resources for low or no-cost help.

 

You may get calls from telemarketers offering credit repair services.  The Scam, companies’ nationwide, appeal to consumers with poor credit histories and who are desperate. They promise, for a fee, to clean up your credit report so you can get a car loan, a home mortgage, insurance, or even a job. Desperate consumers fall prey to this scam. Remember, if it sounds too good to be true. It is.

 

Some credit repair services get sleazy when they promise to do a job that’s just not possible. Unlimited credit report disputes, corrections, and removals with Equifax, Experian, and TransUnion and guaranteed deletions are just some of the promises you hear.

 

An ethical firm (usually reputable lawyers, not shysters) will not tout miracles, charge you in advance or make false promises. if they do, sooner or later the FTC will find them.

 

Just this past week, a credit repair company was shut down and fined by the FTC for making promises it couldn’t possibly keep, by assuring buyers that they could remove negative accounts even if accurate and for collecting money in advance for work yet to be performed.

 

That’s a key word. Accurate. The foundation of credit repair isn’t an industry trade secret. It’s using the law with your customized disputes to garner the best possible results. Period. 

 

By using existing state and federal laws, you CAN remove negative information from your credit reports. The fundamentals aren’t whether the item is negative or positive. It’s is it accurate.  The FCRA is quite clear on this issue. If it isn’t verifiable or accurate, it cannot remain.

 

It doesn’t matter what your history, background, or credit record is, you’ll be amazed at how simple correction can be. You’ve probably been told that your credit history will stick with you forever, or it takes years to clean up. 

 

While no one can guarantee you a spotless credit record, real credit repair is a worthwhile investment, and if the bureaus, collection agencies, and creditors were doing their job, credit report repair wouldn’t be the top search online.

 

People are desperate because credit reports DO contain lots of errors. Nearly every consumer has an error in at least one credit report from one of the major credit bureaus. Credit bureaus generate your report they receive from your creditors; they don’t verify it… Unless you ask.

 

The simple truth is that the credit bureaus and even furnishers of information must comply with federal law. Doing so isn’t so easy for them. You need to leverage that. It will take time, but it’s a very worthwhile investment.

 

 

Don’t despair.  It’s never too late to become credit worthy – just get started, and remember that it won’t happen overnight and you must commit to doing the work. Doing the work can be justified in how much money you are going to save if you don’t have to hire someone AND in rates if you do have an improved credit report.

 

While I can certainly understand the FTC warning us all to avoid credit repair and scams, what I don’t understand is why they don’t focus a campaign on just how difficult the credit system makes fixing your credit. The bureaus don’t work for us, they make billions and our disputes are a kink in there rhythm. They sort of help us because they have to, not because they want to.

 

So, what ends up happening, is the consumer gets frustrated and seeks out a service to fix their credit for them, and often, it’s a scam.  The FTC moves in, shuts them down, and reminds us that we can do this ourselves. Trouble is, people get lost in the process and the FTC doesn’t tell us that communication with the credit bureaus, debt collectors, and furnishers of information can be a vicious cycle.

 

That’s why it’s important to educate yourself and if you are going to do the work, do some research online. You’ll quickly find there are only a handful a really good , reputable DIY sites and credit repair lawyers.  

 

The highly effective letters that we offer have been proven to WORK in correcting negative items on your credit that may be outdated, obsolete, or inaccurate (unverifiable). When you combine the right letters to cut through the bureaucracy of the credit system, you’ll garner much better results, save money and avoid mistakes that can cause you more trouble and more time. Not to mention, you’ll understand the dangers of dealing with bill collectors without proper knowledge.

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Digging yourself out of debt

September 7th, 2008

If you’re like most of us, right now you are struggling to pay your bills and make the most of your paycheck. With unemployment at an all time high, gas prices over 4.00 a gallon, it’s no wonder people are watching every penny.

But… are you? This is a great article I found over at CareOne with tips to take responsibility of your financial mess and set up a solid plan to dig yourself out by taking responsibility for your financial mess.

Stop Making Decisions Based Solely on Emotions

Advertisers and retailers count on you basing a purchase solely on emotions, stop letting them! Before you purchase something, as yourself this question: Do you really NEED it? I stress need not wants because too often we get the two confused. Clothing is a great example for this question. You need clothing, you don’t need Banana Republic. Old Navy, Target and Wal-Mart work just as well.

Quit Worrying About your Credit Score

This is one of the top questions posted in our Community. Everyone wants to know how it will affect their credit score. Guess what, it doesn’t matter because you should not be concerned with getting more credit in the immediate future anyway. More debt does not help you pay off what you already have; it only makes your situation worse. Focus your energies on creating a budget and finding a part time job.

Stop Blaming the Banks

Yes, they gave you the credit cards, yes they raised your rates, and yes they charged over the limit fees…but guess what? You filled out the application, you made the charges, you probably didn’t read the fine print on the back of the agreement because I know I sure didn’t, and you ran up the balance. Deregulation of the banking industry was good and it was bad. The bad part is it put credit cards in the hands of a lot of people who did not really understand what the banks could do. Stop blaming, start paying.

Take Responsibility for Your Actions

I blamed my problems on everyone else. The sad part is I always had money for other things besides my bills. I made sure I had enough to buy cigarettes or go out on the weekends. I could always just pay my credit card bill late, or my car payment, or my student loan. Time to grow up. How many of you smoke? How many of you eat out for lunch every day? How many of you buy lotto tickets or gamble? This money can be put to better use.

Bottom Line:
Think before you buy
It is not the bank’s fault
You did it, now it’s time to dig yourself out

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Credit notification moves onward and upward

August 21st, 2008

It’s not bad enough that lenders make us feel like yesterday’s trash when our credit scores don’t meet what they consider “golden”, but often you’re not even told if you’re getting a good deal or not-  when it comes to the rates and terms.

Many consumers have no idea what a good rate is or isn’t, especially if they don’t use the credit system a lot. Now, a new change may make that easier for all of us by making the lenders tell us that we are getting a good or not so good deal.

People who deal in the credit system on a regular basis often lose touch with this fact, but it’s not your everyday Joe that knows if he’s getting a good deal or not. This change would make the lender tell you that you may not be getting the best deal so you’d at least be able to make an informed decision or go elsewhere before you sign on the dotted line.

 

proposed federal regulation that would force lenders to tell consumers “This isn’t our best deal” moved a step closer on Monday.

Now, lenders offer loans at whatever rates they like, without explanation. Consumers with the cleanest credit reports and highest credit scores tend to get the best rates.

Under the proposal, lenders that decide to offer higher-rate loans based on consumers’ credit reports would have to notify consumers of that fact. The notification would have to come before the deal was done.

The change, jointly proposed by federal regulators in May 2008, is intended to:

  • Make lending more transparent.
  • Give consumers the chance to review and fix credit report errors.
  • Let consumers take steps to improve their credit before committing to a loan.

In short, it requires lenders to say, “Hey, consumer, we’re giving you a bum deal because you have bum credit.” Continue to read the rest here.

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