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August 24, 2010

What You Should Know About Credit Counseling

Filed under: Business — Tags: , — taxtorpedo @ 8:58 am

Credit counseling is a free service that many people with money problems have turned to in the face of financial ruin. Credit counseling companies negotiate with your creditors to reach financial solutions that benefit both you and your creditors. Often they are able to lower your monthly payments, reduce high interest, and eliminate late charges.

In addition to getting harassing collectors off your back, credit counseling can be an educational experience that you can carry with you throughout life. Whatever the reason for your financial problems, credit counseling can teach you how to avoid those problems in the future should you be faced with the same circumstances.

Credit counseling is confidential and rightly so as money is quite a private issue for most people. Some even find it difficult to have such intimacies exposed in credit counseling. Hopefully you will be met with a caring and professional credit counselor who can ease your worries and make you feel at home discussing your current financial situation.

One of the things that you should learn through credit counseling is how to make the most out of the money you have. How to stretch your dollar, so to speak. Of course this will help your current situation but it will also help you hold on to more of your money in the future and keep you out of situations similar to the one that brought you to credit counseling in the first place.

Credit counseling is not for everyone by any means. Some people simply don’t respond to planning and budgeting and they are going to be frivolous with their money no matter what advice they get in credit counseling. It is best to go into credit counseling with a goal and a determination to reach that goal at any cost. It is not an easy undertaking to change your financial life and you should certainly go into it with both eyes wide open.

Timothy Gorman is a successful webmaster and publisher of Debt-Relief-Solutions.com. He provides more debt relief, bankruptcy and free credit counseling information that you can research in your pajamas on his website.

August 23, 2010

What Does Your Credit Say About You?

Filed under: Business — Tags: , — miskec @ 8:55 am

A credit report is more than just a snapshot of your financial picture; it can assist credit grantors in determining your overall risk factor. Additionally, lenders, credit grantors, and even human resource departments often use it as a tool to determine a person’s character.

When applying for a mortgage, your lender will request a credit report from one or all three consumer credit agencies. While credit repositories do not divulge exactly how the scoring model calculates the numerical score, the score determines your credit standing and worthiness. This score is based on several factors including types of credit, amount of credit and your payment history. For instance, if a score is 679 with a 12-month mortgage reporting 30 days late; or a 620 score with no mortgage lates and a credit card under half the credit limit ? who would you lend to? When refinancing or purchasing a home, the accuracy of this information could literally mean thousands of dollars either saved or lost.

Vital information is constantly streaming into your credit report, both accurate and erroneous. Due to the level of erroneous reporting, there has been pressure on Congress to make the credit repositories more accountable for the accuracy of the information AND to divulge what goes into the scoring models. However, do not leave it to Congress to straighten out the pitfalls of errors on your personal credit report. You should check your report annually to insure that all the data is accurate.

Why is this important? The lending industry is moving toward “risk-based” pricing. In other words, the higher one’s credit scores, the less paper they will have to provide to prove that they are creditworthy AND the interest rate and/or fees a borrower pays will be based on the level of their scores. The higher the score, the lower the rate, payment and many times the down payment. Does this mean that people with challenged credit should not apply? Not at all. No different than one of us lending a co-worker or family member a couple hundred bucks until payday, the lender simply wants to make sure they are protected. A loan may still be granted in this scenario by perhaps requiring more money towards the down payment or a slightly higher interest rate.

The truth is, it’s a great reward for those who maintain impeccable credit and a goal for others. With this in mind everyone can take advantage of low interest rates.

Le’Andra Martin, Branch Manager with American Mortgage Specialists can be reached at 866-824-9549. She is dedicated to helping homeowners and investors maximize the investment in their homes.

August 19, 2010

Credit Repair Scam – How To Avoid Being A Statistic?

Filed under: Business — Tags: , — Akilakalum @ 11:57 pm

A good credit history is critically important for the consumer. A bad credit will prevent you from getting a business loan, owning a home, or even a job. Promises to “fix” your credit are always made by credit consolidation companies, but they are seldom true. Here are some of the important tips to avoid scams:

First things first. Negative information cannot be erased if the information is correct. Only inaccurate information can be corrected in your credit file. Credit file information remains on your record for seven good years from the time it is reported to the bureau. For bankruptcy, the information remains on your record for ten years. All the consolidated information about your credit bills you fell behind on, but are now paid, will remain on your report for the time period mentioned above.

Do not pay the credit repair company unless their promises are kept. Remember, the law is on your side. Federal law requires credit repair companies to give you a complete detailed explanation of your legal rights, a completely documented written contract, and above all, 3 days to cancel. This applies to all credit repair services including for-profit services, non-profit services, creditors and credit unions.

Be wary about emails you receive. When you hover your mouse over the link in the email, you will know for sure if it is a trusted website or a fraudelent one. If fraudelent, report it to your bank promptly.

You don’t need a counselor to correct your mistakes in the credit report. Take charge of it yourself. If you were recently denied credit, you can request a free credit report. Otherwise there is a small charge for it. Some states will allow you a free copy of your credit report once a year. It doesn’t cost you anything to dispute or question items in your credit report. Get online or follow instructions from your credit bureau. The three major credit bureaus are Equifax (800- 685-1111), Experian (800-682-7654) and Transunion (800-916-8800). In most cases you will need to contact all the three credit bureaus as the information they have about you may vary.

Remember that you can’t create a second credit file. Some of the fraudelent companies will offer to provide the consumers with a different social security number (tax identification number if ssn does not exist) in order to create a new credit file for the consumer. Such a practice is called as file segregation. File segregation is illegal and does not work.

Whereever possible, add explanation to your credit report to prove your point. If you have legitimate reasons for not paying certain bills on time (switching jobs, illness), or if you refused to pay because of a dispute, send the bureau a statement to be tagged with your credit report. Each lender who pulls your report will be aware why you fell behind on those bills.

Counseling might be a good option. Find a good non profit consumer credit counseling service in your neighbourhood. Get online or open your yellow pages to find one. Seek the guidance of friends and family members. Select a counselor, meet them in person to make sure they are right for you. Ask them on tips and advice on how to build a good credit history. If you are still lagging behind on your payments, credit consolidation firms will be able to set up a payment plan with your creditors. If money is an issue, select a non profit credit counseling service. They will offer their service for free or for a very low cost.

Ameri credit services provides credit counseling and credit consolidation to customers. Visit us at http://www.americreditservices.com for free credit consolidation articles, free credit counseling tips and non profit credit management services.

Sound Advice For First Time Credit Card Users

Filed under: Business — Tags: , — latexfetishmodels @ 5:55 pm

If you are just entering the world of credit cards, there is important information you will need to know in order to manage your credit and your finances effectively. Establishing good habits and a good credit history now is the foundation for a solid financial future. Applying for a credit card in your own name can help you establish a sound credit history and will be a valuable asset in applying for a loan for a home, new car, or getting a new job or apartment. In addition, there is no safer way to make purchases online or over the phone than with a credit card.

Along with the benefits of having credit cards, comes added responsibility. If you misuse your credit cards or fail to take responsibility for your spending habits, you could end up in serious financial trouble. Learning how to choose the credit card that is right for you is your first step. There are numerous credit card offers from which to choose, and it can be confusing to know which is the best one for you. Do not choose a credit card simply because of a low introductory rate or generous rewards. A low introductory rate will increase sharply when the introductory period is over, and many times these types of cards have annual fees and additional costs that are not made clear in the initial offer.

Know the terms of your contract with the credit card company. Interest rates and late fees can cause your balance to rise considerably and making the minimum payments will not help you pay off your credit card debt. If you make a lot of purchases with your credit card, it will be necessary for you to pay your entire balance each month if you want to avoid additional fees. Some credit cards raise your interest rate if your balance exceeds a certain amount, and will charge you numerous late fees and other miscellaneous charges if you exceed your credit limit, even if the reason you are over your limit is due to fees and penalties.

You should know exactly when you will be billed each month and prepare to send your payment in several days before the due date. Late payments will result in additional fees and could reflect badly on your credit report. Even if you plan to make your payment online, plan to do so at least 5 business days before your bill is due to avoid any possibility of late payments. It is very tempting to use your credit card for cash advances. You should avoid cash advances except in the case of emergency. Cash advances generally come with a higher interest rate than regular purchases and you will be charged an additional fee for each cash advance. Even if your interest rate is relatively low, the rate you are charged for amounts resulting from cash advances can be significantly higher.

Be very careful about how and when you use your credit cards. Never loan your credit card to friends and make sure you protect your card at all times. Identity theft and credit card fraud are major problems. You will need to take the appropriate safety precautions to avoid either of these situations. When your monthly statement arrives, make sure you have kept all of your receipts and check your receipts against your bill. If you find any errors, report them immediately to your credit card company. You can learn to manage your credit wisely by practicing good credit habits now. Credit cards are almost a necessity in our society, but in obtaining credit you must learn good spending habits and make smart financial decisions.

This article has been provided courtesy of Creditor Web. Creditor Web offers great credit card articles available for reprint and other tools to help you search and compare credit card offers

Identity Theft – Dont Think You Are Immune

Filed under: Business — Tags: , — joshuaking @ 8:57 am

As identity theft becomes more prevalent, the need to regularly check your credit report is very easy to see and understand. Two big headlines in the news recently point to how closely tied your credit report and identity theft are.

First, we hear of the troubles of Choice Point, a company involved in the storage and distribution of credit information. It appears some criminals set up a fake company and used it to obtain sensitive credit information. Then in turn they used it to steal the identities of about 750 people. That number will probably grow, since more than 500,000 people across the country have been put at risk.

Second, comes the story about missing computer tapes containing credit card records of more than 1.2 million of Bank of America cardholders. Most of the accounts belonged to federal government employees. This has placed the account holders in danger of increased risk of identity theft.

Both of these companies are now in the process of notifying the people of their exposure. The truly bad part of all the problems is these leaks and losses occurred months ago. These two companies were not very quick in notifying the people affected. Way too much damage could have been done before they had been alerted to the trouble.

While the headlines may change, the need to check your credit report does not. You may be very careful. You may shred your documents, the credit card and other financial solicitations you receive in the mail. You may take great care how and where you give out your financial information. Unfortunately as these stories show, it may not be enough.

Identity theft affects about 10 million victims per year. It has been estimated to cost consumers and businesses more than 50 billion dollars a year. It is easily among the fastest growing categories of white collar crime. You need to do all you can to fight theft of your identity.

A new law has been put on the books by the Congress to help combat the losses. It allows the you, the consumer to request a free credit report from the credit agencies once a year. You should not hesitate to take advantage of it. However, the law has a rollout feature which does not allow full access for all Americans until September 1 of this (2005) year.

While this is a step in the right direction, in typical fashion the government continues to leave the populace exposed. You should access your credit report much more often than once a year. If an identity theft takes place just after receiving the free credit reports, an enormous amount of damage can be done before you can review your next free report.

The Federal Trade Commission has put together a list of questions and answers concerning this new law and the effect it will have on your credit report and your risk of identity theft. They can be helpful to you in determining your rights under the law

It makes sense to check your reports regularly, as often as, on a monthly basis. This may seem a bit much to you, but just ask a person who has had their identity stolen how much hassle it is to take your life back. They will tell you it is well worth the effort. Let’s face it, no one cares as much as you, about your credit record, and the damage that identity theft could cause in your life.

(c)2005 David Wilding

David Wilding has for the past ten years worked with groups and individuals to rid their lives of debt. Visit his website for more ideas, tools, and strategies to get rid of your debt.

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