July 26th, 2008
No, I don’t mean you need to teach them grammar, math and geography. You can leave those subjects up to the school system and hopefully they’ll learn what they need to know with just a little help from you at homework time.
I’m talking about a subject that will have far more impact on their lives than knowing the capital of Montana, or the proper conjugation of a verb. I’m talking about money management. This is a subject schools should, but don’t address.
Start when your kids are old enough to start asking for a quarter to put in a candy machine. Show them how to budget and save for special toys, and teach them that we all have to make choices, because you can’t spend the same dollar twice.
When they’re a little older, teach them about bank accounts. Get them a savings account and let them make the deposits and watch the balance grow. And while you’re at it, explain to them how that nest egg will benefit them later. But don’t stop there – teach them about checking accounts and the necessity to keep careful accounting.
Show them how money melts away as a result of an overdraft. Once, while working in a grocery store, I met a young woman who hadn’t learned this lesson. At that time, the bank was charging about $20 for each overdraft, and this girl wrote three NSF (non-sufficient funds) checks at our store in just two days. The sad part was, none of those checks was for over $10. So while she thought she was spending about $25, she created an $85 obligation at the bank.
By high school kids should be learning about credit reports and credit scores. Hopefully yours looks good and you won’t be ashamed to show it to them. But if it’s bad you can use the opportunity to show them how that is affecting your life in negative ways.
The first step is to get your free credit report. Then make sure you understand how to read it before you start explaining it to the kids. Show them how every loan and every credit card shows up there as a part of your financial history – and how all those things are combined to give you a credit score. Let them know that while your finances used to be a private matter, now your credit score can be accessed by almost anyone.
Above all, remember to make this education an ongoing process. Help them make sound money management a part of their daily lives so that when they get out on their own, all doors of opportunity will be open to them.
About the Author: Mike Clover is the owner of http://www.creditscorequick.com/. CreditScoreQuick.com is the one of the most unique on-line resources for free credit score report, fico score, free credit check, identity theft protection, secured credit cards, student credit cards , credit cards, mortgage loans, auto loans, insurance, debt consolidation ,and a BlOG with a wealth of personal credit information. The information within this website is written by professionals that know about credit, and what determines ones credit worthiness
Posted in credit education | 1 Comment »
July 25th, 2008
Right after you stop reeling from the shock, it’s time to take action.
You may have learned of the identity theft by examining your credit report and finding inquiries from unfamiliar companies (a sign that someone has applied for credit in your name) or by finding debts or new credit accounts that you don’t recognize.
If instead you learned of it only when debt collectors began to call, get a copy of your report immediately. You’ll need it when you take the next step: Contacting law enforcement.
You must file a formal report, because you’ll need a copy of the report when you contact the credit bureaus and respond to debt collectors. Your police report should include all the fraudulent accounts you identify when examining your credit report.
Contact:
• Your Local Police Department
• FTC.gov/bcp/coline/pubs/credit/affidavit.pdf
• FTC 800-438-4338 or 800-ID THEFT
As you begin this process, keep a detailed log of everything you do, everyone you speak with, and what is said by both parties. Keep track of every expense you incur, as well. Put all receipts in one safe place for easy access later. In your log, make note of the emotional stress and how it is affecting your work and your personal relationships. Depending upon circumstances, your actual expenses and your time loss could be tax-deductible.
Now contact the credit bureaus. Notify one of the credit bureau fraud units that you are a victim of Identity Theft. That Bureau will take responsibility for telling the other two bureaus. (Call Equifax: 800-525-6285; Experian: 888-397-3742; or Trans Union: 800-680-7289) Next:
• Tell the Bureaus to flag your credit report with a fraud alert
• Send a dispute letter, accompanied by the police report and the FTC fraud affidavit specifying which accounts are fraudulent.
• Subscribe to the bureau’s monitoring services
• Consider signing up for Trusted ID services – which will block your credit report so only you can use it.
• Ask the Bureaus to contact the creditors and let them know that fraudulent activities have taken place.
You’ll probably have to deal with debt collectors. Here’s how to handle them:
• Get the collector’s name, company name, address, and phone number – noted in your detailed log. Inform the caller that you are recording this information, along with the date and time.
• Inform the collection agency you ar a victim of Identity Theft
• Provide the FTC uniform fraud affidavit
• Ask for the name and number of the credit issuer they’re representing
• Send the debt collector a letter, stating that you do not owe this debt and that the account is closed.
• Request in writing that the account be flagged as fraudulent and ask that it be removed from your credit report.
CreditScoreQuick.com
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July 25th, 2008
By now you’ve contacted your local law enforcement and the FTC and have the proper documentation in hand to show that you’ve been a victim of identity theft. You’ve notified one of the major credit bureaus, who has in turn notified the other two.
You’ve been diligent about logging every conversation, along with its date and time, and you’ve kept a careful record of every expense associated with reclaiming your own identity.
You’re daydreaming about what you’d like to do to the person who caused you all this grief, but that won’t help. You need to keep a clear head and keep working on putting everything back to rights.
One of the first things you did when you discovered the identity theft was pull your credit report. Now do it again, because more information may have come in since the last report.
Examine it again for new entries, and if you find some, contact the credit bureau again and let them know of the new fraudulent accounts or charges.
If either the first or second report showed new accounts opened in your name, the next step is to contact each of those creditors and do the following:
• Notify each creditor of the identity theft and get the address where you need to send the fraud affidavit.
• Ask the creditor to send you any application that has been made in your name
• Ask to have the account closed and flagged with a fraud alert
If the thief has been using your credit cards, you need to notify the credit card issuers immediately and have those cards cancelled. They’ll issue new cards, with new numbers. Check to make sure that the address and e-mail address in their database is correct, so they don’t just send your new cards to the thief! Of course let them know which charges on your account are fraudulent, and of course note all of these conversations in detail in your log.
If the identity thief has written checks in your name…
• Call your local police and file another report
• Call your bank and close the account
• Get the proper address to send a copy of the police report
• Ask for a refund of monies fraudulently withdrawn
• And of course, carefully record each of these steps in your log
Identity theft costs millions each year, both in money and time loss. It’s a rude and devastating intrusion into your life. But if you take the steps we’ve outlined, you’ll get through it with the least amount of stress.
CreditScoreQuick.com
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July 25th, 2008
Two of the most common credit mistakes appear at first to be smart moves:
• Closing Credit Card accounts you aren’t using
• Avoiding having any credit cards at all
It doesn’t seem sensible, but it’s true. In order to have a high score, you need to have plenty of credit available – credit that you aren’t using!
The Fair Isaac Corporation’s credit scoring system says that having low credit balances compared to the amount of credit you could be using makes you a good credit risk. This is based on percentages, so if you had $20,000 available and only used $5,000 it would show that you used only 25% of your available credit – but if you closed some accounts and now had only $10,000 available, it would show that you are using 50% of your available credit – and thus lower your FICO score.
Similarly, having no credit cards not only means that you have no ready credit available, but offers no verifiable record of your payment history. Never mind that you’re so careful with money that you either pay cash or go without. That kind of responsibility doesn’t count in the world of credit scoring.
Creditors want to know that you pay your bills on time, so having a couple of credit cards that are in good standing shows your financial reliability.
High Credit Card Balances are the next mistake. According to Fair Isaac, your balance should never be more than 30% of the credit limit on any one card. So avoid the temptation to move all your high interest balances over to a low interest credit card – unless you can do it and still stay under the 30% mark on the low interest card.
Perhaps the most dangerous mistake of all is Co-signing for loans. You do it to help a friend or family member, but that act of kindness can come back to bite you – hard. Not only do you add debt to your credit report, the fact that the person couldn’t get credit without a co-signor means that there’s a good possibility that they aren’t responsible with money – and that before long, late payments will begin to show up on your credit report.
Late payments will drop your score a full 100 points – and that could mean the difference between you being able to qualify for a loan or not. At the very least, it will mean that when you need personal credit, you’ll pay higher interest rates.
Unless you’re co-signing for a child who is living with you and you can not only monitor bill paying, but pay the account yourself if your child doesn’t – just don’t do it. Letting a friend or relative ruin your credit is not a good way to maintain a good relationship.
CreditScoreQuick.com
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July 24th, 2008
Q:
Hi Mike,
I disputed my credit report through your site. I had some collections on my credit report that are over 7 years old. My question is how long does it normally take to remove the collection that is incorrect? This collection on my credit report is 9 years old, and is still reporting with Equifax credit bureau. This is very aggravating to me and I feel like the credit bureaus don’t stay on top of this stuff like they should. I just want it removed; I believe it is dragging down my credit score.
Shawn Matters
A:
Hi Shawn,
This is a common issue with the credit bureaus. Yes, if there is a collection reporting on your credit report it is dragging down your credit score. Typically after you dispute the inaccuracy, the credit bureaus will remove it in about 30 days. Make sure you only dispute it once, because if you dispute it twice the credit bureaus will put you back in the 30 day window again from the date of dispute. So in essence it could take 60 days to resolve by disputing it twice.
Mike Clover
CreditScoreQuick.com
Posted in collections, credit education | Comments Off
July 24th, 2008
You probably never thought that transferring credit card balances from one credit card to another credit card would affect your credit score. It may sound like a good idea to transfer high credit card balances to lower interest rate credit cards banks. In some cases this is a good idea, but it really depends on some circumstances. When your credit score is determined, one of the factors in the credit scoring process is the amount of debt owed. This accounts for 30% of your credit score. I am going to discuss two scenarios, one that will not affect your credit score and one scenario that will.
Scenario One
Let’s assume you have a credit card with a balance of $6,000 on it. The interest rate on this card is killing you and you have found a better deal to pay off the card quicker. The new card has approved you for $7500 credit limit and 0% interest on balance transfers for 18 months. This sounds like a good idea. So you transfer the balance to the new card for the low interest rate.
Here is the problem:
When you owe more than 30% of the allowed credit limit on a credit card, this will drop your credit score. With this scenario you have almost used up all the credit they gave you. This is not wise at all. The balance you owe compared to the approved credit limit it way too high. You have 80% of the card limit already used up. This will affect your credit core
Scenario Two
Let’s assume you have a credit card with a balance of $6000 on it. Plus you just got approved for a credit card with a credit limit of $25,000. They are offering the same deal on transfers as above, but they gave you a higher credit limit. This is the ideal situation and will not affect your credit score. The reason is the balance owed compared to credit limit is around 24%. This is considered low risk to most credit scoring risk models.
This principal can be applied to all credit card balances. You should not have your credit card balances charged up more than 30% of the allowed credit limit.
CreditScoreQuick.com
Posted in credit cards, free credit score reports | Comments Off
July 24th, 2008
As part of a continuing credit education program, CreditScoreQuick.com offers consumers tips on how to minimize credit risk and repair credit history in their online blog.
(PRWEB) July 24, 2008 — CreditScoreQuick.com, created by a professional lender, recently introduced a series of articles dedicated to helping consumers learn how to repair their credit histories and lower credit risk, absolutely free of charge, through an online blog at CreditScoreQuick.com/blogger.htm. Recent topics in the blog include:
* Rental and foreclosure collections and what it means in today’s housing market.
* How consumers can determine their credit score at no cost and what it means for their financial planning.
* How to avoid, or recover from, financial identity theft.
Before the recent housing crunch and increasing foreclosure rates, many consumers were unconcerned about their negative credit history, and banks were eager to get loans approved for customers. In order to receive quick loan approval, customers with negative credit histories were ripe for credit repair company’s assistance. According to CreditScoreQuick.com owner, Mike Clover, “During the real estate boom, credit repair companies were beating down my door for clients that needed credit restoration. We tried all kinds of companies who stated that they could help our clients out.”
Over time, Clover realized these companies were not doing anything except taking clients money. The fees these so-called credit repair companies charged consumers averaged $1,000 or more. “Being lenders during this extremely busy time, we did not have the time to repair our client’s credit reports, so we outsourced it. After exhausting just about every credit repair company in town, we decided to start directly helping clients repair their credit through our new company, CreditScoreQuick.com,” says Clover.
“We knew what needed to be done to help out individuals and families who were facing financial trouble so we started posting how to repair your credit articles on our Web site blog,” continues Clover. “Since we had first-hand experience in how to really fix credit reports, we decided to post our first hand experience on the web for free.”
When it comes to learning about credit and making sound financial decisions, may consumers find themselves buried in confusing information that doesn’t make sense, or even contradicts information from other sources. “We found that most people had fallen prey to credit repair scams because they were desperate for help,” Clover says. “Credit repair is just better money management education, and education on what affects your credit worthiness.”
According to CreditScoreQuick.com, no one can completely remove a debt they owe from their credit report. Many people have heard the “100 percent removal” sales pitch from credit repair companies so many times, that they truly believe it. But then they find out it is just a sales pitch designed to get them to register and spend anywhere from $1,000 to $2,000.
The results have been documented all over the Web announcing credit repair companies facing investigation and possible fines by the FTC and the Better Business Bureaus for not delivering what they promised.
So CreditScoreQuick.com took the liberty to show people what it takes to repair their credit report themselves. As part of their ongoing credit repair education series, CreditScoreQuick.com has begun posting better credit management education articles in a series of daily blogs. “Our top priority is to show the American people how important it is to mange your credit so you don’t get in financial trouble. If you have found yourself in trouble with your credit, you can repair your credit report through our site absolutely free, with no strings attached,” states Clover.
For additional information on repairing credit, e-mail CreditScoreQuick.com and they will respond to questions within 24 hours with a post on their company blog. CreditScoreQuick.com offers a full range of credit tools for consumers who wish to lower their credit risk including personal loan and mortgage applications, free credit reports, credit monitoring and identity theft protection.
Posted in credit education, credit repair agency | Comments Off
July 24th, 2008
If your credit score was just lowered, how would you find out? There are so many avenues now to get your credit report it’s actually pretty easy. But what if it actually was lowered to the point that it would really cost you on loans? This is where the constant stream of information is flowing about how important your credit score is these days. A credit score is so powerful these days that it has become the driving force of the lending industry. When it comes right down to it, all of this is the result of money. If someone loans you money and your credit score states you are low risk, then there is a pretty good chance that the bank will not need to worry about you defaulting. But in this article I wanted to discuss some matters that would affect your credit score.
Applying for credit
If you are going out applying for a bunch of credit, this will lower your credit score. The reason is the credit score risk models look at this type of activity in a negative way. The reason is it looks like you are applying for too much new credit which could be a risk to a creditor. The reason it look negative at this is because you could be acquiring too much debt too soon
Late payments
If you were just late on a payment that is with a creditor, you credit score was just destroyed. Late payments will affect your credit rating about 100 points.
High credit card balances
If you just went out and charged up your credit cards above 30% of allowed credit limit, you score just dropped. If you charged over the credit limit your credit score just dropped as well.
Closing credit card accounts
If you just closed one of your credit card accounts you just lowered your credit score. You really should not close out good credit unless there is a really good reason. This type of activity will lower your fico score.
Not enough credit
Maybe your credit score is not increasing because you don’t have a mix of credit on your credit report. You should have a couple credit cards and maybe a auto loan. You credit score is calculated by your mix of credit and your activity with this credit.
These are some quick tips on what could lower your credit score. What out for stuff like this, it will cost you.
About the Author: Mike Clover is the owner of http://www.creditscorequick.com/. CreditScoreQuick.com is the one of the most unique on-line resources for free credit score report, fico score, free credit check, identity theft protection, secured credit cards, student credit cards , credit cards, mortgage loans, auto loans, insurance, debt consolidation ,and a BlOG with a wealth of personal credit information. The information within this website is written by professionals that know about credit, and what determines ones credit worthiness
Posted in fre credit report, free credit score reports | Comments Off
July 24th, 2008
No one wants to run out on a valid debt, but sometimes things happen that make it impossible to make payments. In the best of all worlds, you could go to creditors, explain the situation, and they would let you put off making payments until you got back on your feet.
But while some creditors might be willing to cooperate, given the promise of full payment at a later date, some will not. That leaves you with some tough choices:
• Filing Chapter 7 Bankruptcy
• Filing Chapter 13 Bankruptcy
• Letting your debts go to collection
Prior to the Bankruptcy Abuse Prevention and Consumer Protection Act of 2005, almost anyone could file Chapter 7 and wipe the slate clean. The bankruptcy put a blot on their credit report and lowered their FICO credit score, but they no longer owed the debt.
Now it’s a bit tougher. If your income is greater than the state median income, your motion to file Chapter 7 will be dismissed and you will have to file Chapter 13. That means you’ll have to repay the debts over time.
A Chapter 7 bankruptcy dissolves all debts that legally qualify for the process – meaning that almost all liabilities are erased. You can’t erase a debt to the IRS – so don’t count on this system to get rid of overdue income taxes.
Chapter 7 filings remain on your credit report for 10 years, so this move is not one to take without due consideration.
Under Chapter 13, you must pay off at least a portion of your debts over time. For 5 years you’ll pay money to a court appointed Trustee, who will disperse the funds to your creditors. This option is usually for people who have a steady income.
Be aware that certain restrictions will apply to your life. You won’t be able to go out and buy a new car, that’s for sure! This stays on your credit report for 7 years.
The third option might be the best in some cases: Letting your debts go to collection.
When your original creditor decides that collecting from you is a lost cause, it will sell your debt to a collection agency for pennies on the dollar. The collection agency will, of course, attempt to get the full balance from you, but you can negotiate a lesser balance agreement. Even when you pay far less than the original debt, the collection agency makes money because they paid so little for the debt.
The future will see fewer people filing Chapter 7, if for no other reason than the income limitations. It should see fewer people overall filing, because of the life restrictions imposed under Chapter 13.
Always pay your debts if you can, but if you can’t, consider letting them go to collection as an alternative to bankruptcy.
CreditScoreQuick.com
Posted in bankruptcy, collections, free credit score reports | Comments Off
July 24th, 2008
You’ll see plenty of companies on line, in the newspapers, on the radio, and on TV who are shouting out offers for their Free Credit Reports. And they are telling the truth – they’ll give you a credit report.
The trouble is, it won’t be worth the paper it’s printed on, because it won’t contain the number you need most to see: your credit score.
The folks who think they need to know all about your financial life will definitely look at the history portrayed in your credit report, but they also want your score. They don’t have the time or the expertise to weigh each segment of your financial history, so they count on the 3 major credit bureaus to tell them about your credit worthiness.
After all, when Bill Fair and Earl Isaac created the FICO scoring system, they’d been studying the statistics for years – figuring out what financial traits marked the difference between a good credit risk and a poor one. No system can predict the future with 100% accuracy, but their system predicts it well enough to cause almost everyone to rely on credit scores generated from it.
Who wants to know about your money management history? Seems like almost everyone:
• Mortgage companies
• Banks
• Car loan companies
• Credit Card Companies
• Credit Unions
• Department stores
• Potential employers
• Potential landlords
• Insurance Companies
• Cell phone companies
• Satellite Television providers
• And even your soon-to-be spouse!
Our finances used to be a private matter, and now almost everyone knows your business!
When you get your free “scoreless” credit report you’ll be able to see what has been reported about you, and you’ll be able to check for mistakes and signs of identity theft, but you still won’t know how a potential creditor views you. And you won’t know if you need to begin taking steps to rebuild poor credit.
But there’s a second reason why you need to know your own score. Sad to say, some potential creditors will ask if you know your score – and use that lack of knowledge against you if you don’t.
If you have a good score and don’t know it, those creditors can fool you into thinking your score is poor, giving them a reason to charge you higher interest. They make millions every year from people who simply don’t realize that they qualify for lower rates.
The good news is, when you request your free credit score reports from Credit Score Quick.com, you’ll get all you need – including the scores you need to know.
CreditScoreQuick.com
Posted in credit report credit scores, fico score, free credit reports, free credit score reports | Comments Off
Disclaimer: This information has been compiled and provided by CreditScoreQuick.com as an informational service to the public. While our goal is to provide information that will help consumers to manage their credit and debt, this information should not be considered legal advice. Such advice must be specific to the various circumstances of each person's situation, and the general information provided on these pages should not be used as a substitute for the advice of competent legal counsel.
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