Category

Credit

Jul 23
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The Truth About Credit Scores & Credit Repair Companies

By Credit, Money Management No Comments

In the wake of credit repair companies being fined for using unlawful and deceptive practices to lure consumers into paying thousands of dollars their services, people are concerned about how to protect and repair their credit legitimately.

Despite the mis-education of credit shared on the internet, there are reputable companies that provide information and services to help consumers.

In this episode, Rod Griffin of Experian

  • dispels the most common myths about credit and
  • shares the truth about credit, credit scores and credit repair companies
[ctt template=”8″ link=”S0afe” via=”no” ]Anything a Credit Repair can do for a fee, you can do it yourself for FREE![/ctt]

ABOUT ROD GRIFFIN

Rod Griffin is Director of Public Education for Experian. He leads Experian’s national consumer education programs, oversees the company’s financial literacy grant program, which awarded more than $850,000 in Fiscal 2015, and works with consumer advocates, financial educators, media and others to help consumers increase their ability to understand and manage personal finances and protect themselves from fraud and identity theft. The Institute for Financial Literacy named Rod “Educator of the Year” in April 2016.

THANK YOU FOR LISTENING TO THE “FINANCIAL FORNICATING WITH MADAM MONEY” PODCAST!

We appreciate you listening to the Financial Fornicating with Madam Money Podcast. Please share your comments or questions about this episode below or at info@madammoney.com. Also, please share this episode using the social media buttons.

You can also listen to the Financial Fornicating with Madam Money Podcast on iTunes and Google Play Music! Please share your honest feedback as Ratings and Reviews are very helpful and greatly appreciated!

May 27
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credit

3 Signs Your Worried About The Wrong S**T Regarding Your Credit

By Credit, Money Management, Podcast No Comments

 

Are you worried or stressed out about what is reporting on your credit report?

Since credit reports are used more and more to identify and qualify consumers for all types of services, having good, or at least fair credit, is very necessary. – @MsMadamMoney

However, if our credit is “colorful” (Ok… bad), it can inhibit access to what we need, like insurance, utilities, employment, mortgage as well as consumer credit.

Whether the trade lines (credit accounts) are reporting incorrect or outdated information; or if there accounts on the credit report that is not yours, you should be aware of what is reporting and take the appropriate action to dispute the erroneous information.

The best way to begin the process of fixing or restoring credit is to obtain free copies of the credit reports at annualcreditreport.com. It is important to understand what each credit reporting company is reporting about you, since the credit reporting companies do not report to each other.

Now, there are several legitimate concerns regarding what and how credit accounts are reporting on the three major credit reports (Equifax, Experian and TransUnion). However, some people concern themselves with the wrong things when it comes to their credit.

In this episode of Financial Fornicating with Madam Money Podcast, I share:

  • Three things to NOT stress out about when you are working to restore your credit
  • The Anatomy of the Credit Score
  • How to refocus to work on areas to help you reach your credit restoration goals

Thank you for listening to the “Financial Fornicating with Madam Money” Podcast!

We appreciate you listening to the Financial Fornicating with Madam Money Podcast. Please share your comments or questions about this episode below or at info@madammoney.com. Also, please share this episode using the social media buttons.

You can also listen to the Financial Fornicating with Madam Money Podcast on iTunes and Google Play Music! Please share your honest feedback as Ratings and Reviews are very helpful and greatly appreciated!

Episode Sponsor

This episode is sponsored by DUALpreneur.net. Are you a full-time employee and an entrepreneur? If so, you are a DUALpreneur and you understand and value the concept of Multiple Streams of Income. DUALpreneur.net provides tools, resources and services to help DUALpreneurs “Do It All, Have It All and Be It All.” For more information, visit DUALpreneur.net.

Apr 01
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5 Foolish Money Mistakes to Avoid

By Credit, Money Management, Saving, Shopping No Comments

It’s April Fools Day, full of pranks and jokes all for fun. However, there is nothing fun about being foolish with money.

So, here the top 5 Foolish Money Mistakes to Avoid.

Avoid impulse shopping.

Make shopping a planned activity with a list or a budgeted amount.  Unplanned or impulse shopping will sabotage your spending plan / budget.  If you really want to purchase the item, give yourself 24 to 48 hours to shop for a better deal, figure out if you really want it and can afford it. You’ll be glad you waited.

Avoid retail therapy.

When you are emotionally down or distraught, avoid shopping or making any large purchases.  We are less financially objective when our emotions cloud our judgment.  Do something that doesn’t cost anything or very little, like go for a walk, spend time with family or friends, etc.

Avoid overdraft protection.

Overdraft or “Courtesy Pay” will allow you to you overspend and charge you a fee for letting the debit card transaction go through. A fee of $27 up to $35 will be charged for every overdraft, even if the bill runs just $1 or $5 over the amount you have in your account. Some banks charge the fee if you’re a penny over. Essentially, you’re getting very short-term credit at effective interest rates that reach the high triple digits. Now was that cup of coffee really worth $40?

Avoid savings tampering.

If you have to tap into your savings to make a purchase, you may not be able to afford the purchase.  Establish a savings account that is not easily accessible with a certain amount directly deposited every pay period. Savings accounts are supposed to grow, not be chiseled away.

Avoid financial promiscuity.

Financial Promiscuity is when we use unsecured revolving credit (credit cards) for small purchases when cash should be used.  Avoid using credit to purchase that “value meal” or anything less than $50.  This will ensure that we do not slowly acquire Financial STDs (Substantially Tremendous Debt).

So, enjoy the day and play an innocent joke or prank on someone you love and keep the foolishness away from your money!

Mar 02
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Brilliant Budgeting Tips To Eliminate Credit Card Debt

By Credit, Debt Management, Money Management No Comments

“A budget tells us what we can’t afford, but it doesn’t keep us from buying it”

Are you drowning in debt and don’t have any idea on how to get credit card debt relief? Well, you’re not the only one who wants to get an effective solution to your problems.

I can speak about at least 4 credit card debt solutions for hours and these are – credit card debt settlement, credit card debt consolidation, credit card debt management and bankruptcy. These solutions will help you get credit card debt relief within a few months. But, these solutions will work best when you use some brilliant budgeting tips every day to pave the path to financial freedom.

Budgeting tips to eradicate credit card debt

Budgeting is a must when you’re drowned in credit card debt. It helps you to have an idea about your financial health. It shows you the areas where you can cut costs. Remember, if you don’t change your spending habits, then beware! You would be in a bigger financial trouble. Here are the 3 budgeting tips you can follow to pay down credit card debts in 2016.

1. Calculate how much you owe and track your expenses

Use a credit card debt payoff calculator to find out how much you have to pay every month and for how long to attain financial freedom. Once you get the figure, your next task would be to track your monthly income and expenses. This would take some time. Calculate your total monthly income and the maximum amount you have to pay on bills such as electric, telephone, rent, etc. Now, subtract your expenses from your income to get the amount you can pay on your credit card debts.

If your expenses are more than your income, then you’re in trouble. It would be tough for you to pay off your credit card debt soon.

2. Cut down your expenses to pay off credit card faster

Only money can help to solve your current problem. So, you need to cut down your expenses so as to have more money on your hand. I’m not telling you to stop eating and save money. But, at least, you can reduce your expenses on entertainment, traveling, clothes, accessories, etc. Create a list of your expenses on your personal computer. Find out the ones on which you can trim your expenditures. Calculate how much you would save every month by eliminating these expenses. You can use the money for paying off credit card debt faster.

3. Use your savings to make extra payments

The more you save, the faster you would get out of credit card debt. Use your savings to make minimum payments on all your credit cards. But make sure you pay a little extra on the credit card with the smallest balance. Keep on doing this every month till this credit card with the smallest balance is paid off completely. After that, focus on the next smallest debt. Make extra payments on this card till it is paid off. Save ruthlessly so that you can pay off all your credit cards one by one in 2016.

If you have opted for credit card debt settlement, then use your savings to settle your credit cards as soon as possible. Deposit your savings in the trust account opened by the debt settlement company. Your aim would be to save enough money in the trust account so that the settlement company can start the negotiation process as soon as possible.

Conclusion

You have to pay off your debt. This is your ultimate goal in 2016. But at the same time build your emergency fund. This would help you meet unexpected expenditures in the future. You won’t get into fresh credit card debts in the future. You would not rely on credit cards to pay for the emergency expenses such as hospital bills and holiday gifts that may pop up anytime. You can use the emergency fund to have wonderful vacations with your family.

Just make sure you save minimum 10 percent of your income every month. I know it’s little hard to do when you’re in debt. But, give your best shot. Best of luck guys!

 

Originally published March 30, 2016

Sep 26
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Your Credit Score Is Not Your Story

By Credit, Money Management No Comments

Remember the time you went to a bookstore? You were surrounded by millions of books and magazines. Your intention was to buy one, maybe two or three books about a general subject. You go to the Subject section and now … you must choose. Hmmmm.

How did you choose?

Was it the cover?

Was it the Title?

Was it the Author?

Did someone refer you to a specific book?

Generally, most book buying consumers look at the cover, then the title to determine if they are going to pick up the book to read the book summary on the back, open it to read the table of contents or a few paragraphs of the 1st chapter.

Ironically, this is how most financial institutions make their judgmental decisions to approve or decline a loan request. Right, wrong or indifferent, the Credit Score is the “Title” to the story that is in your credit report, the “Book.”

If the Credit Score (title of the book) is “attractive,” aka good credit, the lender will look at the credit report based on the loan request (read the table of contents or begin reading the book). If the lender likes what they see (the request and credit is within their lending policies and guidelines), they approve the loan (buy the book).

If the Credit Score (title of the book) is “unattractive,” aka bad credit, the lender will deny the loan request (put the book back on the shelf).

Related: How Credit Scores Are Calculated

Although, not all lenders may be this cut and dry, most DO base their credit request decisions based on the credit score.

Have you ever missed out on an awesome book because it had a horrible title or crappy cover?

It was only when friends, family, or Oprah said that the book was a Must Read that you decided to check it out.

Have you ever missed out on an awesome relationship with someone because they did not fit your desired requirements, physically?

It was only when they married someone else and you later found out that they were a millionaire and wanted to take care of you — for life.

Ok, maybe that one is a stretch, but you get my point.

Lenders may be missing out on wonderful customers who may have a very low credit score and “colorful” credit, but may be a less credit risk because they now have a job or a better job and are willing to do automatic payments (using payroll deduction or direct deposit) to pay on their loan to re-establish their credit.




Yes. There are many people with low credit scores because they were negligent with their credit and intentionally had no intent to pay. These people are DIFFERENT and I’ll deal with them in another article.

We’re focusing on people who low credit scores because of an unfortunate, unforeseen and unexpected life interruption, like medical expenses, being laid off, furloughed, divorced, etc. When they are finally getting back on their feet, they may need a loan. And, they have a Story.

For these individuals who have a willingness to pay and desire to reestablish their credit, here are a few helpful hints when your loan request has been denied due to your credit score:

Ask for Specific Reasons why you were denied.

You will get a standard letter with 1 to 3 denial reasons. Call the lender to get specifics as to why your loan request was denied.

For example: You applied for an auto loan, but there is a recent Repossession on your credit report. The lender, may not want to take the risk of you defaulting on the auto loan with them? As a consumer with a story, the repossession may have been because you were laid off and you had to turn in the vehicle because you could not afford it. Now you can!!! How about THAT!

Related: 5 Easy Ways to Improve Your Credit

[ctt template=”8″ link=”Bsx32″ via=”no” ]Denied? Call the lender for specific reasons why your loan request was denied. You can’t fix what you don’t know.[/ctt]

Request to meet with the Loan Manager (or their supervisor) in person, if possible.

Since your Credit Score (the Title of your book) may be … crappy, you may be able to get a second look. Remember, Perception is Everything! So, if you are able to meet with the manager in person, go to the meeting like you would a job interview and be prepared to share your story, answer their questions and ask lots of questions.

Ask for your Loan Request to be reconsidered.

Some lenders may have a loan appeal process. If they do not, ask for a loan manager or supervisor to review your loan request again. Make sure you send this request in writing with Your Story and supporting documentation, if available or necessary.

Related: Anatomy of a Credit Report

Offer to do Automatic Payment (Payroll Deduction or Direct Deposit). 

If the lender knows that they are going to “automatically” receive the loan payments on time, they may see the loan request as less of a credit risk and may reconsider.

Consider a Counter Offer / Ask for a lesser amount.

The more the loan amount, the more the risk to the lender. If the lender does not offer a counter offer, ask for a lesser loan amount.




For example: Ask if they will consider approving $500 for 6 months instead of $1000 for 12 months. Let the lender know that you are open to negotiate.

Consider a Credit Union.

If your bank still won’t consider your loan request, try a local credit union. Unlike many banks, credit unions understand that Credit Scores are not the full story. Therefore, they may pay more attention to what is in the report, rather than just the Credit Score. Even if the credit union cannot approve your loan request, they may provide you with resources that will help you become more creditworthy in the future.

The reality is that not everyone will be approved for the loans they want. BUT… if you have a legitimate story as to why your credit is so “colorful” and you now that the means (income and ability to pay) to restore you credit, these tips may just help.

BTW … don’t forget to get a free copy of your credit reports at www.annualcreditreport.com. No one should know more about what’s in your credit than you do.