I love the Suzie Orman shows where she talks to listeners, reviews their financial situations and tells them whether they can afford to make a certain investment or purchase. (You're great Suzie!)
Unfortunately, too many of us move forward without any thought. Buy now (especially on plastic) and pay for it later. Isn't that what has delivered the country to its current state? For those who say we're not in a recession, I say you're full of bologna- and we're not talking Oscar Meyer.
Check out this link (http://www.hsh.com/calc-howmuch.html) for a mortgage calculator that will give you an estimate of how much you can afford. Always a good idea before you pull out of the apartment complex driveway in your 1989 Corolla and begin looking at million dollar homes. (This is especially true for those of you new to the Rat Race. And, BTW, welcome to the real world! LOL)
And FYI on top of that. For your sake, please pull your OWN credit bureau reports FREE OF CHARGE at http://www.annualcreditreport.com BEFORE you apply for a loan- mortgage or car note. You might save yourself some time and disappointment. Clear up any issues and then go shopping.
Showing posts with label credit history. Show all posts
Showing posts with label credit history. Show all posts
Oct 22, 2008
May 5, 2008
Lose Your House or Lose Your Credit Card
Every day I hear horror stories from folks who tell me they're looking at losing their homes or the family farm. I always wish I could reach through the phone, grab 'em by the shoulders and shake some sense into them, while asking, "Why did you let it get to this point?"
The big question is usually: How did this happen? Most of us usually know. I see it every day. I see the credit card bills with hundreds and thousands of dollars of charges. That's great if you're paying it off every month, but frequently they're digging a deeper and deeper hole. It eventually catches up to you. Ask my brother, my brother-in-law or my favorite cousin. No names here folks. You know who you are. I love them to death, but they could all use a little lesson in discipline. They all lived well beyond their means, purchasing every little upgrade, every new gadget and every new electronic toy the day it came out. Cha-ching, cha-ching.
I can't tell you how many people I run into every day who would prefer to lose their house than lose their credit card. Is that right? Isn't it your castle, your sanctuary? Your piece of real estate is your most important possession and should be guarded wisely. I'm not talking about the Colt and the ADT, although ain't nothing wrong with that. (Sorry you S&W fans.)
I'm proud to say I don't live the life of an innovator. I sometimes shop at Goodwill, do my share of eBay (buying and selling) and love to find a bargain- be it at a department store or grocery store. Ask the wife- my coupon queen. (She inherited that title from my mother, who was also a serious coupon queen.)
And we're now hustling even more with gas now hitting 3.55 here in beautiful Richmond. My job allows me to talk to people across the country every day and the truckers are telling me it will be $4 nationwide soon and then we'll hit $5 by the end of the summer. More and more folks are on their motorcycles and the scooter sales in town have generated a waiting list. Be careful that you don't crash yours into a parked truck or police car like a few have done here recently. Geez. And don't forget your helmet peeps.
Anyho, back to the financial mess. Avoid the foreclosure or the bankruptcy. Cut it off at the pass. Reduce your spending (ASAP) if you're headed into trouble. If that's possible, get some help. Cut your cards up and get some financial counseling. The bankruptcy lawyers are more than happy to take your money to arrange settlements for you. What do they care about your credit? Don't get me started on that.
Avoid the rush to the poorhouse. Sit down with the other adults in your house, look at your bills several times a year, work out a budget and stick to it. Unless you're playing for the NFL or shooting a movie with Spielberg, we should all be doing this. Word.
The big question is usually: How did this happen? Most of us usually know. I see it every day. I see the credit card bills with hundreds and thousands of dollars of charges. That's great if you're paying it off every month, but frequently they're digging a deeper and deeper hole. It eventually catches up to you. Ask my brother, my brother-in-law or my favorite cousin. No names here folks. You know who you are. I love them to death, but they could all use a little lesson in discipline. They all lived well beyond their means, purchasing every little upgrade, every new gadget and every new electronic toy the day it came out. Cha-ching, cha-ching.
I can't tell you how many people I run into every day who would prefer to lose their house than lose their credit card. Is that right? Isn't it your castle, your sanctuary? Your piece of real estate is your most important possession and should be guarded wisely. I'm not talking about the Colt and the ADT, although ain't nothing wrong with that. (Sorry you S&W fans.)
I'm proud to say I don't live the life of an innovator. I sometimes shop at Goodwill, do my share of eBay (buying and selling) and love to find a bargain- be it at a department store or grocery store. Ask the wife- my coupon queen. (She inherited that title from my mother, who was also a serious coupon queen.)
And we're now hustling even more with gas now hitting 3.55 here in beautiful Richmond. My job allows me to talk to people across the country every day and the truckers are telling me it will be $4 nationwide soon and then we'll hit $5 by the end of the summer. More and more folks are on their motorcycles and the scooter sales in town have generated a waiting list. Be careful that you don't crash yours into a parked truck or police car like a few have done here recently. Geez. And don't forget your helmet peeps.
Anyho, back to the financial mess. Avoid the foreclosure or the bankruptcy. Cut it off at the pass. Reduce your spending (ASAP) if you're headed into trouble. If that's possible, get some help. Cut your cards up and get some financial counseling. The bankruptcy lawyers are more than happy to take your money to arrange settlements for you. What do they care about your credit? Don't get me started on that.
Avoid the rush to the poorhouse. Sit down with the other adults in your house, look at your bills several times a year, work out a budget and stick to it. Unless you're playing for the NFL or shooting a movie with Spielberg, we should all be doing this. Word.
Oct 10, 2007
In The News: Credit Scores Changing
Your credit score could soon be changing, according to news released by Fair Isaac, which calculates the FICO score used to determine your credit card offers, rates for home and car loans, as well as rewards packages. Have a low FICO score and your offers won’t be as irresistible as someone with a perfect score of 850.
What’s changing, you ask? Fair Isaac recently announced they would not recognize authorized user accounts. These are frequently accounts created by one person, the primary, and another person is added, sometimes as an afterthought. It’s common to see these accounts created by parents and then offered to Junior as a means to help build his credit history and score.
Sometimes a spouse will open a credit card account without the presence or knowledge of the other spouse and decide to add the latter. Because this person is added after the account is created, he or she would be considered an authorized user as well. How do you avoid that? List both spouses on the initial application. If no space is available, call the bank or institution and ask if they can add your spouse when you apply.
A little sidebar here: adding the spouse as an authorized user if fine, but don’t get angry with your credit card company because your spouse, the authorized user, cannot close the account, request a balance transfer or request new cards. The authorized user has some limited powers on account and can usually request information, but is prevented from making any major steps or actions.
Previously, if Junior was listed on the account as an authorized user, he would have the benefit of the primary’s account appearing on his (junior’s) credit bureau reports.
What prompted this was the ability over the last year for one to purchase authorized user status on a stranger’s account to rebuild your own history. This practice led to changes.
There are some steps Junior (or your spouse) can take to build his own credit history. If he or she has no credit history at all, they want to begin with a starter card, perhaps a small department store card. I would advise making a single small purchase once a month on the card for several months. Pay the bill in full every month and avoid finance charges.
If you’re not considered creditworthy by the banks, your child or spouse may need to begin with a secured card. This type of card requires a cash deposit. Usually, these cards can be converted to unsecured cards later on down the road.
If you’re running into roadblocks on applications or finding your requests for credit denied, you may want to pull a copy of your own credit bureau report. Americans are now entitled to a free annual copy of their credit bureau reports from each of the three agencies. Go to http://www.annualcreditreport.com/. That’s the only government-endorsed, truly FREE website created for the purpose of the Credit Report Mandate. The other websites are just copycats and will charge you something.
You can pull all three credit bureau reports at once if you want, but I recommend spacing them out. Start with Experian or TransUnion and then rotate between the three, pulling one every four or six months to stay on top of it. Put a note on your calendar and an alert to self in your Outlook. This is only going to give you the credit report, not the FICO score. I know you can purchase the FICO score there and I believe it’s $5.
If Junior or your spouse has a poor credit history, I would strongly encourage them to improve that by paying your bills on time. Fair Isaac bases more than a third of your FICO score on payment history.-SH
What’s changing, you ask? Fair Isaac recently announced they would not recognize authorized user accounts. These are frequently accounts created by one person, the primary, and another person is added, sometimes as an afterthought. It’s common to see these accounts created by parents and then offered to Junior as a means to help build his credit history and score.
Sometimes a spouse will open a credit card account without the presence or knowledge of the other spouse and decide to add the latter. Because this person is added after the account is created, he or she would be considered an authorized user as well. How do you avoid that? List both spouses on the initial application. If no space is available, call the bank or institution and ask if they can add your spouse when you apply.
A little sidebar here: adding the spouse as an authorized user if fine, but don’t get angry with your credit card company because your spouse, the authorized user, cannot close the account, request a balance transfer or request new cards. The authorized user has some limited powers on account and can usually request information, but is prevented from making any major steps or actions.
Previously, if Junior was listed on the account as an authorized user, he would have the benefit of the primary’s account appearing on his (junior’s) credit bureau reports.
What prompted this was the ability over the last year for one to purchase authorized user status on a stranger’s account to rebuild your own history. This practice led to changes.
There are some steps Junior (or your spouse) can take to build his own credit history. If he or she has no credit history at all, they want to begin with a starter card, perhaps a small department store card. I would advise making a single small purchase once a month on the card for several months. Pay the bill in full every month and avoid finance charges.
If you’re not considered creditworthy by the banks, your child or spouse may need to begin with a secured card. This type of card requires a cash deposit. Usually, these cards can be converted to unsecured cards later on down the road.
If you’re running into roadblocks on applications or finding your requests for credit denied, you may want to pull a copy of your own credit bureau report. Americans are now entitled to a free annual copy of their credit bureau reports from each of the three agencies. Go to http://www.annualcreditreport.com/. That’s the only government-endorsed, truly FREE website created for the purpose of the Credit Report Mandate. The other websites are just copycats and will charge you something.
You can pull all three credit bureau reports at once if you want, but I recommend spacing them out. Start with Experian or TransUnion and then rotate between the three, pulling one every four or six months to stay on top of it. Put a note on your calendar and an alert to self in your Outlook. This is only going to give you the credit report, not the FICO score. I know you can purchase the FICO score there and I believe it’s $5.
If Junior or your spouse has a poor credit history, I would strongly encourage them to improve that by paying your bills on time. Fair Isaac bases more than a third of your FICO score on payment history.-SH
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