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Clean Credit Queen Blog – Credit Education for Small Businesses, Individuals, and Real Estate Investors

There are many types of credit reports

Sep 20

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Review your credit reports

Review your credit reports

Credit reports come in many styles but no matter which one you ask for it contains critical information for you to better understand your credit standing. Your credit report impacts you in many ways from your housing to your job, and from car loans to car insurance,  just to name a few. Each type of report contains the same main data like your identifying information, social security number, addresses, jobs, as well as a list of creditors and payments. Below are six variations on credit reports that can be ordered, some by individual consumers, and others only by businesses. Check them out so you know what you are getting!

Credit Reports
Consumer: Single Bureau – The single bureau credit report is the basic report that contains information from only one of the three credit bureaus: (Experian, TransUnion, or Equifax). Even though all three reports are supposed to contain the same material, not every creditor reports to all three bureaus so the information may not be as thorough for each one. This is the least expensive of all the credit reports. Single bureau reports can be obtained from each credit bureau or from Annual Credit Report. See my website to find out how to get you free credit report.

Consumer: Tri-merge or Three Bureau – The three bureau consumer credit report contains information from all three credit bureaus and is a view of your complete recorded credit history. Information is presented in a table format so allow you to compare each of the bureaus, making it easy to check for any inconsistencies.

Business – A business credit report details information about a particular business. It is as important for a business as your personal credit report is for you. It has the same basic information including credit history and inquiries, and all public record filings. It also contains the number of years the company has been in business, the names of principals, the number of employees, and estimated sales.

Standard Factual – The standard factual report is used by mortgage lenders for most conventional loans because it is very thorough. It is also the most expensive type of credit report.

Employment- The report received by a potential employer is very similar to the standard consumer information found on most credit reports. It may also contain current and previous employment information and any public records and, if applicable, criminal records.

Rental Agent – Rental and leasing offices request credit reports that may or may not include a criminal background check, this is usually a single bureau report though can contain more information if the leasing agent requests it.

If you have any one of these reports pulled for you by your mortgage lender or rental agent, ask if you can see it or have a copy. Many businesses will oblige. It helps to see what they see as consumer reports and reports pulled by businesses often contain different information.

Write and tell me what experience have you had with these other reports.

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Credit Statistics – How are You Doing?

Sep 7

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How is your credit doing?

How is your credit doing?

I don’t know why, but everyone seems to love to know how they stack up against the latest statistics on anything from driving the right kind of car to cheering for their favorite football team. I have gathered some stats from Consumer Jungle.com to share with you. See how you rank!

  • The average consumer household credit card debt has nearly tripled in the past 20 years: from $3000 to over $8100.
  • That number is increasing because only about 40% of Americans pay off their credit cards each month.
  • That could be because 43% of families spend more than they make – about 20% more!
  • That explains another statistic – for the past 8 years more people have declared bankruptcy than have graduated from college!
  • For those that did go to college, the average credit card debt held by a graduating senior is over $3000. Add that to their average student loan debt of more than $20,000 and you can see that your average grad has got to get a great job just to afford their loan payments.
  • Some of that credit card debt was charged to one of the more than 12 credit card offers students receive per week in their campus mailboxes!
  • Just because the cards are coming to college students does not make them great deals. The average interest rate was nearly 15%.
  • Since only about 7% of high school students have credit cards, most college students are new at the credit game. Unless they have had some credit education they are unlikely to follow all the rules for creating great credit from these accounts.

To improve your credit education come to my products page and see what is available to help you make the most of your credit. Sign up for a credit teleseminar, find out how to Love Your Credit Score, or get one of the home study courses with success coaching. Let the Clean Credit Queen give you the credit education you need to survive in today’s new credit economy.

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Your Credit Score is More Important Than Your GPA

Aug 12

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grade

grade

If you or someone you know is in school right now, the most important number in your life is your grade point average, or your GPA. It is true that your GPA helps determine what school you can get into, what kind of scholarship you may be eligible for, even rates you can get on your car insurance. However, very soon that GPA will fade in importance and another number will take its place. That number is your credit score. That number will determine where you can live, what job you qualify for, and the rates you pay for both your car and your insurance, and much, much more. While you may know how to keep your GPA up, do you know how to develop and maintain your credit score? It is never too early to start building your credit muscle. The laws are changing but until February if you are between 18 and 21 you can qualify for a credit card. If you decide to get a card, or if you already have one, it is not a way to buy more than you can afford. It is the beginning of your credit history and could eventually be worth more than 50 points of your credit score. That is a big chunk when you consider that often even having an extra 5 or 10 points can mean the difference between good credit and great credit. Good credit could mean an interest rate of 11.99% on a car loan while a great credit score could mean perhaps a 3.99% rate or less. That 5% would translate to $50/month. Over 48 months that makes a significant difference over the life of the loan. You would have paid over $2400 more for you car than you should have! Visit my website products page and look for the teleseminars on credit to learn how you can get your credit started the right way and save that $2400 and more!

Click here for my credit essentials page and sign up today!

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Identity Theft Risk Now Has Its Own Scoring System

Aug 2

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Just when you finally gIdentity Theft of credit cardot your credit score under control and your debt-to-limit ratio is under 30%, now you have another number to worry about. It’s your IDScore.

‘What is an IDScore?’ you ask. Well, it’s a relatively new number to make sure that you are who you say you are. It is promoted as a tool to predict the likelihood of Identity Theft. The score ranges from 0 to 999, and this is one score that you want to be low. Identity scores are calculated from information in your credit report – yet another reason to make sure that you know what is in all of your credit reports and that the information that is there is accurate!

Identity scores are based on how certain personal information is used in credit transactions or for credit applications. Things that will make your IDScore lower (Better) are: stability in address, living in a single family home where your mail only comes to you not a multi-unit mail box, keeping your maiden name when you marry, and having a local cell phone number as your contact number on an application.

It has been found (Experian did a survey) that those with good credit scores get approved for credit more easily. This makes them more likely to be a victim of identity theft because their scores create fewer barriers to approval by someone who is trying to steal that identity.

If your IDScore is too high when you apply for credit, you will be asked ‘challenge questions’ very similar to those asked when you tried to get your credit report from annualcreditreport.com. I don’t know about you, but I found the answers to some of those questions tough to remember. I know I could not have given the name of my first mortgage company (over 25 years ago!) if I had not had access to my own credit report. If I had not been able to prove my identity by answering challenge questions, I might have been asked to go to a bank or to fax in proof of identity like a passport or drivers license. How inconvenient and what might this do to online transactions?

I know that identity theft is a growing problem but do we really need another ‘score’ to be measured against? The attempt to create incredibly detailed consumer files is troubling. And, toward the issue of accuracy, you now must really be vigilant in checking your credit report and correcting even the seemingly smallest of details as that could be the one thing you are asked to verify your identity. Bad credit report data will make your IDScore bad as well.

You can get a free copy of your IDScores at MyIdScore.com. They ask for your name, social security number, address, phone numbers, date of birth, and email. Without your SS#, the system will return a significantly higher score than it will if you enter it along with the other required information.

You may not think this is important until you try to open a new account and can’t remember your address from 7 years ago and have to go to a local bank to prove you are you. Now is the time to check and make sure your credit reports are completely correct and what you IDScore says about your likelihood of being a victim of identity theft.

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Tips for Tight Budgets

Jul 22

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Don't break into your piggy bank!

Don't break into your piggy bank!

This month has been focused on budgeting. Tight money times call for giving priority to fixed expenses like car payments, insurance premiums, mortgage/rent, and credit card debt. The variable expenses are the ones that you can shave down to the essentials to make it through the tough times. However, you don’t have to wait for times to get tough to implement some changes. If you know or even suspect that things are going to get worse for you in the near future, start to make changes now. Stop any unnecessary spending. Can you do with a store brand or shop at a food warehouse where bulk pricing helps you save pennies and dollars? Are there things you are paying others to do for you that you could do yourself like lawn care or house cleaning? Do you car pool, even one day a week? How about reusing or conserving items you might otherwise waste?
Get all of the discounts you are entitled to with your store cards and credit points. Use those store coupons – many are available online. One of the best pieces of advice I got from my mom was to never grocery shop when you are hungry or go to the store without a detailed list that is created from at least a week’s worth of planned meals.

Substitute low-cost protein foods such as turkey, chicken, peanut butter, eggs, and dry beans. Hamburger or large roasts that can make several meals can also save you money. Use your freezer by cooking several meals at once and storing them. This cuts down on preparation time and saves energy by reducing oven time.

If you turn the thermostat to a few degrees warmer in the summer and a few degrees cooler in the winter you will save a noticeable amount on your utility bill. Don’t forget to change furnace filters often – at least once a month if your house gets a lot of dust. Every two if the filter stays clean between changes. Get a phone plan that fits your calling pattern to prevent over charges. The phone company representative can look at your last few months’ bills and help you select the best plan to save money.
Save on entertainment by taking advantage of the many free and inexpensive things that there are to do in your surrounding area: museums, parks, hiking, special local events, wine tasting, church and other community events.

If you are a part of my free mini-course “Nebraska Jones and the Adventure of the Lost Credit Score,” you would have followed Nebraska as he dealt with his budget. If you are interested in getting access to this 12 week mini course go to my website and sign up on the products page for ICE-301. For $2 a lesson you will receive this 12 week interactive course that covers all the core credit principles and gives you a better foundation for your credit decisions.

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Having trouble with your mortgage?

Jul 2

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Did you know that it could cost over $50, 000 for a bank to foreclose on a home? That is a big cost when the bank doesn’t really want the property in the first place. Here are a couple of things you might want to consider. First off, can you sell your house to a cash buyer and then offer to rent it back from them? You might even be able to negotiate buying the house back from them at some point in the future. That clause ensures that you will be taking great care of the property and providing a good cash flow to your new landlord. It this route is possible, you don’t even have to tell the neighbors you were in trouble, just keep living there, paying your new note and no one will know the difference.
If you cannot get a buyer and end up in foreclosure, there are a few things you can do. There is a voluntary program called “Keys for Cash” that some lenders are using to help prevent damage to the house that they will be taking back through foreclosure. Once the sheriff’s sale goes through and the bank still owns the property, you may be in the position to negotiate. This is not meant to be an extortion, you simply state that there are some expenses you will incur to move out of the home and could use some help with. You will turn in the keys, and not damage the property, steal appliances, or strip the house of copper wire or fixtures. In turn you would appreciate money for a security deposit on an apartment, moving expenses, or even a deposit for phone/cable at your next place.

House for sale

House for sale

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Credit Card Companies are Changing the Rules!

Jun 20

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Danger - plain white envelope

Danger - plain white envelope

Have you gotten any of  those plain white envelopes in the mail? They have no return address and look like junk mail. Well, you had better at least open them. These are what credit card companies use to send you notification that they are changing your rates, lowering your limits, or even closing your account.

Here is some advice as to what to do if you get one of these notices. If you have good credit you should complain diplomatically or ask if you can transfer a balance from another card. If your credit is poor,  look into  joining a credit union. One thing you should not do is close accounts. Pay them off and then spend just a bit every couple of months. That will keep some of your limit available and make your score better by not changing the average age of your cards. 

While new credit laws have been passed recently, they will not go into effect for quite a while, and credit card companies are getting ready for those changes by charging annual fees, increasing interest rates and other fees, lowering credit limits, scaling back rewards programs and even reducing grace periods. Reduced or eliminated grace periods may force some card users to change tactics and use other payment options, such as cash and rewards debit cards. These changes are not just impacting consumers with good credit, everyone is going to see lower credit limits, higher rates, and fewer special deal promotions. 

No law is perfect. It remains to be seen what loopholes  the credit card companies can find in the new law. For now, keep statement balances low, spend your rewards points and charge a small amount on unused cards at least once a quarter to keep them reporting to your account. And watch your mail for those plain white envelopes!

Teachers, Firefighters, Buy Houses At a Discount!

May 18

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Discount on great houses

Discount on great houses

In a sea of less than promising daily news in the economic sector, there remains the Good Neighbor Next Door Program for teachers, EMT’s, firefighters and law enforcement who are wishing to purchase a home. Sponsored by HUD, it’s designed to be a win-win for those who choose these fields as their life’s work as well as the communities they wish to raise their families in. Although I’ve been aware of this program for some time, I was surprised to learn that those who qualify for this program might receive a 50% discount from the list price of eligible homes. 50%!
Each state has its own revitalization areas and you can find available listings in your home state as well. Of course, HUD has its list of regulations and requirements, but it’s an exceptional program and one that doesn’t receive nearly enough press. One of those stipulations requires a second mortgage be approved for the amount of the discount; although no payments are ever due provided you remain in the home for three years. This is a great way for those who make such incredible contributions to our communities to buy their homes in these same areas. It’s no secret those who teach our children and protect our communities are rarely adequately compensated for the sacrifices they make. Further, they’re often in the very fields that face the harshest cut-backs in tight economies.
If you’re one of those people who’ve chosen any of the above mentioned career avenues, it’s certainly worth checking into. You’ll have the standard process, including credit approval, appraisals and other detailed checklists that come when purchasing a home, but I really believe you might find exactly what you’re looking for with this program. Consider the money saved just on interest over a traditional thirty year mortgage on a loan that’s half of the sell price! Often, those who participate in HUD’s Good Neighbor program go into their homes with substantial equity before they’ve even made their first mortgage payment!
Find out more information, visit the hud.gov site and be sure to visit their frequently asked questions page as well. The properties change weekly, so there’s a seemingly new inventory each time you visit. I believe in this program and I can tell you it’s one of the few success stories in the news today.

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Credit Stress Relief On Its Way!

May 7

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 When we consider the statistics regarding credit card debt in current economic times, we can not only relate to our own frustrations, but those of President Obama and the federal government as a whole.

Shelter yourself

Shelter yourself

As President Obama approached the traditional 100 Days in Office earmark, he met with the head honchos from the credit card sector and made no bones about his position regarding tactics and polices used to collect payments.  With so many job losses, foreclosures and a myriad of other economic problems, any bit of relief the collective American society can gain feels like rain from heaven.

 

 

·         Average credit balance for Americans: $7,300

·         Annual penalty fees collected by credit card companies: $15 billion

·         Percentage of credit cards currently in use with more than 20% interest: 20%

I hear the collective gasps and I share in your incredulous disbelief; still those numbers have come from the president’s own research efforts, courtesy of his countless staff members.

So just what did President Obama have to say?  Basically, he announced the golden days of endless fees and penalties are over for the credit card companies, new and stronger protective mechanisms would be put in place for consumers that would ensure no unfair rate increases and would eliminate abusive fees and penalties.  The days we, as consumers, were convinced the language in the small print provided by those same credit card companies were written in some foreign language will now be written in plain English.  And isn’t it about time?  But this just the start for these new guidelines.

President Obama has also demanded more accountability, courtesy of card issuers.  More oversight, better communication and truer attempts at finding a happy medium when consumers have lost their jobs to repay their debts were also high on his list of priorities. 

If all this sounds great to us, imagine how the credit card industry feels.  This will be an expensive undertaking for them, and to be sure, there will be ways for them to ensure the lion’s share will be shouldered by their customers; but if they refuse to participate willingly, there will be hefty fines and better enforcement to keep them in line.

This is all being developed now and although it’s not the cure-all, it’s most certainly a start.  In a time when nothing is a sure thing, we’ll take anything we can get to offset some of the stress involved with living through a recession that includes historical foreclosures, job losses and now, automobile repossessions.

Til next time, this is Linda Adams, the Clean Credit Queen, saying,

Good Day and Good Credit!

www.cleancreditqueen.com

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Tackle Credit Card Debt

Apr 26

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Working on Debt together

Working on Debt together

8 Steps to Tackle Credit Card Debt Problem
Looking for a solution to your Credit Card Debt problem?

First of all, you can take comfort in the fact that you are not the only one fighting the credit card debt problem. There are hordes of people who might have an even worse credit card debt problem compared to you; all of them seeking to eliminate the credit card debt problem. So what is the solution to credit card debt problem?

Well, the solution really is to smash the credit card debt problem with full force and eliminate it completely. Now how do you do that? There is no magic pill that will instantly remedy your debt. It took a while to get into debt and it will take longer to get out. There are many ways in which you can tackle credit card debt problem. I strongly recommend against debt consolidation or debt relief unless you don’t mind your credit score taking an ever bigger hit than it has due to your high credit balance to limit ratio.

Different people suggest different ways of tackling credit card debt problem. However, here is a step by step account of what you can do to a handle on your credit card debt problem.

Take stock of the situation i.e. draw up a table with the following fields – Credit card name, balance, payment due day (the day of the month by which you are required to make payment of your credit card bill), APR, reward points earned, redemption offers applicable for your reward points balance, remarks.
1. Fill the table up with data from your various credit cards.
2. Figure out which credit card is contributing the most to the credit card debt problem i.e. highest APR and highest balance.
3. Check if reward points can be used to make partial payments or cover any kind of fees or if the points can be bartered for something you need (spending less means preventing the credit card debt problem from getting worse).
4. Draw a comparison table of offers available for eliminating credit card debt problem (i.e. consolidating credit card debt).
5. First eliminate debt on the credit card that is contributing the most to the credit card debt problem.
6. Practice controlled and healthy spending habits (after all you are looking to get rid of credit card debt problem and not aggravate the credit card debt problem).
7. Look for alternative means of adding to your income (more money means earlier termination of credit card debt problem).
8. See your debt reduce with time and celebrate the day when you finally put an end to your credit card debt problem.
Remember this is just one of the ways of tackling credit card debt problem; you might devise your approach for doing away with credit card debt problem. If you have a better suggestion that has worked for you, please contact me at Linda@CleanCreditQueen.com and let me know. Also if you have found something that backfired – let me know so I can warn others.

Until next time,
Good Day and Good Credit
Linda Adams

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