Monthly Archives: August 2013

5 Reasons you Should Check your Credit Report Annually

The thing that’s real important in today’s world is our credit. We all need our credit to be in the best state because we all need good credit sooner or later. We need good credit to take out a loan for a car, house, or just about anything else that is “loan” related. That’s why it’s so important to always check your credit annually to see what kind of state your credit is in and what you can do to change it.

Most of the time we go without checking our credit and when we try to take out a loan that’s when we find out.  Since you can easily get your credit report for free annually, I wanted to share with you five reasons you should check your credit report at least once a year.

Has your identity been stolen?

The main reason why you want to check your credit every once in a while is to see if your identity has been stolen. There are times when people steal your identity and you have no idea until you check your credit. If you keep up with your credit you will find out right away but if you don’t you will find out until you check it. There are times when your credit card information has been stolen and you sometimes don’t find out until it’s too late. If this does happen to you and you find out soon, you can make a fraud alert on your credit report.

Is there an error?

Another reason is so that you can make sure that the last credit report that you had wasn’t an error. Studies have shown that four out of five credit reports have a chance to have a 25% error, that’s something that can’t be good if you only check it in a long time. If you get your credit report and see that everything is fine and then you wait around for about 3 years and print out another and see the error, then you are going to have a problem. That’s why it’s important to always keep up with your credit score so errors won’t happen.

Can you get that loan in the first place?

If you print one your credit report out and don’t find any errors but then go and apply for a loan to buy a house and at the last minute they say that your credit score is bad, it might not be a good day. By printing out your credit score, you can see if you are eligible for a loan,  and if so, you will be able to get a fairly good idea what kind of loan you’re going to get.  Remember that most, if not all loans, are going to be judged by your score.  The better your score, the better your interest rate is going to be.

What about the co-signer?

When you co-sign a loan, it can sometimes hurt people by co-signing somebody that doesn’t pay their bill. When you co-sign somebody, if that person doesn’t pay their bills, then you are responsible for paying the debt that it’s owed and that can affect your credit score. That’s why it’s a good reason to check your credit if you have applied for a co-sign loan.

What is your score?

You want to know what your score is, and this is a good reason why you would want to check your credit score. That way, before you get into any kind of loan or anything else that can affect your credit score, you can look at the state of your credit and see if it’s a good idea to go with the loan that you are planning. It’s also a good idea if you are looking to improve your credit score.

Jessica Norman is from the website howmuchisit.org. Here, you can browse through more than 3,200 cost helping guides that range from finance to professional services.

 

How Important is Your Credit Score when Investing in Canadian Real Estate?

Though the U.S. real estate market has shown signs of rebounding, it remains inconsistent at times. Another option for many American investors is the Canadian market. There are some good opportunities for real estate investment available through the United States’ neighbor to the north. While there are some differences in the processes used to purchase property in the two countries, one thing that remains the same is the importance of good credit scores.

Why credit scores matter
A good credit report will impact the application process for a real estate purchase in a variety of ways.
*Interest rates – Higher credit scores will mean financial institutions will be willing to offer better interest rates. Poor credit scores signal riskier borrowers, meaning the lender will charge higher rates. This can mean the difference in thousands of dollars in the overall cost of the purchase.
*Approval – In some cases, a poor credit score could even cause the bank to deny a loan application.

What to know about credit scores
While the U.S. and Canada share a historically good relationship, the two do operate differently in certain political and economic arenas. Even small differences in the process can result in the loan application being rejected, or paying thousands of extra dollars in fees or interest.

*Credit reporting firms – In the United States there are generally three major companies that create credit scores that are then figured into a credit report. In Canada, the two most popular firms are Equifax and Transunion.

*What’s in a credit report – A person’s payment history, types of credit, amounts that are owed, length of credit history and new credit will all be considered in a credit report. It should be noted payment history is weighted the most in the Canadian formula.

*Do credit scores transfer? – An investor in the U.S. likely will spend several years building up their credit score, but that may all be for naught if they suddenly decide to try to make some real estate investments in Canada. Unless some credit history has been build up in Canada, financial institutions may not recognize the credit scores based out of the U.S. Exceptions could be found through certain lending institutions or the credit bureau. Some banks in Canada have partnerships with those in the United States, so they may agree to use the credit score from the U.S. In addition, Equifax has subsidiaries around the world and could draw its credit rating from a U.S. firm.

*Where to get the mortgage – One way to get around not having a credit score in Canada may be to secure a loan in the U.S. However, Canadian lenders would be better equipped to help the investor navigate through the differences in U.S. and Canadian real estate investments. Those differences could make or break the investment.

A good credit score is extremely important to anyone wanting to invest in real estate, whether in the U.S. or Canada. The better the score, the more likely the investor is to be approved for the loan and to receive favorable terms.
Claire Atkinson writes for the Kanetix comparison service in Manitoba, which has more advice on Canadian mortgages.

How to Stop Collection Harassment

You don’t have to put up with collection harassment from creditors. Since your payments are normally once a month, most credit agencies will (or not) email you to let you know your payment is due. It depends if you’ve set it up that way or not.

There are others who may call you, especially if you’re behind on the payments. They call enough, so that’s it’s just legal, but less than harassment.  Of course, it depends on the credit agency and their company’s policy.

Everyone, especially these days, is falling behind on payments to credit payments.  When you start to fall behind, the credit company calls you to let you know you’re late, at least most of them do; however, some do not. They usually call a week after your payment is due as a reminder. If you fail to respond, they will call you more often until they get to talk to you.

However, when you fall way behind on payments, they send your account to a credit collection agency. They call you to figure out a payment plan. If you fall behind on this collection, they start to harass you with phone calls and letters.  They also can’t contact you before 8:00 am and after 9:00 pm, plus, they can’t contact you at work if you tell them you’re not allowed to receive personal calls.

There are cases of collection harassment where the collection agency calls several times a day and sends letters every day. This is illegal and you can ask them to stop by sending them a letter asking them to stop. The calls are considered abusive, unfair or deceptive practices and the Fair Debt Collection Practices Act enforces this practice.

First, you have to write a letter to the company that is harassing you with phone calls.  Be sure to keep copies of all communications with the company and send it as certified mail and pay for the “return receipt” documentation. That will let you know they received the letter.

The collection harassment should stop; however, most of the time it doesn’t and that’s when you have to contact the FTC or the Federal Trade Commission. They are the national agency that deals with the Fair Debt Collection Practices Act. You can file a complaint with them for the company that is calling you all the time. Of course, this doesn’t make the debt go away, you still have to pay it, but it will stop the harassing calls and letters.

Always keep a copy of the communications with the collection agency. They will end up filing a lawsuit against you, but you’ll be better off if you have a copy of the harassment against you.

The collection agency may be resilient against all threats to stop the collection harassment and you may have to change your phone number or put a block on receiving calls from their number.

The best way to deal with collection agencies is to come to an agreement on a payment plan that works for both parties. You should know the laws you’re entitle to for protection against collection agencies using abusive, unfair or deceptive practices to collect a debt.  You don’t have to tolerate their abuse.

For more information on your rights against collection harassment, contact the FTC.gov website and search for Debt Collection FAQs: A Guide for Consumers. You can also contact the National Association of Consumer Advocates at NACA.net for their debt collection practices they can help you with on the debt from the agency that is distressing you.

Mark Clayborne is the author of Amazon’s best-selling credit repair book –Hidden Credit Repair Secrets. For a Free Video Course on Credit Repair Click Here.