Here is the key to your Financial Toolbox

Tuesday, August 30, 2011

Know Your Financial Standing

If you do not know your financial standing you are living in the dark. One of the first things on your mind should be knowing what your credit rating is and how you can improve it or protect it. This all starts with credit monitoring. How can you miss all the commercials on television about credit reporting and how you can get a free credit report? I know what most people say, yes you get a free credit report then you have to pay a charge every month for credit monitoring. Credit monitoring is around fifteen dollars a month and it is a small price to pay to detect any problems or potential problems with you credit rating. Over the past seven years I do not only have one, I have two credit monitoring programs going and I have avoided on several occasions potential harm to my credit report by inaccurate entries or mistakes to my credit report. Computers and individuals make mistakes and it is your job to protect yourself. No one will automatically do it for you.

My wife shares her name with many other Scott's. If you have a common name like Lisa Brown or William Jones you have a real good chance you may have cross entries on your credit report caused by human error. And, sometimes these are not easy to get one of these disputes to get off your credit report if you do not respond swiftly. I have even heard a case where a parent’s teenage daughter rented a movie from Block Buster on the parent’s membership card and did not return the movie and a year or so later the parent went to apply for a loan, and was turned down for the loan because that movie was neither returned nor paid for. I am sure there are more horror storied like this one out there. The longer little stupid errors like these stay on your credit report the harder they are to get off so address them quickly.

Good credit monitoring services help you understand your credit and what to do if there is a problem with your credit report. Also if you have been under financial duress you are a potential candidate for many mistakes that can affect your financial recovery. While you are in your recovery period you want to make sure constantly, there are no mistakes being made through collection agencies and unsettled claims about you and your accounts. With credit monitoring anything in the future that is derogatory against your credit report will be either mailed or e-mailed to you to give you a chance to respond as swiftly as you feel you need to.
I want to remind everyone we do have video on collection agencies below the blog posts in the Video Section that you may want to pay special attention too.


What You Need To Do If You Discover Problems

There are two ways you can go when fixing problems with your credit report. You can do it yourself or you can go with an Agency that will advise you of potential problems and then help you fix them. Many people once you understand credit reporting and how to recognize problems can go about the task yourself. This can be time consuming but can be rewarding when you get everything in line as it should be. If you have many potential problems you may want to hire a service or an agency. All the services I recommend are on the side bar. If you want to do more research My Shopping Genie I highly suggest to help organize and speed up your searches remember the download is free. This is a personal decision I know the Attorney from Find Law said you can do this yourself. However instead of taking days away from work it may pay to look into these services. One of these services could at least tell you where you need to start or handle potential problems for you.
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Some of you that have a good credit history and may want to protect it in a different way. Fraud detection companies, services or websites may make you feel a little more comfortable. If you make many online transactions you may want to go in this direction. But, by monitoring your credit card statements or any statements you can monitor yourself online with regular credit monitoring you should be able to detect and stop any threats quickly. Your financial well being takes constant monitoring from you it is up to you and only you can protect yourself. You have to plan some time each week for strategy and defense. It can be a real battle ground out there and we have the tools to help you do battle when a problem comes up.
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If you decide to fix these problems yourself we also have some other ways we can help. On the sidebar there is Just Ask. If you want a second opinion on anything or you just need to know something Just Ask has professionals in medical care, law, and technical help. We also have sources where you can find a lawyer or get any legal documents you may need saving you the expense of hiring a lawyer or the original consultation fees. Where all the other financial experts give you direction, we give you resources to stay on course to financial freedom.


Here is more information from Forbes Magazine on how your Credit Rating effects you.

The New Credit Score Rules

 by Justine Rivero

Monday, August 29, 2011
The average credit score nationwide is 666, according to CreditKarma.com. That's not only an ominous number, but can be a costly one.

 Based on CreditKarma.com's data, the trend amongst lenders shows that a 660 credit score is the threshold to be approved for a mortgage, auto loan and unsecured credit card. Digging deeper into consumers' credit health, nearly 40% of consumers have a credit score below 660. That means 4 out of 10 Americans would likely be denied for a mortgage and auto loan, charged sky-high interest rates, and only qualify for a secured credit card.
With credit scores controlling consumers' access to credit and the prices they pay for lending products, Americans must take control of their credit health.

 In the fine line between approval and denial in lending, consumers deserve to know more so they can do more about their credit health. While recent federal regulations have nudged open the door on consumers' access to credit, it's not enough. Consumers must be empowered to actively manage their credit, not just when they are transacting but also in their daily financial life.
As legislation and economic changes evolve the credit industry, consumers' access to credit scores must be broadened. Here's what you need to know about credit now.

 1. It's your consumer right to get a free credit score! Thanks to a recent federal regulation, consumers who are denied on a credit application or receive higher interests due to their credit profile are entitled to see their credit score for free. This only applies to declined consumers, so it begs the question: why aren't all consumers getting their credit score for free? With such significant impact on accessing and pricing of financial products, free credit score access should be a right of all consumers. We may see government efforts to provide free credit score access on the horizon. Once a mysterious and proprietary secret of the credit industry, credit scores are becoming a powerful tool in the hands of consumers.
2. Standards for accessing credit are always in motion. Once upon a time, the general "good" credit score standard was 660. During the recession's credit crunch, the standard jumped to 720. It appears some credit card issuers are again expanding their credit standards and approving lower credit tiers. Some mortgage lenders say a 720 credit score is needed to get the best mortgage rate, while others say 750 is the new standard. Additionally, lenders are increasingly focusing on other credit details aside from your three digit score. For example, a consumer can have a 780 credit score, considered in the excellent range, and be denied on a credit card application because their credit history is simply not long enough. It'll take time and economic stability till lenders comfortably agree on credit score standards; hopefully that keeps you on your toes and improving credit health everyday.

 3. It's not enough to check your credit score. One drawback of the federal regulation is its limitations. Giving consumers access to their credit after being denied is too little, too late. Credit scores can fluctuate suddenly, so a single snapshot isn't enough. What's necessary is for consumers to monitor their credit. Whether you have a 550 or an 800, tracking trends in your credit use and credit score helps identify areas to improve, habits to avoid, and most importantly, makes you conscious of how day-to-day financial decisions impacts your credit health. You might need several months' cushion to polish up your score, so begin monitoring your credit as soon as you plan to buy a home or car, or apply for a loan or credit card. If you aren't applying for credit but currently have a credit card, it's still imperative to stay on top of your credit health. Issuers periodically do an account review, and if any new credit blemishes appear, it could affect your card terms. Proactively use credit score monitoring services so you, and not lenders, are the first to know about recent changes on your credit.
4. Expect credit score differences. The federal regulation also shined light on the fact that there are dozens of credit score models in use. While many consumers consider FICO to be the "real" score and everything else to be a "FAKO", the truth is that every lender chooses differently: there are the credit bureau-specific models, the VantageScore, the FICO score, scores specific to lender type like mortgage, auto and credit card issuers, and even models particular to certain banks. If your TransUnion score and VantageScore have a 40 point difference, there isn't a "more accurate" score. It's similar to weighing yourself at home versus the gym or the doctor's office; the scales show different numbers because they're calibrated differently, but ultimately, they all measure your weight. Rather than obsessing over the three-digit score, focus on the risk factors involved such as your debt, number of accounts, and credit use. Just like diet and exercise will reflect in your weight across all scales, taking action to holistically improve your credit health will reflect across the broad spectrum of credit score models.

 While the recent federal regulation is a positive move for consumers, lenders have already found loopholes, reports SmartMoney. For example, if the lender uses its own scoring model, they aren't required to disclose that credit score to consumers. Also, insurance companies, which also use a credit score model to evaluate customers and price premiums, are excluded from this regulation and aren't required to disclose credit scores to consumers who are charged a higher premium.
As the Consumer Financial Protection Bureau stretches its reach and more financial reform finds its legs, consumers must keep challenging Uncle Sam to keep the heat on the financial industry when it comes to credit score access. Consumers must also keep putting in the legwork to build healthy credit and keep an eye on their credit score.

 We're headed in the right direction when it comes to consumers' access to their credit score. But don't walk away from this topic just yet; we barely have our foot in the door.

 Justine Rivero is the Credit Advisor for CreditKarma.com.

 Copyrighted, Forbes.com. All rights reserved.f you only read one article about credit scores this year, read this one.
To See the original article on Yahoo Click Here!

This Weeks Rant
My intent with any entry in this blog is help you start your research the rest is up to you. I could have given up many times myself but thanks to the knowledge and support of others I am accomplishing my goals in becoming financially free. This can be an angering, frustrating, or frightening process that can make you feel hopeless at times but, I want you to find some comfort here and get yourself on the right path to happiness and financial freedom.
 



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