Credit cards should always be used wisely. You don’t ever want credit card debt because the more you have the harder it is to get out on top. However, it’s even harder to watch credit card spending during times of economic hardship like the current credit crunch we are facing. Here are a few tips on how to avoid increasing your credit card debt during a credit crunch:

1. If anything, you should be aggressively paying down your credit card debt. Things are getting worse and interest rates are going up so if you can, pay them off.

2. Be weary of using credit cards to pay for frivolous things. Ask yourself, do you really need the item? Is it a necessity? Forgo those purchases unless you know you can pay them off once the bill arrives. Not being able to pay off these items will cost you much more in the long run because you will be paying the high interest rates. 

3. If you have no choice but to put daily necessities on your credit card such as food and gas, pay off those items as soon as you can. Lenders these days are reducing credit limits while increasing interest rates so if you’re not paying off the bill then those items are costing you double or even triple the price if you were to pay in cash. 

The  main thing to keep in mind is that you should be spending wisely and saving aggressively so you can pay down any credit card debt you may have. It’s not worth ruining your credit over. 

Learn more about budgeting and how to use credit cards wisely.

Budgeting should be something that you do year round rather than just during a rough economic time. However, budgeting during economic downturns is much more difficult. Here are some tips on how to budget correctly:

1. Always plan for the worst case scenario such as someone losing their job. If possible, you should try to save at least 3 months worth of bills including rent or mortgage payments.

2. Cut frivolous spending like buying coffee from a cafe a few times a week or going out to eat. Instead, make your own coffee or get it from work. Simple as this may seem, these small cut backs add up in the long run. This can also encourage more bonding time between you and your family. Making dinner together can be a fun event.

3. Coupons, coupons, and more coupons! Clip coupons, pay attention to grocery store and department store advertisements, and stock up on items that are on sale that you use regularly. 

4. Contact your creditors if someone has lost their job and let them know about the situation you’re in. Sometimes they may be able to help by putting in place lower payment plans. The last thing you want to do now is to get into higher credit card debt. Always be aware of how your actions now affect your credit score. The last thing you want is to increase credit card debt or ruin your credit. Think long term.

5. Keep a journal or spreadsheet of what you are spending including food and all bills. Compare how you’re doing month over month. By doing this simple exercise, you’ll realize where all of your money goes and will make you more aware of your spending habits.

Click here to learn more about budgeting to save, and how to use credit cards wisely.

According to a report released today, foreclosures for 2008 spiked to a whopping 81%. Not to mention being up 225% compared with 2006. The 2008 total foreclosure filings totaled more than 3.1 million. Yes, that’s million. Which means that one out of every 54 households received a notice last year. Think of all the for sale and foreclosure signs in your neighborhood alone. 

This has to make you wonder, what happened with the government intervening in an effort to quell these foreclosures? Foreclosures were actually up 17% in December of 2008 versus November. These scary numbers are not likely to improve anytime soon. 

Good news?

There is a lot of supply out there if you are ready to own a home or are looking to purchase a home. Few things to note. Lenders are extremely cautious today and will not lend to folks with low credit scores. So if you want to take advantage of all of the inventory on the market today, then the first step is to pull your credit report and review the report for accuracy. If it’s not and you have unverifiable negative items on your reports, then work quickly to remove them. It is your legal right to dispute negative items on your credit reports that are unverifiable. 

To learn more about the foreclosure rate in 2008, read this special foreclosure report.

Question

I have a late payment from 2004 since then I have never been late.  Why is it showing up on credit reports? 

Scott

Answer

Unfortunately, creditors and the credit bureaus are unforgiving.  Negative items on your credit reports can remain for years, affecting your good name each time you apply for credit.  In your situation, the deletion of this one item could make all the difference in you getting future interest rates that are lower. The good news is you may be able to delete negative items on your credit report. If you want a free no obligation phone consultation with a credit repair professional, simply call 800-445-8540.  Or continue to visit www.creditrepair.com for updated information and resources regarding your credit wellness.  

-Candice

Question

I am trying to repair my credit report and have some items deleted from my credit report one company in particular that told me if i paid for a non use settlement they would delete it from my credit report instead they just reported it closed and unsecured. but they were the ones who told me to dispute it in the first place to have it removed and they would agree to remove or delete it from my credit report.

McKell L.

Answer

It is hard to hold these creditors to anything if you don’t get it in writing. Did you get the agreement to these terms in writing?  If so, you could probably fight to hold them to it. If not, there are things you can do to dispute these negative marks on your credit. Here are some ways that you can go about doing this.

1) You can write the dispute letters yourself. Here are a couple of articles with more advice on how to do that. http://www.creditrepair.com/credit/repairing-credit-yourself.html  http://www.creditrepair.com/credit/credit-report-dispute-letter.html 

2) You can get a free phone consultation from a credit repair professional. They will actually write the dispute letters on your behalf. Call us at 1-800-445-8540 for a free credit consultation.

Thank you and good luck.

-Candice

Question

I have about 30000 in old debt (old charge accounts). I’m looking for help in clearing these from my credit report. Is there a way to remove charge offs/collections?

Billy S.

Answer

Yes. There is a way. Bad credit may be deleted. Here are some ways that you can go about doing this.

1) One option may be writing the dispute letters yourself. Here are a couple of articles with more advice on how to repair credit yourself.

2) You can get a free phone consultation from a credit repair professional. Credit repair professionals will actually write the dispute letters on your behalf. Call us at 1-800-445-8540 for a free credit consultation.

Thank you and good luck.
-Candice

The National Bureau of Economic Research said today that the U.S. has been in a recession since December of 2007. They said that the massive decline in jobs in 2008 was one of the key reasons they decided to state why the recession started last year. They estimated that employers have cut jobs by 1.2 million. 

In a statement, White House Deputy Press Secretary Tony Fratto said that even though the recession is now official, it is more important to focus on the steps being taken to fix the economy.

“The most important things we can do for the economy right now are to return the financial and credit markets to normal, and to continue to make progress in housing, and that’s where we’ll continue to focus,” he said. “Addressing these areas will do the most right now to return the economy to growth and job creation.”

So, if you are in need of an economic stimulus package, look into credit repairing your credit. It’s one of the biggest factors lenders look at when determining your risk. Your credit score will also determine your loan rate. The lower the score, the higher the interest rate. You may be able to save hundreds of dollars a month by avoiding high interest rates on your credit cards, auto loans, and home loans. 

To read more, visit: 

http://money.cnn.com/2008/12/01/news/economy/recession/index.htm?postversion=2008120112

Question

I am in the procross of trying to buy me my first home but i have a credit score of 517. I know that my score si low but do you think that i may be able to get a mortgage with a score that low. I also do not have the money to put down for a down payment so do you think that i will be able to get my first home with what i just told you.

Daniel M.

Answer

Daniel

Thanks for your question.  Unfortunately with the market change, a credit score of 517 will not be high enough to get a new mortgage loan. Now a days, you will need a 680 credit score or higher with the best rates going to those with a 720 credit score or higher.

There is good news though…you can become a home owner!

It will take time and a plan, but you can do it!

Some things to consider…first, start repairing your credit.  There are many ways to do this. 

1)    Challenge all questionable negative listings

2)    Pay off all collections, judgments and liens you may have

3)    Pay down your revolving accounts below 30% of their balance

4)    Start building positive credit with a gas credit card or an in store credit card and never be late on these!

In addition, it will take 20-25% of the purchase price of your new home as a down payment.  You may want to consider setting up a separate bank account and put as much as you can into that account each paycheck.  You may also want to ask family for some assistance.  There are also Down Payment Assistance programs out there.

Let us know if we can help you further.  Call us or fill out one of our forms on CreditRepair.com and we will match you to the most reputable partners in the country that may help you achieve your goals!

Thanks,

Candice

Mortgage rates were impacted by the news that the government would take over Freddie Mac and Fannie Mae. According to Bankrate.com, a 30-year fixed mortgage dropped from 6.55% to 6.2% when the market opened on Monday September 8^th.

Read more in Marketwatch, Mortgage rates fall on Fannie, Freddie Rescue.

Jerry Howard, chief executive of the National Association of Home Builders, in an interview Monday said the government action was “a very important first step” that will help ease mortgage rates and restore confidence in the debt of Fannie and Freddie. The government bailout was aimed at lowering mortgage rates and assuring that home loans would be available to consumers. This is good news for consumers looking to buy a home. There are currently more homes on the market, and low rates. It is the perfect time to take advantage of a buyer’s market.

If you are considering a home purchase, it is important that you qualify for the lowest rates available. You can do this by taking control of your credit rating. Credit Report Repair services are just another way of optimizing your position and taking advantage of the current mortgage market.

Find out your options with a free phone consultation.

Question

How can I increase my credit score quickly?

Mary J.

Answer

Hi Mary

Good news…there are many ways to improve your credit and there are things you can do today to see some improvement quickly.

1)    You have the right to dispute any negative item that you question as being accurate, obsolete, unverifiable or misleading.  Audit your credit report and challenge any questionable negative item to make your report as accurate as possible.

2)    By off or pay down your balances.  If you have old collections, charge offs, judgments or tax liens, you should resolve these and get these satisfied.  Also, any revolving accounts need to be paid on time and keep the balances low, usually below 30% of your available credit.

3)    Build positive credit.  You should have a good mixture of revolving and installment credit on your credit reports.  And, continue to pay on time!

4)    Lastly, check your credit often.  Make sure there are no mistakes and make sure no one is pulling your credit.  Inquiries can lower your score.

If you would like a customized personalized solution to increasing your credit score, please don’t hesitate to call us.

Thanks,

Candice