New? Read This.
This blog is about getting smart about your credit, and credit repair.We’ll leave all the other quick-fix promises up to other bloggers, but we’re in the business of credit, and we’re tired of all the bullshit.
Then Read This
This FAQ page was written in the best interest of ourselves, our clients, future clients, and other credit repair companies; that hopefully, some day start doing things right by being honest with you.
And Finally This.
This is the part where I should tell you that you always, always always, need a professional because that way you hire us to do it for you and this is great for us. Except we promised you no BS on this blog.
Here’s how credit used to work in olden times. You had a small property, a nice middle-income household, in a little town. You also had a name. It was a good name. You could use your good name anywhere, to help you get stuff. You’d head on over to the general store and say, “I need a pound of nails,” and the shop owner would hand them over.
“Oops,” you’d say. “I seem to have left my wallet (or coin pouch, or whatever they had back then) at my rustic lodgings.”
“No problem,” the shopkeeper would say. “I know you’re good for it.”
Credit card companies have been abusing their cardholders for years, encouraging them in bad credit habits and recouping tons of money in fees. In an attempt to curb these practices, President Obama recently passed the Credit Card Accountability, Responsibility, and Disclosure Act (also called the Credit CARD Act, because legislators can be clever too).
The credit card companies aren’t the only ones to blame, though. They got away with their tricky little ways for years largely because the general public didn’t know enough about the way their credit cards worked to keep those abuses from happening. So we’re going to go through the major components of the Credit CARD Act for you, to sort out what exactly is going on with your credit cards right now.
We talk a lot about taking a common sense approach to improving your credit, but we’ve never really laid out our basic do-it-yourself version. We thought we’d remedy that today. You know, just for variety.
1. Make a Plan
Get all your credit reports, your bills, and your bank statements out on a table and take a hard look at them. If you don’t have any of these things handy, go online and get a copy of the most recent ones.
Go through that credit report with a fine-toothed comb. Look at the items that are hurting your credit particularly, and highlight any ones that seem wrong or that are having an impact that seems way out of proportion to the offense.
There are a kajillion and one tips out there to save a few dollars every month. We talk about them, other people talk about them, Oprah talks about them. In all likelihood, so do the guys who run things over at Buckingham Palace. Not the Queen, but the Queen’s people. They probably trim the fat here and there. It takes a lot of money to run a palace.
One of the commonest tips is cutting out your morning latte. $3.70 per latte times 5 days a week times four weeks is $74. If you and your spouse both stop drinking your lattes, you can get an extra $150 a month out of that cutback. And we just talked about how critical that $150 can actually be.
Wow. Awesome. I am totally going to stop drinking lattes right now. It’s not good for my heart anyway. I will be healthier and wealthier and wiser and I will also read that stack of books I’ve been meaning to get around to. Go team.
As everyone tries to monitor their budgets and save money, there’s probably not been enough discussion about what to do with the money you save. Most Americans right now have huge amounts of debt and no savings to speak of. When you only have enough money to put toward one or the other, which is the smart investment for the future? Which will save you the most money in the long run?
In almost every instance, it is far better to put your extra cash into paying off debt. Though it is a huge advantage to have savings put aside, the more immediate problem is the huge interest rates and fees the credit card is costing you (see this post). Even if you save up several thousand dollars into a savings account and still make the minimum payments on your credit card, you’ll still wind up in the hole. Here’s how.
