The Long Road of Minimum Payments
“A lot of people think the math is wrong. They don’t realize it will take two decades to pay (the balance) off if they only pay the minimum,” said John Ulzheimer, president of consumer education for Credit.com in an article on Yahoo Finance. “That box was a clear win out of the CARD Act.”
That information may be quite a shock to many people, but it may push people into a greater awareness of their finances and how to manage them. You can get an even clearer financial picture if you combine this information from all of your credit cards. Also look at the balance, interest rate, due date, and minimum payment for each card.
Once you can see the whole picture, you’ll probably want to start paying your cards down to avoid spending that extra amount on interest. Look at the option of paying off the card with the highest interest first. Can you transfer some of the balance to a card with a lower interest rate? If so, be sure to look at what the balance transfer fee is and calculate that against the interest you’d be paying. If you come out ahead, go ahead and do it.
You might also want to look at paying off your lowest balance first. It will reduce the number of cards you have to keep track of, make you feel like you’re accomplishing something and allow you to put the amount of that payment toward a higher interest card.
If you find it overwhelming, or think it seems impossible to pay off what you owe, you might want to contact Mick Bernard a fully trained and certified credit expert. Trained counselors know the “loopholes” and hidden secrets to FICO and how to get further than dispute letters will get you. They know how to help you raise your credit score, and settle collections and debts.
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Time to Take on More Credit?
As a result of the credit crisis and recovery act initiatives we’re seeing some of the lowest interest rates in history. Although interest rates have been low at other times but the recent bubble bursts has created a very unique situation. As the economy naturally began to flatten out, prices across several market sectors in have been lowered a great deal as well. Borrowing to finance a new business, a home, a new car, or just about anything else is just about as “inexpensive” as ever, but does this make now the perfect time to take out new loans and more debt?
Credit industry experts have warned that although today’s current economic conditions may make it tempting to finance new purchases, it is important to remember to avoid the same mistakes many Americans have made in the past. Now may be the time to continue to save more, pay down debt, and work on repairing your credit score instead.
Job growth prospects remain slim. If you haven’t already lost your job, there is still always a possibility that you may lose yours and be left without one for a long period of time, like millions of other Americans. With your current job, you may be capable of taking advantage of the current market by taking on new loans, but if a job loss arises, you may become behind in payments or even have to default on your loan, badly damaging your credit. If you’re currently unemployed already, there is a good possibility that taking on new debt will not be worth it.
In addition, obtaining credit can be much harder today. If your credit score is less than excellent, you may not qualify for a new loan as you would have easily qualified in the past. Even those who are looking to refinance a home now will generally need at least 20% in equity in the home as well as stable income.
If you do decide to take on a new loan to take advantage of today’s climate, make sure you will be able to maintain good credit. If you do need to borrow now, but your credit score is leaving you with less than the best interest rates, talk to Mick Bernard, in order to work towards obtaining the best possible rates.
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Can Obama's plan to help homeowners with private mortgages work?
In President Barack Obama’s State of the Union last night, he vowed to keep the “American dream” alive.
His plan includes legislation that would extend the expanded HARP refinancing program to homeowners with private loans.
Currently only underwater homeowners with mortgages backed by government-owned Fannie and Freddie Mac are eligible. To qualify, it doesn’t matter how much homeowners are underwater, but they can’t have missed more than one payment.
In Arizona, where nearly 50 percent of homeowners are underwater, I have received calls and emails from several people with private mortgages upset they don’t qualify for the government’s refinancing plan.
The federal government …
Some investors eligible for HARP 2 refinancing
Fannie Mae and Freddie Mac are changing the rules in a way doing something that could make metro Phoenix’s many home investors very happy.
The new program that allows homeowners with mortgages held by those government-owned mortgage giants to refinance, no matter how underwater they are, now will include investors. When the expanded Home Affordable Refinancing Program, or HARP, was announced in October, investors weren’t going to be to be included.
But then federal officials realized that many people who don’t live in a home they own are accidental investors. They can’t sell because they owe much more on their mortgage than their house is …
December best month of 2011 for new home sales in Phoenix
New-home sales across the Phoenix area in 2011 hit their highest level at the end of the year, according to the “Phoenix Housing Market Letter.”
In December 855, new homes sold. That’s nearly double the monthly rate in Phoenix for most of 2011. It could be that the supply of foreclosure- and resale homes is at a seven-year low, or the near-record low interest rates.
RL Brown and Greg Burger, publishers of the report, are presenting their 2012 forecast at a web conference on Wednesday Jan. 25. Recent new-home sales numbers and the big drop in foreclosure homes for sale could mean a …
Commercial market dealing with foreclosure issues
Problems similar to those that played out lenders, servicers and borrowers in housing market during its foreclosure crisis, are now issues for the commercial real estate market.
Earlier this week at a Arizona Commercial Mortgage Lenders Association meeting, much of the discussion was about difficulties of buying office buildings, hotels, warehouses, apartments and shopping centers in foreclosure.
Like homeowners have experienced with lenders, investors and commercial real estate brokers are dealing problems finding the right person to negotiate a deal with or even the right servicing firm to find out information on the property.
During the past few years, many metro Phoenix homeowners …
Gilbert man indicted for housing investment scheme
Arizona prosecutors have cracked down on another scheme that takes advantage of homeowners facing foreclosure.
Gerald Lee Kelly, 47, of Gilbert has been indicted by a federal grand jury in Phoenix for wire and mail fraud, money laundering and structuring financial transactions to avoid federal bank requirements.
The indictment alleges that in 2006 and 2007, Kelly operated a business called Cornerstone Financial Holdings, LLC (“Cornerstone”), and through that entity defrauded investors by promising an 18-25% return on their investment. The indictment charges that Kelly told victims that their investments would fund short-term, high-interest loans to distressed homeowners and that they would be …
New real estate expert at ASU
Arizona State University has a new real estate analyst, but he’s no newcomer to metro Phoenix’s housing market.
Mike Orr, publisher of The Cromford Report, the daily online real-estate market analysis for metro Phoenix, has joined the W.P. Carey School of Business. The Oxford University-educated mathematician from England will provide real estate analysis for the university and continue his own real estate report. His new ASU title is director of the Center for Real Estate Theory and Practice.
Jay Butler, ASU’s longtime real estate analyst, retired last summer.
Orr moved to metro Phoenix from Silicon Valley during the housing boom after a 30-year …
Myths Could Hurt your Credit Score
Most Americans think they know the majority there is to know about credit cards and the credit industry. When it comes to credit cards, however, there are actually several common falsehoods that have actually been passed from card holding generation to generation. Here we’ll discuss some very common beliefs and practices when it comes to using a credit card – and believe it or not, many of them are purely based on myth. If you get caught up in some of them, you’re credit score could actually suffer for it.
Firstly, many Americans believe credit card accounts aren’t open until activated. We receive a card in the mail that has a sticker with a toll free number on the back. Most of us think that this card is not part of our credit report or credit ratio until we decide to pick up the phone, dial the number, and give the okay to activate the card. No so, say credit industry experts! As soon as you apply for the card, your credit reports are pulled and the account almost immediately shows up as active on your credit report. Simply applying for a credit card can even damage your credit score.
Another common belief among consumers is that if credit card bills are paid in full and on time, there is no need to worry about the credit cards effect on your credit score. Credit ratio basics prove this belief to be a myth, one that blissful unawareness of can hurt your credit score.
Remember that paying your balance on time and in full is great for your finances, stress level, and even prevents large dings to your credit score but there is another part of the equation you must remember. Even if you’re doing both of these things, you still may be using too much of your credit limit. Your debt to credit ratio which consists of your total credit limit (across all cards) and how much of that credit you use makes a difference within your FICO score. When you hear “be wary of maxing out your cards” even if you pay on time, this is why. When in question about why you have a low credit score/bad credit or how to repair your credit, contact Credit Strategies at 480-502-5554.
Credit Strategies
480-502-5554 * www.911CreditPro.com * Mick@911CreditPro.com
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Myths Could Hurt your Credit Score
Most Americans think they know the majority there is to know about credit cards and the credit industry. When it comes to credit cards, however, there are actually several common falsehoods that have actually been passed from card holding generation to generation. Here we’ll discuss some very common beliefs and practices when it comes to using a credit card – and believe it or not, many of them are purely based on myth. If you get caught up in some of them, you’re credit score could actually suffer for it.
Firstly, many Americans believe credit card accounts aren’t open until activated. We receive a card in the mail that has a sticker with a toll free number on the back. Most of us think that this card is not part of our credit report or credit ratio until we decide to pick up the phone, dial the number, and give the okay to activate the card. No so, say credit industry experts! As soon as you apply for the card, your credit reports are pulled and the account almost immediately shows up as active on your credit report. Simply applying for a credit card can even damage your credit score.
Another common belief among consumers is that if credit card bills are paid in full and on time, there is no need to worry about the credit cards effect on your credit score. Credit ratio basics prove this belief to be a myth, one that blissful unawareness of can hurt your credit score.
Remember that paying your balance on time and in full is great for your finances, stress level, and even prevents large dings to your credit score but there is another part of the equation you must remember. Even if you’re doing both of these things, you still may be using too much of your credit limit. Your debt to credit ratio which consists of your total credit limit (across all cards) and how much of that credit you use makes a difference within your FICO score. When you hear “be wary of maxing out your cards” even if you pay on time, this is why. When in question about why you have a low credit score/bad credit or how to repair your credit, contact Credit Strategies at 480-502-5554.
Credit Strategies
480-502-5554 * www.911CreditPro.com * Mick@911CreditPro.com
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