My Blog

How much do your kids know about managing money?

05/14/2012 13:29:00

How much do your kids know about money management?

This past April, there was a Financial Literacy and Educational Summit held in Chicago where a survey determined that over 70% of Americans say their kids do not get any kind of money management education. What is a sad fact here is that parents are not teaching their own kids about how to manage money and neither are the schools. In a time where credit is still loose, card solicitations run rampant, and our marketing media continues to encourage people to buy more than they need, financial education is more important than ever.

In recent blogs, we have talked about high school and college graduates being unprepared for dealing with finances. College graduates have an even bigger burden as many not only struggle to find jobs but have student loan debts to wrestle to add to the burden. We know that giving a gift of a credit consultation may not have a lot of appeal initially. But as this survey shows, most parents don’t seem to have the tools to talk to their kids about financing their lives and it is so important that we want to help!!

This is one of the many reasons people should go through a credit consultation with Debbie. If they are still too young to have a credit history, then this is a really great time to sit down with her and learn some basics about how credit works and how it needs to be managed. She can also talk to people about setting up a budget, thinking before spending, and other questions kids might have about how to have enough money for the things theyneed. Another advantage to doing this is that it will open the door for discussions between parents and their kids. Having 70% of Americans admitting they have not talked to their children about money basics means most people find it hard to figure out where to start. By doing a consultation, this can open the door to better communication and make life easier for more than one generation.

Graduation Gift Idea...that keeps on giving

04/23/2012 16:00:00

Graduation – the gift that keeps ongiving!

It’s hard to believe that high school and college is almost over for the year. If you have a family member or friend who is graduating, you’re probably thinking about what to get as a gift. Our marketing media, as clever and strong as it is, will have lots of ideas for you. If not already, you’ll be seeing catalogs full of ideas to give your graduate; some ideas might be practical, but most gift suggestions are one designed to give a thrill. It makes a lot of sense; after all, graduation is a milestone and mark of accomplishment.

But before you head out to the mall to find the perfect graduation gift, think about what you really want your graduate to have. Clothes and electronic gifts are so tempting because there is an immediate gratification that comes with it. But in a year or two, these things are often forgotten, and often out of date. So how about being creative and giving something that could possibly last a lifetime? Like a Credit Consultation. OK, this doesn’t sound like a great present but think about this. Good credit management never goes out of date, and it never gets old. It may not be sexy, nor greeted with a lot of excitement. But the “thank you” could come back over and over again. Sitting down with Debbie tends to be an enjoyable experience while the information is easy to absorb. It’s not infrequent to have our clients remark how much they have enjoyed learning things no one else would teach them. At I Clean Ugly Credit, we can help you give the gift that keeps on giving, all for only $59. Think about it, it could end up being the best gift the graduate will ever receive.

Be Careful what you share with your spouse...

04/03/2012 13:02:00

When it comes to your spouse, be careful with what you share!

Sounds ominous doesn’t it? But good financial planning in a marriage can make a huge difference. A question came up about when a spouse dies, and they have debts, do you automatically assume the debt? In this particular case, it had to do with a husband passing away who had a credit card in his name and there wasa balance due. Naturally, if both names are on the card, the debt belongs to the survivor. If you decide to have separate credit cards,then by all means, keep them completely separate.

Arizona is a community property state and lenders will pursue a surviving spouse to make good on any debts left by the deceased. If there are assets shared by the deceased and survivor, they will come after that to get paid.

Divorce and death are two problem areas some people need to address when it comes to assets and liabilities. We continually promote talking to a credit specialist to help understand how credit and debt works and ways to maximize your credit score. Over the years, we have helped people save thousands of dollars by educating our clients on how to achieve higher credit scores and avoid common pitfalls which can put people in serious financial trouble. The price of a consultation can be returned many times over and give a person more confidence in doing their financial planning.

The REAL cost of Disputing

02/14/2012 07:18:00

The real cost of disputing

Over the years, credit reporting has become a permanent part of our financial well being. It is used to determine if we can qualify for loans, determine the cost of insurances such as health and automobile, and is scrutinized regarding employment. It is a well known fact that with so much data to manage, mistakes can be made, and indeed a high percentage of credit reports contain errors. The way to combat erroneous information is to dispute any incorrect information, which cleans up the report and reflects ones true credit history.

But, over the past few years, an industry has developed where ANY negative information (even if it’s correct) is being disputed in hopes of just getting it off the report. The rationale is if the credit bureaus can’t verify the information in a timely manner, by law they are required to remove the information which in turn, raises the scores. The problem with doing this is that mortgage companies have become wary of people following this practice. Credit bureaus have also wised up to what’s happening and have found a way to make money from this. When a person disputes an item, the credit bureaus now note any items being disputed by putting the words “CONSUMER DISPUTES”by that item on the report. When mortgage companies see this, they are more wary of granting a loan and can deny qualification because of this. What’s unfair about this (and the bureaus are good at being unfair) is that it doesn’tmatter if the item was bad information or not. They are simply just stamping anything that has been disputed with this tag.

So how do you combat this? With money of course!! Recently,we had a client who had to pay $180 ($60 per bureau) to have the words “ConsumerDisputes” removed from one item that appeared on all three reports. Having this tag on just one item was preventing her from obtaining a loan.

So what can we learn from this? The big lesson is that simply disputing negatives is NOT the same as fixing bad or mediocre credit. It can incur significant costs and if nothing has been learned, the problem will crop up again. Add the cost of removing the “Consumer Disputes”tag on reports, the costs continue to build. At “I CLEAN UGLY CREDIT”, we have been promoting education which teaches people how to permanently repair their credit, and at a much lower cost! We have helped people obtain homes, cars, and simply improve their credit even if they don’t have an immediate purchase pending. Just a simple consultation can pay for itself over and over again, making life so much easier to finance.

What was the trend for credit scores in 2011?

01/30/2012 19:12:00

2011 – The effect on credit scores and debt.

Now that 2011 is over, we can take a look at how people did with their credit over the year. According to the Arizona Republic, the news isgood…and bad. Across the country, credit scores actually dropped eight points to fall to an average of 660. In Arizona,which has tended to run below the national average, this year was no exception with the average score at 656. The problem with scores like these is that people will pay more for things like higher interest on mortgages and higher rates for car loans and healthinsurance.

More positive was the news on credit card debt. This fell 11% to an average of $6,576. However, in December, Arizonans did boost their card balances by four percent which was one of the biggest increases of any of the states for the month. We would like to think this is due to some pick up in employment, or people feeling more comfortable with staying employed. Hopefully this is the case.

What’s most important is looking ahead and seeing what we can do to bring up credit scores while reducing credit debt. One easy way is to pay off the credit card debt to bring down the ratio of outstanding debt. The ideal is to have outstanding credit card debt be no more than 25% of the credit line. When this is accomplished, it can help raise the score. What can be even more effective is to get a credit consultation. This is different than whole sale credit repair in that it’s a way to review one’s credit history, get a plan to make relevant changes, and it’s inexpensive. At I Clean Ugly Credit, past clients have been able to recoup the cost and save even more within a few months of going through this and following the plan.

If more people did this, 2012 could have news that is good on both scores and debt! Give us a call today!

What Does Credit Repair Really Mean?

01/25/2012 19:33:00

What Does ‘Credit Repair’ Really Mean?

In these times, with so much information available, it canbe hard to distinguish what certain words mean. Several years ago, repairing credit simply meant fixing a problem thatwas real, or disputing an error in credit reporting that was damaging, but nottrue. Fixing a real problem has alwaysbeen a good idea and hopefully, by doing this, one learns how the problemoccurred and understands how to avoid making that mistake again. Disputing incorrect information and having itcorrected is also a good way to repair credit. The lesson learned here is to check one’s credit report periodically toensure all information is reported correctly. If incorrect information appears, it should be disputed.

Credit repair companies used to help people disputeincorrect information, but when the real estate market started to rise at anunprecedented rate, a “new” kind of repair came into being where disputingbecame a market in itself. Instead ofcorrecting false information, people started disputing anything that wasnegative, even if it was true. The basisfor doing this had to do with timing. Ifthe dispute wasn’t answered within a certain amount of time, legally, it had tobe removed from the credit report. Oncethe negative information came off, the credit score would rise. Currently, there are still credit repaircompanies making fantastic claims of repairing credit quickly, and/orguaranteeing higher credit scores.

There are problems with doing this; the biggest beingclients themselves because they now have a falsely elevated score withoutfixing the real problem. At “I CleanUgly Credit”, we have a term for this: putting a band aid on a wound that needsstitches. It may heal, but it won’t healproperly. Just increasing a numberdoesn’t erase past behavior and mortgage companies are paying more attention tothis. There are too many factors toblame for the housing crisis over the past couple of years to cover in thisarticle. However, one contributingfactor has to do with making loans to people who have not taken care of pastexpenses.

Although this can be tough, taking care of past problems theright way is the only true credit repair. There are options available to make it easier and this is where Debbieis most valuable. By setting up aconsultation with her, clients get a distinct, easy to follow plan that isdesigned specifically for their needs AND learn how to make changes that last alife time.

Take a look at the testimonials on this web site.

Inspirational Story...Something to think about

01/24/2012 08:32:00

Taken from a facebook Post:
There once was a blind girl who hated herself because she was blind. She hated everyone except her loving boyfriend. He was always there for her. She told her boyfriend, "If I could see the world, I'd marry you". One day someone donated a pair of eyes to her. When the bandages came off, she was able to see everything, includi...ng her boyfriend. He asked her, "Now that you can see the world, will you............ marry me?" The girl looked at her boyfriend and saw that he was blind. The sight of his closed eyelids shocked her. She hadn't expected that. The thought of looking at him for the rest of her life led her to refuse to marry him. Her boyfriend left her in tears and days later wrote a note to her saying; "Take good care of your eyes, my dear, for before they were yours, they were mine." This is how the human brain often works when our status changes. Only a very few remember what our life was like before, and who was always by our side in the most painful situations. Today, before you say an unkind word...Think of someone who cant speak. Before you complain about the taste of your food...Think of someone who has nothing to eat. Before you complain about your husband or wife...Think of someone who's crying out to GOD for a companion. Today, before you complain about life...Think of someone who went too early to heaven. Before you complain about your children...Think of someone who desires children but is barren. Before you argue about your dirty house (that someone didn't clean)...Think of the people who are living in the streets. Before whining about the distance you drive...Think of someone who walks the same distance with their feet. And when you are tired and complain about your job...Think of the unemployed, the disabled, and those who wish they had your job. But before you think of pointing the finger or condemning another...Remember, not one of us is without sin and we all answer to one MAKER. And, when depressing thoughts seem to get you down...Put a smile on your face and thank God you're aliveour post here.

Understanding your Credit Report

01/09/2012 15:10:00

Understanding your credit report I have seen a number of articles that try to diagram and explain all the parts of a credit report. They’ll tell you a report is broken down into the following categories: 1.) Identifying information. 2.) Account details. 3.) Credit Inquiries. 4.) Public records and collections. 5.) Positive and negative accounts. These are well intended articles, designed to help people understand important information and may have helped some people. However, with the way credit reports are formatted, even having this information can be of limited value. First of all, the bureaus have not standardized the reporting format. Experian, Trans Union and Equifax all have their own way of writing their reports so it can be hard to match up information. Second, it can be further complicated by the fact that the reports may not report the same information. This is due to companies who may not report to all 3 credit bureaus, or inconsistent reporting. Finally, there are the mistakes which happen more often than people may think. Since the information is being inputed by people, something as simple as a tiny error of data can show up differently on one or more reports. I Clean Ugly Credit takes the time to go over the report, line by line, to clarify the information. Once the information is clear, the individual understands how the reports were written and has a clear plan on how to make improvements. If you are motivated to request your reports, but feel a little overwhelmed by all the data, the best way to proceed is to have a consultation with Debbie and it will be much easier to more on from there. Debbie will review your credit report, line by line and together you will come up with a plan to maximize your credit score. HOPE is on the way!!

Credit and Divorce

12/26/2011 12:03:00

Credit and Divorce

Joe and Jane recently divorced. Their divorce decree stated that Joe would pay the balances on their three joint credit card accounts .Months later, after Joe neglected to pay off these accounts, all three creditors contacted Jane for payment. She referred them to the divorce decree, insisting that she was not responsible for the accounts. The creditors correctly stated that they were not parties to the decree and that Jane was still legally responsible for paying off the couple’s joint accounts. Jane later found out that the late payments appeared on her credit report.

If you’ve recently been through a divorce – or are contemplating one -you may want to look closely at issues involving credit. Understanding the different kinds of credit accounts opened during a marriage may help illuminate the potential benefits – and pitfalls – of each.

There are two types of credit accounts: individual and joint. You can permit authorized persons to use the account with either. When you apply for credit – whether a charge card or a mortgage loan – you’ll be asked to select one type.

Individual or Joint Account

Individual Account: Your income, assets, and credit history are considered by the creditor. Whether you are married or single, you alone are responsible for paying off the debt. The account will appear on your credit report, and may appear on the credit report of any “authorized” user. However, if you live in a community property state(Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas,Washington, or Wisconsin), you and your spouse may be responsible for debts incurred during the marriage, and the individual debts of one spouse may appear on the credit report of the other.

Advantages/Disadvantages: If you’re not employed outside the home, work part-time, or have a low-paying job, it may be difficult to demonstrate a strong financial picture without your spouse’s income. But if you open an account in your name and are responsible, no one can negatively affect your credit record.

Joint Account: Your income, financial assets, and credit history – and your spouse’s – are considerations for a joint account. No matter who handles the household bills, you and your spouse are responsible for seeing that debts are paid. A creditor who reports the credit history of a joint account to credit bureaus must report it in both names (if the account was opened after June 1, 1977).

Advantages/Disadvantages: An application combining the financial resources of two people may present a stronger case to a creditor whois granting a loan or credit card. But because two people applied together for the credit, each is responsible for the debt. This is true even if a divorce decree assigns separate debt obligations to each spouse. Former spouses who run up bills and don’t pay them can hurt their ex-partner’s credit histories on jointly-held accounts.

Account “Users”

If you open an individual account, you may authorize another person to use it. If you name your spouse as the authorized user, a creditor who reports the credit history to a credit bureau must report it in yours pouse’s name as well as in your’s (if the account was opened afterJune 1, 1977). A creditor also may report the credit history in the name of any other authorized user.

Advantages/Disadvantages: User accounts often are opened for convenience. They benefit people who might not qualify for credit on their own, such as students or homemakers. While these people may use the account, you – not they – are contractually liable for paying the debt.

If You Divorce
If you’re considering divorce or separation, pay special attention to the status of your credit accounts. If you maintain joint accounts during this time, it’s important to make regular payments so your credit record won’t suffer. As long as there’s an outstanding balance on a joint account, you and your spouse are responsible for it.

If you divorce, you may want to close joint accounts or accounts in which your former spouse was an authorized user. Or ask the creditor to convert these accounts to individual accounts.

By law, a creditor cannot close a joint account because of a change in marital status, but can do so at the request of either spouse. A creditor, however, does not have to change joint accounts to individual accounts. The creditor can require you to reapply for credit on an individual basis and then, based on your new application, extend or deny you credit. In the case of a mortgage or home equity loan, a lender is likely to require refinancing to remove a spouse from the obligation.

Information provided from www. Knowdebt.org

How do I rebuild my credit after a short sale, foreclosure or bankruptcy?

12/04/2011 20:04:00

I am often asked "how do I rebuild my credit after a short sale, foreclosure or bankruptcy"? The answer is simple..."Begin right away!" Normally, there will be a waiting period before you will be able to qualify for financing for your next home. During that "waiting period", it is important that you be sure that you are working to maximize your credit score. I recommend these three steps:

NEVER make a late payment...NEVER! One late payment can affect your credit score up to 100 points!
Pay down or Pay off your existing credit card balances. Keep your balance owed paid down to no more than 30% of your credit limits. If you don't currently have any open credit cards...open at least one. I recommend opening a secured credit card if you can't qualify for an unsecured card.
Call I Clean Ugly Credit today and schedule a credit consultation to develop a personal plan on how you can maximize your credit score and begin to rebuild your credit.

Please remember that the past is the past. Don't look back! Learn from your experiences and know that there is HOPE!