This weekend I had a conversation with well educated attorney, probably around 65 years old, she asked me, “How are you doing in this economy? What do you do?” I responded, “I’m in education and finance; we sell products on saving money and specifically, how to raise your credit score to reduce your monthly payments.” She said, “Oh yeah, I understand all about credit. That is one problem I don’t have to deal with.” She continued by saying, “I only have one American Express card and that’s all I use.” I said, “Well statistically speaking, if you have one credit card it’s going to hurt your credit score.” She said, “I do know that, in fact, I had 11 cards, and I closed them all down.” My response, “Well, statistically speaking when you close down your accounts it will hurt your credit score.” She said, “I did know that, but it’s not a problem for me because I don’t need credit.” From there, I let the conversation die. The bottom line, I hear this every single day. Every day, I hear that, “I’m different.” In reality, if you are living in America, we are all the same when it comes to your credit score. Even though this woman thinks she “doesn’t need credit,” she does and let me explain. Does she have car insurance? Yes, and that could be impacted because of your credit score. Does she have a mortgage? Most likely, and that WILL be impacted by her credit score. Does she have kids? Yes, she had three of them. Most likely, her kids don’t have her resources and if she is teaching her kids this information; they are starting down the wrong path. This woman thinks that she doesn’t have problems, just like the 100M Americans who don’t think they have a problem.
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Personal Growth Blog for Philip Tirone – Credit Scoring Expert and Champion for the Underdog
Archive for March, 2009
Foreclosure vs. Short Sale – What’s Better for Me?
March 27th, 2009LOS ANGELES (PRWeb) — With Millions of Americans facing a foreclosure or a short sale in their very near future, many are asking the same questions (with answers):
1) Will I ever be able to get a loan again? Yes, if you follow the right steps.
2) Should I let my property go into foreclosure or do a Short Sale? Depends on your situation.
3) I heard I need to wait 4 years to get another home loan, it this true? Not Necessarily. Some programs require 2 years.
4) What will have a bigger impact on my credit score? Most of the time, a Foreclosure will have a bigger impact on your credit score. However, that will depend on each situation.
5) How can I recover my credit after this? How long will it take? If you follow the right steps, you should have a 720 Credit Score 4-5 years sooner than waiting for it to fall off your credit.
“This is all I get asked lately,” says Philip Tirone, author, speaker and activist on the credit scoring system.
If a consumer is going to have a Foreclosure or Short Sale in their future, the most important item they need to focus on is their credit score. How they handle this one action can cost them thousands of dollars in future payments on their car, credit cards, and future homes.
After the Foreclosure or Short Sale is completed, there are many things that consumers are not aware they need to do. One of which is re-establish credit from the beginning. Relying on their previous credit record will not work, even though other accounts had no late payments.
About Philip Tirone:
After closing $500 Million in residential home financing, Philip became attentive to the thousands of dollars in extra interest payments being wasted by Americans because of their credit scores. His mission is clear: educate Americans on how to increase their monthly disposable income, without changing their lifestyle, simply by understanding the credit scoring process.
Realizing the strain this lack of credit transparency has on the American financial system, Philip has made a personal commitment to educate consumers on how to navigate our credit system until our credit laws are changed and are fair to consumers.
Philip’s book, “7 Steps to a 720® Credit Score” dispels the misconceptions around our credit scoring system and guides consumers who are struggling with Bankruptcy, Foreclosure, Short Sale, Divorce, and many other experiences that impact a person’s credit score.
Philip and his programs have been featured in the LA Times, WSJ, the SF Chronicle, among others. Additionally, Philip has been a frequent guest lecturer at UCLA Anderson School of Business and Management.
Contact:
Danielle Fairlee, DSF Communications
Danielle@dsfcommunications.com
(818) 346-7110
Spending… the PROBLEM That Nobody is Talking About
March 25th, 2009I’m hearing over and over, “the economy is recovering, the economy is recovering!” Ben Bernanke said last week that he expects our recovery to come this year and of course our politicians are saying its “right around the corner.” Let me ask you a question: In your world, who is spending more money today than they were a year ago? This is the fundamental problem that we are faced with. 70% of our economy is based on people buying things. For our economy to recover, the government needs people to buy bigger cars, changing their IPods, new homes, etc. etc., thus the lower rates and rebate checks from the government. The problem is that spending money got us into this problem, and the government wants us to spend more to get us out of the problem… BUT… nobody is spending! In my world, conversation after conversation is about saving more, not spending more. Are we really going to get out of the woods this way?
The 800lb Gorilla – Lending Guidelines!
March 24th, 2009Yesterday I got a call a money manager from Canada. He said, “I’m so excited that the market’s turning! Inventory of real estate is coming down and banks are lending more! It’s going to be great!” I hate to be the downer here… but there is one thing that everyone is missing: lending guidelines are tougher than they have been for over a decade AND they continue to get tougher. If the guidelines don’t loosen, then there’s no way we’re going to have a recovery like everyone thinks is coming. Last week a lady called me for a loan for $300,000 loan. Her property is worth $2M. That’s a 15% loan to value, meaning there is only a loan on 15% of her home. She’s been in the property for the last 12 years, has $75,000 in the bank, has never been late on her payments, and her credit score is over 720. Per Fannie Mae/ Freddie Mac’s current lending guidelines, she can’t qualify for a $300,000 loan. Why? Because her income goes up and down (she’s an actress). Do you see the problem here? When someone who has lived in a property for 12 years, has great credit, never missed a payment, has $75,000 in the bank (equivalent of 3.9 years of payment), and they can’t get a loan, I think our lending guidelines need to soften before we’re going to see a recovery.
Overdraft Fees / Credit Card Fees – Why Can’t Banks be Fair?
March 23rd, 2009In “USA Today,” there was an article about how overdraft fees work at banks. It gives an example how one lady racked up $175 in overdraft fees on small debit card transactions for purchases such as coffee and lunch! That is really unfair. If you think that is bad, think about the outrageous fees that credit card companies charge consumers because of their credit score. Some American’s are being charged 30% interest rate on credit card balances because of errors that are on their credit report. That is correct, errors! In fact, according to a Federal Reserve Board Study, 80% of American’s have an error on our credit report and 25% of those errors are so bad, if you applied for credit today, you would be denied, because of that error!
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