April's 15 Ways to Financial Literacy

What makes April special? Let us count the ways:

April Fool’s Day
Income Tax Day
My Brother’s Birthday
National Frog Month
National Autism Month
No Housework Day
International Guitar Month

. . . and more!

It’s also Financial Literacy Month. Even with 2 days left, it’s worth it to take a minute and get a little education. (And it still counts even if you wait until May!)

Every couple years, the Jump$tart Coalition issues a "personal finance" exam to high school seniors.

The test highlights the importance of personal financial literacy among America's youth and comes at an especially important juncture.

In the last test, 12th graders answered 48.3% correct on average and posted the lowest scores since Jump$tart first issued the test in 1996.

Can you do better? Find out by taking the complete Jump$tart Personal Financial Literacy test for yourself online.

The average adult scores 68%.

There are a great many other links concerning financial literacy and personal finance. Here are a few of my favorites:

Credit.com
The Official Free Annual Credit Report
Credit Info Center
You Need a Budget
truecredit.com
myfico.com
Free Money Finance

Get clicking and get reading . . . the health of your wallet depends on it!

When Your Wallet Speaks . . .

For some reason, I seem fascinated by people’s wallets. Any article referencing wallets or featuring a photo of one is an automatic hook for me: I have to stop and read. Perhaps it’s because when it comes to money, it doesn’t get much more personal than our own wallets.

Recently, I posted a short piece on things you definitely don’t want in your wallet. Today, here’s another take on the wallet and what it says about your money: Bankrate.com’s look at What Your Wallet Says About You.

Turns out how you handle your cash may reveal more than a little about you and money. Are you a cash crumpler? Receipt collector? Obsessive organizer? ATM addict? Compulsive credit carder?

Take a look and you may be surprised at what you find. More likely than not, you’ll see yourself in one or more of these profiles. Or maybe your habits suggest a new one altogether.

For my part, I’m definitely the “receipt collector”. There’s even a special section reserved in my wallet – and then my desk drawer – for all those business receipts. But for whatever reason, I rarely get beyond the collection step – maybe a subtle way of convincing myself I’m on top of things even when I’m not. Definitely something to think about . . . tomorrow, maybe.

Mirror, Mirror . . . Who's the Best? (Hint: It's Not Suze)

This morning while paying bills on-line, I had CNNMoney.com’s video clips playing in the background. When I heard a piece on “who do you trust and what makes a good financial advisor” with Suze Orman, I was reminded again of how important it is when dealing with your finances to find someone who really knows you.

“The best advisor,” Suze said, “is the one you see looking back at you when you look in the mirror.”

No one knows your habits, your strengths, your limits and your risk profile better than you. And no one, but no one, cares more about your money than you.

Whatever you may think of Suze Orman and her advice to the masses, it’s hard to argue the point she made here, and it serves as a great rule of thumb whether you’re talking about credit building, financial planning, mortgage financing, insurance plans or whatever.

While we all know ourselves better than anyone else does, it’s unlikely we know financial planning, mortgage financing or how to reduce and eliminate debt as well as an experienced professional. That’s why it’s essential to find someone technically sharp and adept at dealing with the problem you are trying to solve.

More important, however, is finding someone willing to get to know you--your priorities, your needs and where you are in your life—if not as well as you do yourself, as close as they can come.

In conversations with prospective clients, I sometimes worry about them feeling they are in the interrogation room when 7 out of 10 questions have nothing to do with their current financing or interest rate.

It comes from my commitment to knowing what they really need before suggesting loan programs, rates and payment scenarios. In fact, it’s my way of determining whether we are truly a good fit in the first place.

So when you are searching for your next loan, make sure you’re listening for the way you’re being listened to. After all, we mortgage advisors have to look in the mirror every morning, too.

And some of us actually care about who we see looking back.

financial advisor mortgage advisor Suze Orman Turbo Tagger

160 Million “We’re So Sorry’s” and One Big Opportunity

“We’re so sorry, Uncle Albert

We’re so sorry if we caused you any pain

We’re so sorry, Uncle Albert

But there’s no one left at home

And I believe I’m gonna rain”

Can you say “We’re so sorry” 160 times? And do it again a million times over?

That’s exactly what one credit bureau promised last week.

In the largest class action settlement in US history, credit reporting giant TransUnion agreed to a preliminary settlement in Chicago federal court Wednesday that would provide 160 million Americans free access to their credit scores and six months of credit monitoring with no strings attached.

“This is astonishing,” said Ken McEldowney, executive director of Consumer Action, a national advocacy group based in San Francisco. “It’s everything we tell consumers that they need to find out if they have problems with their credit. They are getting information on how to improve it and information about whether they are creditworthy,” said McEldowney.

The settlement entitles consumers to six months of a TransUnion monitoring service—the one I use myself—that allows them access to information in their credit reports as well as their current scores at any time.

And for those of us who love being lazy, it even notifies subscribers by email of significant changes to their files, including reports of late payments or accounts opened in their names. TransUnion normally sells the service for $59.75 or more—meaning the settlement is worth as much as $10 billion.

How did borrowers get so lucky? Plaintiffs in the case alleged that anyone who had a credit file maintained by TransUnion (nearly half the U.S. population) were inundated with junk mail from marketers who bought data from the credit reporting giant. Federal law prohibits the sale of a person’s private credit information except under certain circumstances, such as when he or she has applied for a loan. The plaintiffs argued TransUnion crossed the line in the sale of private information.

The settlement represents a big opportunity to both borrowers and TransUnion. By filing a claim under the lawsuit, eligible plaintiffs receive 6 to 9 months of free access to one of the industry’s premier credit monitoring services. TransUnion offers a wide range of credit monitoring and educational resources.

The settlement represents a boon to TransUnion in that the company does not admit to any wrongdoing and at the same time offers a free trial to 160 million potential customers. Six months is more than enough time to get a handle on your credit profile, and it’s likely that after a free trial lasting 6 to 9 months, many will continue to subscribe to the company’s service.

Anyone who had any type of loan account between January 1987 and last Wednesday (and there must be some sort of prize for anyone who does not fit in that category!) is eligible to file a claim under the settlement. Claims can be filed starting June 16^th at the settlement web site https://www.listclassaction.com/ or by calling 866-416-3470.

credit monitoring credit score TransUnion Turbo Tagger

(Source: Chicago Tribune, May 31, 2008, Kathy Kristof)

Guess What Number Could Doom Your Loan Now (Hint: It’s Not Your Credit Score)

“I’m thinking of a number . . .”

Unless you’ve been living under a rock for the past 10 years, you've seen the ubiquitous FreeCredit.com commercial featuring a too-smart-for-his-own-good looking guy in a director’s chair and those 5 famous words.

In fact, I apologize if you’ve somehow finally succeeded in banishing this annoying phrase from your mind only to be reminded again by this post.

As annoying as this guy was, the commercial helped wake America up to the importance of the mysterious 3 digit number known as your credit score. Without the right number, your chances of qualifying for favorable interest rates—or qualifying for a mortgage at all—are often doomed from the start.

These days, however, there is a new number wreaking havoc with borrower’s attempts at obtaining mortgage financing. And unlike the credit score, there is virtually nothing borrowers can do to change it when it doesn’t come in at the right level.

The new number killing otherwise successful loan applications today? Appraisal value.
Several factors, all a function of the collapse of the mortgage market and subsequent declining home sales, have converged to give appraisal value an increasingly prominent role in loan approvals:

Declining markets
A new “declining market” designation has meant tighter lending guidelines for certain properties, reducing the maximum loan-to-value allowed on a given loan by as much as 5%. A loan originally approved for $285,000 on a $300,000 property in a declining market is now limited to $270,000—a $15,000 reduction in funds available to the borrower.

Tougher appraisal review
Appraisal reviews by lenders have resulted in greater scrutiny of appraisal reports. After reviewing an appraisal, the lender’s market review “experts” often order values to be reduced by tens of thousands of dollars before approving a loan. A recent legal settlement regarding mortgage broker-appraiser relationships will place even further restrictions on appraisal practices.

Foreclosure and short sales
Perhaps most important has been the rise in housing inventories, foreclosures and short sales. Slow sales and increased supply places downward pressure on home prices, while below-market sales resulting from foreclosure and short sale prices compound the pressure.

While it is illegal for loan officers to consult with or advise appraisers concerning home valuation, some lenders are setting up “valuation desks” independent of their appraiser to conduct preliminary searches of recent comparable sales data before ordering an appraisal. By considering whether recent comparable sales figures are likely to support the value needed for a loan to work, borrowers can better determine whether it’s worth it to order and pay for an appraisal for a property that may come up short in value.

Short of picking up and moving a house to a neighborhood that is retaining its values, there is little a borrower can do to compensate for the new threat to qualifying.

But judging from the number of borrowers stopped in their tracks by unfavorable appraisal values, the grating memory “I’m thinking of a number” conjures may help keep expectations realistic, and could even help save a few hundred dollars when the numbers don’t add up.

appraisals housing values credit score Turbo Tagger

Lite the Fuse: 6 Low- and No-Cost Start-up Steps You Can Take Right Now

Ready to get into action and give yourself some credit? Here are 6 low- and no-cost steps you can take this week. The are all easy and cost very little or nothing at all.

Hidden in this list is the fuse that will light an explosion of momentum in your credit building project. Good luck!

1) Get organized
Create a list of ALL your creditors including lender, address, contact telephone, current balance, current minimum payment, monthly payment date and interest rate. (COST = FREE)

2) Pay all bills on time
Create a schedule and way of reminding yourself to pay all bills on time. Examples: place reminders in Outlook, your cell phone calendar, the calendar on the wall, or by setting up auto-pays (make sure you control thru your bank's on-line payment system, if they offer it, NOT an auto debit with the lender). Whatever system works best for you -- maybe split up your accounts with your spouse so you can share the burden. (COST = FREE)

3) Pay down balances
Prioritize your balances and bring ALL past due accounts current ASAP. Then, target those accounts you can bring below 50% debt to credit limit ratio. The more active accounts in good standing with balances below 50%, the stronger your score. (COST = FREE)

4) Get educated
Visit http://www.myfico.com/ and http://www.truecredit.com/. Downloand and read "Your Credit Score" and the other free resources available from myFICO, sponsored by Fair Isaac--the company that actually creates the scores. They are the best source for your TRUE Fico score. myFICO offers a free 30-day trial for their credit monitoring service, but we recommend you use TrueCredit, which offers more complete credit reports and it's own credit monitoring service. Set your account up for $14.95/month, no contract, and free for the first 30 days. Review for mistakes and inaccuracies you can begin challenging. (COST = FREE 30 days, then $15/month)

5) Get your credit report
Visit http://www.annualcreditreport.com/ and order your free credit report (no scores) -- one from each bureau. Review for mistakes and inaccuracies you can begin challenging. (COST - FREE)

6) Set up and follow a budget
You Need a Budget -- yes, you! Go to http://www.youneedabudget.com/ and invest $20-40 towards your financial future. This system will have you living off last month's income (vs. this month's) in no time and give you some power back in terms of managing your cash flow. Awesome product, easy to use, simple to understand. I use it and everyone with cashflow problems should as well. (COST = $40 or less)

BONUS: Get plugged in!
Go to http://www.getcreditwise.net/ and put it on your favorites list. Find more bonuses there. Put the next Chicago Get Credit Wise Club meeting on your calendar. Do it NOW! (COST = FREE, . . . ALWAYS)

Back To Basics: The 5 Key Components That Make Up Your Credit Score

To those of us with more in our lives to worry about than how are tradelines look or how many points up or down our score went last month, credit matters are often complex and confusing. Sometimes, it pays to get back to basics.

Today, we feature a clip from Linda Ferrari, President of Credit Resource Corporation. Linda is an expert on credit remediation and is great at putting it plain and simple.

No matter where you go, every effective credit repair or score-building program will start with and build upon these 5 key components.

In fact, one of the easiest ways to take control of your credit profile is to start right here: review each of these 5 basic components and see how you are doing with each. You’ll be surprised what a difference addressing just a few of these can make.

For additional resources, review the links under DOLLARWISE in the sidebar at the right. To learn more about Credit Resource Corporation, visit www. http://www.creditresourcecorp.com/.

Source: LoanToolbox
www.loantoolbox.com

credit repair credit score mortgage Turbo Tagger

What's In Your Wallet? More Than You May Want!

If you were to stop what you were doing and give yourself 10 seconds to list everything in your wallet or purse, what would be on your list?

Cash, driver's license, credit cards, debit cards, membership ID, a receipt or two and a subway card -- that's my list.


If after making your list, you actually emptied your purse or wallet in front of you, would there be more than you expected? An unpaid bill with your address and account number on it? A credit card receipt with your card number on it? An expired ID you haven't used in months?

With one in four US households falling victim to identity theft in the last five years (FTC)--many of us are walking around with ticking time bombs in our own back pockets.

Author "Fox" of the Squawkfox blog emptied her purse recently and found she had already lit the fuse. The result of her exercise was "Ten Things You Should Never Carry in a Purse or Wallet" to avoid identity theft. Besides the obvious social security card, passport and birth certificates, some surprising items also made the list: business cards, flash drives, checkbooks and even condoms!

In addition to Fox's post, Truecredit.com and MyFICO.com offer excellent resources for protecting yourself from identity theft--from simple common sense practices to identity theft insurance.

Are you toting more than the bare necessities? Do yourself a favor and purge the purse of risky business.

identity theft credit protection personal finance Turbo Tagger

You're Not Immune -- No Matter What Your Credit Profile Looks Like

Four times annually, the Federal Reserve surveys 84 different banks about general banking conditions.

One of the survey questions asks about current mortgage lending standards and whether they are loosening or tightening.

The chart at right is from the April 2008 survey and it illustrates what we already know: It's getting tougher and tougher to get approved for a home loan. Some of the areas in which mortgage guidelines are tightening are well-known:

• More thorough income documentation
• Higher credit score requirements
• More "money in the bank" post-closing

Some areas are less well-known:

• More scrutiny of prior delinquencies
• Strict review of appraised values

Overall, getting a mortgage approval from a bank is more difficult than in months past and the tightening trend is expected to continue throughout the rest of the credit cycle.

No "class" of buyers is immune, either -- not even the "prime" ones. Home prices may fall going forward but stricter mortgage guidelines means that fewer home buyers will be able to take advantage.

If you're unsure about your credit profile, check with your loan officer to see how additional restrictions could impact your ability to purchase (and finance!) a home.

(Image courtesy: Federal Reserve)

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Why Free Credit Reports Are Worth What They Cost

The ubiquity of "free" credit reporting services like FreeCreditReport.com, TrueCredit.com, and AnnualCreditReport.com have helped breed a new generation of credit-aware Americans.

Because credit ratings have more importance to everyday life than in years past, this is a welcome development. For example:

• Lenders use credit ratings to determine borrowing rates
• Insurers use credit ratings to determine premiums
• Employers use credit ratings to make hiring decision

Unfortunately for Americans, though, not all credit reports are created equal. And when it comes to actually applying for credit in the form of a new credit card or mortgage, the free reports are worth precisely what they cost.

This is one reason why home buyers should have their credit reviewed by a mortgage lender as soon as possible in the home buying process -- the free reports offered by the major credit bureaus may be misleading and incomplete. Free credit reports are useful for identifying identity theft and reviewing active accounts, but do very little to help a potential creditor gauge your creditworthiness.

As the chart shows us, each industry's creditors has a way they like to do business and that way is the "standard" way.

(Image courtesy: The Wall Street Journal)

free credit report annual credit report mortgage Turbo Tagger

Miss Our Last Call? Hear It Now ! !

Play Back Number: (641) 985-5004
Access Code: 434835#
When prompted, enter the access code. Once confirmed, the system will play back the recorded conference. During play back, the user can scroll the play back in forward or backwards. You will find the play back features below.


Playback Feature Keys:
Hit "1" to rewind 30 seconds
Hit "2" to fast forward 30 seconds
Hit "5" to pause/resume playback

Post comments here or email them to getcreditwise@acn.net

Give Yourself Some Credit ! !

Money Talks: Low- and No-Cost Ways to Improve Your Own Credit

Wednesday, January 17th
7:00PM EST

DIAL IN: 605-772-3001
PASSCODE: 434835#

Join our FREE Teleseminar on "Low- and No-Cost Ways to Improve Your Own Credit," hosted by Ben Barber, Mortgage Consultant and Satin Crable, Credit Expert and Owner, JAIN Credit

Topics covered:

• Your FICO Score and the 5 Key Elements That Determine Your Score
• The Truth About the 6 Most Common Credit Myths
• 5 Low- or No-Cost Actions You Can Take Today to Impact Your Credit Future
• Question & Answer with Satin Crable
• What Next: 9 Links for More Free Resources

This 40-minute workshop is normally offered on an invitation only basis at $125 per person. On January 17th, it's yours free -- free to you and free to anyone else with whom you wish to share it.

Why are we offering it for free? We've seen too many good people with bad credit, and we don't believe anyone should need to spend thousands of dollars or have a degree in finance to help themselves out of debt. We believe you get what you give, and we're willing to give a little more than most. Put yourself on the call and start your New Year with a New Possibility in your credit future.

Please call in 5-7 minutes prior to call time to secure a place on the call. Host not responsible for long-distance charges incurred. Email questions, comments and registrations (requested by not required) to accessnow@acn.net

Get Your Bonuses Here

As promised on our January 17th teleseminar, here are two BONUS opportunities available for a limited time only:

JAIN Credit Personal Credit Review

CALL NOW at 773-983-2101 for a personalized credit review with Satin Crable, Professional Credit Specialist and owner of JAIN Credit. Schedule your free consultation between now and February 16th to start your year off right.

BONUS open through February 28th.


LIFETIME FINANCIAL Personal Mortgage Review

EMAIL NOW to getcreditwise@acn.net to request a personalized mortgage review with Ben Barber, Mortgage Consultant with Lifetime Financial Partners. Assess your "mortgage fit" in a free consultation. I promise you will learn the following:

1) WHERE TO GO to access objective information about mortgage terms and products that puts YOU in the driver's seat when it comes to assessing your options

2) YOUR MORTGAGE FIT How well your current mortgage fits your current financial profile -- are you qualified for a new mortgage, will re-financing benefit you, are you ready for a purchase or should you sit tight with what you have now?

3) YOUR CREDIT SCORE What your credit score is today -- that 3 digit number that holds the key to your financial future.

All just for the asking, no obligation and no cost to you.

BONUS open through February 28th.