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Short Sale on Your Income Property? - You May Owe the IRS Big Time
 Remember last month when I talked about how you may owe taxes after a short sale on your personal residence? The same problem may happen if you have an investment property with problems. Depending on your situation, especially how much you owe on your property and to whom, you may have a huge tax problem on your hands. Plenty of help for a primary residence Over the past few years, there have been a number of new laws and government programs set up to help homeowers. For example, the Mortgage Forgiveness Debt Relief Act of 2007 generally allows taxpayers to exclude income from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring, as well as mortgage debt forgiven in connection with a foreclosure, qualify for this relief, and these advantages will be in place until 2012. Also, as the economy continues to be rough for the average taxpayer, there will be continued political pressure to provide relief in the form of tax breaks and rule changes. Why investment properties are different To put it simply, an investment property is not a primary residence, so many of the breaks that homeowners get when it comes to tax breaks for forgiven debt doesn't exist. For example, if you are personally insolvent on the day that you do a short sale on a personal residence, you probably don't owe any taxes on the value of the forgiven debt. If the same thing happens with an investment property, it isn't a personal residence, and you may owe on the forgiven debt. Nightmare scenario: you lost money but still owe taxes There are many ways that this can happen, and the following is an easy to follow example. An investor bought a four-unit apartment house for 0% down three years ago, and the rent from the tenants easily covered the mortgages and other costs. In the last year, two very bad things happened - real estate prices dropped 30%, three of the tenants moved out or just stopped paying rent, and you are bleeding money like crazy. You find another investor who takes it off your hands, and you think you are lucky because the mortgage holder allowed a short sale on your property. Things look great until a few months later when you get the 1099C from the mortgage holder and you realize that the forgiven debt is considered income, and you owe taxes on the difference between the purchase price and the sale price. The only problem is your apartment house was your only significant investment, and after you sold it and took care of all the other costs, you were living paycheck to paycheck. You have a tax bill that is is equal to your annual income, and Uncle Sam doesn't want a sad story, he wants you to show him the money. How to deal with this problem The best way to deal with the problem is to avoid it by not selling the property. If this is not an option, then it is time to get either creative or proactive. Creative would be working with the mortgage holder to change the terms of the deal, or working with real estate management company to find paying tenants. If you have no choice but to sell, then at least prepare for the consequences by contacting the IRS about your situation. They will still want their money, but they may be open to negotiating a payment agreement with you. Short sellers, who get lenders to forgive a portion of the debt in order to complete a sale, are also at risk because lenders will often leave their options open to come back and collect later. If you are involved in a short sale, make sure to review your agreements carefully, preferably with the help of a competent professional. Photo credit: Wikipedia  |
Repair Your Bad Credit Score And Credit History By Having Cash On Hand
By Alex Strobel
A bad credit score can come from unforeseeable circumstances, like a medical emergency or car trouble, but typically, those who are in a great amount of debt and have received a bad credit score as a result have poor financial habits and live outside of their means.
Having cash on hand for big purchases is an old world habit that is rarely practiced today, as many feel it is their right to have the best and most lavish material possessions. While there is nothing wrong with a big house and a nice car, buying things that are outside of your price range is going to always lead to financial trouble.
The vast majority of people that want a home or a car will not save up the money to buy these things, but would rather take a loan that will cost more over time, with interest factored in. Oddly enough, a home loan payment and a car payment usually don’t turn a good credit score bad, as these bills are usually paid first.
Constantly buying unnecessary items on credit causes debt to pile up and, again when interest is factored in, you are going to find yourself behind an almost insurmountable mountain of debt.
By using the simple practices of budgeting, saving, and even sacrificing you can get out of debt and stay out of debt all while raising your credit score. If you use credit to buy non-necessities you are in the position to improve your credit history. However, before you buy something that isn’t vital, like food, water or shelter, you need to make a monthly or weekly budget and save up the money before making the purchase.
You can make the purchase on credit, having the money on hand, and then when your credit card bill comes, pay off the charge with the money that was saved. Simple practices like this will go a long way helping you not only stay out of debt, but it can improve your bad credit score over time.
SOURCE : www.rwbpress.com
A bad credit score can come from unforeseeable circumstances, like a medical emergency or car trouble, but typically, those who are in a great amount of debt and have received a bad credit score as a result have poor financial habits and live outside of their means.
Having cash on hand for big purchases is an old world habit that is rarely practiced today, as many feel it is their right to have the best and most lavish material possessions. While there is nothing wrong with a big house and a nice car, buying things that are outside of your price range is going to always lead to financial trouble.
The vast majority of people that want a home or a car will not save up the money to buy these things, but would rather take a loan that will cost more over time, with interest factored in. Oddly enough, a home loan payment and a car payment usually don’t turn a good credit score bad, as these bills are usually paid first.
Constantly buying unnecessary items on credit causes debt to pile up and, again when interest is factored in, you are going to find yourself behind an almost insurmountable mountain of debt.
By using the simple practices of budgeting, saving, and even sacrificing you can get out of debt and stay out of debt all while raising your credit score. If you use credit to buy non-necessities you are in the position to improve your credit history. However, before you buy something that isn’t vital, like food, water or shelter, you need to make a monthly or weekly budget and save up the money before making the purchase.
You can make the purchase on credit, having the money on hand, and then when your credit card bill comes, pay off the charge with the money that was saved. Simple practices like this will go a long way helping you not only stay out of debt, but it can improve your bad credit score over time.
SOURCE : www.rwbpress.com
Credit Repair 101 - Beware of scams
by William E. Lewis Jr.,
While the economy has been showing some signs of improvement, your good name and reputation is becoming more important within the community. Creditors have tightened their guidelines effectively barring millions of Americans from borrowing money. Even those with high credit scores have experienced closed credit card accounts and equity lines. When an account has not been closed, credit limits have been reduced to the current balance due.
Mortgage lenders, auto finance companies, credit card issuers and banks have all raised the bar. Borrowers with low FICO scores can expect to be denied or to pay significantly higher interest rates than those with excellent histories. Long gone are the days of obtaining credit, goods, benefits, services and/or employment with a 620 score. In more instances than not, a consumer will be denied if they maintain a credit score lower than 740.
The terms credit repair, credit restoration or credit rehabilitation are somewhat synonymous. Those with bad histories cannot afford to ignore the potential benefits of credit repair. In today's economy, a strong FICO score is more important than ever. Approximately 78 percent of credit profiles in the United States contain some sort of error or omission materially impacting credit worthiness. Absent self-help and the "do-it-yourself" approach, a consumer may hire a credit service organization (CSO) in the restoration of their good name and reputation within the community.
Most - but not all - CSOs specialize in the restoration of consumer credit worthiness as well as issues related to identity theft. Assuming that said organization is performing within the law, they utilize laws enacted by Congress to dispute negative, erroneous, obsolete, and/or fraudulent information contained within your consumer credit profile.
Utilizing the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Fair Credit Billing Act, and the Fair and Accurate Credit Transactions Act, a reputable CSO will assist a consumer in the submission of disputes electronically, verbally and in writing to the Equifax, Experian and Trans Union consumer reporting agencies in addition to creditors, collection agencies, third-party record providers and state, federal, local, or private regulatory authorities.
Keep in mind that anything a CSO can do, you can do yourself for little to no cost. With that said, a reputable organization should have the edge as they will possess the education, knowledge and a source proven method that is generally unknown to the average consumer. Unlike most credit repair clinics that submit the same written dispute letters monthly, a reputable CSO will have devised a strategy whereby disputes are submitted electronically, verbally and in writing over a long period of time to the credit reporting agencies, creditors, collectors, and third-party record providers reporting negative, inaccurate, obsolete and/or erroneous information.
A reputable CSO should have a provable track record of results as well as the ability to modify and/or remove erroneous or inaccurate judgments, liens, foreclosures, bankruptcies, short-sales, student loans, inquiries, derogatory tradelines, personal identifiers and other transient data from a consumer's credit report. Although the credit restoration process can take anywhere from 30 days to six months, most individuals should see some results within the first 45 to 60 days.
Credit repair, credit restoration and/or credit rehabilitation is as legal as pleading "not guilty" in a court of law. With that said, one must understand that most CSOs are not law firms and that their employees are not licensed to practice law. As such, even a reputable CSO cannot provide legal advice nor represent a consumer before any court or in any legal proceeding. In the event that legal representation is required, said organization should provide an appropriate attorney referral for consultation.
When self-help or the "do-it-yourself" approach is not feasible and you decide to hire a CSO to restore your credit, be sure to check them out. While the majority of credit repair clinics are scams, a few good ones do exist. Consumers can check out a credit repair clinic through their state Attorney General - www.MyFloridaLegal.com in Florida - or through the Better Business Bureau at www.BBB.org
SOURCE : www2.highlandstoday.com
While the economy has been showing some signs of improvement, your good name and reputation is becoming more important within the community. Creditors have tightened their guidelines effectively barring millions of Americans from borrowing money. Even those with high credit scores have experienced closed credit card accounts and equity lines. When an account has not been closed, credit limits have been reduced to the current balance due.
Mortgage lenders, auto finance companies, credit card issuers and banks have all raised the bar. Borrowers with low FICO scores can expect to be denied or to pay significantly higher interest rates than those with excellent histories. Long gone are the days of obtaining credit, goods, benefits, services and/or employment with a 620 score. In more instances than not, a consumer will be denied if they maintain a credit score lower than 740.
The terms credit repair, credit restoration or credit rehabilitation are somewhat synonymous. Those with bad histories cannot afford to ignore the potential benefits of credit repair. In today's economy, a strong FICO score is more important than ever. Approximately 78 percent of credit profiles in the United States contain some sort of error or omission materially impacting credit worthiness. Absent self-help and the "do-it-yourself" approach, a consumer may hire a credit service organization (CSO) in the restoration of their good name and reputation within the community.
Most - but not all - CSOs specialize in the restoration of consumer credit worthiness as well as issues related to identity theft. Assuming that said organization is performing within the law, they utilize laws enacted by Congress to dispute negative, erroneous, obsolete, and/or fraudulent information contained within your consumer credit profile.
Utilizing the Fair Credit Reporting Act, the Fair Debt Collection Practices Act, the Fair Credit Billing Act, and the Fair and Accurate Credit Transactions Act, a reputable CSO will assist a consumer in the submission of disputes electronically, verbally and in writing to the Equifax, Experian and Trans Union consumer reporting agencies in addition to creditors, collection agencies, third-party record providers and state, federal, local, or private regulatory authorities.
Keep in mind that anything a CSO can do, you can do yourself for little to no cost. With that said, a reputable organization should have the edge as they will possess the education, knowledge and a source proven method that is generally unknown to the average consumer. Unlike most credit repair clinics that submit the same written dispute letters monthly, a reputable CSO will have devised a strategy whereby disputes are submitted electronically, verbally and in writing over a long period of time to the credit reporting agencies, creditors, collectors, and third-party record providers reporting negative, inaccurate, obsolete and/or erroneous information.
A reputable CSO should have a provable track record of results as well as the ability to modify and/or remove erroneous or inaccurate judgments, liens, foreclosures, bankruptcies, short-sales, student loans, inquiries, derogatory tradelines, personal identifiers and other transient data from a consumer's credit report. Although the credit restoration process can take anywhere from 30 days to six months, most individuals should see some results within the first 45 to 60 days.
Credit repair, credit restoration and/or credit rehabilitation is as legal as pleading "not guilty" in a court of law. With that said, one must understand that most CSOs are not law firms and that their employees are not licensed to practice law. As such, even a reputable CSO cannot provide legal advice nor represent a consumer before any court or in any legal proceeding. In the event that legal representation is required, said organization should provide an appropriate attorney referral for consultation.
When self-help or the "do-it-yourself" approach is not feasible and you decide to hire a CSO to restore your credit, be sure to check them out. While the majority of credit repair clinics are scams, a few good ones do exist. Consumers can check out a credit repair clinic through their state Attorney General - www.MyFloridaLegal.com in Florida - or through the Better Business Bureau at www.BBB.org
SOURCE : www2.highlandstoday.com
Developing A Good Credit History Early In Life Can Help Avoid A Bad Credit Score
By Steven Craig
People that are just beginning to build a credit history come in different stages of life and having little or no credit history isn’t just something that is applied to young men and women. Buying on and paying off credit, paying off loans and other forms of debt payment all reflect well on your credit history, which brings about high credit score.
However, bad credit often follows people around throughout life and while there are ways to repair bad credit, getting off on the right financial foot is going to be key to not only avoiding bad credit, but maintaining habits that are conducive to good credit.
Buying on credit can be the beginning of trouble for many, but it is vital to building a good credit history. However, one good rule to buying on credit is to have the cash for the purchase on hand. This is counter to the whole point of buying on credit in many people’s minds, but credit card companies hope you don’t have the money to pay off your balance so that interest charges will pile up and they make more money.
While there are emergencies that require the use of a credit card at times, if you are looking to buy something particular and not necessarily vital, make sure you have the money on hand or in a savings account, ready to go when your credit card bill comes due.
By practicing small, common sense actions with credit cards, you will not only be able to build a good credit history, but also avoid a bad credit score.
SOURCE : www.rwbpress.com
People that are just beginning to build a credit history come in different stages of life and having little or no credit history isn’t just something that is applied to young men and women. Buying on and paying off credit, paying off loans and other forms of debt payment all reflect well on your credit history, which brings about high credit score.
However, bad credit often follows people around throughout life and while there are ways to repair bad credit, getting off on the right financial foot is going to be key to not only avoiding bad credit, but maintaining habits that are conducive to good credit.
Buying on credit can be the beginning of trouble for many, but it is vital to building a good credit history. However, one good rule to buying on credit is to have the cash for the purchase on hand. This is counter to the whole point of buying on credit in many people’s minds, but credit card companies hope you don’t have the money to pay off your balance so that interest charges will pile up and they make more money.
While there are emergencies that require the use of a credit card at times, if you are looking to buy something particular and not necessarily vital, make sure you have the money on hand or in a savings account, ready to go when your credit card bill comes due.
By practicing small, common sense actions with credit cards, you will not only be able to build a good credit history, but also avoid a bad credit score.
SOURCE : www.rwbpress.com
Homeowners DIY ‘to save money’ this Easter and other holidays
Many homeowners are to do their own household maintenance, or DIY, over the Easter holiday - possibly to save money - a study has suggested.
Research carried out by Churchill Home Insurance revealed that more than one in four householders are planning to do their maintenance rather than pay a professional to perform the duties for them.
It means that over a quarter of a million homes will be painting, decorating and renovating over the bank holiday period.
The survey disclosed that more men are set to pick up a hammer or paintbrush than women over the weekend, with Northern Ireland having the most DIY fans with nearly half of those quizzed reporting that they aim to do some work.
Residents from the East Midlands, however, plan to do the least.
Statistics recently released by uSwitch.com showed that around 5.5 million households - 21 per cent of the nation - are now in debt to energy suppliers after the coldest winter in 30 years.
SOURCE : www.abacusfinance.co.uk
Article By Joe Shervin
Research carried out by Churchill Home Insurance revealed that more than one in four householders are planning to do their maintenance rather than pay a professional to perform the duties for them.
It means that over a quarter of a million homes will be painting, decorating and renovating over the bank holiday period.
The survey disclosed that more men are set to pick up a hammer or paintbrush than women over the weekend, with Northern Ireland having the most DIY fans with nearly half of those quizzed reporting that they aim to do some work.
Residents from the East Midlands, however, plan to do the least.
Statistics recently released by uSwitch.com showed that around 5.5 million households - 21 per cent of the nation - are now in debt to energy suppliers after the coldest winter in 30 years.
SOURCE : www.abacusfinance.co.uk
Article By Joe Shervin
Repair A Bad Credit Score—Budgeting Is Key To Paying Bills On Time
By Lee McFarland
There are many things one can do to improve their credit history, thus raising their credit score, but when it comes down to the basics, budgeting is going to not only improve your credit score and keep you out of debt, but also it will keep you from missing payments and losing points on your credit score.
If you are looking to repair your credit score then simply paying bills on time is going to be a big part of that. Paying bills when they are due may sound simplistic, but there are many individuals that have a plan of what bills they will not pay from one month to the other.
The old idea of living within your means is going to drastically improve your credit score and keep you out of debt as well. Obviously, big forms of debt like a home or car payment isn’t something most people can pay in one go, but little bills and credit card charges that aren’t necessities are what is hurting many that have seen their credit score go from good to bad.
Making a budget can be an easy task, but it will require taking care of vital expenses over your wants. Taking stock of your income and looking at how much will go toward necessary payments is the first step. Then anything left over is allocated to food, gas, and the like. If there is a purchase you wish to make, doing so on a credit card can repair your score, but be certain you have the money on hand to set aside to pay the bill when it comes due. Don’t just assume you will have the money later.
By starting with the basics of finance and saving, you are going to put yourself in a better position to build your credit history and improve your credit score.
SOURCE : www.rwbpress.com
There are many things one can do to improve their credit history, thus raising their credit score, but when it comes down to the basics, budgeting is going to not only improve your credit score and keep you out of debt, but also it will keep you from missing payments and losing points on your credit score.
If you are looking to repair your credit score then simply paying bills on time is going to be a big part of that. Paying bills when they are due may sound simplistic, but there are many individuals that have a plan of what bills they will not pay from one month to the other.
The old idea of living within your means is going to drastically improve your credit score and keep you out of debt as well. Obviously, big forms of debt like a home or car payment isn’t something most people can pay in one go, but little bills and credit card charges that aren’t necessities are what is hurting many that have seen their credit score go from good to bad.
Making a budget can be an easy task, but it will require taking care of vital expenses over your wants. Taking stock of your income and looking at how much will go toward necessary payments is the first step. Then anything left over is allocated to food, gas, and the like. If there is a purchase you wish to make, doing so on a credit card can repair your score, but be certain you have the money on hand to set aside to pay the bill when it comes due. Don’t just assume you will have the money later.
By starting with the basics of finance and saving, you are going to put yourself in a better position to build your credit history and improve your credit score.
SOURCE : www.rwbpress.com
Recovery Act can save you money on your 2009 tax bill
In February 2009, President Obama signed into law the American Recovery and Reinvestment Act, or Recovery Act, into law. One of the benefits of the law is that you may be able to get tax credits or tax reductions for your 2009 taxes.
To give you an idea of what benefits you can get, you can review the tax savings checklist on the White House web site that will give you an idea of what benefits you can get.
If you go through this checklist, you will have an idea of what you should look for when you do your taxes. A tax program like TurboTax, or a tax professional, may be able to find these benefits as well, but you should still go through this checklist so you will know what to look for or what to ask when it comes time to do your taxes.
Video about the Tax Savings Tool
To give you an idea of what benefits you can get, you can review the tax savings checklist on the White House web site that will give you an idea of what benefits you can get.
If you go through this checklist, you will have an idea of what you should look for when you do your taxes. A tax program like TurboTax, or a tax professional, may be able to find these benefits as well, but you should still go through this checklist so you will know what to look for or what to ask when it comes time to do your taxes.
Video about the Tax Savings Tool
Can you repair an error on a credit report in time to save a job?
by Evan Bedard
Your credit report is definitely something that can have an impact on your career, depending on your line of work. This is one reason why it is crucial that all of the information on your report remains as accurate as possible. Since you are entitled to one free copy of this report a year it would be wise to do this to make sure there are no mistakes and creditors are reporting accordingly.
This is especially important for individuals who have a job requires security clearance. Security clearance is a status that allows one to access classified information for their line of work, usually positions where they work directly with the federal government or as a federal contractor. Some of these jobs include the military, police officers, and the CIA. If certain events happen that cause this persons score to drop there is a chance they can be reassigned or possibly even eliminated from their job.
However, this is also quite common for people looking for a job as well because some employers will want to examine the applicants credit history before offering a certain position. You do not want an error on your report to prevent you from landing the position you are looking for.
Should there be some errors on your report, you can correct them quite easily by going through the proper channels due to the Fair Credit Reporting Act. In an effort to keep your credit report and score completely accurate, you should keep a close eye on it before you need to use it to your advantage. A high score will be an advantage in the future if you are looking for a job, trying to secure a loan, or maybe even applying for a credit card. Many financial advisors suggest that people check their credit scores at least once to twice a year to ensure accuracy.
Here the FTC explains why it is important to check your report:
“-Because the information it contains affects whether you can get a loan — and how much you will have to pay to borrow money.
-To make sure the information is accurate, complete, and up-to-date before you apply for a loan for a major purchase like a house or car, buy insurance, or apply for a job.
-To help guard against identity theft. That’s when someone uses your personal information — like your name, your Social Security number, or your credit card number — to commit fraud. Identity thieves may use your information to open a new credit card account in your name. Then, when they don’t pay the bills, the delinquent account is reported on your credit report. Inaccurate information like that could affect your ability to get credit, insurance, or even a job.”
If there is an error on your credit report, you should get the ball rolling to correct it as soon as possible. If you don’t, your chances of getting a new job will be less than impressive.
In order to correct any mistakes, you must file a dispute and request an investigation with the consumer reporting companies. Including your complete name, address, date of birth and social security number, list the name of the company that made the error and make reference to the error itself. Write down why you are filing a dispute, include documents to support your position, and request that the mistaken infomation be corrected or removed immediately.
From there they will investigate the items in dispute, and if they find the items were indeed reported wrong they will forward all information to the company that reported the information. After they receive the notice about the dispute they also must do an investigation to determine whether or not the items were reported properly. If they cannot prove it is accurate they must than inform the consumer reporting companies of this to ensure the mistakes get removed from the consumers file.
Hopefully, if things go right, the credit bureau will recognize the mistake and make the proper corrections. This will get you on your way to your new job with a cleaner credit report and a higher credit score. A higher credit score will always make it easier to get a job, especially if you need the credit rating to improve your life.
Staying on top of repairing any credit errors on your report before you need it will keep you safe from any breaks in the accuracy of your credit report. Fixing these errors is very important to your overall success in the effort to keep a positive credit rating. The answer is yes, you can repair any credit report errors in time to save your job. Providing your employer is compassionate enough to stay with you through the correction process, almost any job can be spared.
It doesn’t take very long to ensure your credit report is accurate either. You can spend the time it takes to ensure all credit marks are accurate and guarantee that any future uses for your credit report will turn up accurate information. Why leave such a thing to chance, get the ball rolling to verify the details of your credit report are completely truthful and legally binding.
SOURCE : www.loansafe.org
Your credit report is definitely something that can have an impact on your career, depending on your line of work. This is one reason why it is crucial that all of the information on your report remains as accurate as possible. Since you are entitled to one free copy of this report a year it would be wise to do this to make sure there are no mistakes and creditors are reporting accordingly.
This is especially important for individuals who have a job requires security clearance. Security clearance is a status that allows one to access classified information for their line of work, usually positions where they work directly with the federal government or as a federal contractor. Some of these jobs include the military, police officers, and the CIA. If certain events happen that cause this persons score to drop there is a chance they can be reassigned or possibly even eliminated from their job.
However, this is also quite common for people looking for a job as well because some employers will want to examine the applicants credit history before offering a certain position. You do not want an error on your report to prevent you from landing the position you are looking for.
Should there be some errors on your report, you can correct them quite easily by going through the proper channels due to the Fair Credit Reporting Act. In an effort to keep your credit report and score completely accurate, you should keep a close eye on it before you need to use it to your advantage. A high score will be an advantage in the future if you are looking for a job, trying to secure a loan, or maybe even applying for a credit card. Many financial advisors suggest that people check their credit scores at least once to twice a year to ensure accuracy.
Here the FTC explains why it is important to check your report:
“-Because the information it contains affects whether you can get a loan — and how much you will have to pay to borrow money.
-To make sure the information is accurate, complete, and up-to-date before you apply for a loan for a major purchase like a house or car, buy insurance, or apply for a job.
-To help guard against identity theft. That’s when someone uses your personal information — like your name, your Social Security number, or your credit card number — to commit fraud. Identity thieves may use your information to open a new credit card account in your name. Then, when they don’t pay the bills, the delinquent account is reported on your credit report. Inaccurate information like that could affect your ability to get credit, insurance, or even a job.”
If there is an error on your credit report, you should get the ball rolling to correct it as soon as possible. If you don’t, your chances of getting a new job will be less than impressive.
In order to correct any mistakes, you must file a dispute and request an investigation with the consumer reporting companies. Including your complete name, address, date of birth and social security number, list the name of the company that made the error and make reference to the error itself. Write down why you are filing a dispute, include documents to support your position, and request that the mistaken infomation be corrected or removed immediately.
From there they will investigate the items in dispute, and if they find the items were indeed reported wrong they will forward all information to the company that reported the information. After they receive the notice about the dispute they also must do an investigation to determine whether or not the items were reported properly. If they cannot prove it is accurate they must than inform the consumer reporting companies of this to ensure the mistakes get removed from the consumers file.
Hopefully, if things go right, the credit bureau will recognize the mistake and make the proper corrections. This will get you on your way to your new job with a cleaner credit report and a higher credit score. A higher credit score will always make it easier to get a job, especially if you need the credit rating to improve your life.
Staying on top of repairing any credit errors on your report before you need it will keep you safe from any breaks in the accuracy of your credit report. Fixing these errors is very important to your overall success in the effort to keep a positive credit rating. The answer is yes, you can repair any credit report errors in time to save your job. Providing your employer is compassionate enough to stay with you through the correction process, almost any job can be spared.
It doesn’t take very long to ensure your credit report is accurate either. You can spend the time it takes to ensure all credit marks are accurate and guarantee that any future uses for your credit report will turn up accurate information. Why leave such a thing to chance, get the ball rolling to verify the details of your credit report are completely truthful and legally binding.
SOURCE : www.loansafe.org
Easy Solutions To Get Out Of Debt—Pay Off High Interest Debt To Avoid Bad Credit
By Steven Craig
Debt, be it loans or credit cards, can cause you to face multiple, high interest rates, which over time can cause trouble for those repaying the debt, which then leads to bad credit. It’s a slippery slope. However, there are easy, common ways to get out of debt and avoid a bad credit score or simply raise your credit score.
Obviously, paying off debt is going to be the only way to either get out of debt or increase your bad credit score. An excellent credit history shows lenders you are reliable and while a little debt, when well managed and used for the right purposes, can be good, too much is going to cause lasting troubles.
Many people attempt to consolidate their debt and if you have multiple forms of high interest debt this may be your best option. However, someone that has only two or three sources of debt may want to take a different approach.
A common practice is to pay off one form of debt at a time, commonly high interest debt first, which would then free up more money for remaining debt sources. Some people will pay off the debt with the smallest balance first, but it all comes down to what is right for you personally and only you are going to be able to make that decision.
However, be mindful of the length of any repayment plan, like a debt consolidation loan and make sure the interest rates will not, over the long run, cost more than had you kept the debt separate. Always look at how much repaying and interest will cost over the life of any repayment schedule and if it will be a substantial amount more than you feel is appropriate, then make plans to pay more each month on that debt.
It may take work and sacrifice, but getting out of debt quickly is going to either help or repair a bad credit score and make your financial life less stressful.
SOURCE : http://www.rwbpress.com/
Debt, be it loans or credit cards, can cause you to face multiple, high interest rates, which over time can cause trouble for those repaying the debt, which then leads to bad credit. It’s a slippery slope. However, there are easy, common ways to get out of debt and avoid a bad credit score or simply raise your credit score.
Obviously, paying off debt is going to be the only way to either get out of debt or increase your bad credit score. An excellent credit history shows lenders you are reliable and while a little debt, when well managed and used for the right purposes, can be good, too much is going to cause lasting troubles.
Many people attempt to consolidate their debt and if you have multiple forms of high interest debt this may be your best option. However, someone that has only two or three sources of debt may want to take a different approach.
A common practice is to pay off one form of debt at a time, commonly high interest debt first, which would then free up more money for remaining debt sources. Some people will pay off the debt with the smallest balance first, but it all comes down to what is right for you personally and only you are going to be able to make that decision.
However, be mindful of the length of any repayment plan, like a debt consolidation loan and make sure the interest rates will not, over the long run, cost more than had you kept the debt separate. Always look at how much repaying and interest will cost over the life of any repayment schedule and if it will be a substantial amount more than you feel is appropriate, then make plans to pay more each month on that debt.
It may take work and sacrifice, but getting out of debt quickly is going to either help or repair a bad credit score and make your financial life less stressful.
SOURCE : http://www.rwbpress.com/
Strategic Foreclosure 101
Many Americans are wondering how to deal with an underwater mortgage in these tough economic times. The Highlands County communities of Lake Placid, Sebring and Avon Park have been hit harder by the housing crisis than most Florida cities. While some can afford to continue making payments on their home, many residents of the Heartland have been pushed into foreclosure as home values have decreased anywhere from 15 to 55 percent or more.
Aside from a loan modification, we have all heard the terms foreclosure, short-sale, and deed-in-lieu of foreclosure. Each of these terms spells trouble for the homeowner - loss of home, reduced credit score, and negative social stigma. Although lenders in February filed fewer foreclosure actions in central Florida compared to a year earlier, a new strategy is on the horizon, an idea coined "strategic foreclosure."
If you purchased your home at the peak of the real estate market from 2004 to 2006, your value has substantially dropped. Although irrelevant to some borrowers as they can afford the payment and plan on residing in their home for a decade or more, others have simply stopped paying in the hope of forcing a short-sale or reduction in principal.
Should you walk away from your mortgage even if you can afford to pay? Millions of Americans are asking themselves that same question. Some borrowers feel they have a legal, moral, and ethical obligation to make payments notwithstanding a substantial drop in value. With almost half of the residential mortgages in Highlands County underwater, a growing number of individuals are contemplating walking away from the place they call home.
If you can resolve yourself to possible litigation and a lower credit score for several years, walking away may be a smart business decision. Right now, only a small percentage of borrowers are contemplating this technique. A recent study, though, found that approximately 32 percent of homeowners nationwide would consider walking away from their mortgage if the value of their home continues to decrease.
While "strategic foreclosure" makes perfect economic sense, many homeowners do not choose this course of action out of shame, guilt and fear. Underwater homeowners continue to stress over their mortgage payments to avoid the consequence of foreclosure and a perceived negative social stigma within the community. This is especially so when a borrower has the financial ability to pay.
Although almost 17.4 million homes nationwide are underwater, one must consider the adverse implications of "strategic foreclosure" before walking away. First, and foremost, is the loss of your home. Have you purchased the home across the street at half the amount of your current mortgage? Do you plan on renting? Are you aware that a "strategic foreclosure" will have the same impact on your credit score as a loan modification, judicial foreclosure, short-sale, or deed-in-lieu of foreclosure? Are you aware that you can be sued for any deficiency balance on your home?
"Borrowers who are underwater on their mortgages would be better off financially if they walked away from their homes," says Scott Kleiman, a foreclosure defense attorney with Kalis & Kleiman. "They don't because of their moral and ethical obligation to pay their mortgages."
Borrowers who had a good credit history before they walk away through "strategic foreclosure" can usually rebuild their good name and reputation within a couple of years. In a recent study commissioned by the global information services company Experian, approximately 588,000 borrowers nationwide simply walked away from their homes in 2008. This is up 128 percent over 2007. From all indications, 2010 will be a banner year as the social stigma of foreclosure and simply walking away from your home will have dissolved amid the mortgage meltdown.
Just like former "Beverly Hills 90210" star Brian Austin Green - who has advanced a "strategic foreclosure" strategy in an effort to short-sale his $2 million Hollywood Hills home - you too can ride the wave of the future.
As a homeowner, you can afford to make your mortgage payments but are underwater to the point of no return. As a borrower, the American dream of owning a home is lost as it will maintain negative equity for a decade or more. "Strategic foreclosure" may be the first step toward a short-sale and walking away from your home.
William E. Lewis Jr., is a credit repair expert with Credit Restoration Consultants and host of "The Credit Report with Bill Lewis" on AM 1470 WWNN, a daily forum for business and financial news, politics, economic trends, and cutting edge issues.
SOURCE : www2.highlandstoday.com
Aside from a loan modification, we have all heard the terms foreclosure, short-sale, and deed-in-lieu of foreclosure. Each of these terms spells trouble for the homeowner - loss of home, reduced credit score, and negative social stigma. Although lenders in February filed fewer foreclosure actions in central Florida compared to a year earlier, a new strategy is on the horizon, an idea coined "strategic foreclosure."
If you purchased your home at the peak of the real estate market from 2004 to 2006, your value has substantially dropped. Although irrelevant to some borrowers as they can afford the payment and plan on residing in their home for a decade or more, others have simply stopped paying in the hope of forcing a short-sale or reduction in principal.
Should you walk away from your mortgage even if you can afford to pay? Millions of Americans are asking themselves that same question. Some borrowers feel they have a legal, moral, and ethical obligation to make payments notwithstanding a substantial drop in value. With almost half of the residential mortgages in Highlands County underwater, a growing number of individuals are contemplating walking away from the place they call home.
If you can resolve yourself to possible litigation and a lower credit score for several years, walking away may be a smart business decision. Right now, only a small percentage of borrowers are contemplating this technique. A recent study, though, found that approximately 32 percent of homeowners nationwide would consider walking away from their mortgage if the value of their home continues to decrease.
While "strategic foreclosure" makes perfect economic sense, many homeowners do not choose this course of action out of shame, guilt and fear. Underwater homeowners continue to stress over their mortgage payments to avoid the consequence of foreclosure and a perceived negative social stigma within the community. This is especially so when a borrower has the financial ability to pay.
Although almost 17.4 million homes nationwide are underwater, one must consider the adverse implications of "strategic foreclosure" before walking away. First, and foremost, is the loss of your home. Have you purchased the home across the street at half the amount of your current mortgage? Do you plan on renting? Are you aware that a "strategic foreclosure" will have the same impact on your credit score as a loan modification, judicial foreclosure, short-sale, or deed-in-lieu of foreclosure? Are you aware that you can be sued for any deficiency balance on your home?
"Borrowers who are underwater on their mortgages would be better off financially if they walked away from their homes," says Scott Kleiman, a foreclosure defense attorney with Kalis & Kleiman. "They don't because of their moral and ethical obligation to pay their mortgages."
Borrowers who had a good credit history before they walk away through "strategic foreclosure" can usually rebuild their good name and reputation within a couple of years. In a recent study commissioned by the global information services company Experian, approximately 588,000 borrowers nationwide simply walked away from their homes in 2008. This is up 128 percent over 2007. From all indications, 2010 will be a banner year as the social stigma of foreclosure and simply walking away from your home will have dissolved amid the mortgage meltdown.
Just like former "Beverly Hills 90210" star Brian Austin Green - who has advanced a "strategic foreclosure" strategy in an effort to short-sale his $2 million Hollywood Hills home - you too can ride the wave of the future.
As a homeowner, you can afford to make your mortgage payments but are underwater to the point of no return. As a borrower, the American dream of owning a home is lost as it will maintain negative equity for a decade or more. "Strategic foreclosure" may be the first step toward a short-sale and walking away from your home.
William E. Lewis Jr., is a credit repair expert with Credit Restoration Consultants and host of "The Credit Report with Bill Lewis" on AM 1470 WWNN, a daily forum for business and financial news, politics, economic trends, and cutting edge issues.
SOURCE : www2.highlandstoday.com
Don't give up: you can repair your credit
by: Michael G. Shinn/NNPA Columnist
Repairing your credit may save you money. Over the near term, interest rates will rise. The Federal Reserve just increased the rate it charges banks for emergency loans. This was the Feds' first tangible move to tighten credit following the Great Recession. Additionally, in order to finance the burgeoning national debt, the government will become a more active player in the credit markets including credit cards, car loans, home mortgages.
The rates that lenders charge consumers are based on two major factors. First, lenders look at the individual's capacity to pay, as measured by their income in relation to their monthly payments. Second, they look at their past payment history, as measured by their credit report. A poor credit history is viewed a higher risk and therefore requires a higher return to the lender, for taking that risk.
Repair Your Credit
An individual can have damaged credit for several reasons. The most obvious reason is a poor payment and credit history. However, according to a recent study by the Public Interest Research Group, 25 percent of the credit reports surveyed had serious errors that could result in credit denial; 79% contained other serious mistakes and errors; and 30 percent contained credit accounts that had been closed by the consumer, but remained listed as open.
Steps to Credit Repair
The Fair Credit Reporting Act sets the standards that credit reporting bureaus and creditors must follow in reporting credit files. The act also gives individuals the right to challenge the accuracy of their credit report, request a reinvestigation within a reasonable amount of time and have errors corrected or deleted.
1. Get a copy of your credit reports. You can get a free copy from all three reporting agencies by going to www.annualcreditreport.com. You can also get your credit score for a small fee. Review your credit reports and look for errors, inaccuracies and negative credit items.
2. Write dispute letters to the credit bureaus on the items you believe are errors or inaccuracies. Send your letters by certified mail with a return receipt requested. Keep copies of your letters and mail receipts. The Federal Trade Commission has sample dispute letters and more detailed information at www.ftc.gov.
3. The credit bureaus must reinvestigate the disputed items by contacting the information provider and requesting an investigation of their file and a follow-up report.
4. The credit bureau is required to report the results of the reinvestigation to the individual. If there is an error or inaccuracy it must be corrected. However, if the information provider confirms the original information, the individual has the right to appeal. If there is no response from the information provider in a reasonable amount of time, the disputed item must be corrected or deleted.
5. After the reinvestigation is completed, the credit bureau is required to provide the individual with written results and a free updated copy of their credit report.
Dealing with Real Debt
f an individual has damaged credit because of a poor payment or credit history, there are two primary options. The self-help option works for most people. The first step of this option is to create a realistic budget. Then, develop a twelve-month plan to either eliminate or substantially reduce high-interest rate debt. The overall objectives should be to reduce the total debt level, lower interest rates and reduce the number of creditors.
If self-help is not enough, contact a legitimate non-profit credit or debt counseling service. The counseling service can set up a payment plan, in which the individual makes one monthly payment to the counseling agency, which then pays each of their creditors. The service can save money by negotiating lower payments and possibly lower interest rates. Most people can pay off their unsecured debt in three to five years by following these plans. The National Foundation for Credit Counseling (www.nfcc.org) has a referral line that automatically directs calls to the individual's local area. (1-800-355-2227).
No Quick Fix!
There is no quick fix for repairing damaged credit. Avoid the scams and either do it yourself or seek help from a legitimate credit counseling service. The money you save by paying lower interest rates, can be used to help achieve your financial goals.
SOURCE : http://media.www.districtchronicles.com
Repairing your credit may save you money. Over the near term, interest rates will rise. The Federal Reserve just increased the rate it charges banks for emergency loans. This was the Feds' first tangible move to tighten credit following the Great Recession. Additionally, in order to finance the burgeoning national debt, the government will become a more active player in the credit markets including credit cards, car loans, home mortgages.
The rates that lenders charge consumers are based on two major factors. First, lenders look at the individual's capacity to pay, as measured by their income in relation to their monthly payments. Second, they look at their past payment history, as measured by their credit report. A poor credit history is viewed a higher risk and therefore requires a higher return to the lender, for taking that risk.
Repair Your Credit
An individual can have damaged credit for several reasons. The most obvious reason is a poor payment and credit history. However, according to a recent study by the Public Interest Research Group, 25 percent of the credit reports surveyed had serious errors that could result in credit denial; 79% contained other serious mistakes and errors; and 30 percent contained credit accounts that had been closed by the consumer, but remained listed as open.
Steps to Credit Repair
The Fair Credit Reporting Act sets the standards that credit reporting bureaus and creditors must follow in reporting credit files. The act also gives individuals the right to challenge the accuracy of their credit report, request a reinvestigation within a reasonable amount of time and have errors corrected or deleted.
1. Get a copy of your credit reports. You can get a free copy from all three reporting agencies by going to www.annualcreditreport.com. You can also get your credit score for a small fee. Review your credit reports and look for errors, inaccuracies and negative credit items.
2. Write dispute letters to the credit bureaus on the items you believe are errors or inaccuracies. Send your letters by certified mail with a return receipt requested. Keep copies of your letters and mail receipts. The Federal Trade Commission has sample dispute letters and more detailed information at www.ftc.gov.
3. The credit bureaus must reinvestigate the disputed items by contacting the information provider and requesting an investigation of their file and a follow-up report.
4. The credit bureau is required to report the results of the reinvestigation to the individual. If there is an error or inaccuracy it must be corrected. However, if the information provider confirms the original information, the individual has the right to appeal. If there is no response from the information provider in a reasonable amount of time, the disputed item must be corrected or deleted.
5. After the reinvestigation is completed, the credit bureau is required to provide the individual with written results and a free updated copy of their credit report.
Dealing with Real Debt
f an individual has damaged credit because of a poor payment or credit history, there are two primary options. The self-help option works for most people. The first step of this option is to create a realistic budget. Then, develop a twelve-month plan to either eliminate or substantially reduce high-interest rate debt. The overall objectives should be to reduce the total debt level, lower interest rates and reduce the number of creditors.
If self-help is not enough, contact a legitimate non-profit credit or debt counseling service. The counseling service can set up a payment plan, in which the individual makes one monthly payment to the counseling agency, which then pays each of their creditors. The service can save money by negotiating lower payments and possibly lower interest rates. Most people can pay off their unsecured debt in three to five years by following these plans. The National Foundation for Credit Counseling (www.nfcc.org) has a referral line that automatically directs calls to the individual's local area. (1-800-355-2227).
No Quick Fix!
There is no quick fix for repairing damaged credit. Avoid the scams and either do it yourself or seek help from a legitimate credit counseling service. The money you save by paying lower interest rates, can be used to help achieve your financial goals.
SOURCE : http://media.www.districtchronicles.com
Credit Repair May Earn you Lower Auto Insurance Rates
Most consumers know that a good credit score is important when applying for a mortgage loan. But how many consumers know that a top credit score can also mean lower rates when they’re applying for auto insurance? It’s just one more reason that consumers should be focused more than ever on credit repair; your three-digit credit score truly impacts every facet of your financial life. You need that score, then, to be as high as possible.
Controversial Measuring Stick
Not everyone is thrilled that auto insurers rely on credit scores when determining how much money their clients pay for insurance. Critics say that consumers’ credit scores have no relevance on how safely they drive their cars and other vehicles. Count legislators in Washington State in this group: Members of the state Senate earlier this year tried to pass a law that would have banned insurers from using credit scores to set prices and underwrite policies. The bill died in committee in early February, meaning that Washington insurers don’t yet have to change their ways.
The Importance of Credit Repair
The Washington State example should once again highlight to consumers just how important their credit scores are. These scores, also known as FICO scores, are designed to tell lenders and other financial service providers how well you’ve managed your money in the past. If you’ve run up huge amounts of revolving debt your three-digit FICO score will fall. If you forget to send in your student-loan payment or skip your credit-card payment your score will fall. If your score drops by too much, your life might suddenly become more difficult. Mortgage lenders may not lend you the money that allows you to buy your first house. Auto lenders may be happy to give you a loan, but they’ll make sure that you pay sky-high interest rates for the privilege. You may not even be able to qualify for a new credit card. Fortunately, if your scores are down, some simple credit repair tips can help bring them back up.
Repairing Ailing Scores
If your credit score falls under 620, you definitely need to engage in some credit repair. First, never pay a bill late again. Making your monthly payments on time, all the time, is the surest way to steadily increase your credit score. Next, pay down your revolving debt. Finally, order free copies of your three credit reports from AnnualCreditReport.com, and search them for any errors. Notify the bureaus in writing to erase the error from your record. Credit repair is far from a fun or quick job. But if you have the patience to turn your financial life around, you’ll soon find that everything else becomes a bit easier.
SOURCE : www.loansandcredit.com
You may still owe money after a foreclosure or short sale
 So your house was under water and you thought you could deal with your problem by having a short sale and moving on with your life. Maybe you got foreclosed on and you thought that the nightmare ended then. Think again. You may be on the hook for paying off part or all of the remaining mortgage, even years later.Foreclosure is not the end of the story Most states, like Florida where about half of the homes are underwater, allow mortgage holders to collect on the unpaid portion of the mortgage after a foreclosure. In Florida, the courts give mortgage holders up to five years to seek a favorable judgment, and up to 20 years to collect. It may be different in your state, Arizona, California, and about one in three of the remaining states prohibit collection efforts on a primary residence after foreclosure. The government may help you, but not that much The federal government started the Home Affordable Modification Program to help homeowners who have financing their mortgage at a lower rate, but it is pretty restrictive. Your first mortgage can't be more than 125% of the current market value of your home, your mortgage has to be guaranteed by Fannie Mae or Freddie Mac, and you have to have no late payments in the previous 12 months. If you are either seriously underwater by more than 25%, or if you are already in the foreclosure process, you're (sorry) out of luck. Who is most likely to get hit? Not surprisingly, banks and mortgage holders would prefer to go after people who have assets or income. Homeowners who can afford to make payments, but decide to walk away from an underwater mortgage, sometimes called a rational default or a strategic default, are at risk if they don't have any other serious financial issues and have otherwise good credit. Short sellers, who get lenders to forgive a portion of the debt in order to complete a sale, are also at risk because lenders will often leave their options open to come back and collect later. If you are involved in a short sale, make sure to review your agreements carefully, preferably with the help of a competent professional. Those who have been foreclosed upon may also be at risk. Because the details of each foreclosure are very different, if you have been foreclosed upon or at risk of having that happen, check your mortgage agreement details very carefully to get a realistic idea of what issues you may be facing down the road. SOURCE : Mortgage311.org |
Advice for Homeowners with an Underwater Mortgage: Short Sales and Taxes - IRS Gives You a Break
If you have to sell a house with an underwater mortgage, your lender may forgive a portion of the debt. If this happens, the IRS looks at the forgiven debt as income that may be taxable. The good news for many homeowners is that the government may cut you some slack and not may you pay taxes on the forgiven debt. The Mortgage Debt Relief Act of 2007 allows many homeowners to exclude income from the discharge of debt on their principal residence. This isn't only for short sales. You may get a tax break even if you debt is reduced through mortgage restructuring, or if part or all of a mortgage is forgiven in a foreclosure. This provision applies to debt forgiven from 2007 through 2012. Up to $2 million of forgiven debt is eligible for this exclusion if you are married and filing jointly, and $1 million if married filing and separately. This tax break applies only if the forgiven debt is directly related to a decline in the home's value or the taxpayer's financial condition. The following are the most commonly asked questions and answers about The Mortgage Forgiveness Debt Relief Act and debt cancellation: What is Cancellation of Debt? If you borrow money from a commercial lender and the lender later cancels or forgives the debt, the amount that you didn't pay back is normally reportable as income because you no longer have an obligation to repay the lender. Here's a simple example of forgiven debt. You borrowed $10,000 but defaulted after paying off $2,000 of the principle. If the lender can't collect the remaining $8,000, that amount is considered taxable income in most cases. When is cancellation of debt not taxable? The most common situations when cancellation of debt income is not taxable is when it involves:
What if I don't tell the IRS? Don't count on getting away with it by not telling the IRS. The lender is usually required to report the amount of the canceled debt to you (using Form 1099-C) and to the IRS. The amount of debt forgiven must be reported on IRS Form 982 and this form must be attached to your tax return. If you don't report it, and the IRS expects to see you mention it in a tax return, you could be headed for an audit. Related Resources More information, including detailed examples can be found in Publication 4681, Canceled Debts, Foreclosures, Repossessions, and Abandonments. Also see IRS news release IR-2008-17.  |
SOURCE : Mortgage311.org
CRE Credit Services introduces the "Circle of Restoration"
Executives at CRE Credit Services announced today that their "Circle of Restoration" would be used to not only repair derogatory items from their clients' reports; but also to help them get new lines of credit. James Charlet is the COO and Co Owner of this enterprising and ambitious new company. "Many people have the mistaken belief that all that matters when calculating a credit score is the lack of derogatory information, when in actuality the presence of positive trade lines is just as important to their overall credit health," said James as he was going over the new system.
Credit repair has gotten mixed reviews over the years, and has gone from the greatest thing since sliced bread to a not so hot status in recent years. Simon Webster the CEO of CRE believes that this can be changed with an emphasis on what's truly best for the client. Simon believes that "the client has and always will come first at CRE Credit Services, and we will do our best to make sure that holds true in every facet of our business."
CRE plans to make sure that clients know credit repair is very different than the credit restoration that they offer. "Credit restoration is the complete revival of a client's credit health, from dealing with derogatory items to establishing new lines of credit" said Justynn Royal, Executive Vice President. "What our Circle of Restoration is going to do is allow us to take care of our clients from start to finish making this difficult time for them as easy as possible. This is what separates us from the competition."
Being relatively new to the industry means that CRE Credit Services is the new kid on the block, however, if they truly do emphasize customer care over anything else then this write thinks they will do just fine. You can check out CRE Credit Services for yourself at crecreditservices.com or for a free consultation call 877-4779321.
SOURCE : PR-USA.net
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