What Do You Want From Life?
Do you own a home? Do you have the security of a savings account? Can you afford to set aside a percentage of your take-home pay for investment? Everything that you do in life is connected to your credit report. There is nothing that can have as significant an impact on your life, and ultimately on your financial freedom. It’s worth taking a close look.
The Interest Rate Connection
Most people that embark on a program of credit repair have a single and valuable short term goal in mind. The most common goal is home ownership. In many cases consumers with credit issues simply can’t qualify for mortgage financing. These individuals would like to improve their credit scores enough to obtain mortgage approval. There are also a large number of people in credit repair programs that currently own homes but due to credit issues received expensive sub-prime financing. They would like to improve their credit scores enough to refinance into a better mortgage and reduce their payments.
Building Personal Wealth
Both of these goals are valid. Historically home ownership has been the foundation of almost all personal wealth. Home ownership is also likely to be the largest financial obligation that you will have in your life. And the quality of your credit will determine the size of the monthly payment associated with home ownership. The importance of this connection is enormous.
Home Ownership Costs and Benefits
Homeowners with sub-prime mortgage financing typically pay a premium of up to two percent on their mortgage rate. This interest premium on a typical $200,000 mortgage amounts to $333 per month, or $4,000 per year. In addition, sub prime borrowers are usually limited to some form of adjustable rate financing that often results in additional premium costs to them over time. There are many benefits to home ownership that may outweigh these extra costs. But there are also actions that you can take to eliminate the extra costs and the looming adjustable rate adjustments as soon as possible.
Credit Repair Works
Don’t underestimate the power of credit repair. You would do yourself a horrible disservice by ignoring the potential improvement in your credit report that can result from an informed review of the content of your credit and a systematic program of repair. Dealing with the credit bureaus can be challenging, but if you take some time you can learn how to do this yourself, or you can hire a reputable credit repair company.
Enormous Benefits
What is credit repair worth to you? The case above is pretty typical. An improvement in your credit score may very well save you in excess of $333 per month. What would this do for your life? If you were to deposit that $333 each month into a money-market account earning 5%, in ten years your account would have grown to $51,000. In twenty years this same account would have a balance of $136,000. Not a bad return on your credit repair efforts.
The Tip of the Iceberg
If instead of investing your monthly savings in a money-market account you were to apply that $333 each month to the principle balance on your new mortgage, assuming an interest rate of 6% you will pay off your mortgage in seventeen years instead of thirty. Would you enjoy being mortgage free? What if I were to tell you that your mortgage is just the tip of the iceberg? Do you want to know the real benefit of great credit? Consider every single thing that your credit will affect. Think about your auto loans, credit cards, personal loans, and equity lines. The math is staggering.
Take Action
It’s up to you. Make sure that your credit is every bit as good as it can possibly be. Don’t let anything stand in the way of taking action. You can undertake a program of credit repair on your own. Or you can check out a couple of good credit repair companies. Speak to them on the phone. Ask questions. They should have many years of experience in dealing with the credit bureaus and be experts in the field of credit scoring. There is so much to gain. Be proactive.
Copyright © 2007 James W. Kemish. All Content. All Rights Reserved.
By: Jim Kemish
Archive for November, 2009
Credit Repair Awesome Benefits
November 28th, 2009Easy Credit Repair
November 20th, 2009
Today, many people end up needing credit repair. How can you find reliable help? Can you repair your own credit? Yes you can, or you can use a good credit repair company. Learn how in this article to determine which is best for you.
Understanding how to remedy this situation will give you the confidence necessary to take charge! Knowledge will allow you to snatch yourself (and your checkbook!) back from the snarling creditor wolves. Remember, Little Red Riding Hood survived her wolf and you can, too!
If you are one of the many people trying to stave off the creditor wolves (or even if you are not), just keep reading. I will explain the ins and outs of credit repair. Oftentimes, people believe there is no way out. However, I am here to tell you that you can fix your bad credit.
It is important to understand how you ended up in a debt situation now requiring credit repair. In many cases, bad credit commences with:
- too many credit cards, most of which (if not all) have outlandish balances;
- no or little accumulated rainy day savings funds;
- overdue bills; or,
- just bad financial decisions.
People, for the reasons mentioned above, frequently suffer from a phenomenon known as “bad credit”. Assistance can be found in the form of credit and debt counseling. Essentially, you can obtain bad credit by:
- not being able to purchase on credit; or,
- by having a less than stellar credit report, though you still may be able to purchase on credit.
At this point, I would like to go out on a limb and state the obvious…credit repair can be AVOIDED by:
- not running your credit cards up;
- not paying your bills late;
- not spending more than you bring home;
- squirreling away some money each paycheck for that unexpected expense or vacation; and,
- making good financial choices.
It’s never a good thing to have credit issues hanging over your head. You really need to get rid of them so you can get on with your life. They do not go away by themselves. So you must take action. If not repaired, over the years it can cost you thousands of dollars. You first need to understand how to read a credit report.
There are three major credit reporting agencies–Experian, Equifax & TransUnion. These credit bureau agencies gather information from various sources about a person’s credit history. They then compile a unique summary of the relevant information, called a credit report.
Credit report information contains credit and non-credit information. Examples of credit information are names of creditors, credit card/loan account numbers, current balances, monthly amounts due, and number of past due payments. Likewise, examples of non-credit information are a person’s name and previously used names, current and prior addresses, social security numbers, and employment history.
Negative credit report information will remain on a person’s credit report for anywhere from seven to ten years. Credit inquiries, on the other hand, can only remain on a person’s credit report for two years.
Ok, so now you know just enough to get started. You can see how having bad credit is costing you money. You’re tired of the pain. You want help. Or at least you want to know where to find help you can trust.
There are many credit repair programs out there. Where do we start? So first things first. Getting a copy of your credit report with the scores is needed. Feel free to visit this “credit repair” website to learn more. This could be the beginning of a new life for you.
By: Jeffrey Ragan
