My Way Credit

Tips for maintaining and repairing your credit
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Archive for May, 2008

19:DISPUTE ERRORS ON YOUR CREDIT REPORT

May 31, 2008 By: avenger1 Category: Credit Repair, Contributors No Comments →


Contact each of the three major credit bureaus -
TransUnion, Equifax, and Experian - and get copies of your credit reports and
credit scores. Carefully read over the reports and note any errors. In writing,
contact the credit bureaus and ask that mistakes be removed or investigated.

This is called a dispute letter and once it is received,
credit bureaus have to investigate your dispute within thirty days of receiving
your letter. It is important to keep a copy of your letter and it is important
to note the date the letter was sent. You should not be accusatory or abusive
in your letter - calmly and clearly state the problem and request an
investigation.

Note that you are aware the agency is required to
investigate the claim within thirty days and note that you will follow up. Be
sure that you do follow up with the issues you raised in your letter - just
because the agency investigates does not always mean that your credit report
will end up error-free.

Many credit bureaus now make it possible for you to
correct errors on your credit report online - and many have information on
their web sites that tells you exactly how disputes must be handled to be
effectively removed. It is important that you follow this information exactly
so that the inaccuracies on your credit report are removed promptly and your
credit score is updated as soon as possible.

COUNTRYWIDE AND BANK OF AMERICA

May 31, 2008 By: randy37 Category: Loans, Contributors No Comments →

This is part four of this series but I got tired of calling it "Depressing News," although it still is. In the latest news flash, Bank of America has told David Sambol, currently President of Countrywide, that his services will not be required as, if, and when the proposed merger takes place.  It would appear, however, that he will get the previously promised $28 million in compensation.

In a very kindly worded announcement, BofA said that they wanted the combined mortgage operation run by someone with a "deep understanding of the Bank of America culture and operating model."  Thus it would appear that BofA is buying the chicken coop without the top foxes and that the proposed merger is more likely to occur.

What is to be learned here?  The thing that I see is how blinded those who are benefitting from a structure can be to changes that can and will affect them. Whether it is President Mugabe of Zimbabwe or Angelo Mozilo of Countrywide or an almost successful Presidential candidate, they are part of a culture in which they tell themselves they are so successful that they can't lose. 

There is a fundamental part of human nature that seems to affect all of us.  The quick demise of Countrywide from high-flyer last year to almost bankrupt company being picked up for ten cents on the dollar was appalling only because of its speed. Had you asked Countrywide's highest executives about their prospects a year ago, they would have told you that they were bulletproof.

I want to make the distinction between types of seemingly random events. The type of disaster that hit Parkersburg, Iowa last week was random. You do not know where a tornado will happen, although it is more likely in Iowa than in, say, New York. But if you look at the Parkersburg website at http://www.parkersburgiowa.info/ I defy you to find any consciousness that some 40% of the town would soon be leveled. 

The Countrywide event is different. It is the result of a grave miscalculation of the risks involved in profligate lending. You wonder what Mr. Mozilo's approach to underwriting would have been had all losses been deducted from the $474 million in stock that he cashed in. It's easy to play risky games if you are playing with OPM, Other Peoples’ Money.

What is less understandable it that there was plenty of evidence that strongly suggested that the foreclosure rate was going to be high with subprime loans, perhaps in the 20% range, as now appears to be the case. Notwithstanding the evidence that suggested Countrywide's actions were incredibly risky, they went ahead and did them anyway.

Finally, speculation is that the Countrywide name will also vanish. That is not unusual. Remember that after the crisis of the '80s and '90s, many Savings & Loan Associations changed their names to Savings Banks, a name that appeared more appealing to consumers. But it does seem to be a sad end for one of America's most recognized brand names, even if it is fitting.  The brand joins WorldCom, Bear Stearns, Enron, and a host of others on the scrap heap of American business names brought down by greed. 

42:GET OUT OF THE SPENDING HABIT

May 30, 2008 By: avenger1 Category: Credit Repair, Contributors No Comments →


We are surrounded with advertisements that tell us to
buy, buy, buy. When we want to read a book, we buy it. When we want to go
somewhere, we take a cab or drive rather than walking.

 

Stopping spending consciously can be hard, but heading to
your local library, walking instead of taking a car, buying a used computer
instead of a new one - all can help you spend less and save more. There are
several ways you can save money and pay off your debts faster by spending less:

1) When you head out, carry a small amount of cash with
you and leave your credit cards at home. That

way, you will not be able to overspend.

2) Stop catalogs from arriving at your house or discard
them unread - advertisements and catalogues

encourage you to spend and buy when you don’t need to.

3) Do it yourself. Eat in rather than dining out. Dining
at restaurants or getting food delivered is always

more expensive than doing your own cooking. Also, do your
own taxes rather than farming the job out to

someone else. Wash your own car, run your own errands,
mow your own lawn. When you do something

yourself, you spend less.

4) Watch less television. It sounds strange, but
television can make you overspend - television contains

many professionally-created advertisements pushing us to
spend and spend. These ads are so well done that

not spending after watching them is sometimes very
difficult (just what advertisers want!). Switching off

your television can help you avoid temptation.

5) Make do or do without. While you are repairing your
credit, channel all your extra money into paying off

debts and reestablishing good credit. Make so with what
you have and avoid shopping as much as possible.

6) Buy discount or used. Whether it is furniture or
shoes, you can save money by refusing to pay retail price.

Saving your money by spending less can let you pay off
your debts faster, something that can improve your credit score dramatically.

Tip #43:Save#/TITLE#

One of the best ways to ensure that your credit rating
stays good is to save money each month. Whether you are able to save $25 a
month or $200 or even more, saving and investing your savings will prepare you
for financial emergencies, will get you out of overspending, and will allow you
to build investments that can help you in later years.

With savings at your bank, you don’t have to worry that
sudden illness will make you unable to pay your bills, resulting in dings on
your credit.

 

Saving ten percent of your income is a nice, reasonable
goal. You can use your invested savings to make certain that your debts never
get overwhelming. Most employers and banks will even deduct a certain amount of
money from your paycheck or account each month to be put into investments.

This can be a very convenient way to save, as you are
unlikely to miss or spend money you have taken out before you can get your
hands on it.