Category Archives for "Managing Credit"

Getting Out of Debt

This section is for people who are struggling with bills including mortgage payments. In this lingering recession it is not uncommon. There are three types of issues to face: possible mortgage foreclosure, credit card debt and debt of more than one type.

Foreclosure has been such a scourge and has happened so much more often in recent years that lenders have taken steps to find ways to avoid taking possession of owner occupied homes.

Here in California there is a cooperative program sponsored in a partnership between the mortgage industry and the state. It is called Keep Your Home California and your lender will know about it and will be happy to make a referral to the agency that handles it for them. Just ask your lender or look online for KeepYourHomeCalifornia.org. 

Credit card debt is covered in the Credit Card section. It is included here because there are two levels of credit card debt, one can be used directly by the borrower working with the bank. It is called forebearance and is the first alternative for the borrower.

To deal with a situation involving several kinds of debt and where there is a more complex problem may require a workout using a non-profit credit counseling service. It may be offered by a lender but is more often referred to a non-profit firm to coordinate the plan

These are called Debt Management Plans or DMPs. The non-profits are not free; fees are very reasonable and they are compensated by the lenders, too.

Although it is the least desirable alternative, as a last resort in finding a reasonable outcome, bankruptcy is available.

There is much more to know and updates will be found in the Blog by looking in the Categories for Managing Credit.

Keeping Score

Knowing your credit score is not the same as access to your three credit reports. Your credit score is often called a FICO score. It is taken from information on your credit reports and general data on all borrowers in your area. FICO is an overall grade.

You can purchase a copy of your FICO score at myfico.

Just as your credit reports change as you use credit, make payments and apply for more and different types of credit, so your FICO score will change from month to month.

Look in the Blog section for Categories labeled Credit Score for ways to improve and sustain a good FICO score