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Loan

Easiest Way to Pay Student Loans? Don’t Have Them!

By | Debt, Loan, Personal Finance, Save Money

Most well-paying jobs require a college education, but graduates spend the bulk of their first few years just paying off their student loans. After four or five years of endless studying and late-night pizza deliveries, you have a diploma – and about $100,000 in student loan debt.

In a depressed economic climate, student loan debts are being put aside just to pay the bills; this causes many loans to go into default. Do not be a victim of high education debt! With hard work and excellent time management skills, you can graduate from college without student loans.

While the full-ride scholarship is rare, there are many partial and specialized scholarships available. The college itself often has many different scholarships available for everything from sports to academic majors. Some high schools have scholarships contributed by various alumni and can be based on scholastic merit or activity.

Various organizations and charities also provide scholarships. If you are or a parent is a member of veterans, social or other organizations, you can check to see if they have scholarships. A scholarship doesn’t have to be paid back and can be as little as fifty to several thousand dollars. Attending the school where your parents attended may also give you access to alumni scholarships.

You may be able to pay your way through college using monthly payments. This requires having a job while you are enrolled, and it can be challenging to work and study simultaneously, but many students find the right balance. You can also save money by only going to college half-time or by starting at a community college. Most financial aid offices offer monthly payment plans to help you manage the cost. You can spend a few years flipping burgers during college and go into your corporate job debt free.

For some, delaying college and working prior to attending, to save up money for tuition, might be the right choice. You can even work during high school. Many high schools partner with local community colleges so that students can earn college credit at a much lower price. Exploring these options, as well as taking AP classes that grant college credit when you successfully pass the AP test can also reduce your overall student debt burden.

While these tips won’t help those currently straddled with the heavy burden of student debt, these tips can help those who are just beginning to consider college:

  • Attend a state school instead of a private school, to benefit from lower tuition rates
  • Rent books instead of buying them, to save hundreds of dollars each semester
  • Get hired by a company that offers a tuition reimbursement program
  • Live at home instead of in dorms and save $5,000 – $8,000 a semester or more

If you want to graduate with no student loans, then you need to exhaust every cost saving measure before and during your college career.

Credit Repair: Tips to Help Maintain a Good Credit Score.

By | Credit Cards, Credit Repair, Credit Reports, Credit Scores, Loan, Payment, Personal Finance, Revolving Debt

Accurate negative information generally remains listed on your credit report for up to seven years, while bankruptcies remain for 7-10 years.   However, there are things you can do to gradually improve and maintain a good credit score, such as the following:

  • Fix any inaccurate information.  This is one of the most important things you can do to maximize your credit score.  Up to 79% of credit reports contain errors.
  • Update old accounts.
  • Request that old inquiries be removed (older than 2 years).
  • Pay your bills on time. Delinquent payments, even if only a few days late, and collections can have a major negative impact on your score.
  • If you have missed payments, get current and stay current. The longer you pay your bills on time, the better your credit score. Older credit problems count for less, so poor credit performance won’t haunt you forever. The impact of past credit problems on your score fades as time passes and as recent good payment patterns show up on your credit report.
  • Be aware that paying off an accurate collection account will not remove it from your credit report. It will stay on your report for seven years.
  • Keep balances low on credit cards and other “revolving credit”.  High outstanding debt can affect a credit score.
  • Pay off debt.  The most effective way to improve your credit score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score.
  • Don’t close unused credit cards as a short-term strategy to raise your score. Maintain your accounts for a long time.  The longer your credit history, the more it helps increase your credit score.  Closing older accounts can actually lower your score.
  • Don’t open a number of new credit cards that you don’t need, just to increase your available credit. Apply for and open new credit accounts only as needed. Don’t open accounts for the purpose of providing a better credit picture – it probably won’t raise your score and, in some instances, may even lower your score.
  • If you have been managing credit for a short time, don’t open a lot of new accounts too rapidly. New accounts will lower your average account age, which will have a larger effect on your score if you don’t have a lot of other credit information. Also, rapid account buildup can look risky if you are a new credit user.
  • Do your rate shopping for a loan within a focused period of time. FICO scores distinguish between a search for a mortgage or auto loan, where it is customary to shop for the best rate, and a search for many new credit cards.

 

Rates Are Low, But Can You Get a Mortgage?

By | Credit Repair, Credit Reports, Credit Scores, Debt, Fannie Mae, Home Buying, Homeowner, Loan, Mortgage, Real Estate, Your Credit

Mortgage rates are bouncing off of 40 year lows.  Seems like the best time to buy a house or refinance.  Not so fast – there is a catch.  You have to qualify first!

Before the recession, qualifying for a mortgage was not much of an issue.  The overall standards were pretty low.  If you had a low credit score, you could still qualify for financing.  Your credit score did not necessarily determine if you qualified more so than the rate that you qualified for.   People with higher credit scores received lower rates and people with lower credit scores received higher rates.  But just about everyone qualified for something. 

The lending environment today is vastly different.  Only those that meet the highest qualification standards can get financing.  According to the Federal Reserve, about seventy five percent of those that apply for financing are qualifying.  Of course, the number of those applying for loans has decreased significantly. 

According to Fannie Mae and Freddie Mac, the average credit score for loans that they finance has risen to 760.  It was 720 just a few years ago.  For FHA loans, the average score has increased to 700 from 660.

The subprime market has just about disappeared altogether.  Before the recession, subprime lenders routinely made loans to borrowers with credit scores below 620.  Today, it is very difficult to find lenders willing to make these loans. 

If you are thinking about financing, you should check your credit score.  If your score is below some of the qualifying averages, take proactive steps to improve your credit scores.  Remember, about eighty percent of the credit reports contain errors.  With a little bit of effort, you might find that you do qualify for a loan at the current rates after all.

When an Account on My Credit Report Changes to Say It Is In DISPUTE, Does That Hurt My Credit Score?

By | Ask a Credit Expert, Credit Repair, Debt, Fair Credit Reporting Act, Home Buying, Loan, Mortgage, Personal Finance, Your Credit

First, let’s talk about disputing. As a consumer you have every right to dispute any accounts and/or personal information on your credit reports that you feel has inaccurate, misleading, and/or incomplete information. Now, don’t be misled into thinking that means the entire credit account must be or has to be wrong in order to dispute the account. As consumers we need to review our credit reports at least once a year for errors. We need to look over every account and make sure the balance is reporting accurately.  If there are late payments reporting, look over them and make sure everything is accurate.  If something shows open when it should be closed then it needs to be updated, if the balance is wrong then it needs to be updated as well.  If something is reporting that does not belong to you then it needs to be disputed and removed.

Now that you know what needs to be disputed, let’s talk about the affect it will have on your credit score. When you dispute an account it will show on your credit report that the account is in dispute, but that should not be looked upon as negative. Now, if you pull your credit score while you are disputing accounts it will make your credit score fluctuate. When you pull your credit score it pulls that information at that exact moment and calculates the score. Any account in dispute will not be factored into your credit score at that time. That can have a positive affect or a negative affect on your credit score. Since it can have a negative affect it is usually best if you do not pull your credit score or apply for credit while you are disputing credit items on your credit reports. If you wait to apply for credit then you will allow time for the disputes to be finished and hopefully your credit score will increase from the work that was done. Another reason you want to wait for disputes to be complete, is that A LOT of mortgage brokers will not close a loan if your credit reports say an account in dispute. So, it is best to dispute everything you need to dispute and get your credit reports updated before you apply for a mortgage loan.

For all of your disputing needs, call the best in the industry – Ovation Credit Services. Our Credit Analysts are here for your FREE Credit Consultation and to answer any of your questions. Call us at 1-866-639-3426 option 2.

If you have a question for our Credit Expert Kristi Thornton, send an email to [email protected]

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