A 10-Step Take Action Plan: Part Five - Decide & Act: Dispute, Negotiate or Wait

Now it’s time to take action. This means taking the steps to get the items on your list updated, corrected, or removed. There is a book written by Linda Ferrari, a national credit expert, titled The Big Score - Getting It & Keeping It. And although I am going to give you some great information below, I highly recommend that you consider reading this book if you are facing serious credit challenges. Throughout The Big Score, you will receive access to tools, tips, information and even legal references that will help you successfully dispute and negotiate with the credit bureaus and creditors; however, for the purposes of this part of the series, I will outline the basics.

You have three choices:

Dispute

If your decision is to dispute an item, you must be ready to commit and follow through. Here are some basic tips to get you started:

1. Send a letter to the credit bureaus giving them a detailed explanation of what you are requesting. Attach copies of any supporting documentation that you have (i.e. statements proving your correct credit card limits and proof of payments). Send letters certified, and, to avoid delay in their replies, always attach proof of social security and proof of address right from the beginning.
2. Wait 35 days (allowing 5 days for mail time.) If the bureaus do not respond within 35 days, send a formal complaint letter reminding them that per Section 611 of the Fair Credit Reporting Act they are required to respond within 30 days from the date they received your initial dispute. Also remind them that per Section 616 & 617 of the same Act they are liable for damages, including punitive, and that if necessary you will seek legal representation. Attach your original dispute letter and proof of delivery to the complaint.
3. Just because the credit bureau has determined an item “investigated” does not mean the results are accurate. If you are 100% sure that your claim is true and accurate, and the bureau responds stating that the creditor has verified the information and the item will not be removed or updated, you must request a reinvestigation under Section 611 of the Fair Credit Reporting Act. I highly recommend that you do so within 5 days of receiving the results of their investigation. You can repeat this process as many times as you want, however, after three to four attempts, I would consider moving onto the next step.

If the credit bureau continues to stand its ground on not updating or correcting inaccurate items on your credit report, here are some additional tips:

• Attaching copies of lawsuit verdicts that show how consumers have prevailed against the bureaus can help you convince the credit bureaus to make the necessary changes to your reports. It lets them know that you are well aware of your consumer rights. There are several references to successful lawsuits online wherein consumers who have sued the credit bureaus and creditors with punitive damages have been awarded hundreds of thousands of dollars and even millions.
• Look for other consumer stories on the web. There are many credit repair blogs in which consumers share their strategies. Be careful not to take advice as blind trust, but instead, look for helpful hints that pertain to your situation.
• File a complaint with the Federal Trade Commission Consumer Response Center. You may be able to have your case added to a class action lawsuit against the bureau that is reporting the inaccurate information. You can access the FTC Complaint Wizard at http://www.ftc.gov/bcp/index.shtml, or you can mail a complaint letter to the following address:

Federal Trade Commission
Consumer Response Center
600 Pennsylvania Avenue, NW
Washington, DC 20580

Negotiate

If your decision is to negotiate on an item, the most important advice I can give you about negotiating is to do your research before entering into negotiations with a creditor or collection agency.

Here are some other great resources to help you get to know the ins and outs of the credit counseling and debt negotiation industry:

• National Foundation for Credit Counseling
• Association of Independent Consumer Credit Counseling Agencies
• The Federal Trade Commission
• National Consumer Law Center
• Consumer Federation of America’s Report: Credit Counseling in Crisis
• National Consumer Law Centers Report: The ABC’s of Credit Counseling

Here are the basics to debt negotiation:

1. Lay your debts out on paper.
2. Validate collection and charge-off debt with the creditor or collection agency.
3. Verify the Statute of Limitations and 7-year reporting period.
4. Figure out how much you can realistically afford to pay.
5. Call the creditors to discuss your options or negotiate.
6. Get the agreement in writing, and then follow through with the payment plan as agreed.

The key to successful debt relief negotiation is to establish clear goals before you start, and be persistent. Many times you may have to contact the creditors or collection agencies several times before reaching an agreement. Be professional even when they are not. Do not let your emotions get the best of you. Be polite, calm, and cool.

I am a true believer in trying to do it on your own if you have the time because no one will have your back like you will. It does not take a specific degree to get the job done. However, there is a clear precedent set years ago by the credit counseling and debt negotiation industry that makes creditors very reluctant to deal directly with consumers. But a precedent is not a law, and if you do your research, and work hard enough, you can definitely do it on your own.

Two important things to remember:

1. Negotiate with confidence that you will win. By doing your research, you will gain the knowledge you must have to successfully negotiate derogatory debts. Knowledge is power, and once the collection agency or creditor realizes that you have done your research, not only will you limit their response options, but they will realize immediately that you are not a pushover. The tactics that they would normally use on a consumer who doesn’t know their rights, will now be useless to them, and they will be more apt to agree to your terms.
2. Get everything in writing. Words mean NOTHING when it comes to agreements with collection agencies or creditors and the terms they agree to on the telephone.

On the other hand, if you don’t have the time or emotional energy to face creditors and collection agencies head-on, you do have options. My best advice is to do as much research and cost comparison as you can before you hire a company to help. Make sure you do the math on the plans they propose. In other words, make sure that at the end of the day, the payment plans, or fees make sense.

Here’s a real life success story from Linda Ferrari’s book, The Big Score - Getting It & Keeping It - to help motivate you to take on your creditors.

Real Life Success Story: David

Debt Negotiation can create real life miracles. In fact, just a few months ago, I received a call from a client I’ll call David. David was in a situation in which he found himself a heartbeat away from throwing his hands up and walking away from everything. He had a failing business that had been in the red for more than two years, a home for which he now owed more than its value, four credit card accounts that were maxed out to the tune of $ 210,000, and a collapsed emotional and physical threshold.

We sat down and took a look at his debt, to see what we could do to salvage his credit and his life. The first question I asked David is how much cash he could gather to help settle his debts. He estimated that he could raise about $ 100,000 to settle $ 210,000 in credit card debt, and bring his mortgage current.

David had always been on top of the game. He usually had a lot of money, and he was strong. Because I knew this, I worked with David teaching him how to debt negotiate. At first he was reluctant, because the accounts were still open and in good standing. “There is no way that these banks are going to accept this offer from me, especially when I am still current on the accounts,” David argued. “I have no idea what to say, or what to ask for. I want you to handle this for me.”

I explained to David that original creditors do not like dealing with third parties. More so, to have a third-party call on behalf of his open accounts that were in good standing would immediately create a defensive situation. If anyone other than David made that first call, the chances of reaching a settlement amount on his accounts before they charged off would be very slim. So we wrote his hardship letter and mailed it to the creditors, and I coached David through the do’s and don’ts of negotiating on the telephone. Within one week, he had successfully negotiated three of the accounts for 40%. He told me that he was honest and professional. I had advised him to not threaten bankruptcy straight out, but to make it clear that he did not foresee being able to pull himself out of his financial situation. I also suggested that he offer to send them proof of his hardship. Proof that his company had been in the red and that he was not pulling enough income to cover his debts, and proof that his mortgage was in default. Once David finished negotiating with the first creditor successfully, the remaining creditors were much easier to face. He now knew it was possible to do something that he had believed could not be done. He saved many thousands of dollars in commission fees to a debt negotiation company and he immediately reduced his debt by more than $ 60,000.

The accounts were reported to the credit bureaus as “Paid For Less Than Full Balance,” which is negative, but less negative than a Charge Off or Collection with a balance that is open to lawsuit. Plus when the balances went down to zero, his score went up in the Amounts Owed factor because his debt to limit ratio on those accounts was at $ 0.

Wait

Two of the most misunderstood aspects of credit reporting are: Statute of Limitations and the 7-Year Reporting Period. It is important to understand both when deciding whether you should wait for the derogatory information to fall off of your report, or not. Most consumers don’t realize that there are two expiration dates when it comes to negative credit accounts. In most instances, charged off debt expires sometimes 3-4 years before the 7-year reporting period is up. What you need to take into consideration:

• If the statute of limitations has expired on a debt, then you are no longer legally liable to pay that debt. You cannot be sued and your wages cannot be garnished. However, the item can still remain on your credit report for the 7-Year Reporting Period and you may be denied credit due to an open derogatory balance on your credit reports. Statutes vary by type of debt and by state. Call me if you have a question about your state.
• Once the 7-Year Reporting Period runs, you can have that item removed from your credit report altogether. There are exceptions to the 7-Year Reporting Period for some public records, but in most instances, when that 7-Year Reporting Period expires, you are free and clear.

It’s a personal decision. If you are a year from the 7-Year Reporting Period and you cannot afford to pay the debt, then wait it out. However, if you are able to pay the derogatory AND negotiate a deletion, you can arrange to have the item removed earlier and get on with your financial goals. Remember, knowledge is key to successful negotiations.

It’s a personal decision. If you are a year from the 7-Year Reporting Period and you cannot afford to pay the debt, then wait it out. However, an open collection debt with a balance may stop you from successful loan transaction. If you are able to pay the derogatory AND negotiate a deletion, you can arrange to have the item removed earlier and get on with your financial goals. Remember, knowledge is key to successful negotiations.

In Part Six, you’re going to learn about how important your mix of credit is to your credit scores. You will receive some great tips on How To Get Your Mix In Check. Be sure to keep an eye out for this important information.

A 10-Step Take Action Plan: Part Four - Creating Your Take Action Plan Checklist

Let’s use the Home Inspection Analogy. When you want to sell your home, you hire an inspector. They make a detailed “fix it list” of the items in need of repair. The theory is that the more items completed on this list, the more you will maximize the value of your home. It’s the same with credit. Your goal is to go through your credit reports with a fine-tooth comb, make a list of the items that are negatively impacting your scores, and know that the more items you check off your list the better chance you have of maximizing your credit scores in the shortest period of time.

When most people look at their credit reports, they focus on repairing the negative items. It is critically important for you to remember that negative payment history only makes up 35% of your scores. There is another 65% of your scores that has nothing to do with negative payment history but still brings down the scores. It is essential that you make sure that all of your good credit is being reported and being reported accurately.

Create A Spreadsheet

Before making your TAP Checklist, you will want to create a workable spreadsheet that will organize the data and action plan in a way that will give you instant indication of what action needs to be taken. At minimum, your spreadsheet should include the following columns:

• Item Type (i.e. collection, late pay, wrong name, tax lien)
• Dispute Reason
• Account Status (open or closed)
• Original Creditor Name & Account #
• Collection Agency/Court Name and Account or Case #
• Open Date
• Date of Last Delinquency or Date Paid
• A column to list the Statute of Limitations
• A column to list the 7-Year Reporting Date
• Amount Due
• Limit
• Balance
• Action (Dispute, Negotiate, Wait)
• First Dispute/VOD Letter Date
• Reinvestigation Letter Date
• Formal No Response Complaint Date
• Letter of Intent to Sue Date

Make Your TAP Checklist

One of the columns in your spreadsheet will be the dispute reason. To help you get started, here’s a list of 30 of the most common dispute reasons. If any of these apply to the information being reported on your credit reports, you should consider the item negative and add that item to your TAP checklist:

1. This account does not belong to me.
2. I was not 30, 60, 90 or 120 days late on this account.
3. This is a duplicate account.
4. I never authorized this account.
5. The balance on this account is incorrect.
6. There is no past due balance on this account.
7. You are not reporting a positive account on my credit report.
8. This account is closed with a $ 0 balance and has a positive history.
9. This account was closed by me, not the creditor.
10. You are not reporting the correct limit on my account.
11. This account was included in a bankruptcy and should have a $ 0 balance.
12. This account was paid.
13. The open date on this account is incorrect.
14. This account is still open.
15. I am only an authorized user on this account. Please remove it.
16. You are reporting my home equity line of credit as a revolving account.
17. I never authorized this inquiry.
18. This public record has been satisfied/released/dismissed/vacated.
19. You are listing the wrong file/released/satisfied date on this public record.
20. This account was charged off in (date). No late pays should be reported after that date.
21. The date of last activity on this account is incorrect.
22. This account never went into foreclosure/repossession.
23. The 7-year reporting period has expired on this account.
24. The statute of limitations on this account expired. You cannot report it or re-insert it.
25. You are reporting someone else’s information on my credit report that has the same name that I do.
26. You are reporting the wrong social security number, birth date, spouse’s name, phone number on my credit report.
27. You are reporting wrong/expired/misspelled addresses on my credit report.
28. You are reporting misspelled/wrong names on my credit report.
29. You are reporting outdated/wrong employment information on my credit report.
30. This student loan account has been deferred.

The key is to make three separate TAP spreadsheets, one for each credit bureau, and to write down EVERYTHING that needs attention. Then, you can decide which action should be taken - Dispute, Negotiate, or Wait. In Part Five, you will receive some great tips to help you decide which option would be best for your situation. Be sure to keep an eye out for this important information.

2003 Jeep Grand Cherokee Limited Review

If you are looking for an affordable, good quality Jeep Grand Cherokee, then this may the one. This Grand Cherokee comes with the 4.7 Liter V8 engine has about 105,000 miles on it.



The Drive

I’ve recently had the opportunity to put this 2003 Jeep Grand Cherokee Limited through two road tests. Let me start by saying that I was pleasantly surprised about how well this Grand Cherokee drove and performed. I found the seats and the driving to be comfortable…which is important to me. The ride was smooth and it handled as expected for a sport utility.

I put its acceleration and braking to tests. The acceleration was great and smooth and the braking responsive and without and shuttering.

The Exterior

I did an up-close walk-around of the vehicle and don’t see any apparent paint or body work on the vehicle. I did run a Vehicle History Report and it showed No Accidents and No Title Issues. What I did notice were a variety of small scratches and dings on the vehicle. This is to be expected on a vehicle with just over 100,000 miles. As a matter of fact, I see a lot of vehicle with half the miles that don’t look as nice as this Jeep.

The tires are in fair sheep and will probably need to be replaced within the next 10,000 miles.

The Interior

The interior overall is in good condition. Most interior wear on a vehicles is found on the drivers seat and that is the case with the Grand Cherokee as well. The driver seat is show some wear, but not that bad. The rest of the seats are in good condition as well as the dash and the carpet in the vehicle.

I notice no cigarette or any other funny smells in the vehicle. I’m pretty confident this vehicle has not been smoked in.

Mechanically

Mechanically the Jeep Grand Cherokee has passed the Virginia Vehicle Safety Inspection. The only thing we had to do was to replace a broken motor mount. I did notice that the hood supports are not working so those should be replaced.

Price

By comparing pricing from four different sources (Edmunds, Kelley Blue Book, NADA, Manheim), the AMV (Average Market Value) on this Jeep is $10,887.50. The Jeep is offered for sale at $9,999 for a savings of almost $900.

Final Thoughts

For a vehicle with a little over 100,000 miles on it, this Grand Cherokee is in very good condition mechanically and physically. Of course it is not perfect…no pre-owned vehicle is, but other than a few very minor and inexpensive to fix issues this Jeep should make a great vehicle for anyone looking for a nice, quality, affordable sport utility.

To schedule a showing and test drive, please call Chris at 434.566.0107 or e-mail me.

 

Funny Seen In The Movie Flywheel

The movie Flywheel was made by a church in Georgia. The quality is not Hollywood, but the movie is funny. My favorite seen is in this clip at 8:43. Check it out.

Really Nice! Dodge Ram 1500 Pickup Truck

Here is a REALLY nice Dodge Ram 1500.

 
It’s a Dodge Ram 1500 ST with a 3.7 liter V6 engine.

The first thing I did in checking out this truck was to walk around it and look up close to see if there was any apparent paint or body work on the truck. From what I can tell there is none. I did notice two small dings on the vehicles. One is on the tailgate and the other and hard to see one is on the lower part of the drivers side door.

Next I ran a Vehicle History Report and it came back clean showing no accidents or issues (remember don’t trust Carfax or AutoCheck to tell you if a vehicle has really been in accident).

Then I took it for a drive. This Dodge Ram drives really well. It comes equipped with a somewhat hard to find 6-speed manual transmission. Surprisingly the manual transmission shifted more like a car than a truck. Sometimes the clutches on trucks take a little more strength or effort to use, but not on this truck.

For a truck, the Dodge handled pretty well. Acceleration and braking are what you would expect with this type of vehicle.

The interior is in VERY GOOD condition. I did not notice any tares or significant stains on the seats and carpet.

The truck has passed a Virginia State Safety Inspection. Mechanically, we put new struts on the front end and the engine is strong.

One of things I like about this truck is even though is a 2-wheel drive, it sits up like a 4-wheel drive truck. It also has a nice bed liner already in it.

I think this would make a nice truck for anyone looking to have a truck for full-time work or just for weekend projects around the house.

I checked the AMV (Average Market Value) on the truck by comparing prices from four sources: Kelley Blue Book, NADA, Edmunds and Manheim Auto Auctions and got $10,645 as an Average Market Value. The Dodge is offered for sale at $9,950.

To schedule a showing and test drive, please contact me at 434.566.0107 or e-mail me.

 
 

A 10-Step Take Action Plan: Part Three - Reading Your Credit Reports

Laws have made it easier for you to access your reports, but they haven’t made those reports easier to understand. Credit reports have come a long way since the first credit report appeared looking more like NASA code than someone’s credit history. The good news is, today’s credit reports are NOT rocket science.

There are hundreds of different credit report formats in use today. An explanation of each would not only make for a very boring read, but it would also be impossible for me to teach you in this report how to read each format. The good news is that you don’t have to know how to read every format to manage your credit. Once you learn the basics, you will be able to apply your knowledge to any credit report you lay your eyes on. Here are some helpful hints on what to look for as it relates to the format of each:

Equifax

Equifax mixes positive and negative trade lines. This makes Equifax’s report the most difficult to read. As a general rule, Equifax will list public records first, and most collections separately. However, sometimes collections are intermingled with other trade lines, so review every trade line carefully and thoroughly. Late pays are listed at the very bottom of each trade line under the section title “Account History with Status Codes.” Personal identification and demographic information is on the first page, and inquiries are listed in the back of the report.

Experian

Experian separates positive from negative all the time. As a general rule, Experian will list public records first, then all “Potentially Negative Items or Items For Further Review” followed by “Accounts In Good Standing.” Inquiries, and personal identification and demographic information are located in the back of the report.

TransUnion

TransUnion follows suit with Experian, by separating positive from negative accounts. As a general rule, TransUnion will list public records first, then all “Adverse Accounts,” followed by all “Satisfactory Accounts.” Personal identification and demographic information are on the first page, and inquiries are listed in the back of the report.

WORD OF CAUTION: When you dispute with a credit bureau, they will respond with a copy of your updated credit report. So if your action plan begins with an online version of your credit report, the version that you receive in response to your dispute will be different. Don’t be thrown off. The mailed version contains the same information, just laid out differently.

In Part Four, you will receive some great tips and information about how you can create an effective Take Action Plan Checklist. Be sure to keep an eye out for this important information.

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2003 Mini Cooper Review

The 2003 Mini Cooper is a REAL fun car to drive. At the time of this review, this Mini has around 79,000 miles on it. Here are my thoughts and comments on this vehicle.

I don't recall ever driving a Mini before, so it was a treat to take one out and put it through the paces. This Mini handles easily and really well. It is peppy with plenty of performance coming out of it's 1.6L engine. 

Mechanically, the vehicle has passed Virginia State Inspection.

Body wise, the Vehicle History Report shows no accidents (but you should never trust Carfax or AutoCheck to tell you whether or not a vehicle has been in an accident). Upon my body panel review, I did find that part of the right rear bumper and probably part of the right rear quarter panel to be painted. Whatever damage there was must have been minor and the repair and paint work are done professionally. IT IS A NON ISSUE! And by the way, when was the last time a car salesman told you a vehicle had been painted when the Vehicle History Report was clean? Probably never...until now!

The Mini is priced at $10,999. Kelley Blue Book estimates the value to be $11,425 and NADA estimates the value to be $10,800.

To schedule a showing and test drive, please e-mail me or call me at 434.566.0107.

*Remember, there are about 7 million vehicles sold per year and about that many accidents are reported per year. The odds are, at some point in time a vehicle will have paint or body work done to it.