Face Off: Banks vs. Families

Faceoff: Banks vs. Families

As banks run around like chickens with their heads cut off, homeowners are seeking to take matters into their own hands.

According to a recent housingwatch.com article, homeowners can negotiate a 20 percent reduction on their mortgage. The problem? As of late, banks have consistently blocked such requests due to the potential of significant loss from borrower debt reduction. To make matters worse, the Treasury is turning a blind eye.

As a result, livid consumers like Nobel Prize-winning economist, Joseph Stiglitz, and TARP watchdog Elizabeth Warren are taking center stage in the battle against the banks.

Unfortunately, as the saying goes, there are three sides to every story. The Treasury is letting banks get away with blocking such a high percentage of debt reduction for one main reason: so many consumers have taken out second mortgages that banks are already losing money. If the banks allowed for such a reduction on a mass scale, they will be quick to need another bailout. Due to the trillions of dollars in national debt, they are likely to seek help from TARP with no avail.

Consequently, the economy has left consumers in a mindset of rugged individualism. People are abandoning the economic structure with an “every man for himself" mindset. Josh Rosner, a financial analyst specializing in mortgage-backed securities, suggests that borrowers fight and walk away from their mortgages. He believes that if enough people do it (15,000 to be precise), banks will be forced to respond.

Unfortunately, many consumers don't experience the ideal financial unity that Rosner, as well as other analysts, hope to accomplish. One lesson many consumers have already learned is that walking away from credit doesn't make things better. In fact, by walking away, you risk increasing interest rates and late penalties. If you have a second lien, you can face defaulting on your loan, causing critical damage to your credit in a time where good credit is vital. It all depends on whether or not consumers are willing to take the gamble, walk away, cross their fingers and hope the other 14,999 will follow.

How to Read your Credit Report...

So you finally got around to ordering your credit report. Congratulations, you have taken the first step to improving your credit. Upon receiving your credit report, you excitedly –or hesitantly- open the computer file or envelope. Once laying your eyes upon the report, you are overcome with shock and horror as you are bombarded with numbers, “X’s”, addresses and unrecognizable companies. “How do I read this thing?” you think to yourself. Credit reports contain a myriad of information that can be quite confusing; but don’t go gray yet. Check out this article by MSN Money on how to read your credit report.

Don’t let credit become a foreign language to you. When you take control of your credit, you become a smarter consumer, saving you thousands on interest rates, insurance premiums and other unwanted costs. Innovative Credit Consultants can help you break away from the needless hassle of credit repair research and dispute paperwork. Take control of your credit. Visit http://www.icreditinc.com for more information.

REPO and the Great Recession

REPO and the Great Recession

The current recession –now dubbed the Great Recession- was caused by several factors. While many have sought to point fingers at various industries, Robert X. Cringley of housingwatch.com says it is not entirely the fault of subprime mortgage securitization. According to Cringley, “it was just a plain old bank panic.”

According to Cringley, though the whole securitization was in disarray, the size of subprime was not at a size that could put the whole financial system at risk. Instead, Cringley places most of the blame on the Renew Sale and Repurchase (REPO) market. Take a look at this article to find out one of the many contributing factors to the Great Recession.
As a home owner, are you feeling the effects of poor credit in the form of your monthly interest payments? Those with poor credit can pay up to twice the amount in interest as those with good credit. Learn how to lower your mortgage payments. Visit http://www.icreditinc.com for a FREE credit consultation.

Why ICC is Different

Experience the difference at icreditinc.com

In a digital age where unmoderated information is shared over the internet, it is easy to run into inaccurate information and ecommerce scams. At Innovative Credit Consultants, we are dedicated to efficient, reliable credit repair. We stand out from the rest because we provide unique services to help you repair your credit and delete erroneous charges.

After speaking with one of our trained credit professionals, we analyze your credit report and let you know what items are deletable and what items aren’t deletable. Neither do we charge an upfront free nor do we require monthly payments. Our competitors charge monthly and take their time on purpose because to make more money.

Go ahead and call these “leading credit repair companies” and see how much effort they put into collecting a payment from you without even giving you information that is helpful to you.

Find out that the first phone call you make is all about them trying to get your money. We do not charge until we remove an inaccuracy. Our clients are put first, our clients needs are met before we charge. We are a credit repair company that truly serves our client.

Each credit report is as unique as its owner and we believe each item should be treated that way. We are here to fulfill your credit needs in accordance with the Credit Repair Organizing Act and we will always be dedicated to giving you the credit repair and care you need.

Visit http://www.icreditinc.com for more information and a free credit consultation.

Even the execs mess up

Even the execs mess up

The financial future can be very risky. If you do not know the ins and outs of credit, it can be tricky. According to Reuters, even financial guru, Warren Buffett “goofed” when he made the decision to push a Geico credit card in an attempt to hold on to Geico’s “cream of the crop” customers.

After flexing his age and wisdom he managed to successfully push the Geico credit card resulting in a loss of “$6.3 million pretax on cards…$44 million more when it sold a $98 million portfolio of card receivables, at 55 cents on the dollar.” Though Buffett has admitted to his mistakes and has closed that chapter in Geico history, he could have very well contributed to the downfall of the third largest car insurance company.

When it comes to money, everyone is uncertain, at times. Ease that uncertainty by becoming a smarter consumer. Visit http://www.icreditinc.com for a FREE consultation and additional information on how to improve your credit.

Business Basics: Types of Business Structures

About business ownership.
Choosing the right type of business structure for your needs is essential to maintaining a high business credit score. There are several different options to choose from, and each has its own pros and cons when it comes to your personal finances. It is wise to consult an accountant for advice on which is the best option for your small business.

Sole proprietorship’s are the easiest and cheapest business type to set up, maintain and dissolve. There is only one owner of the company, and that person assumes all legal and financial responsibility for the company. If the company defaults on loans or is sued, the owner’s personal assets may be at risk. The business credit of this type of company will be determined by the credit of the individual owner. All profits are considered income to the owner for taxation purposes.

Partnerships are similar to sole proprietorship’s in that all legal and financial responsibilities fall on the owners. For this type of business, there is simply more than one owner. When setting up this type of business, a contract should be drawn up to determine what contributions each partner is to make, how decisions will be made in cases of disagreement, how profits are to be distributed and how a business dissolution will be handled. The credit for this type of company will be determined by the credit of all partners. Each partner is taxed individually for their share of the profits.

Corporations are formed because the owners choose to have the business be considered a separate entity by state and federal government. Owners of a corporation are considered shareholders, and distributed profits are considered dividends. The owners of a corporation are not legally responsible for debts and obligations of the company, but are held responsible for their own personal actions. Because a corporation is considered a separate entity, it has its own credit rating, and will generally not affect the credit of the shareholders. The corporation is responsible for paying its own taxes, and the dividends to shareholders are also taxed individually, resulting in double taxation. Regular corporations are also known as C-corporations.

S-corporations are a different type of corporation, and there are several restrictions on companies that wish to be designated as such. S-corps enjoy the same benefits as C-corps in terms of the limited liability of the shareholders, and is a separate entity for credit purposes. This type of company passes profits to the shareholders as distributions, or wages, as if the shareholders work for the company. Doing this avoids the double taxation that C-corps experience.

The last common business structure is the Limited Liability Corporation (LLC), which has the limited liability aspects of a corporation, but is treated as a sole proprietorship or partnership in terms of how the business is run and profits distributed. There are restrictions on the types of businesses that can form an (LLC), in that they can only have 2 of the 4 aspects that define a corporation. An (LLC) is not a taxable designation, and taxes must be filed as sole proprietorship/partnership or as a corporation.

Because your personal financial situation can be affected by owning a business, it is important to choose the right company structure to maximize potential gain while minimizing potential losses. The main issues to consider are liability and taxation implications of each option.

For more information visit http://www.icreditinc.com or keep reading.

Credit Repair and Your Auto Insurance

Credit Repair and Your Auto Insurance

Your credit score can be the modern equivalent of a scarlet letter. If you have missed payments, defaulted on loans or otherwise sabotaged your credit report, obtaining a new credit card or loan will be Herculean in difficulty; did you know that this can extend to your car insurance as well? Yes: even if you have a spotless driving record, your pockmarked credit report can mean that you have to pay more on auto insurance. Insurers see it two ways: if you have a bad credit score, you may be more likely to pay them late or not at all; you may also be seen as driving as irresponsibly as they think you have used your credit.

If you have a credit score below what FICO considers a good score (higher than 650, with a 700 being in the upper reaches of attainable credit), you may have to pay much more for your auto insurance or even risk being rejected for coverage. Even though some legislators are pushing to have the credit component removed from auto insurance formulas on the basis that your credit does not indicate your likelihood of being in an accident, these proposed laws keep getting shot down.

What can you do if you are one of the many Americans in this position? Repairing your credit is the first step you can take. Late payments are one of the nastiest culprits of bad credit, so budget yourself carefully to ensure you pay all bills on time from this point forward. Pay off your worst debts first to keep from accumulating interest, but don't close those accounts down, since keeping accounts for a long time will boost your creditworthiness.

Once you've done all you can on your own, order your credit report (you are entitled to one free one from each major credit bureau through http://www.annualcreditreport.com, or you could order them for a fee more than once per year). If you find inaccurate information or debts you did not make, notify the credit bureaus about the problems. They have thirty days to either find proof or erase the offending item. You may need assistance in this project, from advice to someone on your side contacting the bureaus. The Innovative Credit Consultants are dedicated to helping you achieve the success you deserve, starting with improved credit and ending with you having your financial dreams realized.

Citibank's Crime and Consequences

Citibank's Crime and Consequences

JEOPARDY! time: shredding your mail, only giving out your personal information to trusted and reputable sources, canceling cards in the event that you lose or have your wallet stolen from you. If you immediately thought "what are ways to prevent identity theft," you are correct. Even if you go through all the right motions to keep your personal information for your use only, once you have entrusted an entity with your Social Security number and other bits and pieces, you have to factor in their potential unreliability.
In January 2010, Citibank made a "processing earror," as they called it, where they accidentally released 600,000 Social Security numbers belonging to their account holders. The nine digits were not explicitly stated as Social Security numbers (they were included in a string of numbers and letters that appeared to be a mail routing number), but they were released nonetheless. Citibank owned up to their mistake and mailed all of the customers whose information was leaked out, apologizing and offering a free 180-day credit monitoring service to ensure that they would not be victims of identity theft.
This incident highlights two key things about credit and identity security. You must never be complacent about the safety of your identity; even if you have done all you can to keep your private information private, a mistake or attack on an institution that uses your information for legitimate uses can expose you to the threat of identity theft. It is more important than ever to guard your information closely.
The other major topic this flub has resurrected is the usefulness of credit monitoring tools. Whenever you are unsure about the security of your information, particularly if you have been affected by Citibank's accidental actions or something similar, a credit monitoring service may be right for you. Ordering your credit report annually is generally all you need to do if you are careful with your information, but sometimes circumstances may make you think about extra measures you can take. You can have a freeze put on the opening of new credit lines without a face-to-face meeting proving your identity and see if you can track any claims that you catch.
Put in this situation, would you take advantage of the credit monitoring? If you wouldn't, what steps would you take to make sure your information won't be misused?

Are consumers going back to old habits?

According to economists, one of the reasons the wildly predictable recession occurred was because of the irresponsible spending of lenders. Lenders continued to supply credit for mortgages, loans and credit cards while the consumer continued to bite off more than they could chew. Despite these factors, it seems that consumers have yet to learn their lesson.

According to a recent CNN article, despite income raising 0.1% in January, spending has risen 0.5%. Ironically, saving rates have fallen from over 4.0% to 3.3%. The increase has raised a red flag for wary economists. The raise in spending has not occurred from excessive credit because lenders have cut down on how they provide credit. The increased spending has occurred as a result of those dipping into their savings. Consumers continue to be present-minded as they cash in on their savings and hope for the best, in the future. Many economists believe if spending continues at this rate, the near future won’t look too bright. With the continuous job losses and less people providing credit, for those who mess up, next time around will be harder to find help. Fortunately, as long as the spending does not become excessive, economists believe that this subtle increase in spending shows that consumers still have hope for the country.

Avoid the effects of the national credit crunch. Lenders are still willing to lend to those with good credit. Give us a call and visit http://www.icreditinc.com for FREE information on how to repair your credit.

Sallie Mae Offers Online Banking

CNN Money announced on Tuesday that the Sallie Mae, the largest U.S. student loan company, began taking steps into retail banking. Not only will students be able to pay loans with the company but they will be able to save with their new online banking program.

The new online bank will offer competitive, high-yield savings accounts that will one-up the national average of about 0.27%. Savings accounts will have an interest rate of 1.35%. The company will also offer certificates of deposit with rates of 1.50% for 12 months to 3.00% for a 60 month CD.

Innovative Credit Consultants continue to provide up-to-date information on the lending and financial world. Stay informed, get the credit information you need to become a more educated consumer. Visit http://www.icreditinc.com for FREE credit repair information.