Repair Credit Score

Archive for June, 2010

Question: I need advice on auto repossession?

I had a 770 Credit Score, and i made a realy bad decission yesterday and bought a 2010 camaro SS. I know realize theres no way i will be able to afford the 700 dollar a month payments for the next 5 years. So i need advice. Can i just let it get repoed, or call the financing company and tell them i cant afford it?

Answer: You are going to lose a lot of money on this, one way or another. You took delivery of the car, and now it is a used car. If it is repossessed, it will be sold (usually at auction) and the proceeds of the sale, less all costs of repossession, transportation, title, storage and sale, will be applied to your loan. You will then be billed for the difference, and if you do not pay it, you will be sued. Your bank accounts and wages can be seized.

Your credit will be trashed for 7 years with a repossession. Any judgment will show for 7 years after you repay the loan.

These cars are bringing in the $35000 range now at the dealer auctions, so depending on what you paid, you may not be in that bad a shape. You should go back to the dealer and see if he will allow you to buy your way out of the deal. You will lose everything if you allow the car to be repossessed, if you offer to let the dealer keep the down payment to let you out of the deal, they may be willing to do so.

If not, you may be able to sell the car and take the loss, paying off the loan. You want to avoid the repossession at all costs, it will cost you more in the long run. Go back to the dealer first thing in the morning.

Mortgage Testing/Credit Score Press Conference Part 1 - April 21, 2010

Question: How does declined credit card applications affect your score?

Hello, i applied for 2 credit card applications within a week and got declined. This is because, i am 18, and only have 2 bank accounts with no credit on file. When i paid $15 yesterday to see my Credit Score, it reported as having "no score". So i guess my declined accounts don't count, expect for the inquiry right?

Answer: if you're just starting out, you may want to open a checking account with a visa/mc debit card, then open a small line of credit linked to your bank account -- use the line, and pay it off regularly. this will allow you to establish credit history.

once you have a few months of good payments and responsible use, get a cash back rewards card, which actually PAYS YOU to use it.

I only use cash-back rewards cards, and here are the top ones available:

Citi Dividend Platinum Select -- 5% cash back groceries, gas & drugstores and 1% on all other purchases (best all around card out there). No intro purchase APR, but 0% balance transfer APR for 1 year. There is a limitation of $300 dividend reward dollars / year, minimum $25 increments. this translates to $6k in gas, groceries, drugstores or $30k in general purchases.

https://www.accountonline.com/acq/choose...

Chase Free Cash Rewards Platinum Visa -- 1% cash back on all purchases. UNLIMITED rewards that can be redeemed in $25 increments. 0% APR for 1 year.

http://www.chase.com/ccp/index.jsp?pg_na...

And if you are a Costco member, take advantage of their TrueEarnings American Express Card -- 3% cash back at all restaurants, 2% for all travel (airfare, hotel, car rental), and 1% cash back on all other purchases. No limit in rewards, which are sent to you once a year in a check.

http://www201.americanexpress.com/apply/...

i personally utilize ALL THREE of these cards, for different purchase types -- maximizing your rewards is easy with this great combination, as long as you are paying off the ENTIRE balance every month.

good luck!

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