Tag: Credit Score

Bankruptcy Law, Credit, Timothy Kingcade Posts

New FICO Model Could Boost Credit Scores for Millions

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FICO, the company responsible for the most widely used credit score in the U.S. announced this month that its newest scoring model will differ drastically from past versions. Known as FICO 9, the new model will take effect in fall 2014. FICO 9 will differ from FICO 8 in two major ways:

1.) It will differential between medical and non-medical bills that have been turned over to collections. Medical bills will no longer carry as much weight in consumers’ credit scores. Currently, FICO 8 makes no distinction between unpaid medical and non-medical bills.

2.) It will disregard accounts in collections that consumers have already paid. Currently, FICO 8 makes no distinction between paid and unpaid accounts in collections.

Treating medical debt differently comes as a welcome change to consumers. In a May 2014 report, the Consumer Financial Protection Bureau (CFPB) said millions of Americans’ credit scores are being “overly penalized” by medical debts in collections.

So how do you know if your credit score will improve because of the new model? Basically, if your credit score is low as a result of unpaid medical bills or bills that went into collections that you later paid, you are likely to get a significant boost from FICO 9 when it takes effect.

Remember, you have the power to boost your credit score by following these “money smart” moves:
• Pay your bills on time.
• Keep your balance on credit cards below 30% of your total credit limit at ALL times.
• Using credit as early in your adult life as possible.
• Keeping a good mix of credit accounts on your credit report.
• Applying only for credit that you actually need.

If you are in a financial crisis and considering filing for bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Related Resources:
http://www.nerdwallet.com/blog/health/2014/08/08/new-fico-score-boost-credit-medical-bills-focus/

Bankruptcy Law, Credit, Timothy Kingcade Posts

7 Ways to Build Credit without a Credit Card

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Whether you are buying a home, car or other big purchase item, the first thing a lender will look at is your credit score. Before applying for a major loan, it is important you know where you stand with your credit score. Many people believe that the only way to establish and build credit is by opening and using a credit card.

Here are a few alternatives to help you put the plastic away and establish good credit.

1.) Ask companies to report on your behalf. If you have recurring bills that you pay on a monthly basis (i.e.- rent, utilities, cell phone, etc.) request that these providers report your payment activity to the three major credit bureaus- TransUnion, Experian and Equifax. Of course before you do that, make sure you have a responsible/on-time payment history. Payment history accounts for 35 percent of your credit score and can have significant impact if there is not a lot of other data on your credit report.

2.) Become an authorized user on another credit card. Do this ONLY if the cardholder has a strong credit background. Signing on as an authorized user will enable you to piggy back off their stellar credit.

3.) Open an account with a credit union and take out a small personal loan. Credit unions typically offer financing options at lower interest rates than traditional banks. To give your credit score a boost, apply for a small personal loan. If denied, inquire about a secured loan-where a certificate of deposit or savings account- will be used as collateral. This request will likely be approved because the risk in minimal on the lender’s end.

4.) Apply for an installment loan. These loans paid in a timely manner over an extended period of time build your credit score because they show creditors that you are a responsible borrower.

5.) Federal student loans. A credit check is not required to obtain a federal student loan. Since it is an installment loan, it can help boost your credit score. Aim for one that is subsidized and deposit the money into a safe interest-bearing account so the funds will be available when repayment starts.

6.) Peer-to-peer loans. Companies like Prosper and Lending Club offer peer-to-peer loans, where borrowers are connected with individual investors. The interest rates are low and these lenders report to the major credit bureaus.

7.) Try an alternative credit score. Check out Payment Reporting Builds Credit (PRBC), which helps consumers create a nontraditional credit score, an alternative to the big three credit bureaus.

Click here to read more on this story.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Timothy Kingcade Posts

Beware of Credit Repair Companies

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We are bombarded with ads for credit repair companies, claiming to “Erase your bad credit history simple, fast and easy- Guaranteed!” Others promise to “Boost your credit score to 750 in just one week.” Consumer credit counselors are warning consumers to take caution when it comes to these type offers because it is likely a scam. In reality, there is no quick fix for credit problems; improving your credit score takes time and effort on your part. No one can remove accurate negative information from your credit report.

Here are some tips from the FTC on how to evaluate the trustworthiness of credit repair companies. Proceed with caution if…

• The company wants you to pay for credit repair services before they provide any services.

• The company does not explain to you your rights and ways you can fix your credit score for free.

• The company recommends that you do not contact any of the three major national credit reporting agencies.

• The company tells you it can get rid of negative credit information on your credit report, even if that information is accurate and current.

• The company suggests you invent a “new” credit identity and a new credit report by applying for an Employer Identification Number, instead of using your Social Security number.

• The company advises you to dispute all the information in your credit report, regardless of its accuracy or timeliness.

Know that if you follow illegal advice and commit fraud, you can land up in hot water. It is a federal crime to lie on a loan or credit application, to misrepresent your social security number and obtain an Employer Identification Number from the IRS under false pretenses. Even if a credit repair agency advises you to do this, you yourself will be held accountable.

Click here to read more on this story.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Income Inequality: Credit Card Debt threatens African American Middle Class

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According to a recent report by the NAACP and the public policy research organization, Demos, middleclass African Americans are using credit to help cover basic living expenses, when income and savings fall short. According to the report, 79 percent of African Americans carry credit card debt and 80 percent have taken out loans for their education.

Interestingly, Black and White households reported different reasons for poor credit: 44 percent of White respondents cited late mortgage payments and using all or nearly all of their credit lines, while 40 percent of Black households cited late student loan payments and credit report errors.

Middle class credit use and debt levels are similar across race. The consequences are what raise eyebrows. The report found that African Americans and Whites had similar rates of card default, late payments, bankruptcy, eviction and repossession. However, indebted African American households face higher interest rates, reporting an average APR of 17.7 percent on the card where they carry the greatest balance, compared to 15.8 percent for White households.

Economic experts point out the problem is not about spending, but about income inequality and the decline in opportunity for middle class African Americans.

Click here to read more on this story.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Protecting your Credit Score when Canceling a Credit Card

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Your credit score can vary from day to day and it is not an exact science. There are dozens of different models out there, the most popular being the FICO score- ranging from 300 to 850. When you need a good credit score, for example, when purchasing your dream home, your credit score becomes very important. If you have a credit score of 730, many mortgage brokers will give you their best rates. If you have a credit score over 740, it’s not going to make much difference- you are already getting the best rates available.

If you are applying for a mortgage, hold off on closing the credit card, until after your loan closes. Closing an account does not only affects your debt-to-credit-limit ratio; it can also adversely affect your credit score if the card you close is your oldest card, because length of credit history is seen as a good thing. The best way to permanently improve both your finances and your credit score is to get the debt-to-credit ratio to zero.

Click here to read more on protecting your credit score when canceling a credit card.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

The 4 BEST Credit Cards for BAD Credit

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It’s almost impossible to get around these days without a credit card. However, if you have poor credit, you are probably concerned you will not qualify for a card or the interest rates, penalties and fees will make it too difficult. Fear not, those individuals with poor credit (a credit score below about 640-660) should consider the below cards- which are not only easy to qualify for, but if used properly can help boost your credit score.
• Capital One Secured MasterCard. This card reports automatically to all 3 credit bureaus. This is a real credit card, not a prepaid card. You can increase your line of credit without increasing your refundable security deposit, and you can get up to a $3,000 line of credit. There are no processing or application fees. You can also utilize tools to track your credit score. No balance transfer fee. $29 annual fee.

• American Express Prepaid Card. This prepaid card doesn’t affect your credit score since it doesn’t report to any of the credit bureaus. With this card, you can load up to $2,500 to your card. You can order up to 3 American Express Prepaid cards. All your prepaid cards will benefit from roadside assistance and purchase protection, as well as excellent customer service. No annual fee.

• PASS Card from American Express. This prepaid card is mainly for parents to get for their teenage children so that they can learn to use a card to pay for their purchases and always have some money handy. You can reload this card whenever you want or schedule reloads, such as monthly or weekly for your child’s allowance. This card will give your teen special access to entertainment events, as well as purchase protection and roadside assistance. No fraud liability. No annual fee.

• BuyRight Prepaid MasterCard. This card requires no credit check. You can enjoy the online billpay feature that will allow you to pay your bills, checks and rent online. You must pay a $9.95 activation fee to use your card for the first time. This card allows you to earn rewards when spending at Starbucks, purchasing iTunes, RedBox, prepaid cell phone minutes and more. There is a $7.95 monthly fee.

Click here to read more on the four BEST credit cards for bad credit.

If you are looking to rebuild your credit history, it is recommended that you apply for Capital One Secured MasterCard as it reports monthly to the three major credit bureaus in the U.S. The key with this card is to pay your bill on time and maintain your account balance well below the credit limit.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

How to Rebuild your Credit after Filing for Bankruptcy

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A poor credit score can affect everything from your credit card and mortgage interest rates to your insurance premiums. It can even affect your employment prospects. Repairing credit takes time, but it’s not impossible. If you are in the subprime category because of a foreclosure or bankruptcy, below are some steps you can take to start improving your credit and getting your score above the all-important 700 mark.

1. Get a secured credit card: A secured credit card can be a good payment method to keep you out of debt. If you deposit $500 to your card, your credit limit becomes $500. Make sure that the issuer reports your activity to the three main credit bureaus (i.e. – TransUnion, Experian and Equifax) to help raise your score.

2. Use Retail or Gas Cards: As your credit score improves with secured or prepaid cards, you will eventually qualify for retail cards from department stores and gas stations. The interest rate on these cards is often high making it essential that you don’t hold a balance beyond the grace period.

3. Beware of Quick Fixes: Do not pay a lot of money to somebody promising to rebuild your credit in a short amount of time. There are no quick fixes. It will take time to repair your credit, but you will likely have a score above 700 before the bankruptcy falls off your report.

Click here to read more about how to improve your credit after filing for bankruptcy.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

South Floridians’ Average Credit Score Declines despite Paying Down Debt

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Despite debt dropping in South Florida, credit scores have actually worsened from a year ago making it hard for consumers to capitalize on low interest rates and qualify for personal loans. According to CreditKarma.com, the average credit score in Broward and Miami-Dade fell to 646 in March after it had been at 658 a year earlier, even though credit card, mortgage and student loan balances improved during the same period. Credit Karma’s CEO, Kenneth Lin, attributes this to South Florida still experiencing fallout from being among the hardest-hit U.S. metro areas for foreclosures, short sales, bankruptcies and layoffs during the Great Recession.

Consumers being late even once in making a monthly credit card payment can hurt their credit score. Banks also could have inadvertently lowered many consumers’ scores when they cut credit card limits during and after the recession. Consumers also could have hurt themselves by closing accounts, which lowers their borrowing limit. Many young South Floridians with student loans are unfairly marked down because when their payments are deferred, they are scored as if they are delinquent in paying.

So what can consumers do to turn this trend around? Young people can apply for credit cards to have their on-time payments reported to improve their credit scores. You can also make sure the three credit reporting agencies- TransUnion, Experian and Equifax are free of errors. All South Floridians should check their credit reports once a year to make sure there are not any mistakes that can hurt their score.

Click here to read more about the average credit score decline despite South Floridians paying down their debt.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

What’s Not on Your Credit Report May Hurt You

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Everyone worries about their credit score and what’s on their credit report, particularly when they are about to make a big purchase such as a car or a home. However, the things that are not on your credit report can be just as harmful as what is. There are several ways that good credit references, such as secured cards and bank loans paid on time, can help your credit:

Accentuate the positive. Positive payment history can be the best thing for your credit score. However, many people do not realize that one of the things credit scores take into account is the proportion of positive and negative items. For example, even if you have negative information on your report, having more positive information can offset the negative.

Length of credit history. Your credit score considers the age of all of your accounts. Even older accounts such as a paid-off mortgage can help your credit score for years to come.

Credit mix. Credit scores also take into account the different types of credit you have. It is best to have both installment and revolving accounts listed on your report.

Missing the good stuff. Not all lenders report their customers’ payment histories to credit-reporting agencies. This can be harmful to your credit score, because many report only negative information. Unfortunately, there is nothing you can do to force a lender to report your account, you just have to continue good bill-paying habits until they begin showing up on your credit report.

Click here to read more about the missing information on your credit report and how it may hurt your credit score.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.

Bankruptcy Law, Credit, Timothy Kingcade Posts

Trends in Credit Card News- How New Legislation is Keeping Consumers Safe

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Congress is taking steps to limit checking account overdraft fees that continue to charge consumers billions of dollars every year. Reps. Carolyn Maloney and Maxine Waters have introduced a bill that limits the cost of overdraft fees and prohibits practices that increase the likelihood accounts will be overdrawn. Also known as the Overdraft Protection Act, it limits overdraft coverage fees in many ways. It would prohibit financial institutions from charging more than one overdraft fee per month or more than six per year; it would require overdraft fees to be “reasonable and proportional” to the amount of the overdraft; and it would prohibit a fee if the overdraft results solely from a hold placed on an account that exceeds the amount of the transaction. Many merchants, such as hotels and gas stations, automatically place a hold on the money in your checking account when you pay with a debit card. The bill also addresses the practice of posting checking account transactions in a way that maximizes overdraft fees.

In other credit card news, a Massachusetts court ruled that zip codes could no longer be required at a check out. The Supreme Court unanimously ruled that zip codes are private information and consumers should not be prompted for a zip code when using a credit card. The decision came from a lawsuit where a merchant was prompted for her name and zip code, after which the retailer used this information to find her address and send her junk mail. The collection of personal information violates state law.

Richard Cordray was again nominated to head the Consumer Financial Protection Bureau (CFPB) last week. The decision came following a 12-10 vote by the U.S. Senate Banking Committee. Every Democrat approved Cordray, while every Republican opposed him. However, his approval will be stalled due to a deadlock preventing his vote. The CFPB is a federal consumer watchdog group that monitors and tracks the complaints on credit cards, mortgages, student loans, bank accounts, services and other consumer loans.

Click here to read more of the latest credit card news.

Click here to find out more about the Consumer Financial Protection Bureau.

If you are in a financial crisis and are considering filing bankruptcy, contact an experienced Miami bankruptcy attorney who can advise you of all of your options. As an experienced CPA as well as a proven bankruptcy lawyer, Timothy Kingcade knows how to help clients take full advantage of the bankruptcy laws to protect their assets and get successful results. Since 1996 Kingcade & Garcia, P.A. has been helping people from all walks of life build a better tomorrow. Our attorneys’ help thousands of people every year take advantage of their rights under bankruptcy protection to restart, rebuild and recover. The day you hire our firm, we will contact your creditors to stop the harassment. You can also find useful consumer information on the Kingcade & Garcia website at www.miamibankruptcy.com.