Are You Monitoring Your Credit Report ?
These days you hear a lot about monitoring your credit report, looking for signs of identity theft. As important as that is, my tip for the day comes as a result of working with one of my clients. Here is a situation where just checking to insure that all the lines of credit could be accounted for was not sufficient to explain the trouble he was having with his credit score. Anyone who has tried to read a credit report, quickly discovers that there is a lot of information on the report that can not be understood with out a way to descipher the codes on the report. This was one of those cases. By examining each account on the report, one could see there were no late payments, however the credit score was too low for someone who is making payments on time. When we looked deeper into the report we discovered the problem. In addition to keeping track of late payments, the credit bureaus also keep track of the method of payment each month. In this report it was showing that my client was making some payments to their mortgage on time, as agreed with the lender, then periodically it would show the payment being made on time through a third party such as a collection service. The only way this is presented on the credit report is through a series of codes. If you don’t know the codes, you easily miss the fact that someone is misrepresenting the way you pay your mortgage or any line of credit for that matter. The tip for the day is: If you suspect there is a problem with your report and you don’t see what’s causing the problem, seek the advise of a competent credit counselor who understands credit report coding.
Credit Don’ts During the Loan Process
Many are taking advantage of interest rates at historic lows, either by re-structuring debt with a refinance or purchasing a new home. However, the recent economic crisis has created even tougher guidelines and credit requirements and there are some things that consumers must be aware of when applying for a loan.
1. Don’t do anything that will cause a red flag to be raised by the scoring system
2. Don’t apply for new credit of any kind unless there is a need to build credit over time.
3. Don’t pay off collections or charge offs without first consulting your lender
4. Don’t max out or over charge on your credit card accounts, stay below 30% of available credit.
5. Don’t consolidate your debt onto 1 or 2 credit cards
6. Don’t close credit card accounts
7. Don’t pay late
8. Don’t allow any accounts to run past due-even one day!
Are Safe Deposit Boxes Actually Safe?
We all have important documents and valuables in our homes that we want to protect from theft and disaster. For many people, safe deposit boxes at banks provide a safe place to store those valuables outside of the home. After all, file cabinets and even fire-resistant cases in your house are still susceptible to intense fires, water damage, and even theft.
But, did you know that safe deposit boxes may be susceptible as well? In fact, during the attack on the World Trade Center and Hurricane Katrina hundreds of bank vaults were damaged or destroyed. Worse yet, valuables stored in a safe deposit box aren’t insured by the bank if damage or theft occurs.
And if you use a safe deposit box to sock away cash for an emergency, you may be surprised to know that a safe deposit box isn’t completely protected. Law enforcement officers can get a court order to raid your safe deposit box, and if the IRS ever freezes your assets, that freeze includes your cash and valuables in a safe deposit box.
All this doesn’t mean that you should hide valuables and cash in your closet or drawer…but it does mean you should take precautions and specific steps to make sure your valuables are protected if you put them in a safe deposit box.
If you have a safe deposit box or are considering getting one, the following steps can help you make sure your documents and valuables are protected:
Call your homeowner’s insurance company to make sure the contents are covered, especially when placing jewelry or collectibles of value in the safe deposit box.
Put important documents such as marriage licenses, car titles, insurance policies and family records in airtight plastic bags or sealed containers to help protect them from water damage.
Make copies of your important documents and store them at home or with your attorney, so you can access your information if something does happen to the originals. Remember, important legal documents such as wills and power of attorney documents should always stay with your attorney. You can place copies in your safe deposit box or keep them at home, if you want to have access to the information. But leave the originals at the attorney’s office.
Make an inventory list of everything in your safe deposit box and keep the list in a safe place at home or in another location. You may even want to take pictures or a videotape of the contents just in case you need to show more proof if something happens. Finally, make sure you inform your family members and your attorney about your safe deposit box! Otherwise, the contents may revert to the state when you pass away.