Wealth Talks A Podcast for SIngle Moms, by a Single Mom
Wealth Talks A Podcast for SIngle Moms, by a Single Mom
Defining your Legacy Challenge
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To kick of Financial Literacy month, I partnered up with another Financial Coach from Alabama to bring our audiences a 5 Day Money Challenge. This is Day 5 of the challenge: How to grow your credit organically. In this video I'm going to show you how to build your credit. So if you're thinking about buying a house or car, or opening a new account, your credit is going to be an important factor. Check out my tips on how to build your credit organically without the help of any company.
And we laugh. It is day five of the defining your legacy event. We have made it to the last day, but you still stuck with us for one more hour.
SPEAKER_01Yeah, yeah. And this is a good hour, it's a power hour.
SPEAKER_00Yes, because we are going to talk about credit. I know that's like on the list of people when they uh like when they try to list out their financials and like what's most important to them. Credit is usually always like the number one thing. Because I think a lot of people understand like the importance of credit, but they just don't really understand credit itself. Like, how does it work? But we're gonna help you tonight.
SPEAKER_01That's right. You got us helping you tonight. We're gonna give you some valuable, valuable information that you can, as we always say, you can execute now because there's no point in getting knowledge and not not using it, not executing on it. So you want to do a quick recap of the week, or you think we're good?
SPEAKER_00That's like I'll go ahead. So day one was income. You were supposed to research different ways that or different jobs that you could do to bring in extra income in the month. Number day two was saving and budgeting. We told you to sit down, start listing out all the all your um expenses, and you know, try to get in your brain like what budgeting method you would like to do, whether you were going to do the cash method or were you going to go something different, like the app pulling in your expenses, just to start generating some ideas. Then we had day three was investments. You were supposed to sit and think about what are some different investments. We talked about, you know, McDonald's, your even your car, like just things around your house. Like typically, if a company owns it, you can invest in that company. All right. And then yesterday, had the uh great pleasure of talking about insurance, learning about disability life, and you were supposed to sit and look at your policies and see if you were adequately covered. I also told you to get a flame-resistant box if you have that paper in your house. And then just also if you don't have any life insurance, disability, any of that, start to think about if you were to leave tomorrow, how would your family be without you, especially if you're like the breadwinner of the family? And so that brings us up to day five, where we are talking about credit.
SPEAKER_01Yes, because credit it determines a lot in our lives, more than we think. Um, it will determine where we live. And that's whether we rent or we own, they pull your credit to check and see how risky you are. It also determines where you work. You know, a lot of employees do pull your credit, they do soft polls. Um, I mean, they can't legally hold that against you, but if unless you're like in the finance world, then it like, okay, if you have bad credit, you can't work in finances because it's not gonna work.
SPEAKER_00And we may want to break that down, the soft versus hard.
SPEAKER_01Oh, yeah, yeah, yeah. So the soft pool are like uh little like inquiries. They're soft and soft and hard are inquiries. The soft pull is an inquiry that you know, um, they would do that. It's not, it doesn't show up necessary on your report. It doesn't duck any points from it, it doesn't have any effect on your report. So you'll do a soft pull, like if you're getting a life insurance policy, they'll do a soft pull on you. If you're getting like a cell phone, they'll do a soft pull. Your utility company would do a soft pull, and an employees would do a soft pull. The hard pull, that's where it has, it can drop your credit score because that's where lenders actually pull in hard on your report. They're looking through all your report, they're looking through your score, they're checking everything out, and those will stay on your report for up to two years. Um, and those are those are hard. So that you receive, you'll see like a little two, maybe four points dropped. The trick with those is like if you're shopping for a mortgage or something, they tell you to do it all within 30 days so that it won't show up too many, um, too many hard inquiries because inquiries do negatively impact your score if you have too many of them. So you should always um keep that in mind when you're shopping around for a mortgage or any type of um lender that's gonna do a hard pull.
SPEAKER_00Yes. Anytime that you're asking someone to lend you credit, nine times out of ten, it's going to be a hard pull. But soft increase, sometimes you won't even get like alerts that someone has soft pulled. And like Shakira mentioned, like even your future employers will do a soft credit pull just to try to get like a holistic view of like who you are as a person, because like everything in our like society uses your credit score, and it really wasn't supposed to be like that, but it's just another way of that you know, you can get discriminated against.
SPEAKER_01And that's why we're here to teach you how to improve your credit, maintain and maintain it, of course. Um, so tonight we're gonna just go over, you know, how to keep your credit healthy, how to keep your report, your credit report. Because I feel, Catherine, most people don't understand the report and the score. They kind of like think they're interchangeable, but they're two separate things and they each hold separate weight when it comes to determining whether lenders find you as risky or not. Because that's what it all is. They want to see how risky you are. Are you gonna pay your bill? Are you gonna pay it on time? And you know, that's how that's how the credit game works.
SPEAKER_00Pretty much. And then on like just to jump right in, like if your credit score is under 740, like for every like there's a range for every range that you're up under that 740, that lender is tacking on extra interest. So you want to be like 740 and above to get the most favorable rates.
SPEAKER_01Yes. And that interest, I think I said it the other the other night. Um, in the year 2020, credit card companies made 176 billion. And 76 billion of that was from interest rates. So they're they're making, they're betting on you to not have a good credit score because it's like, all right, we'll lend you money, but we're gonna make money off of you. So let's not let them make money off of us anymore. We now know how to we go, we're now gonna find out how to keep our credit score up to the 740s and and above.
SPEAKER_00Yeah, let's talk about some things that's on your credit score. So, credit score, there's different um categories that uh and they're weighted, but one of them, one of the main things on your um credit report is like either installment or revolving credit. So revolving credit is like your credit cards. Basically, you give out, well, you have a limit of money and you um can borrow from that money and constantly pay it back. So that's revolving credit. Installment credit, that's more like your mortgage, you know, it has a has a fixed amount that you owe and you're just paying it monthly. That's a slight, that's the slight difference. Cause like you don't get anything back from your mortgage. Well, I mean besides the house, but it's you're yeah, but you're not like you know, taking the house and bringing money back from it. Like when you pay it off, you can well, while you're with while you have your mortgage, you can get equity in your home. But that's a topic for another day. But just the general principle is that credit card, you're swiping, you're paying it back. Um, mortgage, that's your installment um loans, you're just paying it off.
SPEAKER_01Yes. So you need for your your the credit report, you need to have those, you need to have a mix, a healthy mix of those two types of um credits. You need to have a install some installment loans, which could be mortgages, like like Catherine said, it could be student loans, it could be personal loans. So you need to have a healthy mix of both. You just can't have credit cards or you just can't have loans. You have to have a mixture of both because I believe that's 15% of your um your score is based on that healthy mix for you.
SPEAKER_00Yeah, and one of the major things that affects your credit score is the payment history.
SPEAKER_01That's a high as 35%.
SPEAKER_00Yes, like so, like try to avoid not missing a payment, even if you can't pay the minimal amount, try to send something in because 35% is such a large percentage. You miss one payment, your score is gonna drop.
SPEAKER_01Yeah, it's gonna drop drastically, it's going to drop.
SPEAKER_00And then the funny thing is if you have a stellar payment history, it doesn't really bring it up much.
SPEAKER_01Yeah, it doesn't. So, yeah, so when you're paying your bill, is something that I want I want to bring to people's attention is you have three different dates. You have the due date on your statement, you have the reporting date, and you have the closing date. Most people try to pay their bill before the due date, but that's a little bit too late. And I say that because the reporting date is a day, it's usually before the due date. That's when the credit cards report to the bureaus. So you want to try to get your bill paid before that reporting date because you want to look like, all right, yeah, she paid her bill off. She didn't wait till the last minute. Because they look at that, they wait to see if you waited to the last minute to pay your bill. So try to pay your bill a little bit before the due date. Hit that closing that reporting date so that you can it can impact your score positively.
SPEAKER_00Yes. Next thing we got is the amounts owed. So you have a thing called the credit utilization ratio. So basically, you want to keep this up under 30%. Like total of all the credit that you have in your name, like 30% is a good range to stay under, but I would say even lower. Yes, if you could.
SPEAKER_01So 30% doesn't improve your score. It doesn't improve it. It doesn't hurt it, but doesn't improve it. If you really want to wow the lenders, you want to be under 10%. And I know that's like that's a lot, but the whole point of credit is for you to pay buy and then pay off. It's not like an extra bank account for you. It's just you you buy something and you pay it off. So you always want to keep it under the 10%. The 30% doesn't hurt it, it doesn't help it either. You want to help your score, you want to help your report. You want your report to look healthy and you want just your score to keep rising.
SPEAKER_00Yes, and credit utilization counts for that's another big chunk, like 30% of your score. Yes, yes, yeah. So next we have credit history length. So that's about 15% of your score. Yes. So credit history, it's just how long, like the like the first credit you got. If it was like you graduated high school and you got a credit card, that probably is the longest piece of credit you have. And so typically once it gets above seven years, that's when it becomes like a good. But up until then, it's just going to be listed on your report as like fair because they lenders don't consider anything up under seven years as good. And I know for like us, we may be like, man, seven years is a long time. But for lenders, they're like, no, not long enough. I can't trust you.
SPEAKER_01And and with and with that, um, that history, keep in mind that when you apply for new credit, it does knock some of the years off. So let's say you had 10 years of credit history, and then you apply for two loans and a credit card, it's gonna drop it down some. So you want to make sure that when you're applying for new credit, you're keeping that in mind because that will that will drop down your your payment history, your um credit history.
SPEAKER_00Yep. That brings us to the last one, which is credit, like new credit. So that's probably about 10% of your um score. And basically, you just don't want a lot of hard inquiries on your credit report because, like Shakira mentioned, it's gonna knock you down each time, probably about four points. But I mean, it may rebound. But if you're constantly applying for like new credit throughout the year, like those hard inquiries stay on your report for up to two years. So I I personally wouldn't put no more than like two or three in that 24 uh year, uh 24 month time span. Yeah, that's that's true.
SPEAKER_01Oh, back to installment loans. Sorry, I forgot to mention this. So when you do installment loans, let's say you get a personal loan because you don't have any loans on your report and you want to build it up, you should get a loan. Your loan period should be minimum nine, nine to twelve months. Like you don't want to get a loan for three months because that doesn't really count to them. So when you go for a loan, let's say you do like a um a self self-builder, because that's like a credit service that helps you build your um your credit score. They give you installment loans to mimic like a student loan or anything. You want to get a term that's like 12 months or higher because that's the report, that's then when they start reporting it to the bureaus. Like saying, like, oh, I had a loan for three months, I paid it off, really doesn't hold any weight. But if you have it for 12 months, then they're like, oh, okay, so she can or he can get something and pay it off on a continuous basis because they want to see how you pay stuff off and they want to see how risky you will be if you keep your word and pay what you say you're gonna pay at the time you said you was gonna pay it.
SPEAKER_00Right. So I am going to once I get back to where I want to be dropping a link to annualcreditreport.com. It used to be where you could um you would only get you were entitled to only one free credit report a year. But when the COVID-19 pandemic first started, um, basically government said free credit reports. So the good thing about this website is that you can get your experience, transunion, and who's the third one that's invading me? Um Equifax. Equifax. Yeah, you can get your report because that's where you need to start. You need to get your report and see what's on there. Now, when you get the report, your score will not be on there, but you can use an app like the Experian app is really good to um like to get your um you can get one score, your experience score for free. And you can pay like, I think like $29.99 once to get the other two, or you can do like a monthly plan with it also. And you've probably seen the Experian Boost commercials, like those have been really popular. Like um, how that works is that you can add like your utility bills um to your credit report and pay them on time, and it's supposed to help um boost your score because you have like that um steadily reporting credit on your report. Yes, yes, yeah. Yep, so I dropped that link in there. So let's let's keep going. So let's talk about uh what are some ways people can improve their credit.
SPEAKER_01Yeah, I got I got some ways. Okay. So one, make your payments on time. Number one. Not 99%, not oh, I was doing it, but this had happened. None of that. 100% of the time your payments need to be made and pay attention to the reporting date, like like I mentioned earlier. Try not to pay right at the due date because that shows that you are just barely making it. Um, that's gonna help your screen your credit score more ways than you can imagine. Um, keeping your utilization low, um, under 10% is is ideal. That's gonna really help improve your score because that's that shows the lenders that you're not just borrowing, barring, borrowing and can't pay it back. So that that's one thing that's gonna help it. Um, having a healthy mix of credit, the installment and the the revolving credit, that's gonna help your score. Um, keeping your credit age to five minimum, seven years is better, but keeping your credit age history to a nice, comfortable number will help your credit score. Now, let's say you're like Shakira, my credit is bad. Like I messed it up when I was in high school, or I messed it up when I had, you know, COVID came. There are ways to help build your credit organically. You can get a secured credit card. And what a secured credit card does is you get a card and you put money on it and you spend it. So this is your own money, you spend it, so you're not like overdrive, overdrive freeze of interest rates. Then once you do that, you put more money on it and you spend it again. And what this does is this shows the credit, the um the lenders, the bureaus that you can handle swiping and paying. Swiping and paying, that's all it is. Now, when you get a secure credit card, you want to get one that turns into an unsecured. So unsecured credit cards is your American Express, it's your Visa, it's those cards that you you get a limit and you spend and you pay. So you want to get a secured credit card that will turn into an unsecured credit card. And that's how you build your credit. Now, three cards that are really good for people who have bad credit or who have no credit or are the Discover It secured card, the Capital One Quick Silver secured card, and then your Open Sky secured Visa credit card. Those are three good cards that you can get if you're struggling with building a credit or if you do not have credit. So that's important for you to know. Um, you want to watch when you, if you want to look at any other cards, you want to make sure that watch the fees because remember, there are certain things that are hidden fees they add in that you don't know. You want to make sure you have an idea of what those fees are because you don't want to get a secure card and you're like, oh, this is great, and then you get hit with a $49.95 annual fee. And now you're like, wait, wait, what happened? So you want to be careful with that. But those are three cards you want to use to start building your credit. You can also, um, if you have someone that you trust, you can be an authorized user on their account. If they trust you, um, you could be an authorized user on their account. They usually call those trade lines. So you'll you'll buy a trade line and then that will help you build your credit score. So that's another way you can build it.
SPEAKER_00Right. And then the important thing to note that this is like if you would like to do it yourself, if you want to help rebuild your credit without relying on the work of credit repair companies, because to be honest, there are some malicious credit repair companies out here that are that will take advantage of you. But in certain states, credit repair is like illegal, like companies can't even do business there. Like Georgia is one off the top of the bat. You can't do credit repair in Georgia. So if you are going to work with a credit repair company, I just wanted to go over a few things of what to look out for. Because if you see these things, like this company is probably not the most legit, you need to try someone else. So, number one is upfront charges, like they can't charge you upfront. Like they have they charge you after they've performed their work. And so some of them will try to skip around this rule by offering subscriptions that you can pay each month, but you like don't fall for it. And then also they have like a pay per delete um subscription. So then, like every time they delete something off your credit report, then they will ask you to pay them. So you shouldn't do that. You should just pay them after they have finished all their services. Number two, which is the biggest one why companies are illegal in Georgia, is because they misrepresent their services. You cannot remove accurate information from your credit report. Like how some of these companies operate, they take per chance, like they're taking the chance that maybe your name is misspelled wrong, especially if you have like a more unique name. Like they wouldn't like they would send a letter to the credit bureau saying, Oh, you got the wrong person, you need to delete this. And typically they just dispute information hoping that it's wrong. But if it's accurate, if that's you, if you have that debt, then they can't delete that by right. Yes. Yep. And then also just overall just unlawful advice. Like sometimes they may try to get you to create like change your name. This is it's crazy, but there have been cases of like they try to get you to like change your name and such so that that information doesn't really match the person who's on the credit report. Yes, I'm I'm serious. It has been cases. So I mean, I I'm just what I'm saying, like there's just some shady companies out here. Now there are some very legit credit repair companies that would they do help you with like every step of the way. But yes, typically, if they try to like get you to change your name or anything, if they try to get you to like pay them up front, then go to another company.
SPEAKER_01Yes, be be very, very careful. Like if it sounds too good to be true, it usually is too good to be true. Credit is something that even if you mess up your credit, you can get it back. I mean, you can build it back up. It just takes time. You gotta be patient. You gotta be patient, you gotta pay your bills, and you gotta keep your your your debt down low, and you will be surprised at how fast your credit will grow.
SPEAKER_00Yeah.
SPEAKER_01No, you go ahead. Yeah, follow the the mix, the healthy mix of installment and um and revolving. And I'm telling you, you're gonna see your score drop. I mean, you're gonna see your score increase. Sorry.
SPEAKER_00I was about to say they were about to come for you.
SPEAKER_01It works. And one thing, Katherine, I want to mention is is how to handle, let's say, someone does have a lot of credit card debt. When you're going to pay down your debt, you want to be strategic about it. So there are two methods that I usually mention to the clients, and that's the avalanche and the snowball. So the avalanche, I personally like if I have high interest debt. So if you have credit cards that have like a 23%, you know, that's considered high. You know, anything over like 14% is considered high. You will want to tackle those first. And by tackle, I don't mean don't pay the rest of them. I mean you pay the rest of them and whatever extra money you have, you throw it to the one with the highest interest. Because in um reality, that one is costing you more money. You're paying out more money and interest over a long time. So you want to that's you want to be strategic when you're going to pay down debt. Not especially.
SPEAKER_00Yes. Okay, so for the snowball then. Yes. So avalanche, you start with the highest interest first and debt and get rid of it. But snowball is the opposite. You start with like the lowest amount debt and you um tackle it that way. I like snowball because I can see my results more quicker. And so, you know, if you're a person that needs that stimulus to like actually see the fruit of your labor, you will actually see it with the snowball method. While with Avalanche, it it takes a little while to see it, but but overall, you are saving more money because you're tackling the highest interest first, saving money on interest compared to snowball. That highest interest is still accumulating while you're working at the bottom. So it just comes to personal preference at the end of the day.
SPEAKER_01When I first got a credit card debt, I did use the snowball. The snowball was what I use. I was a big Susie Orman fan. Like I used to watch Susie Orman's show every Saturday, every Saturday night. Like that was my that was my fun thing. But yeah, I use the snowball. But when I got a little, I read some some different materials and I found out about the Avalanche, and I I tried that and I like the Avalanche too. Um, because I I found that that was good. Also, guys, no store credit cards. No store credit cards.
SPEAKER_00It ain't worth it.
SPEAKER_01Not worth it. No store credit cards, no, no, no, no, you know, Victoria's Secrets, none of that. If it doesn't have a Visa MasterCard logo, it's not it's not worth it. If you can't use it any other place, it's not it's not worth it at all.
SPEAKER_00I know they sweet talk you in the store, talk about if you sign up today, you get like what 40% off your today's um purchase and stuff. Like they'll they'll try everything because then they and don't blame I don't blame the employees at all because they get a little kickback from how many people they sign up for, like the cards and stuff. So I don't knock anyone's hustle. Yeah, but but just tell them respectfully no.
SPEAKER_01Yeah, because the the store cards they hold higher interest. Um, and it's something that you get into and you'll keep buying, and and then next thing you know, you owe this money and you're like, what? So yeah, don't don't fall for that. And just like some misconceptions about credit. If you check your credit, you your score does not go down. You should all you should be be regularly checking your credit just to make sure you're on you're on track. Your score, it does not impact your score at war. Your score will not drop if you check your credit score. It does not does not work like that.
SPEAKER_00I know there's a lot of myths around credit. Like one I one I saw, well, a lot of just false information about credit. Like one thing I saw is like someone's like, if you swipe your debit card as a credit, that helps boost your credit score. But you got to realize that your debit card is linked to your banking account. Like there's a there's nothing in your debit account. Well, like swiping your debit card is not going to report to the credit. Like there's three major credit bureaus. Now, with the Experian Boost, like you can, like if you're constantly paying for like utilities like internet, phone, electric bill, like it will scan your account to find like those types of transactions and then put them on your credit report. That's the only way, but no, not swiping your debit card and running it as credit is going to improve your score.
SPEAKER_01Yes, that is so true. So, yeah, so building like we we have to get our credits because, like I said, I gave the the statistics um the median black credit score is 677. And like we all know that that just costs us more interest. Like they'll lend to us, but they won't lend to us like they as they would if we had a 740 or better. So we gotta we gotta watch that, we gotta build that up because credit is powerful. Um, it's powerful for many reasons because you can use you can leverage your personal credit. Once your personal personal credit gets to a certain score, you can use that to help build business credit. And like we all are working, and some of us are not inheriting loads of cash. So if we want to do something like start a business, we sometimes we fall into the problem of not having enough capital. And this is where credit can come in and it can help you fund a business, start a business because it will give you that ammunition, it will give you that business funding that will help you pay for startup costs, pay for equipment, you know, whatever you may need. So it's important that you build your credit up because so you can use it at your advantage to build for businesses. You can also use it as a way to pass on generational wealth to your children. Because if you have good credit, that is, I don't want you passing out for that credit, but if you have good credit and you add your child as an authorized user, what that does is that gives them that credit payment history that the the lenders like to see. They'll see, oh, this person has been paying credit off for a while. They've been handling responsibly. So it helps your child, you know, get that good credit score when they're by the time they're 18 years old.
SPEAKER_00And not just personal credit, you can also help your child build business credit, like when they're like 14. So if they want to be a young entrepreneur, like they can, because we're seeing that a lot. Like there's kids younger than me running full-fledged businesses.
SPEAKER_01Yes. And I am a big advocate for every family should have a business. Like that is that is key. Like, and every child, by the time they're 21, they should know how to purchase a house. The steps involved in purchasing a house, they should be able to understand what's needed for purchasing a home. They should know how to run a business. Like these are things our children should know. They they should know these things because it's very important for them when they get out in the world. You know, giving our children money is cool, but giving them knowledge so that they can make those decisions for themselves, it's a game changer. It's totally a game changer. There's stuff I wish my parents would have told me, but they didn't know. So now I pass it on to my children because now I know, so I have to pass that knowledge down.
SPEAKER_00Yes. I wouldn't go back to interest rates because I forgot something. Okay, so say you have a credit card and you have like maybe not necessarily stellar payment history, but you haven't missed a payment in the hot minute. Like just call your call your credit card company and ask can you get a lower rate? Because I bug mine every six months.
SPEAKER_01Let me say something. If they don't do on the first one, call again.
SPEAKER_00Yes, and get another rep. Like, like if the first one won't do it, the second one would. Yes. Like, call again. Like they they will knock down your rate, especially if you've like been paying on time for like a while. I just hit them with the hey, so I was like, my my other credit card, I'm I'm at this percentage and y'all still up here. Like, I don't want to use y'all that and they want you to use it. Yeah, so they will knock down your rate. And like I said, you can call every six months and ask them to lower your rate. And again, if the first one's like uh not yet, just call back, give it like 15.
SPEAKER_01Yep, yep, yep, yep, yep. So are we gonna do homework or yes, homework?
SPEAKER_00Go to that website and pull all three of your credit reports, and I want you to sit down and go through it and make sure the information is accurate. Now, if it's inaccurate, like you can literally like Google the letter, the dispute letter, just change your information in it and send it to the boroughs yourself. You don't have to pay someone else to do it for you and just tell them, like, hey, this information is wrong, like, and just give them the reason why, like, my name is actually spelled this, or you know, this is not my debt, this is someone else's debt. Um, that's one thing we didn't talk about cosigning with other people.
SPEAKER_01Oh, yeah, don't co-sign. I I learned that the hard way. Don't co-sign anything with anybody.
SPEAKER_00Don't do it. The old phrase is to never do never give what you can't live without. So I will not co-sign with anybody. I'm also the person, last person you need to ask to borrow money. Because then not 99.9% of the time the answer is gonna be no, just just because I I personally just don't trust people like that. But yes, so for example, we have a client now that has co-signed on loans with her children, but like this client wants to buy a house, you know, but those large loans for vehicles, very nice vehicles, like they count against her. So now her debt to income ratio is like in the 50s. So no lender is gonna give her anything. Like when we're talking debt to income ratio, that's just basically how much how much of your money is going towards debt divided by how much money you bring in each month. And typically you want to keep that, man, it depends on the lender, but I would I would keep it up under 30% because I think the cutoff, like the tip top cutoff is like 45%. And that includes like if you were gonna get a mortgage, let's just say you're at 30%, you can't uh go above that 45%. And that 45% includes the principal interest, taxes, and insurance, also any HOA like homeowner association fees or any miscellaneous fees that need to be added into there. So very quickly, you could get to that 45%, especially like with how how houses are right now or just the area you live in.
SPEAKER_01Yes, yes, yes, very fast. Back to those dispute letters. So if you're sending out a dispute letter, um, you want to make sure, first of all, you want to send out certified mail. Yes. Um, you want to keep all your receipts, keep everything. Then when you send the letter, you need to send a copy of your ID and your candidate symbol copies of those because that's gonna prove who you are, your identity. Because you don't want to just send a letter and they're like, well, who is this? They they need those two forms of identification to know that it's you. And certified mail actually helps it. The bureaus have 30, the the creditors have 30 days to respond. The bureaus have 30 days. So if they don't respond in 30 days, then there's this website called Consumer. Um, what is it, the consumer board? Let me get it up. CFP, uh, CFB, consumer financial board, I believe it's called. Be familiar with that, that um that that that organization, because that is that is there for us for the consumer to protect you from any predatory lending or consumer financial protection. Yep. So jump drop that in the chat too, because that's going to be very important. So if you have any issues with any creditors or lenders, those are the people you go to. Those are the big, those are the big brothers and sisters that if anything was to happen, we call out big brothers and sisters. And they do take action because I had a personal client who was wrongfully um handled by um what you call it, by a collection agency. They charge up all kinds of fees, they they ran up her debt and they garnished her savings account. And we went through the process, we reached out to the consumer um finance board, and we got action. So they do take action, they do work. So those that's something that a resource that you should put in your back pocket so that if you have any issues, you can always reach out to them and get some justice for for yourself.
SPEAKER_00Yes, and just with um collection agencies, like how it works is that typically like there's typically two ways. Either a the company that you possibly owed, because sometimes it may have been a mix-up, like the company you possibly owe, either they wrote it off and then a collection agency like bought it for pennies on the dollar and they're trying to collect money out of you, or the original company has hired the collection agency to try to recover the funds for you. But typically, like when you're dealing with a collection agency, just always get everything in writing because they're unfortunately they they are snakes. They're gonna they're gonna try to get as much money out of you as possible. So you definitely don't want to run from the collection agency. You want to face them head on, like you want to get everything in writing. If they try to tell you over the phone, like, oh, if you only send X amount and we'll write the X the rest of it off, get it in writing. Because if they try to take you to court, you can't be like, oh, well, I talked to them and you know, they said that they will only take 700 instead of a thousand. I sent it to them, and now they're telling now they're trying to take the rest of the money what the original amount was. Like that's just not gonna stand up, stand up in court, which is sad, you know, at the end of the day.
SPEAKER_01Yeah, yeah, to be be very, very on diligent and on top of things. And know you're right. We consumers have a lot of rights. We have a ton of rights. Um, educate yourself on what is legal and what's not, so that you can protect yourself. Because if my client hadn't come to me, she would have had her whole savings account garnished and it'd have been it would have been horrible. Like this is her only reserve that she saved took a while for her to save up, and they just came and snatched it. So you got to be very, very careful. You got to know what's going on. And like Catherine said, if you receive a letter from Collections AC, be on top of it, you know, find out what it is. Don't be afraid to open the mail. Don't and sometimes they'll they'll work out a deal with you. Like they'll work out a deal with you. It's like they want the money, just you know, just work something out.
SPEAKER_00Yes, because then another thing is that if you keep ignoring those notices, then you may get a court letter. And then if you miss court, like that's default judgment that now that collection agency can possibly just start withdrawing money out of your account. Like, and then if you're already like in a financial hardship, the last thing you need is like some outside person coming in and like freezing your account and taking whatever funds are in there. And it's just horrible situation all the way around.
SPEAKER_01It's not a good situation to be in. So, yeah, homework tonight. I want you guys to check your credit reports, go through them. I mean, like go through them, like take a ruler and go through, make sure everything is um correct. And you'd be surprised how many people have errors on their credit report that when they dispute, their score goes up. So just go through that, try to find, you know, try to look for errors, don't falsify the errors, but look for the ones that are that are incorrect and start the disputing process. You can you can get the letters off Google, change up the word in a little bit, and then send it out.
SPEAKER_00And then just on a side note, that also if it's just because it's not on your credit report, doesn't mean that you owe it also. Because there's a lot of like lenders, just creditors in general, don't even report to the boroughs, but then you could still get a letter in the mail saying that hey, you owe this debt. They just don't report to any of the bureaus, or they may report to a smaller borough because there's like three big ones that we know about, but there's tons of smaller ones also. Yeah, yeah.
SPEAKER_01And you will find it on that website. I I mentioned the consumer finance, you'll find the all the bureaus there. You'll be surprised how many bureaus there are. Are they like bureaus for rent for your bank accounts? If you ever wonder why you get denied for a bank account, you'll go there and you'll see all the information there. It's a great, great resource for you to have.
SPEAKER_00Yes. So, yep, that's your homework. Make sure you, if you want to fix your credit, if you want to improve your credit before you, because I mean it would just suck to lose out on either like your dream home or you know, an apartment you've been waiting on just because someone has a higher credit than you, or you know, there's just things that you can uh credit is something that's fixable. So yes, and it takes time. So you I think it's best to start now than rather wait until you know, day of like when you're applying and stuff, and then you're like, you're not in the running for this anymore. Exactly. Yeah, last thing I'll mention there are FICO scores and there are vantage scores. So I know a lot of people will crack jokes about you know, experience says your credit is horrible, but credit karma will say that your credit's good. Those are credit karma shows you that your vantage scores, and lenders typically don't use those, they don't care about them, they care about your FICO scores.
SPEAKER_01FICO scores, yeah.
SPEAKER_00So if you have like a discover card, I know they'll give you like one of your FICO scores. Again, the Experian app, you can pay like a one-time uh fee to get like all three reports. If you just wanted like a starting point and you didn't want to subscribe, I don't I don't think there's really a need to just subscribe for your credit report every month, like to get a credit score unless you like really are like trying to like fix it and you're trying to like apply for like a mortgage or something. But even then, you could just pay the one-time fee again just to see how it is. Yes. Yeah. All right.
SPEAKER_01So it's been great, guys. This has been a great week. Um, I hope everybody has that tuned in has learned something from this week. Um, please, if you would like the copy of the do it yourself repay your credit organically, don't forget to drop your emails. You could drop it in any of the videos if you're catching the replays. Um, and we I will get that to you next week. Um, I'm very excited. This week has been so much fun, Katherine. It's been great. I'm gonna miss you every night.
SPEAKER_00Same to you. I know. I was like, I was like, today's the last day. What am I gonna do next week?
SPEAKER_01Yeah, but we're we're gonna be back in November.
SPEAKER_00Yes, financial planning month.
SPEAKER_01Yes, and we're gonna have a lot of more information because imagine how much we're gonna grow from now to November.
SPEAKER_00I know. I was like, tell I was like, remind people about your things, your uh webinar. Well, your book.
SPEAKER_01So I uh released a book at the beginning of this month, now Amazon number one bestseller. And guess what? One of the categories was credit repair because I put a lot of credit repair information inside of the book. You can grab that book, the link will be dropped down um from Amazon. Also, this Sunday, I'm having my very first family legacy planning session, which is a meeting for family, and we all cousins out here. So jump on that link. Sunday, 3 p.m. Eastern Standard Time. We're gonna be going over financial planning. I'm gonna go a little bit more into depth on credit um repair, and then my lovely two cousins who are realtors in Florida, they're gonna be teaching you how to purchase real estate for to uh create generational wealth.
SPEAKER_00Yes, and then just a reminder that I am hosting another Money Matters Monday, the last Monday of every month. I choose a random financial topic and I go into a deaf in-depth with it. This topic, this time, is going to be on beginner investing. If you've ever been curious about how to invest, where to invest, how to get started investing. This webinar is for you. I also dropped the link for that, and that would be this Monday at 7 p.m. Central Time. Yes, yes, yes, yes, yes. So well, I think that's it. We're going to sign off.
SPEAKER_01We're signing off. Everyone, we'll see you on Facebook. Bye.