Honor, Pride, Sacrifice and Debt – Credit Law Center

Memorial Day is the day we honor those men and women who took the ultimate sacrifice and in return giving us the greatest gift as United States Citizens, FREEDOM!What a great honor to live in this Country and to be given this wonderful gift, here at Credit Law Center we want to express our heartfelt gratitude to the families, and friends that have lost a solider. We all have our story and our experiences, each employee here I am positive has been touched by a life of a soldier.

Today I want to share a story with you; this story is my story, my father’s story. Our story isn’t about losing someone to active duty, but it is about the struggle that comes with active duty. This story gives me a passion for helping service members daily in my job and why I love what we do at Credit Law Center. Each one of our employees has a reason and a drive for what makes them want to help others succeed. Some of us it may be seeing a Single Parent survive divorce, others just picking you back up after years of struggling, mine is military. We don’t offer military discounts just during certain Holidays. Our company Honors them yearly. I am grateful for this.

My father was 18 when he signed up to head to Vietnam, just like many other service men and women that signs up for this heroic duty. They pride themselves on serving this exceptional country. My dad was sent to Vietnam to be a mechanic on the gunboats and eventually was the one running the gun. You see… He never told me any of this information, let alone did he talk to me about any of this. It was only after his passing that I found this information out. My father was only in Vietnam for a short period, but the trauma it caused him remained with him for many years to come. Ultimately, the trauma is not what this story is about; this story is about the last year of his life and how Agent Orange and being a Disabled Veteran can be very rough on you financial situation. My father’s short stint in Vietnam gave him agent orange exposure. In the last ten years of his life, the VA deemed him 90% disabled due to Agent Orange Exposure.

In April 2015, my dad was rushed to the hospital via ambulance due to a diabetic coma. He was in the hospital and rehab for several weeks. Since my father was considered 90% disabled, I assumed the VA would cover the medical expenses. The Ambulance took him to a non-VA hospital, but they are still supposed to cover this. Unfortunately, there is a ton of red tape, and lots of medical coding errors, as we all know that is common even in non-VA claims. My father was soon released from the rehab and getting non-stop calls from hospitals, doctor’s billing dept, and numerous medical bills daily. Many of us know the stress of dealing with collections and medical billing, try being sick and knowing that this should be handled and knowing he was completely covered.

This is where I come in; the dear old daughter who takes the wrath of the buried trauma he experienced in Vietnam, anger that he was sick and most likely dying from an illness he acquired from serving this beautiful country that he wasn’t ready to let go, and angry at the debt collectors calling him. I tried for months on end to straighten out the situation, and I spent hours on the phone trying to sort it out, with both billing departments and patient liaisons, etc. His credit scores dropped tremendously; they lowered his credit card limits due to the credit scores dropping as the debt was figured in his reports. He had constant calls, letters and just plain stress on both of us.

I was never successfully able to take care of these astronomical medical debts, which affected him mentally, physically and financially in the last year of his life. He passed away from ischemic heart disease, which contributed from agent orange exposure.18301297_10213081692062898_363950453238426406_n

I am not telling my story to discredit the Veteran hospital, what they do is an excellent service to honor our service men and women, and if it weren’t for their care, many men and women would suffer. The moral behind this is many of our service men and women suffer, because of medical billing codes, or inaccurately being billed. A recent report by the CFPB states that 13% of collection complaints made by service men and women are about medical collections. Many of these complaints are from veterans who believe that insurance will pay their bills after leaving the hospital.

I didn’t work at Credit Law Center when I was enduring this life event, and I wish I would have had the experience that I do now. What I do know is that I see it so many times, that men and women have the medical debt in their reports when they should not. My experience has given me the compassion, and the fight to help our consumers. If you know someone who could use our help, we would love to assist them.

Wow! With The Cost of Rent Rising Have You Thought About Buying?

Wow! With the cost of rent rising have you ever thought about buying a home? It is important to weigh the pros and cons of renting vs buying. Credit scores are a factor in buying a home, but there are many different programs for future home buyers can help them get approved for a loan.

According to a recent report by Zumper National Rent Index, the average rental payment for a one bedroom apartment is $1,143, and for a two bedroom apartment $1,358.With the cost of rent rising on average from .4 to .7% for the third month in a row, have you ever weighed the benefits of owning a home?

Rent vs. Buying – Questions to ask yourself

Renting vs. Buying is a huge debate for many, whether you are single, have a family or you a single parent family. Some things you may want to consider are….

  1. How long will you stay in the home? Purchasing a home is a great way to gain equity, building equity isn’t an overnight process. It does require you to stay in the home at least on average of 5 plus years.
  2. Will you be able to handle the home repairs? Home-ownership comes with a lot of responsibilities, and one of them is the up keep of the home. Make sure you are prepared to maintain the property and anything that may break.
  3. If you decide to remain renting, how much will your rent increase over the next few years? With the average cost of rent continuing to rise each year, it may be good to keep in mind this may continue.
  4. What is my Credit Score, and will I qualify for a good interest rate? A good credit score is important when trying to get the best interest rate possible.

Home Ownership

Owning a home can come with lots of advantages and disadvantages. Some major advantages are earning equity, belonging to a community, tax benefits, and the ability to decorate the home to your desire. It is always a good idea to weigh the pros and cons before jumping right in.

 

Renting

Just like owning a home, renting has some great advantages too. If you are unsure where you want to find a permanent residence renting is always a good choice, renting is great for those who don’t want to do the upkeep on a home, if you are financially secure in your job, or just not quite ready to take the financial burden of taxes, mortgage insurance.

It is important to know if home ownership is your American Dream, but you feel your credit just isn’t where it needs to be.  According to the most recent FTC report 79% of all credit reports contain errors, be sure to review your reports, stay update and active, and don’t hesitate to reach out to a professional for help.

 

Debt Collectors Do Not Care About Your Divorce Decree. – Credit Law Center

A divorce decree is the final courts ruling or judgment in the termination of marriage. In this final judgment, the two parties will divide properties, determine spousal/child support and divide financial debt. Something that is brought up a lot in regards to credit reports and debt collections is, my spouse was supposed to pay that debt according to our divorce decree. Yes, your spouse may have been deemed responsible for paying this debt; however, the credit card companies or other financial institutions do not follow the divorce decree

Why do financial institutions not abide by the divorce decrees?

A financial institution only follows the legal binding contract you signed with their organization, so if you and your ex-spouse signed a joint account with their company, you would both be held responsible for the account. It is a good idea that you and your ex-spouse try and pay off any debt before filing for divorce.

It is important to remember that even if your spouse is deemed responsible for paying A, B and C debt in the divorce, and if they do not pay they will come after you and any missed payments will harm your credit and possibly cause the creditors to file judgments.

The debt you are unaware of.

Some states are community property states, and you could be held responsible for the debt that your spouse incurred, even if you are unaware of and did not sign a contract with. Community property states consider marital debt – joint debt.

Things to Consider.

Add an Indemnity clause to your divorce decree in cause you have to pay for his or her portion of the debt to protect your credit rating. The Indemnity clause will allow you to take him or her back to court to allow you to sue for reimbursement.

Make sure you are aware of all debt that is on both reports when filing for divorce if you live in a community property state.

Try and pay off as much debt as possible, before filing for divorce.

Make sure any house or car loans are refinanced in one name so that both names are not on them.

Mortgage Pre-Approval Process – Credit Law Center


If you want to purchase a home the best possible way to guarantee you are on the right track is to see a mortgage lender.  A lender will be able to help you in the pre-approval process. The pre-approval is a promise from the bank that you are qualified to borrow up to a certain amount at a particular interest rate.

What is the Pre-Approval?

Pre-Approval means the lender is confident that you will be able to provide the down payment and your financial statements you have provided show that you will be able to cover the mortgage payments on the specified loan amount. The only contingency left is that the home you choose must meet the appraisal price.

What you will need for Mortgage Pre-Approval

  1.  A Good Credit Score – Most lenders require a credit score of 620 or above. The higher the credit score, the lower the interest rate, the lower the score, the higher the interest rate. Some lenders may refer you to a credit repair company to help you review your credit file to remove inaccurate or derogatory items.
  2.  Proof of Income – All borrowers will need to provide W-2 statements from the last two years, recent pay stubs that show income and any evidence of any additional revenue or assets.
  3.  Employment Verification – The lender will want to see your most current pay stubs and verify your employment. They may also want to speak with your employer. If the same employer hasn’t employed you in the last two years, they may want to talk with the previous employer.
  4.  Proof of Assets – The mortgage lender will want to see your most recent bank statements and any investments that you may have. These items will prove that you have the funds to cover the down payment or the closing costs. If you are receiving any money from a family member or friend to cover the down payment, you will need to make sure you have a gift letter.

It is important during the pre-approval and loan process that you do not change jobs, take money from any that you can not explain, apply from credit cards or make any large purchases

Medical Debt and Credit Reporting – Credit Law Center

With social media so present in our lives now we see the amount of GoFundMe pages for medical bills, it is validating the statistics.  According to a recent report, by the CFPB 43 million Americans have overdue medical debt on their credit reports. Approximately 2 million Americans are affected annually by medical debt and remains the leading cause of personal bankruptcy. Medical debt can stem from a routine medical examine being billed improperly to the insurance company, a tragic accident or a sudden illness.

Medical Debt and Third-Party Collections.

Hospitals and doctor’s offices do not have an active association with the credit bureaus. However, they do have a relationship with third-party debt collectors. Third-party debt collectors do have a connection with credit bureaus, and they will report the negative items to the bureaus. Every medical facility has their set of rules and regulations on how long they will keep a debt before they transfer it to the third-party debt collector. Some medical facilities may move it one day after the due date and others it may be after 60 days past due.

Medical And Credit Scores

When a negative collection item hits the consumer’s report, it may drastically lower your credit score. Having one medical debt on a credit report can lower your score anywhere from 50 to 100 points. There are two different scoring models used, FICO and VantageScore. FICO and VantageScore may be utilized for various reasons, and there are several different variations of both, each industry may use a different version to determine your credit score. For example, the FICO 8, the most commonly used when applying for a loan or a new job until recently, as they just started using the FICO 9. The significant difference between FICO 8 and FICO 9 is that FICO 8 does not separate medical debt from other unpaid debt, so if a lender is using a FICO 9 your score has the potential of being a few points higher.

Things to do to avoid medical debt

The best possible scenario is to pay all bills on time on the due date, in some cases, you may be paying them before the insurance has paid, and the medical facility may reimburse you. That will avoid collections on your report. It is always good advice to know your healthcare plan and understand what your co-pays are as well as your co-insurance, make sure to be familiar with your Explanation-of-Benefits. Being familiar, with your healthcare benefits and knowing what your responsibilities are, and paying the co-pays and coinsurance in advance will help will collections items later. You may always call the healthcare plan and ask them to go over the benefits with you, and you may also ask the medical provider for an itemized statement. Don’t ever be afraid to verify the have billed you correctly.  Last but not least call to make arrangements, you may try this first with the provider or if it has been transferred try working with the collection agency before it is sent to a credit bureau.

 

 

Teaching Credit and Money to Our Children – Credit Law Center

From the day we bring home our children from the hospital all we want to be the best at guiding them and teaching them. It’s a no brainer we will be the one teaching them to tie their shoes, brush their teeth, and most of us will be that one parent waiting up for them until curfew. Did you ever think of how important it would be to teach them about credit scores and cards?

Honestly, I can say I didn’t realize I would be worthy of teaching them! After a failed marriage and adjusting to the daily financial struggles of being a one income single parent family, I finally feel I have the knowledge to teach about credit. Recently my teen daughters had a discussion about my job and the importance of Credit, to my amazement they knew more than I imagined.

As a rule, children are like sponges, they sit back and observe their parents daily as they deal with finances, they witness the emotional effects money can have on their parents. This explains why my girls knew so much. My children have watched me go from the bottom not owning a home, not financing a car, having past due utilities to finally succeeding.

In addition to our daily interactions, there is some key some key tips to help guide them into being financially stable adults.

Set the Example

Your kids are already watching and sensing your emotions when it comes to finances, it never hurts to have open communication with them. Explain to them why you want to save your money, instead of the fancy vacation or the shiny new car. Children will pick up their habits from you, it is natural for them to be products of their environment. If we want to make them financially productive adults, we should do our best to show them we are as well.

Tell Your Kids No and Make them Earn it

As a parent we all know that children can be demanding at times and want unecessary items, however telling them no is an important lesson. This could be a hard lesson as we live in a society with so much instant gratification, however making them save thier allowances, birthday money or even do extra chores to reach obtain the item is teaching them to be self-sufficient.  As the child gets older encourage them to seek out other opportunities to earn money for them, like babysitting, mowing lawns, or tutoring.

Teach them about Cash

Teach them the value of cash and to keep it safe. Younger children you may want to keep it in a bank at home and count it regularly, so they will value the dollar amount and see it as a tangible item. The older they get you may want to start a children’s share account at the bank or credit union you bank at, this will also teach them about interest and the value of saving.

Never overextend or forgive a loan

If you loan your child money it is important to never loan them more than they can pay you back, just like credit limits over extending sets them up for failure. Keep their goals realistic for their financial means. Create a contract, make them sign it and stick with it, include interest, late fees, find creative ways to make it fun for them.

 

As Children mature there are many different financial institutions that have programs that encourage and help parents and caregivers raise financially stable adults. The CFPB has a Money as You Grow book club for children ages 4 to 10, to help assist families to learn key money concepts by reading, play, and quiet one-on-one talks. They also have a great chart on the ages kids develop different money skills.