Streams

Generation Debt: Credit Score

Thursday, February 19, 2009

The weekly February guest is Anya Kamenetz, author of Generation Debt, writer for Fast Company, and blogger at "The Narrow Bridge" and Yahoo Finance, who will be discussing issues of debt, credit, and loans. This week's focus: Rescuing your credit scores, credit counseling scams, and declaring bankruptcy.

Guests:

Anya Kamenetz

Comments [34]

rananaved from New York

<a href=http://thefinancefirm.comrel="dofollow">The Finance Firm</a>

Jun. 04 2010 08:12 AM
Camille Helmer from Florida

I have what has been called very good credit by equifax for years now. Scores ranging from 720-770. I have plenty of plastic like many others and I do own a home. I have paid off my car. Suddenley now I am having my credit reduced on my cards by substantial amounts for lack of useage! and I realize that though I have always paid my bills on time and not abused my cards my beacon score will begin to decline. I wonder if this is going to happen anyway, in spite of all my efforts to maintain good credit worthiness, what is my incentive to pay these bills? Why not just file chapter 11,7 or whatever and start over? Or just have bad credit? After all the score will begin to decline anyway.

Apr. 27 2009 10:06 PM
V from Montclair

I just received a letter from Capitol One Credit Cards advising me that my APR rate and Cash Advance interest rates would be increased by 50% effective May 2009. I do not carry a balance on this card and use it just a few times a year. My current APR interest rate is 8.00%. When I called to say that I thought the rate should stay the same or be lowered--I was advised that the only way to avoid the increase was to cancel the card. Of course I intend to simply not use the card after March '09. It seems that canceling the card will hurt my score. My question, do the politicians and regulators know that this is happening? I've spoken to 3 other people who have Capitol One cards who also received the same notice. All with 760+ credit scores like me. This seems blatantly illegal or at least unethical?

Feb. 24 2009 06:15 PM
Carlos Decena from Bronx, NY

I want to recommend American Consumer Credit Counseling

http://www.consumercredit.com/

to folks interested in credit counseling and getting into a debt management program. Like the local programs mentioned in the segment, these folks help you develop financial literacy and negotiate with all of your creditors to get your interest rates under 10%. I've been working with them for two years now and they have been wonderful.

Feb. 20 2009 06:12 AM
Anya Kamenetz

Check my blog for answers to your questions--posted today and later tonight.

http://anyakamenetz.blogspot.com/

Feb. 19 2009 03:36 PM
A from Brooklyn

What were the two companies that Anya said to contact for trustworthy credit advice? She said the first meeting with them was free, the next $40 or so. If anyone caught this info, please let me know.

Feb. 19 2009 12:18 PM
KC from NYC

Oh! I just found a great new quote from Jamie Dimon, the Chase CEO who's been getting a lot of play on the Brian Lehrer show of late, specifically with his claims that Chase is "losing money" on credit cards:

"I don't think just because someone's underwater they say I don't have to stay there. But they're supposed to pay the mortgage, and we should teach the American people, you're supposed to meet your obligations, not run from them. Because you have a mortgage doesn't mean you should run away as it goes down."

Chase just received $25 billion of taxpayer money. Get angry, folks.

Feb. 19 2009 11:14 AM
Sharon Houlihan from Elmhurst, NY

I often hear about listeners receiving unsolicited credit card offers in the mail. It's really simple to stop these offers. Just look for the opt out info on the back... Call the number, and voila... the offers will stop coming.
Not only will you no longer be tempted to apply for more credit... you will also be helping the environment by cutting down on the amount of trash generated.

Feb. 19 2009 11:10 AM
elle

i have been unemployed for a year, and i have been keeping up with my bills and i have never been late for my credit cards, and i have enough savings for a few months.

i called up bank of america to see what i can do with my credit card, because my interest rate went up to 23% from a promotional rate.

i told them that i was unemployed. they told me since i don't have a consistent income, they cannot do anything for me, but THEN they cut off all my credit with them. even though i have not used the credit with them.

i do have a huge amount of credit card debt in general, but i haven't ever been late with any payments. i called back to get an explanation and that guy said he could even close my entire account down. i'm not sure what to do, but i don't necessarily think you should call you credit card company and tell them you're unemployed.

Feb. 19 2009 11:06 AM
TK from NJ

I have a doctor's bill, which my doctor never submitted to my health insurance company. It's has now been submitted to a collections agency. Health insurance company has told me it is not my fault and up to doctor to submit bill in timely manner. Health insurance is not covering the bill due to late submission by doctor. Now I receive a monthly bill from a collections agency, which I was told to ignore by my health insurance. I have also rec'd an letter from my health insurance submitted to doctor stating I am not responsible for this bill. This is now on my credit report. What do I do? Does that letter mean anything to the collections agency? It is $1800+

Feb. 19 2009 11:03 AM
constance cooper from new york city

I have a problem diametrically opposed to that of most
of your listeners. I always spent as little as possible
and lived within my earnings. When I married more
than twenty years ago, I began sharing my husband's credit account. We have a perfect credit score and no
debts.

I am absolutely unable to get a credit card in my own name. When I send in those "pre-approved" applications,

I am told that since I have no credit history, I cannot have a card. I work part-time, my husband full-time; we have savings, no mortgage, health insurance, and pension accounts.

What is the matter with these credit folks?

Feb. 19 2009 10:59 AM
KC from NYC

Mike: Exactly. Everyone should just stop playing this game. "Keep your credit card account open even if you're not planning to use the card, for the sake of your credit rating?" What!? That is absolute insanity. "Just keep paying off the Mafia; hopefully they won't give you any trouble." I have a better idea: put these people in jail, along with the rest of the loan sharks (who don't make nearly the killing MBNA does).

Feb. 19 2009 10:57 AM
Joanne from nj

got behind on credit cards due to being unemployed for six months; many accounts are now with collection agencies/law firms. I've paid off one of my credit cards that was in collections with a law firm. the account is reflected on my credit report as being in collections. Once this is paid off and updated on my credit report, how will this affect my credit score?

Feb. 19 2009 10:57 AM
Jonella from New York

What you can do when they raise your interest rate to KERAZEE RATE is STOP PAYING THE MINIMUM AMOUNT - because it gets to impossible levels right away. Instead, send them $50 or so a month - just keep doing this for months and months and eventually they will offer to settle with you for significantly less than your bill!!! At least this has been my experience.

Feb. 19 2009 10:56 AM
Christine from Clinton Hill

No! In normal times, keeping your credit card company informed of your trouble paying is the thing to do. These are not normal times. Credit card companies now are closing accounts, lowering credit limits and rasing APRs when you call them to report problems paying.

Feb. 19 2009 10:54 AM
David Rakowski from Allentown, PA

Plus legally Kathy's husband can't file bankruptcy again for 7 years----its a risk that the companies take and one that usually pays off.

Dave

Feb. 19 2009 10:54 AM
jl

"Somerset County 2009 Consumer Bowl"

HSchool education strategy teaching bills, consumer info, credit etc!

http://www.mycentraljersey.com/article/20090217/GETPUBLISHED/902170316

Feb. 19 2009 10:52 AM
Sara from Manhattan

I am a 26 year old graduate student just entering the job market in the arts; I make a small salary, but happily, I have no debt. However, I have no credit either as far as I know. I do not purchase things I cannot afford, so only use a debit card. I have NEVER had a credit card. I would like to what kind I should get now and how I should proceed with it in order to start building my credit. Also, I am one of these highly educated financial illiterates your guest earlier spoke about; what books or websites would you recommend for someone like me? No debt and no credit?

Feb. 19 2009 10:51 AM
carl hoffman from new jersey

My father passed away in 2000
we have similar names, but I am not a "jr"
however, many times when people check
my credit the information comes
back to them that I am dead!
How can I fix this?

Feb. 19 2009 10:51 AM
Mel Stone from Bronx

I had a late mortgage payment on my credit report. i am currently current and plan to be forever.
how long will it take my credit score to recover?
it drop closed to 100 points from that dumb mistake.

Feb. 19 2009 10:51 AM
Lara from Flushing

Does offering to pay off a very large CC debt, 20k plus, give one any leverage in negotiating the balance down to a lower amount. Put another way, what are good strategies for lowering your balance?

Feb. 19 2009 10:51 AM
josh from Brooklyn

If I owe money on three credit cards, is it better to pay off one at a time or a little bit on each at a time to raise my credit score.

Feb. 19 2009 10:49 AM
ch from NJ

We were turned down for an increase on a home equity line yesterday. The loan officer had instant access to our credit score. She said she wasn't really supposed to tell me when I asked what it was. She did end up telling me, but why wasn't she allowed to?

Feb. 19 2009 10:49 AM
C from Manhattan, NY

What do you think of websites like mint.com, an online service which helps people manage their expenditures and even allows one to put alerts when you've spent too much. I wonder how they can offer their services for free. I'm giving them all my account info. - for checking, credit, investments - in hopes of improving my credit score and budget my life better. Are they reliable?

Feb. 19 2009 10:49 AM
Suki from Williamsburg

I pay for everything in cash or with my Amex (which I pay off every month). My credit is not that great because of this. Is it terrible that I don't care? Unlike most of my peers, if I don't have the money for it, I don't buy it.

Feb. 19 2009 10:47 AM
Edward from NJ

Chase Home Finance sent me a solicitation to refinance my mortgage which they currently hold. They accepted my application -- and my application fee! -- and then turned around refused my application because the appraisal didn't come out at 80% equity. Will this loan being denied effect my credit score?

Feb. 19 2009 10:47 AM
FranciL from NYC

I have an extra credit card I don't use. If I close it, will that affect my credit score?

Feb. 19 2009 10:46 AM
Mike from Long Island

Brian and Anya,

Two weeks ago I retrieved my three free credit reports and then purchased a “credit score” report from Trans Union. The number that came back was 783 which was graphically represented as a 49th percentile (below average) credit worthiness. I have always paid off my balances in my 22 year credit history and I have to say I was angered to see Trans Union rating me at “below average” credit worthiness.

This raised a question for me: “why bother paying off my balances at all?” If banks are constantly writing off bad credit card debt, that means there are lots of people walking away from balances, or renegotiating balances. If I am going to be called “below average” for constantly meeting my obligations, why should I continue to pay the banks?

The only blemish on my reports is a 30 day late payment 2 years ago. I have one auto loan with about $20k outstanding and about $30k in credit card debt. My total revolving credit line adds up to about $125k across 6 open credit card accounts. I am a small business owner with an annual cash flow of about $150k. I don’t own a home, but have been taking a close look at my finances as I am starting to look for my first.

Mike
Long Island

Feb. 19 2009 10:44 AM
Scott from Cambridge, MA

I've never gotten my credit score. I have one credit card and I've always paid it off on time. I'm going back to school in June and will be taking out loans. Should I receive a credit report?

Feb. 19 2009 10:44 AM
Tony from San Jose, CA

I only have a single credit card, I charge $10 every month on it and pay it off entirely. I will not close it, as it will hurt my score.

However, can AMEX decide to close it? Or can they decide to charge me a yearly fee?

Feb. 19 2009 10:44 AM
John Eiche from Queens ny

would the mortgage plan help someone who has lost their job has no income and may be facing foreclosure? Home is worth more than loan. and payments are up to date.

Feb. 19 2009 10:20 AM
sophie from manhattan

Several people I know are going to file for Chpt. 11. They say they simply cannot pay their bills and it would give them a fresh start.

Other than not being able to buy a car or home for the next seven years, are there any other down sides to this? And how easy is it for an individual, not a biz, to do this?

Feb. 19 2009 10:03 AM
steve dutton from UWS

My real estate agent told me yesterday that fannie may is charging a premium surcharge on any home loans with a score below 801. a 740 - 800 score gets a 1% surcharge. I'm as credit worthy as a person can be, but my score has never been above 795 - This is no way to stimulate housing sales.
(fortunately I am not in the market to buy / sell)

Feb. 19 2009 09:47 AM
Asterio from Long Island City

The current state of US economy which is largely a 'credit society', is the inevitable result of such system where conspicuous consupmtion is a virtue and 'patriotic' than being frugal and saving for the future. People worry more about their credit score as if its the most important thing in life; wallowing deeper in debt seems to be a 'priviledge and honor' to be proud of. American business models outsourced jobs abroad and made credit into a prime commodity like a product for consumption. The US became the 'venture capitalist' of the world and created the conditions for corruption and fraudulent 'ponzi'scams. Here in the US, you are a "nobody" if you don't have a slew of plastic credit cards. Happiness is equated with more unsustainable credit line.

Feb. 19 2009 09:32 AM

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