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Study Hall: Credit 101 · Earn Your Leisure

0:00
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1:06
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Speaker 4: Let's do it.
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Speaker 5: My graduates from my school being forts bad drop bags
2:00
Speaker 5: drop might drop bag drop drop.
2:14
Speaker 3: You talked about FCO score, right, can you just explain
2:17
Speaker 3: the FIGHTO.
2:18
Speaker 4: So FCO is fair Isaac credit company. They don't want
2:20
Speaker 4: to creates the whole score from all three viewers for you.
2:23
Speaker 4: They use the latest advantage. It will advantage ten vantage
2:26
Speaker 4: a that we're using that advantage ten. They use the
2:28
Speaker 4: latest vantage. So what is it? What is that? Because
2:30
Speaker 4: people might not know what So it's the way the
2:32
Speaker 4: scores created the data that's put into the score. So
2:35
Speaker 4: they don't pick every single like let's say your marketing
2:40
Speaker 4: spress card. Certain cards they pick up and they create
2:42
Speaker 4: the score. So the department that's why I speak about
2:44
Speaker 4: department store card. They don't have your credit that much,
2:47
Speaker 4: So stay away from them, stay into the visa, the
2:49
Speaker 4: master guards and so forth. Those are the ones that
2:50
Speaker 4: create the scores for you. And then your payment history,
2:52
Speaker 4: how much new credit you have, utilization, that's all that's
2:56
Speaker 4: calculated to it.
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Speaker 3: Okay, okay, so all right, So as far as like,
3:01
Speaker 3: there's different factors that determine your credit score, right right, correct?
3:05
Speaker 3: What is some of the key fact is that people
3:08
Speaker 3: should be aware of.
3:09
Speaker 4: One of the major factors I see this on everyone's
3:11
Speaker 4: credit report is utilization. Just like you were talking about.
3:15
Speaker 4: You know, you need to keep your utilization under thirty percent.
3:17
Speaker 4: Once you start hitting thirty one thirty two percent of
3:20
Speaker 4: that utilization, your score drops significantly and it takes two
3:23
Speaker 4: months two billion cycles for it to go up unless
3:25
Speaker 4: you call the bank, like you didn't ask them just
3:28
Speaker 4: to do a courtesy for you. A lot of people
3:30
Speaker 4: don't know how to do that, right or they don't
3:31
Speaker 4: know they could do that. So one of them is
3:34
Speaker 4: keep the utilization very low thirty percent or below. Let's see,
3:38
Speaker 4: you have five cards and excuse me, and you instead
3:42
Speaker 4: of putting all the charges on one card, split it
3:44
Speaker 4: across three cards to keep it under thirty percent. Your
3:47
Speaker 4: score will stay high. Second thing is increase six increases
3:50
Speaker 4: a year. If you do more than that, your score
3:53
Speaker 4: drops each increase two point five points. Right, and banks
3:57
Speaker 4: only give you what this the other banks give you
4:00
Speaker 4: you apply for in your scenario, if you do that now,
4:02
Speaker 4: it would have been hard for you to get all
4:03
Speaker 4: those cards, right because banks are tight on giving our credit.
4:07
Speaker 4: So banks won't give you what this the other banks
4:09
Speaker 4: will give you. So let's say you apply for City
4:10
Speaker 4: Bank or Chase today. You got to deny it. There's
4:13
Speaker 4: an incre there. If a bank don't see a card
4:15
Speaker 4: open up, they're not going to extend your credit to you, right,
4:18
Speaker 4: So new credit.
4:19
Speaker 3: All right, So thirty percent. So if you have ten
4:22
Speaker 3: thousand dollars in credit available, only use three thousand.
4:24
Speaker 4: Correct.
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Speaker 3: That's pretty much.
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Speaker 4: Ah not with one last thing. Also, like if you're
4:29
Speaker 4: trying to build your score and you're in the six fifty,
4:32
Speaker 4: you're lingering around the six to fifty range. You shouldn't
4:34
Speaker 4: pay off your card in full every month because the
4:36
Speaker 4: bank needs to make the bank needs to make a
4:38
Speaker 4: little bit of interest off of you to report okay
4:40
Speaker 4: on your credit report. Correct, it's only until you're like
4:43
Speaker 4: a seven to fifty a highest score you can pay
4:45
Speaker 4: your card off in full because your score is already built.
4:48
Speaker 4: But if you're in the six fifteen, you're trying to
4:49
Speaker 4: raise it, don't pay the card off.
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Speaker 3: Can you just explain that, because that's actually the first
4:53
Speaker 3: time I'm hearing that in detail.
4:56
Speaker 4: Like, so you don't pay off the credit card on
4:58
Speaker 4: full every month like every other month. You could pay
4:59
Speaker 4: it off from the fall. Why not very well, because
5:02
Speaker 4: the bank wouldn't report okay on the credit report. On
5:05
Speaker 4: the slot that says okay, it'll say no data okay.
5:08
Speaker 4: No data is like no credit okay. So you had
5:10
Speaker 4: like trick the system that will make a little bit
5:11
Speaker 4: of interest off for you. Because remember the bank's in
5:13
Speaker 4: the business of making money, right, right, and that's why
5:16
Speaker 4: they charge these interest rates.
5:17
Speaker 2: So they want to see that your valued customer over
5:19
Speaker 2: a period of time exactly, right. So if I have
5:21
Speaker 2: a thousand dollars and I matched out a thousand and
5:23
Speaker 2: I pay a thousand, that's not really showing anything.
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Speaker 4: Exactly, and that's not helping them to there, not making money.
5:28
Speaker 4: So there's no sentence. So I'm to report, okay, on
5:30
Speaker 4: the credit bord you have the report to have a
5:32
Speaker 4: zero balance, but you don't have that that okay, that
5:34
Speaker 4: green mark on your credit board is it is no data, okay.
5:37
Speaker 4: And then the way you see that is actually from
5:39
Speaker 4: the credit report from the viewers. You wouldn't see it
5:42
Speaker 4: on like a mortgage report or on your ownline report.
5:44
Speaker 4: It's when you pull then actual report from the viewers
5:46
Speaker 4: is when you see that.
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Speaker 3: All right. All right, So now all right, so you
5:49
Speaker 3: got some framework and then you got some interesting stories
5:51
Speaker 3: to me and troub. But now we're gonna we're going
5:53
Speaker 3: to dive deep into the the to the world of
5:55
Speaker 3: credit and yeah, we're gonna hopefully drop some gyms that
5:58
Speaker 3: can say if you guys, a lot of time and money.
6:01
Speaker 6: Depends the paths.
6:02
Speaker 2: Get ready, all right, So now we're going to get
6:03
Speaker 2: into the part that most people aren't aware of on
6:06
Speaker 2: their credit card that are actually happening. But you know,
6:09
Speaker 2: when you make a late payment, or you miss a payment,
6:11
Speaker 2: or you miss a few there's something that's called a derogatory.
6:15
Speaker 4: That's correct, that's god.
6:17
Speaker 2: Could you want to explain the impact that that has
6:20
Speaker 2: and some examples of it.
6:21
Speaker 4: Well, the derogatory session. Everyone has that on a credit report, right,
6:24
Speaker 4: So what do you make a late payment? And by
6:26
Speaker 4: the way, the way they report late payments these days
6:28
Speaker 4: have changed because back then right after thirty days the
6:32
Speaker 4: next day you were late. Now to give you a
6:33
Speaker 4: thirty day grace period. But if the payment is not
6:35
Speaker 4: made before five pm the twenty ninth of the next month,
6:39
Speaker 4: then you get reported the first thirty days. That's a derogatory,
6:42
Speaker 4: right collections charge off. Let's say you had a credit
6:45
Speaker 4: card for five six years. You know you were paying
6:47
Speaker 4: for three four years, you ran into a hardship, you missed,
6:50
Speaker 4: you couldn't keep up with the payments anymore, you miss
6:52
Speaker 4: six months of payments, it gets charged off. That's a
6:54
Speaker 4: derogatory Public records lawsuits judgments to the loans follow on
7:00
Speaker 4: there as well. Yes, absolutely, because one here's the thing
7:03
Speaker 4: about student loans. Everyone keeps deferring the student loans and
7:08
Speaker 4: that's actually you shouldn't be doing that. You should at
7:10
Speaker 4: least try to make some sort of payment plan with them.
7:12
Speaker 4: Because now one it affects your credit, your DTI because
7:15
Speaker 4: let's see, you think out six thousand, you defer it
7:17
Speaker 4: for five years. Now your loan is ten thousand. Now
7:20
Speaker 4: you're upside down with the loan one two your lay payments. Also,
7:24
Speaker 4: the report on the credit bord is the derolatory if
7:28
Speaker 4: you miss the lay payment. So I don't suggest anyone
7:31
Speaker 4: try to put the payment in deferment for too long,
7:34
Speaker 4: but if you have to make sure you don't have
7:37
Speaker 4: a gap where it comes out of deferment and you're
7:39
Speaker 4: supposed to make a payment and go back into the
7:40
Speaker 4: deferment heed to avoid that.
7:42
Speaker 2: Yeah, it's tough because I mean we covered it pretty extensively,
7:45
Speaker 2: Like we have millions of Americans that are trained industry,
7:51
Speaker 2: and it's like, you know, the first thing is like deferment,
7:54
Speaker 2: but it only lasts six to twelve months, right, and
7:56
Speaker 2: that that can affect you long term, right when it's
7:58
Speaker 2: time for you to now get the home like student
8:01
Speaker 2: loan payment as effected, you try to get the car student, right,
8:04
Speaker 2: they're going to see that on that derogatory.
8:06
Speaker 4: Because they calculate the monthly payment into your income. Right.
8:08
Speaker 4: So let's say you know you only make I don't know,
8:11
Speaker 4: two thousand dollars a month or bi weekly whatever, and
8:14
Speaker 4: your monthly payments are all your expense including rent, food whatever,
8:18
Speaker 4: not that food, sorry, rent bills, credit cards, it's fifteen hundred.
8:22
Speaker 4: Now you add your student loans in there. Now you
8:24
Speaker 4: only have two hundred dollars left. How are you going
8:26
Speaker 4: to get get more extra? You aren't gonna come in,
8:28
Speaker 4: you know. So it's a debt that you really don't
8:30
Speaker 4: want to carry with you, but we have to if
8:33
Speaker 4: you want to try to at least make some kind
8:34
Speaker 4: of payment towards it.
8:35
Speaker 3: So what do the derogatories? Okay, so some of the
8:39
Speaker 3: common derogatory items are late payment.
8:42
Speaker 4: Late payments, credit cards. Even I did a video about
8:45
Speaker 4: when you move out of your apartment, how to exit
8:47
Speaker 4: your apartment. Your Verizon bill, your contact is some bill,
8:51
Speaker 4: all that goes on your credit board. There's a way
8:52
Speaker 4: to shut everything off before you walk at that apartment
8:54
Speaker 4: so it doesn't travel. So what's the way that you
8:57
Speaker 4: So basically, make a checklist of everything that you have
9:00
Speaker 4: when you were living in an apartment, cable, phone, water
9:02
Speaker 4: or whatever. A week before you move out, you're supposed
9:05
Speaker 4: to call those company and let them know you're leaving,
9:07
Speaker 4: to disconnect the service on this date and send you
9:09
Speaker 4: the bill. Right, a lot of people just walk out
9:12
Speaker 4: and leave everything the Verizon bill capabill. You're supposed to
9:15
Speaker 4: return those boxes. If you don't, you get triged. You're
9:17
Speaker 4: renting those boxes, you don't own them. That's a stupid
9:19
Speaker 4: way of having a debt on your credit report to
9:21
Speaker 4: mess your credit up. Right, you can just return the boxes,
9:24
Speaker 4: play the final bill.
9:25
Speaker 6: Right, Yeah, for sure?
9:26
Speaker 4: So all right, So what the support serving?
9:28
Speaker 6: Yeah?
9:29
Speaker 3: What about taxling?
9:31
Speaker 4: So taxling shows up on your credit but it was
9:34
Speaker 4: up to two years ago. They stopped reporting it, but
9:36
Speaker 4: it stays in the public record. So let's see applying
9:38
Speaker 4: for a mortgage, when they pull for your mortgage report,
9:41
Speaker 4: they put a Lexus nexus. Your taxis show up there,
9:44
Speaker 4: so it can affect you from getting the mortgage, but
9:46
Speaker 4: it's not in your credit report anymore, but it stays
9:48
Speaker 4: in public record. What's Lexus? Next? Is a company out
9:51
Speaker 4: in Atlanta that carries all public record data for everyone. Okay, okay,
9:56
Speaker 4: for all the court system, bankruptcies, everything.
9:58
Speaker 3: So what about credit card judgments? Of people have credit
10:00
Speaker 3: card judgments?
10:01
Speaker 4: Oh, man, listen, that's a good topic. And how that happens.
10:05
Speaker 4: You know, Let's say you have a credit card. I
10:08
Speaker 4: go back to Chase because I did with them every day.
10:10
Speaker 6: Right.
10:10
Speaker 4: Let's say you have to Chase credit card for five years,
10:13
Speaker 4: three years, you paid it. After that you went into
10:15
Speaker 4: a harship. We can't paid no more and it went
10:18
Speaker 4: to collections and you didn't even pay it then, right
10:21
Speaker 4: before the statue limitation comes in, and every debt has
10:23
Speaker 4: a statue mutation, every state has a statue limitation. Right
10:27
Speaker 4: before the statute limitation ends, it goes to an attorney.
10:30
Speaker 4: They pick it up and o'bertaining a defaul judgment against
10:32
Speaker 4: you when you're wle for ten years.
10:34
Speaker 3: So ten years, ten years, but it can be it
10:37
Speaker 3: can be wiped off all right, even if you so
10:39
Speaker 3: if you have the ten year judgment, it can still
10:40
Speaker 3: be like wiped off before that ten years.
10:43
Speaker 4: Absolutely if it's resolved correct. If you don't resolve it,
10:45
Speaker 4: then it can reinue again.
10:46
Speaker 3: How do you resolve it?
10:48
Speaker 4: So you got to make an agreement with the judge,
10:49
Speaker 4: but not with the judgement attorney assume you they could
10:52
Speaker 4: either go back into the quarter and resolve it or
10:54
Speaker 4: resolve it over the phone. Make an agreements that I
10:55
Speaker 4: listen to. That's five thousand, you know, I can give
10:58
Speaker 4: you two thousand call it a day, all right, So
11:00
Speaker 4: death has to be resolved to resolved that that made
11:03
Speaker 4: me think about something because we let me keep it
11:06
Speaker 4: on the show.
11:06
Speaker 6: Right.
11:07
Speaker 3: So usually in our community, what happens is that you
11:10
Speaker 3: fall on the hard times, you don't pay your bills.
11:12
Speaker 3: They call you, and you don't answer the phone call.
11:15
Speaker 3: You try to ignore that.
11:17
Speaker 6: But that's what that's that's what we're gonna do.
11:19
Speaker 4: That's what that's how t do a judgment.
11:21
Speaker 3: So start of it, all right, what's your advice for
11:23
Speaker 3: people that are doing that? Like I always tell people,
11:26
Speaker 3: you can't avoid problems. You have to face it right,
11:29
Speaker 3: So and then especially credit card companies, they'll work with
11:31
Speaker 3: you if you but people still mentally, I guess it's
11:35
Speaker 3: just nobody really wants to be embarrassed or they don't
11:38
Speaker 3: want to even kind of go through that if they
11:40
Speaker 3: know that they don't have the money to pay it.
11:41
Speaker 3: So you have, all right, you got yourself in a
11:44
Speaker 3: bad situation. You can't pay your bill, you're laid on
11:47
Speaker 3: your bills? What what do you do? Like, what's the
11:49
Speaker 3: best is the thing?
11:50
Speaker 4: That's funny we're talking about this A lot of people
11:53
Speaker 4: don't want to resolve to debt because they've been totally
11:55
Speaker 4: you don't have to pay it that back. It's going
11:57
Speaker 4: to disappear a lot of people. That's what a lot
11:59
Speaker 4: of people say. You know, oh, my friends, I don't
12:01
Speaker 4: want to pay it back. Is it true? Yes, you
12:02
Speaker 4: have to, right, but you have to answer the phone
12:06
Speaker 4: man like you can't. They'll work with you. They wanted
12:09
Speaker 4: to work at you.
12:09
Speaker 6: This is I'm just the willing to work with your
12:12
Speaker 6: part is one hundred percent valid.
12:14
Speaker 2: I have friends, and I mean personally, I've done it myself,
12:16
Speaker 2: like I've had I've seen my interest rate go up
12:19
Speaker 2: when I was in college to a point i was like, wait, oh,
12:21
Speaker 2: thirty thousand dollars.
12:22
Speaker 6: I'm twenty one, right, and I'm like, I don't know
12:25
Speaker 6: what to do.
12:25
Speaker 2: So I'm like I literally was listening to how I
12:27
Speaker 2: need to have and I promise you, and I heard
12:30
Speaker 2: Andree was talking about de consolidation and I called this
12:32
Speaker 2: company and I was like, all.
12:34
Speaker 6: Right, well we'll do it.
12:35
Speaker 2: And I did it, and like rather than paying at
12:37
Speaker 2: thirty right, they're the bankers are like, hey, can.
12:40
Speaker 6: We get some money? Right?
12:42
Speaker 2: So I'm like, all right, we agreed to an amount
12:44
Speaker 2: and I'm like, all right, I'll pay that off.
12:45
Speaker 4: There's a difference between that consolidation debt settlement. Yeah, I
12:49
Speaker 4: am not into that consolidated. I don't think anyone should
12:51
Speaker 4: do it. And I'll tell you why. Once the debts
12:54
Speaker 4: charged off, you have to pay something, but not the
12:57
Speaker 4: full thing. The consumers don't know that the debt consolidating
13:00
Speaker 4: where they make you paid the whole debt over three years.
13:03
Speaker 4: You kind of just paid it debt twice. Yeah, Well,
13:05
Speaker 4: because it went insurance paid it or wherever the bank
13:08
Speaker 4: resolved it, and that you paid the whole thing back
13:09
Speaker 4: again to the to the banks. It's once the deb's
13:14
Speaker 4: charged off, it's better to settle to them. Move on.
13:17
Speaker 4: You're five grand, we get that down to eighteen hundred.
13:20
Speaker 4: I would rather pay that and move on because your
13:22
Speaker 4: credit is still shot and you're not going to get
13:24
Speaker 4: the card back. Right, So I haven't paid twice.
13:28
Speaker 2: Right, Yeah, I've seen people do it, like I've seen
13:30
Speaker 2: like like you just said, like, hey, I owe twenty listen,
13:33
Speaker 2: I have ten, right, and the bank is like, you
13:35
Speaker 2: know what, I'll take that ten rather than have nothing
13:37
Speaker 2: from you for the next five years.
13:39
Speaker 4: So here's a trick behind a shot. Was talking about
13:43
Speaker 4: collection agencies and attorneys do skip traits. Well, the skip
13:47
Speaker 4: trace is where they pull your credit and they see
13:49
Speaker 4: that if you're paying like, what's it called skip trace,
13:52
Speaker 4: skip trace, skip t R a CE so skip trait
13:55
Speaker 4: skip trace works like this. They want to find you
13:59
Speaker 4: when you see where you are to serve your judgment.
14:01
Speaker 4: They pull your credit, they see you have this address,
14:02
Speaker 4: that address, that address. That's how the marshals end up
14:05
Speaker 4: coming to your house and dropping a note off, right,
14:07
Speaker 4: so they see if you're paying any debts back. So
14:09
Speaker 4: now let's say you're completely shot, your score five hundred.
14:14
Speaker 4: You have every single debt out there. When they do
14:15
Speaker 4: that skip phase, they know you're completely bro or you
14:19
Speaker 4: seem to be bro. You have a better chance to
14:21
Speaker 4: get in a lower number in that settlement because they'll
14:24
Speaker 4: take anything to move on and resolve it and keep
14:26
Speaker 4: it going. Right, if you apply for more this year,
14:29
Speaker 4: increy on there from a home mortgage company, or you're
14:32
Speaker 4: trying to buy something, you have money, everybody pops up.
14:34
Speaker 4: They want to settle, but they'll sell at a high number.
14:37
Speaker 4: And collection agencies work on commission end of the month.
14:40
Speaker 4: You get the best number.
14:41
Speaker 3: Beginning the month, you don't that so end of the month, Okay,
14:45
Speaker 3: I don't want people to let that go over your head.
14:48
Speaker 3: Explain that.
14:49
Speaker 4: Oh yeah, collection agency is working commission it's a fifty job.
14:54
Speaker 4: But your job is to you have to hit certain numbers.
14:56
Speaker 4: At the end of the month, you have to hit
14:58
Speaker 4: let's say your budget is thirty thousand. After to that
15:00
Speaker 4: you get commissioned. So that's why at the beginning of
15:02
Speaker 4: the month, let's we had a death for five thousand,
15:04
Speaker 4: they'll say, oh, we can only settle for forty five
15:06
Speaker 4: hundred four thousand. Come after the last five days of
15:08
Speaker 4: the month, that same depth for eighteen hundred dollars. But
15:13
Speaker 4: you can't give off your credit report because the loss
15:16
Speaker 4: states whether you pay or don't pay something, it stays
15:19
Speaker 4: on your credit pord for seven years. That's where my
15:21
Speaker 4: company comes in. I make your seven years ninety days,
15:26
Speaker 4: so I'm able to make your credit jump right back
15:28
Speaker 4: to seven fifty eight hundred squeakily. Nothing ever comes back
15:31
Speaker 4: on your credit report.
15:33
Speaker 3: No credit repair.
15:36
Speaker 4: Oh yes, I'll talk about that. It's allowed.
15:41
Speaker 3: Were off camp, you said that there's no such thing.
15:43
Speaker 4: It's the credit credit for it doesn't exist. Right, it's
15:46
Speaker 4: a scam. Right, that's why every single company. Can I
15:49
Speaker 4: call the companies out or you don't care? No, I
15:51
Speaker 4: mean that's all your your mom and pop company, Lexington law,
15:55
Speaker 4: credit payer, dot com credits saying I want to spend
15:58
Speaker 4: this one else the name by the want too, and
16:01
Speaker 4: they all do the same thing, send dispute letters with
16:06
Speaker 4: no letterhead. So yeah, to think about that. If I'm
16:08
Speaker 4: paying you ninety nine dollars, you said I'm gonna fix
16:09
Speaker 4: your credit, why is only the instructions on letterhead but
16:12
Speaker 4: not the level you sent to the credit beer on
16:14
Speaker 4: letterhead looks like I'm sending the letter one two. If
16:17
Speaker 4: you ever read those dispute letters, it's like your ten
16:20
Speaker 4: year old kid wrote it.
16:22
Speaker 3: Right.
16:23
Speaker 4: So, for example, let's say Verizon. You have a Verizon bill,
16:28
Speaker 4: you have Verizon home service, cable internet, whatever it is
16:30
Speaker 4: that you have a Verizon right for over a year,
16:33
Speaker 4: all of a sudden you moved out, You didn't pay
16:34
Speaker 4: the bill because you didn't return the box on the
16:37
Speaker 4: final bills, and you have this on your credit report.
16:40
Speaker 4: Verizon has a collection for you. They're gonna write a
16:42
Speaker 4: letter please validate this debt. I never had this debt? Well,
16:45
Speaker 4: what do you have for the last twelve months? Because
16:47
Speaker 4: everything has a pay per trail behind it, right, So
16:51
Speaker 4: that's what a letter of it works. Not a letter
16:52
Speaker 4: goes to the credit viewers. The credit viewer sends it
16:54
Speaker 4: to the Verizon. Verison sends back your whole statement in
16:57
Speaker 4: the digital file, your checks that you made a slater.
17:00
Speaker 4: They even keep phone communication if you spoke to them.
17:03
Speaker 4: You spoke to us on this day, and that's all.
17:07
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19:56
Speaker 4: That's the foible. I have it in my office when
19:58
Speaker 4: you speak to these companies. Oh my clients quota right.
20:01
Speaker 4: So anyway back to the whole credit period and the
20:03
Speaker 4: letters thing doesn't work because if he has a paper
20:06
Speaker 4: trail one, there's no such thing as fixing credit. Every
20:09
Speaker 4: consumer has a right to dispute something on their credit
20:11
Speaker 4: if they believe it was reported erroneously or inaccurately, that's
20:16
Speaker 4: you're right.
20:16
Speaker 3: So from my understanding, it's like correct me if I'm wrong.
20:20
Speaker 3: They write a letter where you everybody has the ability
20:23
Speaker 3: to write a letter to a company disputing something. If
20:25
Speaker 3: they don't respond to that dispute, it has to come
20:27
Speaker 3: off right. So that's kind of what they do because
20:30
Speaker 3: they know most people are they don't want to do
20:32
Speaker 3: it themselves, so they do.
20:34
Speaker 4: It for them correct. And the reason and the other
20:36
Speaker 4: thing is that in the industry, there's something called servicing
20:38
Speaker 4: a debt and owning a debt. Let me explain that
20:41
Speaker 4: for you. I'll say it again, servicing a debt and
20:43
Speaker 4: owning a debt, owning a debt. There's only four companies
20:46
Speaker 4: in the industry that buys debts Portfolio Recovery, Midland Funding, MCM,
20:51
Speaker 4: and Calgy Portfolio. Those four companies buy debts and they
20:55
Speaker 4: give you thirty days to resolve it. If you don't
20:57
Speaker 4: resolve it, they get it the fault judgment against you.
21:00
Speaker 4: In an attorney attorney serves you you gotta show up
21:02
Speaker 4: in court. Blah blah blah, I shouldn't say blah blah, blah.
21:05
Speaker 4: But the second thing is servicing a debt. So let's
21:08
Speaker 4: say Verizon come back to Verrison. RGM Acquisition is a
21:11
Speaker 4: collection agency. They don't own the debt. Verizon sent the
21:14
Speaker 4: debt to RGM to for them to call you ten
21:16
Speaker 4: times a day. They don't have the man power to
21:18
Speaker 4: do that. So now when you send these letters, the
21:20
Speaker 4: collections agency was never supposed to be there. That's why
21:22
Speaker 4: the collection agency will come off your credit. That's all
21:24
Speaker 4: the letter does. But the debt comes back around ninety
21:28
Speaker 4: days later from to another agency, so the debt is
21:30
Speaker 4: never really leaving you, so that everything has to be resolved.
21:34
Speaker 4: So back to the word of credit re peer. Yeah,
21:36
Speaker 4: it doesn't exist anyone. Everyone has a right to contest
21:39
Speaker 4: something if it's not accurate on your credit re board,
21:42
Speaker 4: but not out of ten times. All these banks and
21:45
Speaker 4: these they're so squeaky clean with their data now, like
21:48
Speaker 4: it's very minimum room for errors.
21:51
Speaker 6: That's important. Man.
21:51
Speaker 2: You gotta educate yourself, right, Like, rather than paying ninety
21:55
Speaker 2: nine dollars, you can do yourself.
21:57
Speaker 6: Do it yourself.
21:57
Speaker 2: Read for about two hours a day, figure it out. Man,
22:00
Speaker 2: it's valuable. So like you're saving your time and your
22:03
Speaker 2: money not supporting.
22:05
Speaker 3: All right, Okay, so now we're going to go into
22:08
Speaker 3: our new topic, our new section.
22:10
Speaker 2: We got a whole new segment that we're calling it
22:13
Speaker 2: ten for ten.
22:14
Speaker 6: So we got ten questions.
22:15
Speaker 2: Hopefully you can give us ten answers and it's courtesy
22:18
Speaker 2: of Instagram.
22:19
Speaker 6: Pretty much our follow us.
22:21
Speaker 2: We laid it out there that we're gonna have credit
22:23
Speaker 2: as an episode and we got a crazy response. Yeah.
22:29
Speaker 4: Yeah, there's so much to learn about this credit industry,
22:31
Speaker 4: how it works, like how credit is built, how you
22:33
Speaker 4: get approved for credit card. There's a whole dollarge based
22:37
Speaker 4: on that. We're just touching like this.
22:40
Speaker 2: Yeah, so we took we took ten and hopefully we
22:43
Speaker 2: can get ten answers questions.
22:44
Speaker 3: We're gonna we're gonna, yeah, we're gonna jump right into it.
22:47
Speaker 3: So yeah, let's do it, all right. So, yes, this
22:50
Speaker 3: is a new segment that we're gonna do. Hopefully we
22:54
Speaker 3: do it every show. Yeah, maybe not every show, but
22:56
Speaker 3: depending on if it's an education show like it is
22:58
Speaker 3: right now, where we're actually bringing somebody in every show
23:00
Speaker 3: with the educational show. But if this is a show
23:02
Speaker 3: where we're bringing an expert in, we're going to start
23:04
Speaker 3: a new segment called ten for ten right, because as
23:07
Speaker 3: I always say, it's not our podcast, it's your podcast.
23:10
Speaker 3: It's a public's podcast, and the platform is to educate.
23:13
Speaker 3: So we're taking ten questions from our listeners and we're
23:18
Speaker 3: going to answer those questions, right, and it's all on Instagram.
23:21
Speaker 3: So we'll put a post up a few days before
23:24
Speaker 3: and we'll ask you know your your questions, and then
23:27
Speaker 3: you guys just comment in the comments section and then
23:30
Speaker 3: we'll pick ten questions and then we'll we'll do.
23:32
Speaker 6: It, so asks the expert.
23:34
Speaker 3: Yeah, for sure, for sure. So we're going to start
23:36
Speaker 3: out with the first question is from I underscore am
23:40
Speaker 3: Underscore Asia shout out to her. She wants to know
23:45
Speaker 3: how do you establish business credit?
23:48
Speaker 4: All right, that's a good question, and there's actually a
23:50
Speaker 4: big that's a big topic actually. So everyone seems to
23:53
Speaker 4: think that business credit that once you register a company
23:56
Speaker 4: name and you have a website and a bank account,
23:59
Speaker 4: you have business credit. Actually don't have business credit. You're
24:02
Speaker 4: still PG and everything under your social. Business credit runs
24:05
Speaker 4: separately from your social it's established on the tax id.
24:09
Speaker 4: It has to standalone by itself, has to sit by
24:11
Speaker 4: itself when you PG something that goes on your personal
24:14
Speaker 4: credit GG with personal guarantee. Okay, excuse me. It's when
24:18
Speaker 4: you PG something, it sits on your credit, on your
24:21
Speaker 4: personal credit. Want it affects your DTI because if it's
24:24
Speaker 4: like an American Express charge card, you're swiping thirty thousand
24:27
Speaker 4: a month. Remember low debt, high score. That's affecting your score.
24:32
Speaker 4: And two it makes your credit score drop. Right, So
24:37
Speaker 4: business credit has to stand alone by itself on the
24:40
Speaker 4: tax sidy. How do you establish it for There's a
24:42
Speaker 4: ten step process. One you have to be the tax
24:45
Speaker 4: iid the bank account. You have to be registered in
24:47
Speaker 4: your newspaper, your counting newspaper, on the two newspapers showing
24:50
Speaker 4: that you have your legitimate, legitimate business. You can't have
24:54
Speaker 4: your home address as the business address because you need
24:58
Speaker 4: to be scores Experience equal facts Dunn Bradstree. Experience equal
25:02
Speaker 4: facts is not recognized. Your home addresses your business address,
25:04
Speaker 4: and your cell phone is a business number. That's why
25:07
Speaker 4: I tell people get a virtual space one ninety nine,
25:09
Speaker 4: Like we just or what about po box?
25:12
Speaker 3: No, you can't have a box, So all right, I
25:14
Speaker 3: didn't know that, So you have Okay, So you need.
25:17
Speaker 4: A receptance and the phone number where they can call
25:19
Speaker 4: them verifying and send mails to.
25:21
Speaker 3: Okay, So you can't get business credit without an address.
25:25
Speaker 3: You need to separate from your home address and you
25:28
Speaker 3: need an office address.
25:29
Speaker 4: That's correct. That's why I say you get a read
25:30
Speaker 4: your space one night and nine is the cheapest thing, right,
25:33
Speaker 4: because it needs to be verifiable by experiening equal facts.
25:36
Speaker 4: Because there's three scores Dunn A Bradstree explant in equal facts.
25:40
Speaker 4: You need three scores and all three viewers. Is how
25:42
Speaker 4: you build a business credit.
25:43
Speaker 6: So why why is trans Union left out of that?
25:46
Speaker 4: Did you just don't use it? It's not heavy enough,
25:48
Speaker 4: all right? So okay, so let's stay on that for
25:50
Speaker 4: a little bit. So you all right, start a business.
25:53
Speaker 4: You got your LLC, you got you got your number bank.
25:57
Speaker 4: You can't open your bank account.
25:58
Speaker 3: Registered in the courthouse. Ye did all that newspaper, did
26:01
Speaker 3: all that stuff. Now you the first So now you
26:04
Speaker 3: have to get an address.
26:05
Speaker 4: Correct.
26:06
Speaker 3: So now we're now we're trying to build credit for
26:07
Speaker 3: the business. Right, So you get a cause. You can
26:10
Speaker 3: get a Google number. Yeah, you get a Google number.
26:13
Speaker 3: You get a number separate from your cell phones and
26:15
Speaker 3: get an address separate from your cell phone. Now can
26:18
Speaker 3: the address for another like say, can I can I
26:21
Speaker 3: use my sister's address, my brother's address. You can just
26:24
Speaker 3: separate from the one live there exactly, okay, the one
26:27
Speaker 3: you live so now that so now, now how do
26:29
Speaker 3: you establish.
26:30
Speaker 4: Now you have that, you need trade lines? So this
26:32
Speaker 4: company talk about that one. So there's companies like Quills.
26:37
Speaker 4: There's like ten other companies out there. I can't think
26:40
Speaker 4: of it right off the top of my head. But
26:41
Speaker 4: here's how it works. I have a whole list to
26:43
Speaker 4: my office. You reach out to them and they give
26:45
Speaker 4: you ten They give you tradelines. Trade lines are like loans.
26:48
Speaker 4: They'll give you like a thousand dollar of credit limit.
26:50
Speaker 4: You have to use fifty dollars for the next six
26:52
Speaker 4: months of pay on time fifty or more. It's built
26:56
Speaker 4: just like you're billing personal credit. But it's two there
26:59
Speaker 4: events once. So you need three of them. Three vendors.
27:03
Speaker 4: If you want to get cards on like Best Buy,
27:07
Speaker 4: Office Depot, Office Max, those guys. If you want credit
27:10
Speaker 4: cards from the bank, you need six venders. Sixpenders are
27:13
Speaker 4: six trade lines, right, and you built from with that
27:17
Speaker 4: for six months from there you apply for your own
27:20
Speaker 4: credit cards. Now, if you want loans out of the bank,
27:23
Speaker 4: you have to have a p and L, a profit
27:25
Speaker 4: and loss, and you have to have a tax return
27:28
Speaker 4: in order for the bank to extend loan under the
27:29
Speaker 4: business because they have to see money coming into the company,
27:32
Speaker 4: money going back out a p and L to see
27:34
Speaker 4: that you know you can pay the loans back.
27:36
Speaker 3: Okay, okay, okay.
27:39
Speaker 2: So we got our next question from Bob Bob Lewis III,
27:42
Speaker 2: and he asked, can you establish credit.
27:45
Speaker 4: For your children absterly at seventeen or eighteen years old? Yeah,
27:48
Speaker 4: you could. How you do it is that you Adam
27:50
Speaker 4: as an authorized user one of your credit cards. But
27:52
Speaker 4: with that coming back to your story, it has to
27:54
Speaker 4: be a clean credit. You can't have high balances, you
27:57
Speaker 4: can't have derogatories. But whatever you do will affect that person.
28:00
Speaker 6: I got lucky.
28:00
Speaker 2: I'm be honest, this is like a true story, and
28:03
Speaker 2: I think we I first noticed it when shut pull
28:05
Speaker 2: my credit and I was twenty six and he was like, wait,
28:10
Speaker 2: you have twenty three years of credit history, and I'm like,
28:13
Speaker 2: I don't know.
28:14
Speaker 6: And then I realized that my parents hut me on
28:17
Speaker 6: their card.
28:18
Speaker 2: That they've had since nineteen eighty five or something like that,
28:21
Speaker 2: and I was like, oh wow, and they've been responsible,
28:23
Speaker 2: So like, yeah, that don't effect you.
28:25
Speaker 6: Ye it affected me in a positive way, positive right
28:28
Speaker 6: of negative way? Yeah yeah, yeah.
28:29
Speaker 4: So you can do it, but it has to be
28:30
Speaker 4: cleaning history right at the age seventeen. Moving on?
28:34
Speaker 3: Okay, perfect, Okay, So this is from Nelly Gibbs. She
28:38
Speaker 3: wants to know what the best way to repay student
28:41
Speaker 3: loans and what's the best way to handle student loan debts.
28:45
Speaker 4: Oh so we were talking about this earlier. So depending
28:47
Speaker 4: on the loan, if it's deferred or some collection, I mean,
28:50
Speaker 4: we kind of gott to find out that. But anyway,
28:52
Speaker 4: the point is, if you have a bunch of student loans,
28:55
Speaker 4: everything is based off of income. The payment plan is
28:57
Speaker 4: based off on an income based right, So when you
29:00
Speaker 4: call a student loans you want to I suggest everyone
29:02
Speaker 4: create a payment plan, Like, don't keep the firm. It's
29:05
Speaker 4: not a good thing to do it because it affects
29:07
Speaker 4: you from doing bigger purchases in the future. But on
29:10
Speaker 4: what you do is you call it a student un company,
29:12
Speaker 4: tell me you want to go on the income based
29:13
Speaker 4: repayment plan and they send your form you fill out.
29:16
Speaker 4: The trick to that is that make sure when you
29:18
Speaker 4: fill out the forms you put that you have a
29:20
Speaker 4: lot of expenses, so the monthly payment is a low
29:22
Speaker 4: payment and they keep you. They locked you into that
29:25
Speaker 4: for a couple of years and then you recertify again.
29:27
Speaker 4: But you want to put like you know, you have
29:29
Speaker 4: you know, rent cards, take fake care, whatever it is
29:33
Speaker 4: to show that you have a lot of expenses. If not,
29:35
Speaker 4: they're going to hit you with a high monthly payment
29:36
Speaker 4: of seven hundred dollars more.
29:38
Speaker 6: Yeah, we've seen. I've seen yet like I've seen.
29:40
Speaker 4: That's how you trick it.
29:41
Speaker 2: Yeah, so our next question is from uh oh and
29:44
Speaker 2: also next thing, if you have student loans on like
29:47
Speaker 2: two different like Sally made none and all that, you
29:50
Speaker 2: can actually have all of those loans refinance into one loan.
29:54
Speaker 4: And I suggest everyone do that so it's easy for
29:57
Speaker 4: you attract the payments. And I'm making what they payments
29:59
Speaker 4: to five different companies that.
30:00
Speaker 2: Is one hundred percent trol man like I was again,
30:03
Speaker 2: i have student loans, Like the first thing what I
30:06
Speaker 2: did was like slid them all navy and is now
30:08
Speaker 2: my correct shout out to them. So the next question
30:13
Speaker 2: is from at Flow Underscore Bella Underscore, and her question
30:17
Speaker 2: is what are some ways I can fix my credit herself?
30:20
Speaker 6: Like what can she do?
30:21
Speaker 4: So first off, you got to pull the report and
30:23
Speaker 4: pull a real time report. You know, credit cardon is
30:25
Speaker 4: not accurate, is not detailed. If you have a mortgage lender,
30:29
Speaker 4: those are the best reports that they try and merge
30:31
Speaker 4: and they give you your whole history for when you
30:33
Speaker 4: were seventeen or when you got credit the current excuse me.
30:37
Speaker 4: Once you pull out report, you able to see all
30:39
Speaker 4: the derogatories and the issues that are holding down your credit.
30:43
Speaker 4: If it's stuff that you know that was paid off already,
30:46
Speaker 4: you can dispute it with the beers that had like
30:49
Speaker 4: third party collections that have that taken off. But you
30:51
Speaker 4: got to see the negatives on there and what debts
30:54
Speaker 4: they are, so you can put a plant to address them.
30:56
Speaker 4: If there's some desks, you can do settlements that you
30:58
Speaker 4: have to do settlements so you can call it back
30:59
Speaker 4: the creditors directly and negotiate with them to make a
31:03
Speaker 4: payment plan. You could even do one account a month
31:05
Speaker 4: until you get to your end.
31:07
Speaker 2: Results and some things is one hundred percent acurate, Like
31:09
Speaker 2: it'll show you that you missed a card payment in
31:11
Speaker 2: twenty fourteen.
31:12
Speaker 3: Very detailed, very detail. All right, So this is a
31:14
Speaker 3: big one. This is a big one. This is from
31:16
Speaker 3: who cares underscore? No one I like that? So can
31:24
Speaker 3: child support be removed from your credit? And can we
31:28
Speaker 3: talk about the effects of child support on your credit?
31:32
Speaker 4: So child support it reports as a collection debt. Right, Yes,
31:36
Speaker 4: it can be removed. Actually, we're the only one could
31:38
Speaker 4: remove them. A letter cannot remove them. The problem is
31:41
Speaker 4: if we remove them, you cannot miss a payment again,
31:43
Speaker 4: because if you miss a payment, it'll come back on.
31:45
Speaker 4: Same thing for late payments on credit card. I want
31:47
Speaker 4: to talk about that. Actually we can remove all your
31:50
Speaker 4: late payments, but you cannot miss any late payments moving forward.
31:53
Speaker 4: If not, it will come back on your credit pordud
31:55
Speaker 4: A bank reports and a batch file. Right, so child
31:58
Speaker 4: support can report and it is a collection also, so
32:01
Speaker 4: if you're trying to buy something and you know your
32:04
Speaker 4: detail is off and your numbers are off, it can
32:06
Speaker 4: affect the monthly payment that you're paying child support. It
32:08
Speaker 4: can affect your approval of how much you can get
32:10
Speaker 4: approofer if that makes sense, all.
32:13
Speaker 2: Right, So our next one is from at done in
32:16
Speaker 2: three to one and he asked when do agencies report
32:19
Speaker 2: debt balances?
32:21
Speaker 6: Is there a specific time during the month that they
32:23
Speaker 6: do it.
32:23
Speaker 4: Or when his agencies? What do you talk?
32:25
Speaker 2: So I'm assuming that he means like when does like
32:28
Speaker 2: TransUnion or experience experience or epifact.
32:31
Speaker 4: Is there a specific Well, the buwers don't. The buwers
32:34
Speaker 4: update on the first to the fifth of every month.
32:36
Speaker 4: But the data comes from the bank or the collection
32:39
Speaker 4: or the credit does not come from the from the bureau.
32:42
Speaker 4: They don't want to just house the data, and on
32:44
Speaker 4: the first to the fifth of every month they update
32:46
Speaker 4: new reports. Okay, so your bank reports different days. Some
32:49
Speaker 4: days they report, you know, the ten to fifteenth whatever.
32:51
Speaker 4: Your building cyclists. But that's something you could find out. Yeah.
32:54
Speaker 4: And also to make it easy for you, if you
32:56
Speaker 4: want to make sure you never laid on your payment,
32:58
Speaker 4: you can call all your credit card companies and ask
33:01
Speaker 4: them to make your do they the same day every month,
33:04
Speaker 4: So if you have five cards, you can make them
33:06
Speaker 4: all of them the fifteenth of every month, so you know,
33:09
Speaker 4: you know, you know, if you're a person that keeps
33:11
Speaker 4: forgetting to make payments. You know, on the fifteenth, every
33:13
Speaker 4: bill is due if you can afford to do it.
33:16
Speaker 3: Okay, Raige against Ordinary has a question she wants to know.
33:20
Speaker 3: After Chapter seven bankruptcy, how long does that stay on
33:23
Speaker 3: your report?
33:24
Speaker 4: Bankruptcy stay for seven years. And here's the crazy about
33:28
Speaker 4: bankruptcy now. One the creditors can contest the bankruptcy. Really,
33:33
Speaker 4: they don't have to. Like let's say you have bank
33:35
Speaker 4: markers motoris for this. They can contest it. They don't
33:38
Speaker 4: have to accept the bankruptcy. They can say no, I
33:40
Speaker 4: don't you know, we don't want to know. They can
33:43
Speaker 4: contest the bankruptcy. To the new bankruptcy laws, depending on
33:47
Speaker 4: what chapter you're filling, you have to pay a percentage
33:50
Speaker 4: of your debt back in court right makes you have
33:55
Speaker 4: to pay a percentage, and that's determined by the judge,
33:58
Speaker 4: the magistrate wherever's doing your bankruptcy what your percentage is.
34:01
Speaker 4: So if you file in bankruptcy, you gotta really think
34:04
Speaker 4: about it. If you don't have like fifty to one
34:05
Speaker 4: hundred thousand dollar worth of death, it's not really fining bankruptcy.
34:08
Speaker 4: It's not really worth it in my eyes to file
34:11
Speaker 4: bankruptcy for seven years.
34:12
Speaker 2: That was gonna be like my next kind of question
34:14
Speaker 2: off of that is like, when would it be I
34:16
Speaker 2: guess appropriate to file for bankruptcy.
34:18
Speaker 6: Right, there's a certain amount of debt that.
34:20
Speaker 4: You should I mean, there's a couple of qualifying scenariosm
34:24
Speaker 4: If you're not working, you know that you can't do
34:26
Speaker 4: anything about it. You can't pay anything, you know. But
34:28
Speaker 4: if you are working, you have some savings because when
34:30
Speaker 4: you FID bankruptcy, they go through all you have to
34:32
Speaker 4: disclose all your assets, right, so you know, if you
34:35
Speaker 4: have money in the bank, you're like, well, why can't
34:37
Speaker 4: you pay this? Knowing that the banking can test it?
34:39
Speaker 4: Not all banks have to and that happened to me
34:41
Speaker 4: actually because I did it many years ago and they
34:43
Speaker 4: contested it. Then you can't have been put You can't
34:45
Speaker 4: open in the camp for three years a bank account,
34:47
Speaker 4: but you can't show if you have any kind of money,
34:49
Speaker 4: any bank account, any bank camp, because they can go back, oh,
34:51
Speaker 4: well you have money. You know. It becomes very messy.
34:54
Speaker 4: But again with the bankruptcy, and it's not as easy
34:57
Speaker 4: as like the way it was in twenty ten. You
34:59
Speaker 4: followed and you walk await, you got to pay a
35:01
Speaker 4: percentage back. So you know, I think everyone should really consider,
35:04
Speaker 4: depending on this scenario instead of filing bankruptcy. It's not
35:07
Speaker 4: the best route. It is a route, but it's not
35:11
Speaker 4: the best route depending on your situation. But it stays
35:13
Speaker 4: there for seven years and then you can the other
35:16
Speaker 4: thing about that you burn. Let's say in the industry
35:20
Speaker 4: is prime and subprime banks. So let's say you file
35:22
Speaker 4: bankruptcy for Discover, American Express, Barclay Chase. Once you find bankruptries,
35:27
Speaker 4: you can't get back to do business with those guys again,
35:29
Speaker 4: They're not gonna extend any credit. So now you're kind
35:31
Speaker 4: of stuck in a subprime rate subprime bank kind of
35:34
Speaker 4: rest of your life where you're being high interest rates
35:36
Speaker 4: because major banks are not gonna extend any kind of
35:38
Speaker 4: credit card to you.
35:40
Speaker 6: That's what I want.
35:43
Speaker 5: My graduates from my school being forced back drop drop
35:49
Speaker 5: Mike drop.
35:50
Speaker 3: Bad drop drop.
36:01
Speaker 1: An illegal alien from Guatemala charged with raping a child
36:05
Speaker 1: in Massachusetts. An MS thirteen gang member from Al Salvador
36:09
Speaker 1: accused of murdering a Texas. Man of Venezuelan charged with
36:13
Speaker 1: filming and selling child pornography in Michigan. These are just
36:17
Speaker 1: some of the heinous migrant criminals caught because of President
36:21
Speaker 1: Donald J. Trump's leadership. I'm Christy Noman, the United States
36:25
Speaker 1: Secretary of Homeland Security. Under President Trump, attempted illegal border
36:29
Speaker 1: crossings are at the lowest levels ever recorded, and over
36:33
Speaker 1: one hundred thousand illegal aliens have been arrested. If you
36:36
Speaker 1: are here illegally, your next you will be fined nearly
36:40
Speaker 1: one thousand dollars a day, imprisoned, and deported. You will
36:44
Speaker 1: never return. But if you register using our CBP home
36:48
Speaker 1: app and leave now, you could be allowed to return legally.
36:52
Speaker 1: Do what's right. Leave now. Under President Trump, America's laws,
36:57
Speaker 1: border and families will
36:59
Speaker 4: Be protected, served by the United States Department of Homeland Security.