Latest / Financial Survival Network / Old Credit Card Scams are Returning -- Paul Oster #5797

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Old Credit Card Scams are Returning -- Paul Oster #5797 · Financial Survival Network

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  You're listening to Carrie Lets's Financial Survival Network, where you get valuable information you
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  Welcome, you are listening to the Financial Survival Network. I'm carry let's your
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  host. Well, we got a return visit from our good friend Paul Auster,
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  and we're gonna be talking about new scams. Everything old is eventually new
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  again, as well as we're going to be getting some insight into the new
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  rule that the Current and Men has implemented that will effectively enialize credit worthy home
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  buyers and reward deadbeats just what you don't want to be doing. Paul.
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  Great to have you back. Hey, just tell us again your website before
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  we get started. Sure, great to be back. It's better Qualified dot
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  com. Better Qualified dot com and there's a link to that in the show
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  notes. By the way, if you've got a question for Paul or myself,
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  I knew this is a very popular topic what we discuss. Shoot me
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  an email k l at Kerry Lutz dot com. So, Paul, it's
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  great to have you back and connect with you. You know, you're one
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  of my oldest running guests. We've been doing this almost since the beginning when
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  I started the podcast eleven years ago, and amazing how things have changed.
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  But some things don't change. So these skimmer things are back again. I
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  mean they used to nail me on them at the gas stations in yeah,
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  Miami. Yeah, I mean it's it was worldwide, and it was so
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  easy because all they had to do was get the data off of that magnetic
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  strip and it had everything and it was unencrypted, stagnant data. So once
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  just swiped the skimmer, you know, the identity thieves had everything that they
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  needed. Moving forward, they went to the chip card, which made it
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  much much more difficult. But like everything else, the identity thieves and the
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  bad actors have now upgraded their technologies, so they're back, and they're back
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  both as skimming, which is where they'll take a device and actually you know,
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  it's an overlay that they put on top of an ATM machine, any
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  point of sale device. Gas stations are notoriously bad for this, but the
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  latest technology is what's called a shimmer, and this is where they actually take
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  a very small circuit board and insert it inside of the machine. Much harder
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  to detect it, you know, with just physically looking at a device,
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  because most of the times they pop the thing open, pop it in,
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  and close it back up, and nobody's the wiser until they realize that a
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  lot of their customers data has been stolen. So they're now able to decrypt
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  and get most of the data off of even the chip cards. A lot
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  of times they do it in conjunction with a camera that's installed. They want
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  to see you put in the three digit CVV code, they want to see
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  you put in any other data that they can grab, and they do that
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  via very very small cameras. So between those things, believe it or not,
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  coming out of the pandemic, this type of credit card fraud and identity
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  theft is exploding and on the rise. Unfortunately. Really that's a real shock
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  there that it came back again. I can't believe that. And yep there
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  is a time when and I was getting a new credit card from American Express
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  once a month was unbelievable. Yeah, yeah, so this, you know,
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  this goes back to you know, one of the ways that you can
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  limit your your exposure and your risk. And look if they get and if
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  you if you use a debit card in this situation, they could literally drain
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  your account. Um if you use a credit card, which obviously we don't
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  try and promote because people get themselves in trouble by using the credit card.
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  But at least the credit card, you know, you're not responsible for any
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  fraudulent charges um. And in the case of using a debit card, you're
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  going to get your money back, but typically they will freeze your account during
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  the investigation, which becomes a huge inconvenience, you know, at that point
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  in time. So we're we're we're up against you know, these bad actors
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  and carry One of the things I didn't really grasp was when you look at
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  Silicon Valley and you look at the tens of thousands of very very smart,
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  technologically advanced workers that have been laid off. Unfortunately, when they fall on
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  hard times, they're the ones that are being recruited to perpetrate these crimes and
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  to advance their technologies on their side. So we're in for some rough waters
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  when it comes to identity theft and cybersecurity. It's kind of like that movie
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  Fun with Dick and Jane where they both get laid off from their jobs.
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  I think it was like George Seagull and yeah, Gaine Fada and then they
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  become bank robbers. Not really good at it, but they keep improving and
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  getting better and better at it. Right, absolutely, absolutely, Oh man,
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  will it ever cease? But the good news is I got a Tesla,
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  so I never even use a credit card to fill my car up anymore.
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  Though at least that exposure has been limited in my case. Yeah,
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  well, I don't know about that. The smarter, the smarter, the
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  cars, the smarter. You know, those are now open, uh you
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  know, uh portals. It's like, believe it or not, they were
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  hacking into refrigerators and think that's connected to the internet. You know, they
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  can reverse engineer it and somehow gain access to your to your data. You
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  know. It's always worried that the my refrigerator would turn state's evidence against me.
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  Yep, that's a little world. What a world? Hey, onto
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  other things. So you heard about this proposal that's being implemented today. I
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  believe that will penalize credit worthy borrowers who are seeking a guess, FHA or
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  federally backed mortgage and reward to the dead beats. Yeah, this is you
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  know, I am not a fan of this at all. If they wanted
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  to put forward a program that helped people that had some credit issues, Look,
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  the pandemic was very unfriendly to everybody. But the reality is to do
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  it this way, and they've tried to spend it a thousand different ways.
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  The bottom line here is, on an average let's say three hundred thousand dollars
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  mortgage, somebody with less than stellar credit. Let's say you're at a six
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  twenty, right, and then you take somebody who is above a six to
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  eighty or a seven hundred. The person with the lower credit is going to
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  save close to four thousand dollars. The person with the higher credit is going
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  to wind up paying about four hundred dollars more. So really is going to
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  stay people. This is for only for government backed loans like your your Federal
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  Housing Authority, your FAJ loans. So if you do, if you get
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  a conventional loan, then you're okay. The problem with this also is that
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  the FED, the government, the administration assumed that people who have higher credit
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  scores have a higher net worth value, and that's certainly not the case.
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  Income has nothing to do with your FICO score, and they know that on
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  both sides of the coin here. So to penalize somebody, let's say a
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  person is making minimum wage, they've been exhausting their resources, they have two
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  jobs just to make all the pay their bills on time, and they go
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  to get the first time owned buyer mortgage and they're going to get penalized because
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  they've actually done what they were supposed to do. This is completely bananas to
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  me. It's counterintuitive, and it's probably one of the biggest socialized piece of
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  legislation that's ever been passed, and there wasn't a lot of fanfare out of
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  it. A lot of people are going to find out when they actually apply
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  for a mortgage, yeah, that it should go on the closing statement on
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  the HUD one as a deadbeat tax one hundred percent. Again, you want
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  to put programs to help foster first time homebuyers, to help the underbanked,
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  um uh, you know all these different communities. That's great, put those
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  programs in place, give them incentives, help them out for sure, down
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  down payment assistance programs, grants. All of that is awesome, But how
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  did we get to a point where again, this is not taxing the rich
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  to pay the poor. This is taxing you know, let's call it attack.
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  This is penalizing someone who has a good credit score to help somebody who
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  doesn't have a good credit score. And again you could have people that are
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  are you know, not wealthy either. The same sense is saying socioeconomic status
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  as the person who's kidding rewarded. Um. Again, this just does not
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  make sense to me. I hope they actually repeal it and get rid of
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  it. Yeah. Well, Congress is threatening to override it, and it
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  seems like both parties are in an uproar over this, which is unusual.
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  Yeah, just another example of government overreach. Do you think they'll do You
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  think they'll revoke it or repeal it, override it? I do? I
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  do? You know? The bank, the banking industry as a whole is
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  very very powerful. Um. They're the ones that are there screaming and hollering
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  because it Again, this just does not make sense. Um, So I
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  think it goes back on the table and again massage it, tweak it.
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  If you want to help the people that had fallen on hard times and their
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  credit has suffered because of it. That's a good idea, right again,
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  I would just do it during the pandemic. If you suffered some financial hardships,
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  you were you, you know, you miss some bills, you know,
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  Listen, if you miss one payment, a thirty day late payment comes
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  on to your credit report, it could easily cost you fifty points. Those
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  fifty points could wind up costing you hundreds, if not thousands of dollars,
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  especially when you're talking about a mortgage. So if you want to help those
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  people, great, but you certainly can't do it by penalizing the people again
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  who have exhausted themselves to pay their bills on time. Yeah, it certainly
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  is an outrage. But by any calculation, and it's not a political thing
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  at all, is now reward people who have managed to get through the pandemic
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  and eat their credit high Maybe give them a bonus too, because presumably that
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  these people can get through a pandemic without defaulting on various obligations, they're going
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  to be a more credit worthy risk one hundred percent. They're the ones that
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  will ultimately drive the economy moving forward anyway. Way, So this is,
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  you know, this is just such a negative impact on the people who again
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  we're doing everything that they possibly could to maintain a good credit score, and
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  to penalize them for those efforts. Is it just doesn't make any sense.
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  Yeah, it's just a slap in the face, it really is. It's
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  not a lot of money or a hundred bucks, but hey, you can
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  maybe take the family on a vacation for that or a weekend. Yeah,
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  we can, even if it was even if it was only fifty dollars a
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  month, right, So fifty dollars a month, six hundred dollars a year,
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  you know, on a thirty year mortgage. We're talking a lot,
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  a lot of money. Now, the average person doesn't hold the mortgage for
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  thirty years. I get that, but some people do. And so we
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  just look, we're smart enough to figure out a different path and a different
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  way to help the people. I don't want to say that they deserve it,
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  but we can certainly help the people that need it the most, and
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  those are that's certainly people that have suffered, you know, a negative impact
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  of their credit scores. Your credit score is going to cost or save your
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  money every single month, whether it's financing, whether it's insurance, security,
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  deposits, you know, for cell phones and having utilities turned on. It's
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  going to cost or save you money every single month, relatively speaking. So
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  the people that you know are are below a seven forty, Actually, it's
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  all tiered base pricing. So the minute you drive below of seven forty,
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  you're gonna pay a little bit more. If you're a seven twenty to a
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  seven forty, you're gonna pay a little bit more than someone is a seven
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  forty and above. If you're below is seven twenty. If you're between a
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  seven hundred and seven twenty, you're gonna pay that much more. And it
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  goes right down six to eighty six to sixty eighty six forty and to a
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  point. You know, typically if you're below a five eighty, you're not
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  even going to get approved for the mortgage. And if you do. You
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  know, people are screaming about the interest rates that they see on the TV.
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  Well, those rates are for people with a seven forty or a buck
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  up. If you're a six hundred and the bank has some program that can
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  get you approved, you're probably paying close to nine percent. Yeah, hey,
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  give us one tip, one hack. They can help you raise your
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  credit score without doing a heck of a lot. Yeah, I mean the
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  easiest way possible. I'll give you two. Hey, you have to build
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  new accounts, open positive accounts. There's all sorts of credit builder companies out
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  there. One is called self Excellent Company. The results are great, it
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  won't cost you a lot of money to do it. And then the other
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  thing is to pay down that credit card debt because that's, you know,
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  the second biggest score factor that impacts your scores. So figure out a way
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  to get out of credit card debt. We say it all the time,
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  But add new positive accounts to your credit report and you can do that even
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  if you have lower scores. Credit builder accounts you can get approved, even
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  if you have a lower credit score. Secured credit cards you can get approved
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  even if you have a lower credit square. So it's just a numbers game.
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  You have to you have to skew it in the other direction. You
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  have to have more open positive accounts than you do negative accounts. All right,
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  Well, we appreciate you coming on Paul. As always, Hey find
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  Pulse site, check them out on a better qualified dot com and the Hey
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  you can find a link to it in the show notes. This interview on
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  Financial Survival Network dot com. Just click it and you go there. And
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  while you're there, sign up for a free newsletter. And if you got
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  any questions, comments, whatever for Paul myself, shoot me an email k
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  l at Arry Lutz dot com. Paul, great catching up with you.
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  We'll talk to you again real soon. Thanks so much, Carrie. Bye
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  now, thanks for listening to carry Lutz's Financial Survival Network, your solution to
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  today's trying times. For the latest, go to Financial Survival Network dot com.
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  Financial Survival Network now more than ever,