Credit scores used for a mortgage or home loan

When you apply for a mortgage or home loan, the lender will use your FICO score. In fact, three FICO scores will be used to determine what’s called your “middle score”. The middle score Your lender will pull one FICO score from each of the major credit bureaus (Experian, Equifax, and TransUnion). Of those three scores, your middle score is the second-highest score, or the score that’s in the middle when the scores are sorted from lowest to highest. Let’s consider the following scenario in which you have the following FICO scores: Equifax: 722 …

Different ways that your credit can affect you

Most people likely think that their credit history is only important when they’re applying for credit. But, your credit history can impact you in other ways, too. Employment Your indebtedness can affect an employer’s decision to hire you. The policies regarding credit vary by employer, but it’s common for financial institutions to place restrictions on hiring candidates with poor credit, including those who have a certain amount of bad debt. If hired, the employee would have access to funds or other sensitive information. Because of the large amounts of outstanding debt, some employers see …

Why you still need a real estate agent when working with a builder

If you’re considering buying a new construction home and will be working with the builder’s agent instead of your own real estate agent, you’re doing yourself a disservice. It seems obvious, but it needs to be stated that you’re being “represented” by the seller’s agent when you buy a new construction property without your own agent. In fact, the seller’s agent has a legal responsibility to serve the seller’s best interest. The builder has a team of experts in their corner. You’ll need a real estate agent in your corner, too, to represent you and keep …

Myths about making early or multiple credit card payments

Often, consumers are advised to make weekly or multiple payments throughout their credit card billing cycle. However, there’s not much context given with this advice. This could leave consumers tying up their funds unnecessarily. Let’s consider the following credit card account activity: The billing cycle ends with a $0 balance There are no pending transactions on the account When the next billing cycle begins, a $2,000 purchase is made There is no other activity on the account There is no interest being accrued Given everything that we know about the consumer’s credit card account …

How mixing personal and business could cost you

We’ve all heard the warnings: “Keep business and personal separate.” “Don’t mix business and personal. Sometimes, these phrases can refer to the concept of keeping personal life and work (or business) life separate. In the context of finances, it refers comingling, which occurs when personal and corporate funds are treated as one. A business owner using their personal bank account or credit card for business purposes (or vice versa) is comingling business and personal funds. When a business is incorporated, it receives certain liability protections. By comingling business and personal funds, the business owner …

Student loan servicer Navient canceling $1.7 billion in student loans

The massive debt wipeout concludes an almost five-year-long investigation into complaints against the servicer. Navient will be required to pay $1.85 billion, which includes: $1.7 billion in student loan cancelation $95 million in restitution $47.4 million in fees paid to the states and the District of Columbia Among the accusations brought against Navient was one that the student loan servicer made predatory subprime loans to students that they know would be unable o repay the loans. These private loans were made to students attending schools with low graduation rates. In addition was the accusation …

Experian, Equifax, & TransUnion received over 700,000 CFPB complaints in 2021

In 2021, Experian, Equifax, and TransUnion collectively received over 700,000 consumer complaints filed against them at the Consumer Financial Protection Bureau (CFPB). The three major credit bureaus, who are responsible for collecting and maintaining credit records, received more than half of all of the CFPB’s complaints in 2021. The CFBP noted that the pattern of complaints revealed that all three bureaus routinely provided consumers with form or template responses instead of meaningful responses to consumers who had concerns about the validity of data in their credit reports. According to the CFPB, TransUnion and Experian …

Roughly 15 million federal student loan borrowers to receive new loan servicers

Some student loan servicers, including Navient and FedLoan Servicing, have opted to stop servicing federal student loans. Around 15 million federal student loan borrowers are serviced by these particular servicers. Roughly half of the affected borrowers will be reassigned to a new servicer by the time student loan repayments begin. The other half can expected to receive a new servicer by the end of 2022. Federal student loan repayments, interest accrual, and collection attempts have been suspended until May 1, 2022. If your servicer is reassigned by then, it’s important that you know who …

Open enrollment for Obamacare ends on January 15th

Although automatic re-enrollment is offered, you may be missing out on better-fitting plans if you don’t review the available plans and select one that’s right for you. In fact, if you didn’t enroll in or update your Marketplace health insurance for 2022 coverage by December 15, 2021, you may have been automatically re-enrolled. So, you’re encouraged to log into your HealthCare.gov account to update your personal information and select the best plan that’s right …