Here are the 4 steps I always recommend for credit success:

1. Start by getting your current credit picture.

2. Educate yourself about credit and credit scores.

3. Work with a Credit Specialist to set a plan that focuses on fixing your specific credit problems.

4. Keep tabs on your credit so you know if your plan is working.

Step 1 – get your current credit snapshot. If you were beginning a diet you wouldn't guess at your weight right? It's the same with credit; it's important to know your starting point. If you already have your credit scores mark this step as complete – you're a quarter of the way through this credit plan already!

Step 2 – get smart. Unless you are a dietitian, you probably wouldn't create a diet that you knew would guarantee success. So, unless you are a credit expert, don't go about trying to improve your credit blindly. Start by understanding the basic do's and don'ts of credit. www.getwisecc.com has a wealth of Credit Education that can help you become knowledgeable about managing your credit.

Step 3 – build your plan. Work with a knowledgeable certified credit specialist, and then you can really attack your credit problems. Your length of credit and payment history is two of the most important factors of your score. So, you may want to avoid opening a lot of new credit accounts, and you really need to focus on keeping current with all of your bills. Understanding how to deal with each credit problem starts with education and continues with a well conceived plan.

Step 4 – check your status. You'd be surprised to know how many people only check on their credit when making a major purchase. If there's a problem, finding out just before a purchase doesn't leave much time to fix the problem. You'd likely step on the scale every couple of days to see if your diet is working, right? Do the same with your credit, especially if you've created an improvement plan. We recommend checking your credit twice a year and at least 6 months before making a major purchase.

Certified Credit Specialist (925) 208-4384 www.getwisecc.com

Will closing a credit card account help my credit score?

--> No. I would never recommend closing a credit card for the sole purpose of raising your score.

This may sound a bit counter-intuitive; after all, cleaning up your credit profile by getting rid of old or unused credit cards sounds like a good idea – and it may be from an overall credit management perspective. If you are tempted to charge more than you should just because you have more availability to credit, then getting rid of that temptation by closing some credit cards might be your best course of action.

However, your credit score takes into consideration something called a "credit utilization ratio". This ratio basically looks at your total used credit in relation to your total available credit; the higher this ratio is, the more it can negatively affect your FICO score. So, by closing an old or unused card, you are essentially wiping away some of your available credit and there by increasing your credit utilization ratio.

It's a bit tricky, so here's an example:

Say you have 3 credit cards. Credit card 1 has a $500 balance and a $2000 credit limit. Credit card 2 is an unused card with a zero balance and a $3000 limit. Credit card 3 has a $1,500 balance and a $1,500 limit. In this scenario your credit utilization ratio looks like this:

Total balances = $2,000 ($500 + $1,500)
Total available credit = $6,500 ($2,000 + $3,000 + $1,500)
Credit utilization ratio = 30% (2,000 divided by 6,500)

Now, if you decide to close credit card 2 because it's an old card that you never use, your credit utilization ratio looks like this:

Total balances = $2,000 ($500 + $1,500)
Total available credit = $3,500 ($2,000 + $1,500)
Credit utilization ratio = 57% (2,000 divided by 3,500)

You can see that your utilization ratio rose from 30% to 57% by closing the unused credit card.

(925) 208-4384

Should I Do Debt Negotiation Myself?

Credit card companies are all different. While they each have entire departments set up to deal with late payment accounts, credit card negotiation, and collections, they each have different standards and procedures that dictate how they deal with “troubled” credit card accounts.

Detailed debt negotiation” how to” information is hard to come by. Yes, you can legally try to do credit card negotiation on your own, however, expect a long road with a lot of detailed (and probably frustrating) work. Remember, you are one small account to them and they deal with millions of accounts daily. It will take a lot of time and effort to get your case in front of the people who decide how to handle delinquent accounts.

The primary advantage of using a professional debt negotiation company is that they know the ins and outs of all the creditor’s negotiation procedures.They know what to say and when to say it to your creditors. On top of that they also often know the people within the credit card companies whom they need to speak with about your account (the decision makers) which can make for a much smoother process.

Those decision makers will be much more likely to speak with a reputable debt negotiation company because that company typically represents hundreds or thousands of clients whose collective debt can total many millions of dollars. Therefore the creditors are much more likely to take their phone calls and negotiate with them than they are with you.

Surely that does not mean you cannot try to do credit card negotiation yourself but be prepared for the time and effort involved.

Contact us for a Debt Settlement Specialist (925) 208-4384

What Are the Rules of a Successful Settlement for Debt?

When you hire a debt company to conduct a settlement for debt that you cannot repay, remember one key point - that you are HIRING them to do the work for you. You use their services because they are the professionals and will know the best way for you to use settlement to successfully get out of debt as soon as possible.

You Need to LISTEN to them for successful debt settlements
Just like you listen to your tax preparer or your doctor, listen to your debt Specialist. What will they tell you to do? Stick with their plan. Most likely, they will provide you with 2 rules for a successful debt settlement:

1. Do not talk to your creditorsyou hired the debt settlement company to do your talking for you so let them do it? Remember, the settlement is a legal procedure and so your silence is the best way to avoid saying something that could make the process much more complicated (and sticky). They know what to say and when to say it to your creditors. Furthermore, a good settlement company has the established relationships with all the major creditors making the process as smooth as possible.

2. Be prepared to cut back expenses in order to save as much money as possibleThe faster you can save, the quicker your company can get you out of debt and initiate the settlement for your debt with your creditors, it’s as simple as that. While they can eliminate up to 50-60% of your debt, they cannot wipe it out without the money you save under their program. Your short term savings will relieve your long term debt problem.

Contact us for a Debt Settlement Specialist (925) 208-4384

The Credit Card Industry Could Face Changes

There has been a recent move to force credit card companies to review and rewrite some of their more controversial practices. Right now, consumers are complaining that they are at the mercy of the industry’s whims. Interest rates change frequently and, sometimes, without any good reason. The companies argue that their own circumstances – with rates of default and delinquency the highest they’ve been in years – make such practices necessary. But customers and their advocates aren’t buying it. The credit card industry takes in billions of dollars each year, critics say, and can afford to treat their customers better.
Some of the practices under review include: universal default, too-short customer notice of changes to terms and conditions, and the retroactive application of new interest rates to a customer’s entire existing balance.
Universal default occurs when a customer’s credit score is lowered and their credit card company raises their interest rate as a result. There are many problems with this practice. For one, it’s too easy to implement. If a customer makes a late car payment, their credit card interest rate could suffer as a result. And higher interest rates make credit card payments higher, increasing the likelihood that the customer will default with many lenders instead of just the original one.
Credit card companies are also being asked to give more notice to customers when their rates are about to change. Right now, companies are only required to give a fourteen day notice by mail. Customers argue that, by the time they receive the mailed notices – if they receive them at all – they only have a few days to decide how to deal with the changes. If the new bill is passed, that notice period will be increased to nearly a month. Companies will also be required to send out bills 25 days in advance of their due dates, compared to the two-week cycle now in place.
The new bill could also change the way card companies handle punitive interest rates. Some companies will take the higher rate and retroactively apply it to the full amount of the customer’s balance. Customers feel that this is unfair; if they have been paying in a timely manner for years, why should they have high interest applied even to the debt that has been meticulously paid month after month? Companies are being asked to apply such rates only to the portion of the balance that caused the increase.
Credit card companies aren’t happy with the proposed changes. They are facing difficult times, they say, and rules and regulations forcing them to change their practices will only hurt their ability to offer credit to a large number of customers. They maintain that the credit card industry is competitive already, and that customers have no need of legislation to protect them from creditors.
Whichever stance you take, it’s possible that the credit card industry will be making a major overhaul in their business practices. In addition to the bill proposed last month by the House Financial Services Committee, the House Judiciary Committee wants merchants to be able to negotiate the amount they have to pay for credit card transaction fees. Despite card companies’ protests, change is on the horizon.

(925) 208-4384

Understanding Frozen Credit

Credit freezes are often confused with fraud alerts, but they are really nothing similar. A fraud alert is when new creditors are alerted that you may have been the victim of fraud, and the creditor is required to take additional verification steps that prove they should be accessing your credit and opening an account for you before they can issue the credit. Fraud alerts also remove you from receiving prescreened offers for insurance and credit. A credit freeze is something a consumer can place on his or her own credit report – depending on where in the country you live. Some states allow anyone to put a freeze on their credit; while others only allow the victims of identity theft to freeze their credit. Here are other tips that will help you understand the basics of a credit freeze:

Even if your credit is frozen, your report can be updated by your existing creditors. Don't think that by placing a freeze on your credit report you can slide by with a few late payments that won't get reported!

A frozen credit will only prevent new creditors from accessing the information in your report. If you’re existing creditors want to check your credit report to see how you are paying your other creditors, they can.

A freeze of your credit is made with individual credit bureaus. If you freeze your credit with Experian it won't be automatically frozen through TransUnion or Equifax. You have to freeze each manually if you want all access to be frozen.
“Thawing” a credit freeze; in other words, removing the hold you have on your credit report, takes several days to take effect (unless you live in Utah where they're able to unthaw in 15 minutes!) If you plan to apply for new credit or apply to rent an apartment or apply for a new job; you will want to thaw your credit a few days before you'll need it to be sure that these authorized people will have access to the report.
Freezing your credit does not prevent you from using your credit cards. It's not like “freezing” the credit card or “freezing” a bank account. It literally only effects the ability of a new lender to look at your credit report.

While the intent of a credit freeze is usually to prevent identity theft and fraud- there are still numerous ways around it that could result in you becoming the victim of identity theft or fraud, despite having a freeze on your credit. For example, in the event a lender doesn't try to check your credit before issuing a new account, new credit could be opened in your name if the criminal had the right details to do so.

Hopefully, this list has given you some useful insight into what a credit freeze is, and what it is not. Using a credit freeze may help reduce your potential for being the victim of identity theft, but if you are hoping to end the prescreened credit card offers or have creditors alerted to possible fraud activity when they begin to open a new account for you; chances are you are looking for a fraud alert service and not a credit freeze.

Business Credit vs. Personal Credit

You may already know about personal credit and how you score is generated. But when it comes to business credit, the rules are very different.

There are no laws giving you a right to know about them.
Nobody tells you about the hidden compliance "checks"
Damage to your business credit profile is almost impossible to reverse.

Many business owners make a mistake by personal guaranteeing loans and credit lines for their businesses. When they do this, they put their personal credit at risk...which can be disastrous if something unexpected should happen to their business. That's why its critically important that when you build your business, you do it separate from your personal credit. Business credit can be yours to use to build or expand your business.

The problem though, is that lenders don't want you to know this. They would rather that you risk your personal credit with these business credit lines. You see, it's to their advantage to get you personally at risk for these lines. They like having more leverage over you and can even wreak more havoc on your personal finances, if they have access to your personal credit. That's just another reason why you NEED to know about how to keep your personal credit completely separate from your business credit.