Thanks for the great seminar the other day. I always learn tons from you.

Take Care,

Steve Tueller – Orem, UT

Ok, so you think you are hotshot and can get whatever you want cause you still have plastic, still have checks or still have money burning in your pocket. When, sheesh, get a life. You can’t spend everything and expect the bills to be paid with your good looks. Creditors just don’t think you are that good looking. So, my friends… stop spending your dough. It’s called self-control and works really great in situations like this. In fact, the wealthy people have 5 savings plans that help them with their finances. There are addiction recovery groups or Over Spenders Anonymous that you can join to help get over this addiction. Didn’t think you had an addiction did you. Well, if you can’t control your spending then yes, you are out of control and there is an addiction. So, get some help.

You will discover that you are out of control when you have no money at the end of the month and still have bills. What’s the adage? I have more month at the end of my paycheck. There are lots of ways to cut spending and save some money. Some of us already have pinched all we can in every conceivable way and still don’t have enough. There is another to get spending in control. You could also get a part time job, ask for a raise or find a better paying job that will help you have the money to pay for the bills you have. Just be sure to not spend more until you get things in control. See # for a plan we have that will get you out of debt in 1/3^rd the time, get your credit scores into the mid 700’s and increase cash flow at the same time. It works, it’s amazing and it can change your financial future almost instantly.

Life just hits us hard and too fast sometimes and we realize we aren’t going to be on time with a payment. What to do? Well, the worse thing is to say and do nothing. Now, if the payment is going to be past the due date, then it would be wise to call the credit up and ask for an extension to give you time to make the payment. They may agree or they may not. They may still give you a late fee or they may not. They may still report the late to the credit bureaus or… they may not. It doesn’t hurt to ask and it may even save a late fee or a report of late to the credit bureaus. The point is, you must ask to be able to receive. Most creditors love the fact that you are keeping them in the loop and talking with them.

Some of us are going to get into real problems because of a loss of job or medical problems or other reasons and the money just won’t be there. Be sure to contact the creditor and explain the situation. Most big companies have a way to accommodate a serious financial difficulty and to make payment arrangements other than what you had before. But you have to call to get help.

OK, OK…

Maybe I was wrong about the worst credit problem being multiple late payments to a finance company. The real worst credit problem is multiple late payments to multiple finance companies.

OUCH!

Oh yes, devastating credit scores will be in the 400’s; this will not only become a severe chronic problem, it will be extremely difficult to get out of. The only solution is to pay off these finance companies and get them removed from your credit report.

The absolute next step is to establish new, good credit PLUS a history with the good credit because any history with a finance company will be bad from day one. Let me repeat: any history with a finance company will be bad from day one until you get it removed from your credit report.

Sorry, but that is just the way it works.

Maybe you’ve been told by someone (who thinks they know something about establishing credit) that going with a finance company is a good way to establish said credit.

Unfortunately, it’s only a good idea if you think a credit score in the low 500’s is OK; if that’s your goal, then go for it. But the truth is that a score in the 500’s will get you absolutely nowhere and credit is getting much tighter. Most of us are going to need a score in the low 700’s to get a loan of any kind and a good interest rate. Obviously this makes a 500 credit score pretty worthless.

So, the three words for today are:

Avoid Finance Companies.