FHA Recoils on New Policy

A policy demanding borrowers to settle their disputed bills in their credit reports before they are qualified to have another loan has been canceled by the Federal Housing Administration.

The FHA has ordered to make the annulment of the policy effective on July 1. This policy would have had a big impact on people with undisputed bill accounts listed on their files where the amounts range from $1000 or more. According to some experts if ever the policy was pushed through, one out of three FHA applicants for loan would find it difficult to get qualified.

The withdrawn policy would have required borrowers who had collections of unpaid bills to settle the amounts before they could apply for a new loan. They could do this either by paying the amounts in full or by applying a repayment schedule. If you fail to do so then you would not be allowed to have FHA loans.

Disputed bills are very common to the files of every borrower in the United States; however it does not pose a very serious risk to credit. These bills would however, result to many altercations and disputes among the overpricing of dealers and consumers. The same is through with open collection accounts, however they are considered more threatening by the lenders because they often get unpaid during the extension period.

Those who opposed the policy said that the terms were more in favor of the lenders and it was very heavy on FHA borrowers, which composed of low income households, first-time buyers and other minority groups. They also said that the policy would not be very helpful in seeking out the credit risks in private lending for the agency. This is because these private persons are already imposing overlays in the mortgages of borrowers.

So to sum it all up, borrowers are no longer required to pay off their undisputed debts, however they must be wary of overlay prices from private lenders for they might be the reason you could not get a loan despite the fact that the FHA is more giving.

Man Arrested for Series of Payday Loan Store Robberies

Aurora police was able to catch a 38 year old man who has been responsible for a series of store robberies. His victims are short-term loan establishments, six of which were in Elgin.

Kane country court is going to hold Fernando D. Zavala’s case. According to the police, he was caught robbing two different stores in just one day. After his arrest the local authorities contacted Elgin because the suspect’s description was similar to many claims in the region.

Some of the places that he attacked were La Hacienda, Walnut Ave, a supermart in Armando, 925 N. in Liberty Street, Pay Day Loan Store, Cash Store and many others. His massive robberies started from August last year.

Elgin Police says they are sure that they caught the right man because he confessed to the crimes. The police also shared that they had no idea that he had victimized that many stores because he held no records of crimes. Most of the stores he had targeted were engaged in the payday loan business.

The criminal said he had hurt no body during his hold-ups, but he refused to reveal how much money he had stolen. Dan Ferrelli, the spokesman for Aurora Police said that Zavala was captured in June 22 after he put up a chase with the authorities. The police responded to a holdup alarm from Check-N-Go, 1276 N. Lake St., after he had stolen from the store and threatened the clerks with a gun, which turned out to be a fake.

He also ordered the clerks to open a safe, but after he was told it had a 10 minute delay alarm he ran out the store through the back door. That was when a short chase broke and he was caught with $1,070 and his toy gun.

He was questioned by the authorities and they found out he had also robbed another store, the Payday Loan Store in 954 E. New York St., earlier that day. He is now faces aggravated armed robbery charges and each of these robberies would cost him 15 years of imprisonment. Zavala is currently behind bars in Kane Country jail on a $1.2 million bail.

Consumer Car Buying Advice Blog – Credit Loan Inquiries

The Service Contract Industry Council or the (SCIC) an organization group which represents almost 80% of the total providers of contracts for appliances, electronics at home and auto services in the United States has released tips for consumers. This press release include the things that consumers should consider in buying extended car warranties or a service contract for brand new vehicles and used ones.

The script seeks to remind clients that they should read the provisions of their contracts very carefully and thoroughly understand all the limitations and inclusions. Another thing you should always keep in mind is to keep evidence of your transactions; these include the paper works, receipts and other records. Furthermore, you should follow the conditions of your manufacturer’s in your car’s maintenance; if you do not it could be a serious breach in your part of the contract.

It is also very important for clients to know the basic information of the manufacturers’ service providers such as the name and contact number. If these are not provided in the contract then you should notify the Department of Insurance or the Better Business Bureau because the company may not be authorized to sell you vehicles.

The script also includes tips for consumers such as being aware of the depreciation or the wear and tear provisions of the company’s warranty; these may include number of years or miles. Another tip is that the consumer has a 30 day “free look” period where in if they think they did not get the right value for their money they could return the car contract and get a full refund.

You should also keep in mind that you should not buy a contract if the company will not disclose a copy of the terms or the conditions for the purchase. And finally, you should be wary of providers that would always use mass marketing techniques.

How to Get a Better Credit Score

A good credit reputation could get you the loans and credit opportunities that you need. Not only is it easier to apply and qualify for financial contracts, the credit rates are also cheaper.

Not everyone is blessed with a stellar credit, but you can always turn things around. If you are one of those people that are wondering how you can improve your credit then read on.

Of course, there is no shortcut to success, if you want to have a better credit, then you best by work hard for it. Creating a good financial plan could always turn your bad credit around.

If you cannot stick to your plans, then you are going to keep struggling with your finances. According to Linda Gunter, a Birmingham resident who used to suffer from bad credit, to get out of that sticky situation, you have to train yourself not to use your credit card.

She says if you can’t pay for something you want with cash, then you best by just forget buying it. Recovering from bad credit is just easier said than done, the real secret to success is good planning and great self-control.

Stephen Yoder, a professor at UAB a School of Business shares that you must make sure that your earnings are equal to your expenses. You can never recover from bad credit if you spend more than you earn.

He says that you must get hold of your credit report, study it and check for errors. These mistakes in the credit records often lead to bankruptcy and bad credit for unsuspecting clients. If you find a mistake in your records then you should write to the agency and correct them.

You should also ask yourself if you have been religious enough in paying your bills. If you fail to pay them on time and they pile up then it could spell trouble for you. If you are not very good at organizing your bills, then you can always set up something called an automatic payment system, where you pay a fixed amount with your card online.

Financial Institutions Open Their Doors to Subprime Lending Again

Banks are starting to open up to subprime lending once again. Equifax spokesperson, Daryl Toor confirmed that in a statement, he further explained that it will not be easy to get a loan if your credit score is below 660 in the FICO credit standards, though consumers are seemingly more responsible and wiser with how they handle their finances.

Bad credit will cost you 5 to 10 percent more when you loan compared to those with stellar credit. Banks would charge you more than the average rates and tie you up with a three year contract that disallows you from increasing your rates in the first year the account is opened.

The ratio of subprime clients have increased this year by 41% compared to 2011 according to Equifax. Credit card insurance for people with VantageScores (those within the 601 to 700 range) has increased to 21% in the first three months of 2012 which is the highest number since 2008.

Those with credit ratings under 600 however are still stuck with limited opportunities. According to Ezra Becker, the vice president of the research and consulting of TransUnion, not everyone is given the chance of a loan because not everyone pays them back, and these high risk clients are among those who are unlikely to pay their loans on time.

The number of credit delinquencies has decreased now and this development greatly contributes to the reason why banks are more comfortable with lending to people with troubled credit standing.the economy in the United States is starting to recover from the great recession it encountered in 2008.

Banks’ credit scores continue to improve and according to TransUnion, the marketing effort is fueling this improvement. Banks and other financial lenders are marketing their services to clients and thus more people are becoming interested in the business.