Friday, May 22, 2009
Monday, May 18, 2009
Can't get hired because of your credit score ?
Have you applied for a new job recently that you were extremely qualified for only to be told you were rejected after your Credit was reviewed? I personally know at least 10 people that have had this happen to them over the last year. These friends are EXPERTS at what they do but have had financial difficulties within the last 10 years. A bankruptcy, divorce, loss of income, 30 day late on a credit card, short sell on their home, etc.. etc.. Does this inhibit their ability to do their job or make them any less of an expert in their field ? Absolutely not !!!! Yet there it is, keeping them from being able to do what they do best and providing for themselves and their families.
This seems ridiculous to me but it is becoming more and more of an issue for our Nation's unemployed.
With the country's largest corporations laying off thousands of employees everyday we have a real crisis happening. Something we have not seen for many, many years. Of course the world has changed a great deal since the days of The Great Depression but we now have new challenges for those seeking a new career.
For the last ten years I have worked as a National Account Executive for a National Bank. I have seen THOUSANDS of credit reports and have always been surprised at the results. Many times highly skilled people such as Doctors , Lawyers, Professional Athletes, Actors, Engineers, and The CEOs of major corporations have the worst credit scores. These individuals often have extremely high incomes and large amounts of cash in reserves. Amazingly enough, these same people are turned down for home loans due to low credit scores. I have found in my experience that these low scores are usually caused by life happening. In some instances these clients had a lousy accountant that did not perform. I have seen business partners that were supposed to take care of bills and didn't, illness or a hospital stay that kept them from being able to pay on time.
What if Hospitals hired their surgeons based on credit? Would you choose a heart surgeon with perfect credit over one with 25 years of experience who had a Bankruptcy due to a Divorce? You never know, that could be an option some day.
My beef here is obvious. I do not see how one's credit score has anything to do with their ability to perform, yet here we are seeing people turned down for employment because of Credit issues.
The three credit reporting agencies, Transunion, Equifax, and Experian are affecting our lives everyday and most of us have no idea what the law is or how to correct it.
Do yourself a favor and get educated !! If you were sick you would go to the Doctor wouldn't you ????
Visit www.tfc2009.info and listen to the free audio. if you decide to take charge, tell them Darren Peck sent you.
This seems ridiculous to me but it is becoming more and more of an issue for our Nation's unemployed.
With the country's largest corporations laying off thousands of employees everyday we have a real crisis happening. Something we have not seen for many, many years. Of course the world has changed a great deal since the days of The Great Depression but we now have new challenges for those seeking a new career.
For the last ten years I have worked as a National Account Executive for a National Bank. I have seen THOUSANDS of credit reports and have always been surprised at the results. Many times highly skilled people such as Doctors , Lawyers, Professional Athletes, Actors, Engineers, and The CEOs of major corporations have the worst credit scores. These individuals often have extremely high incomes and large amounts of cash in reserves. Amazingly enough, these same people are turned down for home loans due to low credit scores. I have found in my experience that these low scores are usually caused by life happening. In some instances these clients had a lousy accountant that did not perform. I have seen business partners that were supposed to take care of bills and didn't, illness or a hospital stay that kept them from being able to pay on time.
What if Hospitals hired their surgeons based on credit? Would you choose a heart surgeon with perfect credit over one with 25 years of experience who had a Bankruptcy due to a Divorce? You never know, that could be an option some day.
My beef here is obvious. I do not see how one's credit score has anything to do with their ability to perform, yet here we are seeing people turned down for employment because of Credit issues.
The three credit reporting agencies, Transunion, Equifax, and Experian are affecting our lives everyday and most of us have no idea what the law is or how to correct it.
Do yourself a favor and get educated !! If you were sick you would go to the Doctor wouldn't you ????
Visit www.tfc2009.info and listen to the free audio. if you decide to take charge, tell them Darren Peck sent you.
Thursday, April 30, 2009
The Problem with Bad Credit
I started this blog with the hopes that people would stumble across it and learn something from my experiences and hopefully help themselves.
Anyone with email these days is bombarded with ads for Mortgages. refinance now, lowest rates, easy terms, lower your payments, Buy a new home with 0 down!, etc.. etc..
Yes, All these things can be had and /or done IF you meet the criteria that they require.
In reality, the Bank's decision to approve a loan is based heavily on several things:
1. Is the borrower employed in the same line of work or business for at least 2 years?
2. Can the Borrower document their income for this time period ( w2's, Tax returns, pay stubs, etc..)
3. CREDIT. Do they have Credit scores above 620 (this would be a low score) for both borrowers?
4. Property. Is it sellable, valued correctly, in a good location, livable etc...
I have been in this business for over a decade and I can tell you that all of these things are important but THE FIRST thing we all look at is the borrowers credit !! You see, even if the borrowers are perfect in every other aspect, a low credit score will kill the deal. There can be some exceptions in the other areas but credit leaves no room for error.
Let me list some of the things that can keep even the finest borrowers from getting a loan approval:
1. bankruptcy in the last 10 years
2. Tax Liens
3. Credit card lates in the last 2 years ( this could be just one 30 day late ! )
4. Repossession of a Vehicle, both voluntary and involuntary.
5. Behind on Child support
6. Behind on Spousal support
7. Debt Consolidation
8. Consumer Credit Counseling
9. Judgements
10. Property Liens
11. Several lines of credit with no balance
12. Too many Credit Cards
There are MANY other things that can be on a credit report that are negative but I like to call these the dastardly dozen.
These are the big No-No's and can keep you from not only getting a home loan but can also keep you from qualifying for the lower interest rates. The lower the interest rate, the lower your payments.
Anyone with email these days is bombarded with ads for Mortgages. refinance now, lowest rates, easy terms, lower your payments, Buy a new home with 0 down!, etc.. etc..
Yes, All these things can be had and /or done IF you meet the criteria that they require.
In reality, the Bank's decision to approve a loan is based heavily on several things:
1. Is the borrower employed in the same line of work or business for at least 2 years?
2. Can the Borrower document their income for this time period ( w2's, Tax returns, pay stubs, etc..)
3. CREDIT. Do they have Credit scores above 620 (this would be a low score) for both borrowers?
4. Property. Is it sellable, valued correctly, in a good location, livable etc...
I have been in this business for over a decade and I can tell you that all of these things are important but THE FIRST thing we all look at is the borrowers credit !! You see, even if the borrowers are perfect in every other aspect, a low credit score will kill the deal. There can be some exceptions in the other areas but credit leaves no room for error.
Let me list some of the things that can keep even the finest borrowers from getting a loan approval:
1. bankruptcy in the last 10 years
2. Tax Liens
3. Credit card lates in the last 2 years ( this could be just one 30 day late ! )
4. Repossession of a Vehicle, both voluntary and involuntary.
5. Behind on Child support
6. Behind on Spousal support
7. Debt Consolidation
8. Consumer Credit Counseling
9. Judgements
10. Property Liens
11. Several lines of credit with no balance
12. Too many Credit Cards
There are MANY other things that can be on a credit report that are negative but I like to call these the dastardly dozen.
These are the big No-No's and can keep you from not only getting a home loan but can also keep you from qualifying for the lower interest rates. The lower the interest rate, the lower your payments.
In my next post I will discuss how Borrowers can take charge of their credit.
DON'T REPAIR IT, RESTORE IT !!
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