Personal Credit Recovery Program Program Benefits Get 24/7 online access to your personal credit report and score Learn at your own pace by working through our self-study credit rebuilding guide Access ready-to-use templates that can help you remove inaccurate data from your credit report Constant and proactive monitoring of your credit report and data with immediate email notification of anything that affects your credit. $1,000,000 zero deductible ID theft insurance policy Available wherever you are (in all 50 states) info@ymminc.com www.ymminc.com (949) 766-0209
PERSONAL CREDIT RECOVERY PROGRAM Life happens to the best of us. And sometimes, life can be a little challenging. If filing a personal Bankruptcy or experiencing a Short Sale or Foreclosure has been one of your recent challenges, Your Money Matters understands what you re going through, and we re here to help. Recovering after a personal financial hardship takes effort and time, but full financial recovery is possible. To help you significantly improve your credit health after your personal financial hardship, YMM has a developed our unique Personal Credit Recovery Program. Don t let the negative effects of a financial hardship keep you from the full financial recovery you need and desire. Let us help. Our Personal Credit Recovery Program is a unique, self-managed system, designed to help you resolve the issues left on your credit profile after a bankruptcy, short sale, or foreclosure and put you back on track to becoming a prime candidate for future financing. All of this is done at your pace using our tools and system. Here s how the Personal Credit Recovery Program works: 1. Click Here to go to our credit partner s website, where you can get a copy of your personal credit report. To access your credit report, make sure you enroll in the Premium package, which includes 24/7 credit monitoring and a $1,000,000 ID theft insurance policy, in addition to 24/7 online access to your credit report. 2. Once you have access to your credit report, read the Secrets to Rebuilding Your Credit eguide to learn the specific steps you need to take to start rebuilding your credit. 3. After you have downloaded a copy of your credit report using the steps above, print the template provided in this packet and address any creditors that are still reporting inaccurate data on your personal credit report. It s that simple. Getting your credit back on track doesn t have to be a nightmare or something you dread. By using our system, you can work at your own pace. By improving and monitoring your credit, you can become a great candidate for any future financing needs you may have. Pricing for 24/7 access to your credit report starts at $24/month. Contact us today to begin your full credit recovery. info@ymminc.com www.ymminc.com (949) 766-0209
Account Dispute Template Below is the template you can use to dispute any inaccurate data on your credit report. To use the template, simply address it to the appropriate creditor and provide as much detail about the account as possible. If you have any documentation that proves the error on the report, be sure to include that along with your letter. The mailing address of your creditor will be listed on the bottom of your personal credit report. DD/MM/YYYY HSBC/BS Buy P.O. Box 15519 Wilmington, DE 19850 RE: Credit bureau reporting To Whom It May Concern: I am requesting a correction of your reporting to the credit bureaus as follows: Account # 063245 Comment: This is part of a Chapter 7 bankruptcy and this should be included in your reporting- See attached schedule Please notify me in writing once this has been completed. Sincerely, John Smith 1234 Main Street Victorville, CA 92392 SSN# 123-45-6789
The Secrets to Rebuilding Your Personal Credit An eguide Your Money Matters www.ymminc.com info@ymminc.com (949) 766-0209
The Secrets to Rebuilding Your Personal Credit Congratulations for making the commitment to improve your personal credit profile! Now that you have made the commitment and you have the tools you need to resolve all the inaccuracies on your credit report, it s time to take the next steps outlined in this guide. Our goal is to help you gain prime credit status in as little time as possible. The steps in this guide will show you how to do that. There is no magic bullet that will make this happen overnight and no one can do these steps for you, but having excellent credit in a short amount of time after your personal financial hardship is absolutely possible. So let s get started. Let s Start with Why So what s the big deal about your credit score anyway? Simply put, credit scores give lenders and other companies that need to do business with you, a fast and objective measurement of your credit risk. Before the use of scoring, the credit granting process could be slow, inconsistent and unfairly biased. Credit scores have made big improvements in the credit process. So what does this mean for you? A higher credit score means better interest rates and it can mean the difference between yes, you are approved and no, we can t help you. Or, you may get approved but a lower score can cost you thousands of dollars over many years. Maybe you are not thinking of borrowing money anytime in the near future but did you know that in addition to lenders, there are many potential employers, landlords, and insurance companies that consider your credit score in their process? How Your Credit Score Is Calculated So of course you know that you score is important, but you might be asking yourself how is a credit score calculated? Credit scores are calculated from different data in your credit report. This data can be grouped into five categories. The percentages reflect how important the category is in determining your score. The payment history is 35%, amounts owed 30%, length of credit history 15%, new credit 10%, and types of credit used is 10%. The payment history reflects the timeliness of your payments. This area demonstrates how you are handling your debt. This is where late payments can really affect your scores, especially since this has the highest percentage of the score.
The amounts owed indicate what the credit limit is and what you owe on that amount. This is where maxed out credit cards start to really affect your score. The ideal balance to owe on a credit card is approximately 10% of your credit line. So, on a credit card with a limit of $2,500, the best scenario is a balance of $250 or less. The next category is length of credit history and this shows how long you have had the accounts and the time since the most recent activity. Accounts reporting that are older than two years can contribute to improving your scores. Many people like to do balance transfers with credit cards to reduce interest paid. That can be a smart thing to do as far as reducing interest paid, however, you need to understand it may impact your score by shortening the length of the credit history. New credit reflects new accounts opened and number of credit inquiries. Typically in this area, similar inquiries in a thirty day period will be calculated as one inquiry. For example, you are shopping for a new car. If you were to go to four dealers in the same week and each one makes an inquiry on your credit, if it is within a thirty day period it counts as one inquiry, as far as score calculations. If you were to go shopping over a four month period and four dealers run your credit one, for each month, each inquiry would count separately and you would have more inquiries calculated on your score. Each inquiry will report but each inquiry may not carry the same weight in calculating your score. The last area is types of credit used. Ideally you would have one mortgage account, one installment account (payment amount is fixed) and two revolving accounts (credit cards, etc). There are as many variations of this as there are reports and it is important to understand that a late payment on a mortgage factors more severely in reducing a score than on any another account. Fixing First Then Recovery So what are some tips on fixing and maintaining good credit? First of all, know what is on your credit report and what your scores are. The statistics show that 50% to 70% of credit reports contain errors. It can be as simple as an incorrect address, opening date on an account, etc. or could be as serious as an account reporting that does not belong to you. The credit report really is a snapshot of how you manage your debt. Late payments have a derogatory impact on scores so make every effort to pay accounts in a timely manner. If you are late, get the account current and stay current. Be aware of your credit limit and your account balance. Sometimes a way to improve this area can be to ask your lender to increase the account balance, don t use this new available credit, and you have already slightly improved your score by increasing available credit limits. Do not open new accounts too rapidly and consider keeping some older accounts just to maintain the credit history. Do your rate shopping in a focused period of time to keep the impact of inquiries less on your score. Consider the credit mix of your accounts as this is weighed into your credit score. To summarize, fixing a credit score is more about fixing errors in your credit history (if they exist) and then following the above guidelines to maintain good credit history. Raising your score after a poor mark on your credit or building credit for the first time will take patience and discipline.
Your credit score is one of the most important numbers in your life. Knowing your credit scores and what is on your report is the fiscally responsible and the smart thing to do. By having a healthy credit profile, you will gain total control over your potential financing options and you will save huge amounts of money when it s time to finance your next purchase. Start the Recovery Process The first step to credit recovery will be for you to establish new credit. The best, and many times the only way to do this, is by secured credit cards. We recommend applying for and obtaining two secured credit cards and then one additional revolving card such as a department store credit card (e.g. Target, Kohl s) or a gas card (e.g. Shell, Mobile). Start with the secured credit cards. You will want to check with your bank to see if they offer this type of card and if they do, apply with your bank first. You can also go online to apply for Capital One s secured credit card. They offer a secured credit card with low fees. After you obtain two secured cards, wait for approximately one month and then apply for the department store or gas card. Important things to know about Secured Credit Cards The second step to credit recover is to understand how secured credit cards work and to manage them correctly. Here are some things you should know. What is a secured credit card? A secured card requires a cash collateral deposit that becomes the credit line for that account. For example, if you put $500 in the account; you can charge up to $500. You may be able to add to the deposit, to add more credit, or sometimes a bank will reward you for good payment and add to your credit line without requesting additional deposits. Do you get your cash collateral back? Yes, the cash collateral is held for as long as the company requires you to do so and the deposit belongs to you. This deposit will be returned to you when the company determines it is no longer required. This decision will be based on your use of the credit and payment history. What kind of charges will there be? This is where it pays to shop around. Look for a card that doesn't charge an application fee. Every secured card charges an annual fee, and they vary dramatically. Read the fine print. Some people have gotten secured cards and found their entire limit consumed with fees before they ever used the card. Secured cards also usually charge higher interest rates, however, your goal is to pay in full monthly and in a manner that will not require you to pay any interest. How much money do I have to deposit? Again, the amount will vary by the card. Most cards require a deposit of $300 to $500. Your credit limit will either be the amount of your deposit or some percentage above that amount.
How to manage your new credit card accounts It is very important when managing your new credit cards that you use approximately 10% of your available limit, but do not go over that amount. If you have a $500 limit, then charge only $50 per statement cycle. When you receive their statement, pay the balance in full and repeat the process. Use this plan for each card. This will re-establish positive credit reporting and ensure that you are not charged interest on the amount of money used each month. The credit score system factors in the amount of credit available for use and the timeliness of the payment. This is why it is important to not use up all of your available credit. If you use the entire limit on your new credit cards, this will result in negative marks on your credit scores and report. Don t Forget About the IRS Getting back on track financially after a hardship is totally possible and well worth the effort. It s important however to not forget about a major element that effects everything you do financially taxes. Read the information below to learn a few key things to consider when thinking about the tax implications of your financial hardship. (The following is meant to present a simplified overview of tax issues associated with Bankruptcy, Foreclosures and Short Sales, and should not be construed as tax advice. Always consult with a Tax Professional and/or Attorney regarding your specific situation.) Bankruptcy and Taxes There are two considerations when it comes to Bankruptcy and taxes forgiveness of debt associated with the Bankruptcy action itself, and existing tax debts. Generally, forgiveness of debt is normally considered taxable income--but not when it comes to bankruptcy or insolvency. So even if you receive a 1099 from a lender whose debt was discharged in your bankruptcy proceeding, be sure to take it to your tax professional. It can be dealt with on the tax return to keep the IRS off your back. It is not taxable income. Regarding existing tax debts - Under bankruptcy laws, tax debts are treated the same way in both Chapter 7 and Chapter 13 petitions. Not all tax debts are capable of being discharged in bankruptcy. Tax debts are associated with a particular tax return and tax year. The bankruptcy law lays out specific criteria for how old a tax debt should be. The bankruptcy petitioner must have tax debts that meet the five criteria for discharge. If the income tax debt meets all five of these rules, then the tax debt is generally dischargeable in Chapter 7 and Chapter 13 bankruptcy petitions: 1. The due date for filing a tax return is at least three years ago. 2. The tax return was filed at least two years ago. 3. The tax assessment is at least 240 days old. 4. The tax return was not fraudulent. 5. The taxpayer is not guilty of tax evasion.
Foreclosures & Short Sales and Taxes This is a complicated area with many qualifications and exceptions. Generally, if you owe a debt to someone else and they cancel or forgive that debt, such as a mortgage lender, the canceled amount may be taxable by the IRS and resident s State. The Mortgage Debt Relief Act of 2007 generally allows taxpayers to exclude income (on their Federal tax return) from the discharge of debt on their principal residence. Debt reduced through mortgage restructuring (aka Loan Mods ), as well as mortgage debt forgiven in connection with a foreclosure, qualifies for the relief. Investment properties do not qualify under the Act. Also, in most instances, recourse mortgage debt resulting from 2nd Trust Deeds and home equity lines ( HELOCS ) do not qualify under the Act and may be taxable. This provision applies to debt forgiven in calendar years 2007 through 2013. Up to $2 million of forgiven debt is eligible for this exclusion ($1 million if married filing separately). The exclusion does not apply if the discharge is due to services performed for the lender or any other reason not directly related to a decline in the home s value or the taxpayer s financial condition. More information, including detailed examples can be found in IRS Publication 4681. This discussion relates to IRS tax regulations only each state has its own tax regulations concerning forgiveness of debt, and is further complicated by whether or not a State is considered a Recourse or Non-Recourse State, and each State s anti-deficiency laws. The Mortgage Debt Relief Act of 2007 expired effective January 1, 2014 and, as of yet, there is no indication as to whether or not the IRS will extend the Act. You should always consult with a Tax Professional and/or Attorney regarding your specific situation. Credit Recovery Checklist Address all incorrect data still showing on credit report. Establish new credit by applying for and managing 3 new credit cards (2 secured cards, 1 department store or gas card). Charge approximately 10% of your available credit limit each month and pay the balances off in full at the end of the statement period. Watch your credit scores climb and become a prime credit candidate! In conclusion, keep focused on the goal of rebuilding your credit. Understand that in time your credit profile will heal, but only if you do the right things. Refer back to this guide to stay on track. And remember, you can make the next years in your financial life truly great.