How To Lower Mortgage Payments With Bad Credit

how to lower mortgage payments with bad credit

If you’re in financial trouble you may be wondering how to lower mortgage payments with bad credit. Unfortunately, there’s not a one-size-fits-all answer — but help is out there.

The agency that owns or insures your mortgage will determine how you go about solving your issues. Before you can fix your financial troubles, find out which mortgage you have.

Fortunately there are only a few options available: Fannie Mae, Freddie Mac, the Federal Housing Administration (FHA), the Department of Veterans Affairs (VA), and the U.S. Department of Agriculture’s Rural Housing Service (RHS).

Let’s take a look at some of the options available to you…

Related: 4 Out-of-Box Ways Homeowners Can Build Good Credit

Fannie Mae and Freddie Mac

Fannie Mae and Freddie Mac have a similar process for loss mitigation. When asking for help under a Fannie or Freddie, your provider will review a set of options in a certain order. If you don’t qualify for the first, the servicer will move on to the second until they find some relief.

Both require you to complete and submit a Form 710  — Mortgage Assistance Application. You should say you are in trouble due to a loss of income or increase in costs.

A servicer may deem your financial difficulties to be temporary, given after a short-term drop in income or a one-off expense.

The servicer could also offer a long-term solution, if your financial issues are more permanent, such as disability or the death of a spouse.

VA Loan

The VA is expected to run through all its options before forcing the sale of a property. There are plenty available to you including:

Repayment plan. This is a written agreement in which you pay the normal amount and extra to cover the debt.

Special forbearance. With this option, the servicer agrees in writing to suspend payments or accept reduced payments. You can then negotiate a repayment option.

Modifications. This allows the servicer to change the loan without consent from the agency. Ultimately, this could lead to a longer pay-off period with lower mortgage payments.

FHA-Insured Mortgages

It may be possible to reduce your monthly loan payment thanks to FHA-HAMP, the Home Affordable Modification Program. However some borrowers are not eligible for that option.

Instead a repayment plan or forbearance agreement may be the options available. These do not change the terms of your loan but could help you pay off your debts.

RHS Guaranteed Loan Program

To reduce your payments on a Rural Housing Service Loan Program you have a few options available including:

Special forbearance. You can agree with the servicer to temporarily reduce or pause payments. You will then have a repayment plan put in place.

To be accepted for this you must have had a loss of income or increase in expenses and your payment has to be 30 days in arrears.

Modification. It is possible to permanently change your loan terms with a modification. There are two types available: a standard modification or a special loan servicing modification.

Speak to the people who know how to lower mortgage payments with bad credit. Contact  GoCleanCredit.com for expert advice and your full range of options.

Can Paying Off Collections Raise Your Credit Score?

Can paying off collections raise your credit score

“Can paying off collections raise your credit score?” It’s a question many people in financial trouble ask. And, unfortunately, the answer is not a simple one.

Paying off collections could boost your credit score, but only under certain circumstances. In today’s article, we’re going to look at your various options. You’ll learn the negative impact of collection accounts, as well as what to do if you find yourself in this unfortunate circumstance.

The Negative Impact of Collection Accounts

Collection accounts lower your credit score and tell lenders you have been unable to manage your finances. This could make it difficult for you to secure credit in the future.

The amount of the collection debt is irrelevant. If the debt is above $1, it impacts your score no matter how much you owe. A debt of $300 will lower your score by the same number of points as a debt of $100,000.

What Happens When You Pay the Debt

When you pay the debt, the collection isn’t removed from your account straight away. It will fall from your report seven years from the date of your first missed payment.

Even if you pay the debt, it is unlikely to result in a major boost to your credit score. However, the collection agency or creditor will update your information to show you have paid. Any future lenders will see that you dealt with the debt and may look favorably upon it.

Make an Arrangement With the Collector

Even though 95% of the time, paying off your debt won’t boost your credit score, there’s a way it could. When contacting the collector to settle, try to agree to a “payment for deletion”.

Remember to get the agreement in writing. If you want more advice on how to do this, contact Go Clean Credit today and speak to an expert.

File a Dispute With the Credit Reporting Agency

Do you think the collection account is a mistake? If you believe it’s inaccurate information, dispute it with a credit reporting agency.

It will then have 30 days to confirm the information they have is correct. If the record is wrong, then the entry could be corrected or (even better) removed.

Work With Credit Restoration Experts

You may be struggling with your financial situation, but Go Clean Credit has the answers.

So, can paying off collections raise your credit score? Yes, we have many credit repair programs available which will get you back on the path to financial success. There’s no one-size-fits-all answer, which is why we find the right program for you.

Each program starts with a free in-depth consultation from one of our expert advisors. From this, you will know the exact path to take for a better credit score.

Check out our different credit repair programs now or get in touch for more advice. Better finances and an improved credit score are just a few clicks away.

Credit Score of 567: Loans, Improvement Tips & More

You got a bit of financial work to do if you have a credit score of 567. In fact, I hate to break it to you, but most people are going to classify this as a bad score. Only 1 in 10 credit applications are accepted for people below a credit score of 580, and that can make things a bit difficult.

Improving your credit score is the best option, but it’s not always the fastest solution. It’s hard to operate without access to credit, so what can you do? In today’s post, we’re going to answer the questions you might have about having a credit score of 567.

1. Home Loans

First-time home buyers with a score of 567 are going to have a hard time. Most places will outright reject your application if it’s under 620, so you can imagine the difficulty.

However, difficult doesn’t mean impossible. Unfortunately, if you do find a place willing to accept your score, you’re going to deal with high interest rates. Buying a home with poor credit may put you in a direr financial situation then you’re already in, and it’s important to make a sound decision.

More often than not, it’s best to start by increasing your score. Just a 60 point increase can put you in a much better position for buying a home.

2. Auto Loans

You’ll find that rejection rates for auto loans are similar to that of home loans. However, it’s much easier to find an alternative to buying a car. Though, here again, you’re going to run into astronomical interest rates.

Using the average $27,000 dollars for a car loan and a 60-month loan, a score of 567 could land you an average APR of upwards of 16% and an interest over life of loan of nearly $12,000 extra dollars!

Unfortunately, it’s also important to improve your score because the low-credit financing industry has many predators. You should trust the people to whom you owe money, and increasing your credit score is one way to access these types of reputable companies.

3. Credit Cards

The credit card is probably the easiest to access a line of credit with a low score. Just don’t expect luxurious benefits and a low APR. In fact, you’ll likely have to apply for a secured credit card until your score improves.

The simple act of opening a secured credit card can increase your score, and if you reliably pay it off month after month the score will continue to increase.

So What To Do?

To put yourself in a more secure position, Focus your efforts on improving your credit score of 567. It needs to increase before making any big financial commitments. If you find yourself needing access to a credit line, start with a secured credit card.

If you need help getting your credit back on track, we’re here to help. The Go Clean Credit team will help you get your score cleaned up and on the right trajectory.

 

How Do You Get a Car Back After Repossession?

how do you get a car back after repossession

Having your car repossessed can honestly feel like the end of the world. Most of us rely on it for everything from getting to work to taking the kids to school. But don’t panic. There are steps you can take in a bid to get it back. So, how do you get a car back after repossession?

Step 1: Talk to the creditor

If your car has been claimed by the creditor then you may be able to negotiate to get it back. Do some research and find out whether you have any defenses related to the vehicle, the credit terms or repossession. If you do, you could find yourself in a very strong negotiating position.

Similarly, if the car is not worth much on the market then the creditor might no receive much for it. The creditor will probably negotiate an agreement with you.

Step 2: Can you reinstate?

A number of states allow consumers to reinstate the contract under certain circumstances. This will mean you will be able to reclaim the car and only pay the back-due payments. This is preferable because you won’t have to fork out the whole debt.

Be careful, however. There may be extra costs including storage charges and you may have to hand out an advanced payment or two. In most states in which reinstatement is allowed, you will only have a few weeks to claim your car — so make sure to act quickly.

Step 3: Pay the full debt

If reinstatement isn’t available in your state — or perhaps you have enough spare money going — you can redeem the car by paying off the full remaining amount and expenses. However, you will need to do this before the creditor sells your car. Because once it’s gone, it is gone.

Legally the creditor must tell you the date they intend to sell the vehicle and has to provide you with a telephone number where you can find out the cost of redeeming the car.

This option should be considered very carefully. If you have struggled to keep up with the monthly payments, it is likely that you may not be able to pay the full debt at once. Do not consider taking out expensive loans in a bid to keep the vehicle as this is a quick way to collect even more debt.

Step 4: File for bankruptcy

If you choose to file for bankruptcy then you will be able to reclaim your car — as long as the creditor has not sold it yet.

There are two options if you do want to take this route: chapter 7 or chapter 13 bankruptcy.

With the chapter 7 option, you will need to pay either the full remaining balance on the car or the vehicle’s value (whichever is less).

With the chapter 13 option, it is possible to set up a plan to pay off the car loan in monthly installments, up to as long as five years.

Step 5: Talk to your attorney

Our final option is to talk to your attorney. If you believe that your vehicle was wrongly taken then you could file a lawsuit to get the car back and receive damages.

If your car is repossessed it can feel like the end of the world. These steps on how do you get a car back after repossession will allow you to take back control. If you feel anxious or insecure about your ability to get your car back after a repossession, give us a call today!

Related:

Personality Types & Credit Scores: Is There a Link?

Are Personality Types & Credit Scores Linked?

It’s an interesting question that we received. Is there a link between personality types and credit scores? Can a personality type predict whether you’ll have good or bad credit?

We don’t know. We’re not Myers Briggs. We’re just a credit repair company.

But, our curiosity did take us to the internet, where we found several discussion threads and resources.

The consensus from our research? There probably isn’t a strong enough link to draw a logical conclusion.

However, there are some resources worth checking out on whether personality types and credit scores are linked. Here they are.

Discussion Threads

Quora: Is there a correlation between Myers-Briggs personality types and Credit Score?

Best Answer: Aside from pretty much the same question being asked on reddit Which type has the highest/lowest credit score? • r/mbti I could not find any other information, but I assume that it should mainly be a question of whether you’re a J or P type since J types are much better with money and credit cards than P types in general, and should have better credit scores. Though, according to one of the answers on reddit, INTP’s are on both extremes of high and low so maybe there isn’t too strong of a correlation.

Reddit: Which type has the highest/lowest credit score?

Best Answer: Highest: ISTJ Lowest: ESFP

Articles

Psych Central: Are Credit Scores and Personality Linked?

Summary: An emerging trend is for companies to use credit reports as an employment screening tool. New research suggests that using a summary of your credit report — your credit score — to screen potential employees is not supported by the evidence.

What do you think? Are personality types and credit scores linked? Tell us by contacting us through our site, or following us on social media to tell us more!

Tips On How To Keep Your Car From Repossession & How to Avoid the Repo Man

tips on how to keep your car from repossession

Repossession is scary, and finding accurate information isn’t always the easiest. In today’s article, we are going to reference and paraphrase some of the tips on how to keep your car from repossession in the NCL Consumer Debt advice series. By the end of today’s article, we hope that you feel more equipped to handle this not-so-fun situation.

How Repossession Happens

When you buy a car on credit, you almost always end up putting the car up as collateral for the loan. From time to time, a consumer will also use their car as the collateral for an unrelated small loan. These are called auto pawn loans or high-cost auto title loans.

If you get behind on payments or violate the terms of your agreement, you put yourself at risk of repossession. Even one or two missed car payments can put you in serious danger.

If this applies to you, keep reading. Here are some tips on how to keep your car from repossession.

1. Keep Your Payments Current

Your car payments should be a priority over other monthly bills. When deciding between, credit card debts, electrical bills or your car payment, remember what you have to lose. If you miss only a few payments for your car, you are at risk.

2. Keep the Damage Insurance Current Too

If you miss your insurance payments your creditor might replace your insurance with a much more expensive option. This will increase your monthly car payments.

3. Figure Out What Add-Ons You Don’t Need and Cancel Them

When you first purchased your car, you may have added unneeded insurance products. Some of them are worth paying for, but it’s unlikely you need them all. Find the add-ons that are unnecessary and cancel them with your insurance dealer.

4. Do a Bit Of Negotiation With the Creditor

Your creditor might allow you to postpone your payment. Try to make an agreement. If you succeed, make sure you have it in writing to avoid any disputes.

5. Figure Out If You Can Cure the Default

Some states grant their citizens a right to a cure. In other words, you may be able to pay for your late payments before repossession. If you do get a second chance, make sure you pay the late payments before the due date.

6. If all else fails, sell the car.

Sometimes you might be out of options, and the only thing you can do is sell your car. This option is better than repossession because you’ll be able to sell your car at a higher price. You also avoid a number of additional fees.

We know that facing a potential repossession feels scary. You may not know what to do and may feel ill-equipped to negotiate your way out of the situation. These tips on how to keep your car from repossession will allow you to breath easy. However, if you feel anxious or insecure about your ability to keep your car from repossession and avoid the Repo Man, give us a call today!

Related:

The Link Between Credit Score and Car Insurance

What Happens To Your Credit When You Break A Car Lease?

My Car Was Repossessed: What Are My Rights Against The Creditor?

my car was repossessed

If your car has just been repossessed the first thing you should be asking yourself is, ‘What are my rights against the creditor?’

Exploring the rules is undoubtedly the best way forward. It will give you the best chance of saving the most amount of money and potentially get your vehicle back.

But what are your rights? Here we take you through six you should know about.

1. Save your personal items

With your car taken by the creditors, you will certainly not want to be losing out financially with lost cell phones or anything similar. It is against the law for creditors to keep your personal property after it has been repossessed. Make sure to demand your items back as soon as possible, both by phone and in writing. Make sure to do that as quickly as possible before it is “misplaced”.

2. Reinstate the contract

Many states allow consumers to reinstate the contract under certain circumstances. Reinstatement will mean you get the vehicle back by paying the back-due payments (not the full debt). However, do watch out for extra costs you might have to pay such as storage charges. Speed is essential on this one. In most of the states that allow reinstatement, you have just a few weeks after repossession to take this option.

3. Redeem the vehicle

You can reclaim your vehicle from creditors if you redeem it — paying off the full amount owed plus expenses. Under the law, the creditor must tell you the date of the car’s sale and give you a telephone number. Like reinstatement, you should find out the cost of the vehicle as soon as possible and act fast. Once the car is sold to someone else, it belongs to them.

4. Haggle with the creditor

You have every right to negotiate with the creditor in an attempt to get your car back. You might be able to get your car back quickly if your car has little value on the market.

5. File for bankruptcy

Once your car has been repossessed you do have the option of getting it returned to you by filing for bankruptcy. However, you will need to this before the creditor sells it, so time is of the essence.

You will need to make payment arrangements under either chapter 7 or 13 bankruptcy if you want to keep the car long term.

If you take the chapter 7 option, you have to pay the creditor either the full remaining balance of the debt or the car’s value — whichever is less. This will need to be paid in installments or all at once depending on your creditor.

If you take chapter 13 bankruptcy then there are several options available to you. However, we think the best way forward is to pay off the car loan in monthly installments.

These payments can be lower than your car loan payments and could help you out of financial difficulties.

6. Take legal action

If you feel like your car was taken illegally by the creditors then you can file a lawsuit to get the car returned and claim damages. However, you will need to hire an attorney, which could be expensive.

Don’t panic if your car is repossessed by creditors. These six steps will put you on the right path to reclaiming your vehicle. Contact us today so we can dive into your specific situation and begin planning a way to help you escape this frustration.

Credit Score of 598: How Your Life Is Impacted Through Car, Home Loans and Credit Cards

credit score of 598

Having a credit score of 598 means you have quite a bit of work to do. You’re classified in the lowest category and are likely finding it difficult to get approved at reasonable interest rates. Sometimes people with this score have a difficult time getting approved at all.

We know this process is a struggle, and we’re here to help. In today’s article, we’ll walk you through a variety of ways your life is impacted by a credit score of 598.

1. Home Loans

Those with a low score are going to pay high-interest rates. Home loans are one of the best examples of how this negatively impacts your financial life.

Let’s say you buy a cheaper home because you can’t afford anything more yet. Unfortunately, you’re also struggling with a credit score of 598. By the time you pay off the loan, your payable interest may add up to more than more than half the original payment.

For the first time home buyer with this score, you will definitely be fighting an uphill battle. In fact, most applications will get automatically declined because you don’t meet the typical 620 threshold.

Increasing your score is going to be your best bet to get a decent home loan. It may take a few years to correct it and it may be frustrating, but bringing your credit score up by even 100 points will put you in an entirely different interest rate category.

2. Auto Loans

A car loan will be easier to get approved, but you’re still going to face plenty of high-interest rate challenges. Let’s say you want a $27,000, 60-month loan. If you have a credit score of 598, you’ll find an average APR of up to 16% in interest.

Here, again, it’s probably best to wait until you’ve built a more trustworthy credit report. After all, there’s no reason to pay enormous interest fees if you’re able to wait on the car.

If it’s something you need right now, however, getting approved is possible. Plenty of financing companies and used car dealerships will work with you. Just know going into it that the loan approval will come with a hefty interest rate too.

 

3. Credit Cards

Credit cards are the easiest to find on the list. You’ll still have suboptimal choices and high-interest rates. In fact, you may not even get approved for an unsecured card. In which case, you’ll need a secure card and be ready for an upfront cash investment.

If all you can get is a secured credit card, get one. Then practice using credit responsibly, and you’ll find your score increasing over time.

For those who used to have good credit, but now struggle with a poor score, consider enlisting the help of a credit repair agency. These tips are great for establishing credit, but there’s often more to be done for those who lowered their scores.

Contact Go Clean Credit to learn more about how you can clean up your score »

How Many Points Does Your Credit Score Go Down When You Check It?

how many points does your credit score go down when you check it

Are you concerned about maintaining a healthy financial life? Everybody knows the importance of a high credit score. It’s like the ultimate game of adulthood. And it leaves you asking questions like, “How many points does your credit score go down when you check it?”

This is a smart strategy. After all, so many small actions trigger a score fluctuation. The last thing you want is to get declined for an important loan because of seemingly inconsequential errors. Cars, credit cards, home loans, and even the department store down the road, will check your credit when you apply. And each of these actions affects your scores.

In today’s post, we’re going to review some of the aspects of credit checks and uncover how many points does your credit score go down when you check it.

But first, we need to know about hard and soft inquiries. Let’s dive in…

The Difference Between Hard and Soft Inquiries

Soft inquiries don’t matter. You can forget they even exist if you want. They don’t hurt your credit card score at all.

Although these inquiries probably show up on your credit report, the lenders can’t see them. Soft inquiries don’t have anything to do with your credit card score. So, if you recently experienced a sudden credit card score drop, you can’t blame the soft inquiries.

Hard inquiries are the real punisher. They can really harm your credit card score if you aren’t careful. But let’s not get too panicked — yet.

Points You’ll Go Down for a Hard Inquiry

Yes, hard inquiries can negatively impact your credit card score. BUT — you shouldn’t see it go down more than five points. The real danger comes when you go on an application spree.

So, how many points does your credit score go down when you check it? Each application will cost you five points off your credit score. The solution? Don’t aimlessly apply for lines of credit.

But what about if you aren’t applying for loans… What if you just want to check your own credit score? Well, good news…

Checking Your OWN Credit Score is a Soft Inquiry

Most applications for a line of credit hit on your report as a hard inquiry. Yes, you read that right! Although this might not always be the case, it’s the typical experience.

Luckily, keeping track of your credit score won’t cost you a thing!

Checking your OWN credit score is a soft inquiry. That means it won’t negatively affect your score at all — which is great news! After all, the only way to spot a need for credit repair or growth is by knowing your report.

HELP! I Went on an Application Spree!!!

Earlier in this article, we mentioned an application spree. This is where an (often unknowing) consumer applies for SEVERAL lines of credit over the course of a month or so.

The result? An AWFUL surprise next time they see their credit report.

Don’t panic — there’s hope. If you’re experiencing the consequences of too many hard inquiries, we’re here to help. Contact us today so we can dive into your specific situation and begin planning a way to help you escape this frustration.

Credit Repair Software Reviews: Top 5 Software Solutions to Fix Your Credit

credit repair software reviews

A credit repair software works to improve your credit score. However, it’s hard to narrow down your options because many companies offer these services. For today’s article, we dug through credit repair software reviews to bring you these top five solutions you can trust.

This technology monitors and fixes errors on your report. As a result, your credit score increase, which makes it easier for you to access loans and mortgages. A credit repair software is easy to use, cheap, efficient, and it allows you to monitor your credit report at the comfort of your home.

Many scams and useless software exists. It’s important to find a reputable company. Or, when in doubt, choose a credit repair agency instead to take care of the heavy lifting for you.

Now, onto the top five picks for credit repair software in 2018…

1. Turbo Credit: Consumer Edition

It removes negative items and false information appearing on your credit report, fights identity theft, and has a TurboStop to legally stops calls from creditors.

“I wanted one that provides information on exactly what one needs to do to lift FICO scores, a breakdown of what banks really look at, and an easy way to dispute and remove errors off a credit report. This software had all these answers and more…” (Source)

Plus, there’s a 30-day money-back guarantee.

Learn more about Turbo Credit: Consumer Edition »

2. 700 Credit Repairs

They offer two primary services: digital credit disputer (software only), and digital score enhancer (software, online workbook, score analyzer and many more).

Where this software really stands apart is in its automated technology.

“Just want to give a huge THANK YOU to 700 Credit Repair!!!!! They repaired our credit to where we were able to get approved for our dream HOME! Thank you so much!!..” (Source)

Learn more about 700 Credit Repairs »

3. TurnScor

Their software works to improve bad credit scores, while their resources focus on training customers in gaining a deeper knowledge of finances and credit management.

“..I didn’t qualify to purchase because of my credit score. I signed up, used the software, and now I qualify to buy a Harley Davidson and it only took 6 months!”…” (Source)

Learn more about TurnScor »

4. Credit Aid

It repairs and improves credit score, removes negative items on your credit report, and even disputes bankruptcies. There’s also a compelling 100% money-back guarantee if your credit score doesn’t improve.

“I LOVE this Software! Prior to using it, I spent quite a bit of money on an expensive ‘credit repair company’ that did NOTHING but take my money! Credit-Aid Software has made it very easy for me to repair my own credit…” (Source)

Learn more about Credit Aid »

5. Credit Detailer

This is another provider focused on providing a solid software AND ongoing training to help their customers get better at finances. It’s easy to use and very affordable compared to other software. Plus, you can buy both Spanish and English versions.

“I called for help and Ken was just terrific! I started off with the trial version and went for the professional version to start my business and have been working smoothly ever since..”- Trish

Learn more about Credit Detailer »