HERE IS A LINK TO PART 1 FOR REFERENCE
HERE IS A LINK TO PART 2 FOR REFERENCE
HERE IS A LINK TO PART 3 FOR REFERENCE
MYTH #4: CREDIT COUNSELING WILL DECREASE ONES SCORE JUST AS BAD AS A BANKRUPTCY
Millions of people are behind in their mortgage payments or have been foreclosed on over the last two years. People have over extended themselves when it comes to credit card balances. Bankruptcies continue to increase as people continue to lose jobs since unemployment rate is at 10% at a national level. People need assistance during these tragic times. I am sure we see adds for credit counseling services on the television, newspaper, Internet and so on.
The current FICO score system does not penalize ones credit report who seek credit counseling. The FICO company conducted a long study to find that people who seek credit counseing do not default on their loans anymore than a regular individual. That is the real scoop.
Ones credit score can still decrease if the credit counselor is not sending in payments on time or not paying what was originally agreed upon. If one is late, then they must report the late to the credit agencies since they have to report the facts. Late payments do hurt ones credit score.
It is a hit or miss when it comes to views from the banks on credit counseling. Some banks view credit counseling as a bad thing while others see it as a great thing. It shows that people are concerned and they are willing to take action to improve their current situation. The mortgage lenders that dislike it will treat the borrower as if they have filed Chapter 13 bankruptcy. There is a possibility that one can still obtain a mortgage with a very high interest rate due to the risk that the bank takes on. One better have great savings and a great salary to minimize the bank risk.
The bottom line is that if one is in credit trouble, then seeking immediate professional credit counseling assistance is a must to get through life. Everyone gets off track here and there. The credit counselor will get one back on track as long as the person follows advice and not open new credit and pay bills on time.
If you need further assistance when it comes to financing, please CLICK HERE.
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