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Welcome To Nces06.29.11

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Welcome To Nces06.29.11

  1. 1. Welcome ToN.C.E.S.Credit Restoration& Education Seminar<br />
  2. 2. AGENDA<br />Introduction / NCES Mission<br />Credit Pitfalls, Traps and the remedy to over come these situations<br />Common Misconceptions<br />Personal Credit, Budgeting & Moving Forward<br />Conclusion<br />Questions & Answers<br />
  3. 3. NCES MISSION<br />To educate the masses on the pitfalls of credit<br />To leverage credit to build assets not liabilities<br />To empower people to navigate their finances confidently<br />Our is to restore America by restoring you<br />Let us help you navigate the financial restructuring of your life<br />
  4. 4. THE FAIR CREDIT REPORTINGACT OF 1971<br />The Fair Credit Reporting Act (FCRA) was passed by congress with<br />the intention to regulate the credit reporting agencies and promote<br />the accuracy of the information in consumer credit reports.<br />The Act spelled out all the rules and regulations that the credit<br />reporting agencies had to follow before they added anything to a<br />consumer’s credit report. Information about “you” has to be<br />accurate and verified before it is entered on your credit reports.<br />The Federal Trade Commission is the government agency<br />responsible for Enforcing the Fair Credit Reporting Act.<br />
  5. 5. CREDIT REPORTING AGENCIES<br />3 Major Reporting Agencies<br />Experian (Fair Isaac Corporation)<br />Equifax (Beacon)<br />TransUnion (Empirica)<br />Functions of CRA’s<br />Collect and maintain information about consumer’s credit history.<br />This information is obtained from banks, credit card companies and<br />various financial institutions.<br />The CRA’s sell this information to lenders and other creditors.<br />The CRA’s are not part of the government.<br />
  6. 6. COMMON CREDIT ERRORS<br />Inaccurate Information: Information that cannot be verified by<br />the CRA and/or the creditor grantor<br />Erroneous Information: Information that has been entered onto<br />a consumer’s credit report due to human error (data entry error),<br />Social Security Number mismatch error, mixed file error, similar<br />name error, or when “reasonable procedures” were not followed<br />when the information was entered on the credit report, or any<br />such related error<br />Obsolete Information: Information that is beyond the industry<br />standards of seven years; or ten years for bankruptcy<br />
  7. 7. CREDIT REPORT ACCURACY<br />Nearly 80% of all consumer credit reports have significant errors<br />25% of which are serious enough to potentially result in a credit<br />denial<br />These errors could affect credit scores by 50 points or more<br />HOW DO THESE ERRORS OCCUR?<br />Loans, payment data or credit card information is applied to the<br />wrong account<br />Name consistency, i.e. John Carl, John Karl, John J. Karl<br />Human error when applications are reviewed, sold or transferred<br />between lenders<br />
  8. 8. WHAT ARE FICO CREDIT SCORES?<br />A statistical methodology to evaluate an individual’s credit worthiness<br />It’s a Reflection of a person’s credit behavior, character and financial state.<br />Creditors use FICO scores to determine an individual’s interest rate and<br />credit limit and the ability to borrow.<br />FICO scores range from 300 to 850 points<br />
  9. 9. CREDIT COMPOSITION<br />10%<br />5 KEY COMPONENTS OF A CREDIT SCORE<br />Paid as agreed<br /> Balance vs. credit limit<br /> Length of credit history<br /> Type of credit<br />Credit Inquiries<br />10%<br />35%<br />15%<br />30%<br />HOW CREDIT AFFECTS YOU<br />The interest rate you pay on credit cards and loans<br />Your ability to get a checking account<br />Rates on your auto insurance<br />Employment<br />Utilities<br />
  10. 10. 6 METHODS TO ESTABLISH CREDIT<br />Apply for a secured credit card, ex. Bank card<br />Maintain a low balance on the card<br />Establish a long history with the account<br />Errorless late payment history<br />Re-establish student loans, deferment<br />Obtain a small auto loan<br />
  11. 11. SECURED CREDIT CARDS<br />One of the best ways to establish credit<br />Apply on-line for a secured card, one accepted<br />anywhere – NOT a catalog card<br />Purchase a $200 - $500 bond from the bank and <br />use it to establish a line of credit<br />
  12. 12. PITFALLS OF SECURED CARDS<br />Pay on or before the due date to avoid a $35 - $40 late fee<br />If unpaid, a $40 over the limit fee is incurred<br />Below example: assume a $300 credit limit, and a late-<br />payment<br />
  13. 13. PITFALLS CONTINUED<br />Credit cards charged off<br />Assigned to a collection agency<br />Collection agency adds a new derogatory account on your<br />credit report<br />Add interest, penalties, legal fees and more fees<br />
  14. 14. COLLECTION AGENCIES<br />Governed by the FTC<br />Privately Owned<br />Operates under the guidelines of the Fair Debt Collection<br />Practices Act<br />Debt collectors, whether a company or an attorney’s office<br />Has to validate the debt<br />
  15. 15. ACTUALIZED COST OF AN AUTOMOBILE<br />
  16. 16. OR…. INVEST IN THE FUTURE<br />A house that sold for nearly $1 million in 2004<br />Foreclosure price of $380,000 in 2010<br />FHA loan: 640-680 credit score with 5.25% rate<br />= Monthly price of $2,300<br />
  17. 17. HUMMER vs. HOUSE<br />
  18. 18. BUDGETING<br />(Based on a monthly average of a family of 4)<br />
  19. 19. BUDGETING<br />Total monthly critical expenses = $5,400<br />Take-home net income = $6,000<br />Remainder money<br />$6,000 - $5,400 = $600<br />Compounded over 72 months = $60,000!<br />
  20. 20. OUR SERVICE<br />Provide the tools and resources necessary to understand:<br />The FICO scoring system<br />The Fair Debt Collection Practice Act (fighting collections agencies)<br />How to protect your credit during hardship (layoff, divorce, death, etc)<br />How to regain your financial independence and build lasting prosperity<br /> We give you:<br />On-line educational tools, automated budgeting worksheets; We want to<br />answer the tough credit questions.<br />24/7 on-line status updates<br />Good Credit Gives Me Time For My Family<br />
  21. 21. CONCLUSION<br />Understanding everything about credit is key to achieving <br />financial security<br />It is important to correct your current situation and establish<br />a path forward<br />NCES gives you the tools and resources to establish your <br />new financial future.<br />
  22. 22. NCES COMMITMENT<br />To restore America by RESTORING YOU<br />Who make America work. If you’re<br />hurting financially and can’t borrow<br />due to bad credit, our job is to help<br />you regain your rightful place in<br />AMERICA.<br />
  23. 23. NCES AT WORK!<br />
  24. 24. The Cost Of Financial Freedom?<br />One Time Payment $349.00<br />Or<br />Split Payment Option $175.00 Now<br />Next Payment In 30 Days $185.00<br />(Includes $11.00 Processing Fee)<br />Total $360.00<br />to break the chains!<br />

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