Are Consumer Purchased Credit Scores Different from Financial Institution Credit Scores?

 “When consumers buy a credit score, they should be aware that a lender may be using a very different score in making a credit decision.” Richard Cordray,director of the Consumer Financial Protection Bureau (CFPB), said in an email statement.

The three main credit reporting agencies; Equifax, Experian & Transunion, use their own algorithms to calculate credit scores and they each have several ways to calculate it.  Fair Isaac Company also computes and sells credit scores, known as FICO Credit Score, has more than 50 scoring models.  This means that there are numerous variations of a credit score. The good news is, based on CFPB’s research found that most of the scores pulled by consumers and other organizations are consistent by at least 75%. Between 20% - 25% of the scores that consumers purchase were moderately different enough to move them into another credit grade that financial institutions use to determine what consumers may qualify for loan rates. The remaining 1% - 5% of the consumers’ scores was significantly different.

Note:  FICO offers a calculator that lists the range of interest rates offered based on FICO score.  This of course may differ based on the financial institutions rates offered.

What is not widely known is that there different types of scoring models that are based on the information the financial institution or business wants to analyze.  For example, a credit score for a credit report pulled by an auto dealership may differ from the credit score of a credit report that is pulled by a financial institution. This is because the auto dealer may mainly want to focus on a consumer’s payment history on auto loans, regardless of the financing company or financial institution.  However, the financial institution’s credit score may be based on a consumer’s entire payment history on all trades reporting on the credit report. Another familiar type of scoring model is the one used by Utility Companies.

Regardless the scoring model, the fact holds true that if you have good credit, you will have high or good credit scores on them all and if you have “colorful” or bad credit, you will have low or bad credit score on them all.  What important is that you understand the “Anatomy of the Credit Score.”

• 35% is based on your payment history.
• 30% is based on how much of your available credit you've borrowed against.
• 15% is based on the length of your credit history.
• 10% is based on the diversity of credit you carry.
• 10% is based on the number of “hard inquiries” from creditors to qualify you for credit or open an account.

Other types of scoring modes are Bankruptcy Scores and Fraud Shield Scores.  

A Bankruptcy Score determines the likely hood of a consumer to file for bankruptcy.  Many lenders use it to determine whether or not they will loan you money. A bankruptcy score also may influence the interest rate that you may qualify for on a loan. Bankruptcy Scores are not generally shared with the public.  The lower the Bankruptcy Score the better. A Bankruptcy Score of 1 – 100 is ideal. A score of 300 to 900 indicates that you need to improve your credit by paying down debt especially on revolving lines of credit, like credit cards.

A Fraud Shield Score identifies inconsistencies between application information and credit report data. Just as the credit score, the higher the score the better.  If you have low Fraud Score, the lending institution many request or require additional document to verify your identity.  Don’t give them a hard time though, it is for your protection.

As with anything, financial and credit knowledge is Key to your Prosperity. 

STEP 1: Understand where you are with your credit.

• Pull your credit report to see what is reporting.  You are able to get a least one free copy of your credit report from all credit bureaus. Go to AnnualCreditreport.com.
• If there are several past due payments or lots of collections reporting, you may want to save your money and work on restoring your credit.  Try the myFICO.com Credit Score Calculator to start. 
• If all accounts are paid as agreed with no collections reporting, you may want to invest in purchasing your credit score to see where you are. 

Start at FreeCreditScore.com.  The score may be free, but make sure you read the disclosures to ensure that you are not required to sign up for a monthly monitoring service.

STEP 2:  Ask for help.

Regardless of whether you need assistance with restoring your credit or improving your credit to increase your credit score, don’t be afraid to ask for assistance.  Below are a few great options to assist you.

Anngie Jenkins, Credit Score Queen

www.CreditScoreQueen.com

National Credit Educational Services

www.NCESNow.org

STEP 3: Assess your spending habits, budget and savings plan.

This is crucial with rebuilding or maintaining your credit.  Feel free to contact me for assistance through

• My monthly Common Cents Newsletter,
• My weekday Madam Money Minute Financial & Credit Tip Texts by texting MADAMMONEY to 46786,
• Registering for a Madam Money Financial BootCamp, or
• For One on One Financial Coaching contact me at the information below:

   

Tarra Jackson, Financial Coach

Prosperity Now Financial Management Services

Tarra@ProsperityNowFMS.com

(404) 852-6295

  
We are all looking forward to being a resource to you towards your Prosperity Now!

The Horrific and Beautiful Franklin Castle

The Franklin Castle is a house surrounded by sorrow.   Franklin Castle was built in 1865 by Hannes Tiedemann, a German immigrant.  It is located in Cleveland, Ohio and is believed by many to be the most haunted house in Ohio.  Whether or not it is the most haunted house in Ohio, it is certainly one of the most tragic.   Tiedemann's luck seemed to have taken a downward turn after he moved into the beautiful mansion.  Many say it wasn't his luck, but his murderous temperament that took a downward turn, but history speaks only of his luck.   Tiedemann's daughter died of diabetes shortly after his taking up residence in the house.  His mother followed quickly behind her and three more of the Tiedemann's children also followed their sibling into the afterlife.  Death came more and more often in Tiedemann's house.  His wife died.  His niece died.  A maid died.   Rumors began to circulate that Tiedemann was behind all the deaths. Other rumors surrounded the house itself.  People began to whisper that the house itself was cursed.

In 1911, the house was purchased by the German Socialist Party.   Little is known about this period in the house's history.  The Nazis owned the house until 1955 and many tell a story in which 20 Nazi's were killed in the house during this period.   Later, the Germans rented the house out.   Other rumors indicate that a mad doctor lived in the house while the Germans owned it.  The doctor performed strange and perverse experiments in the darkest parts of Franklin Castle killing all he experimented on.

Rumors and stories about The Franklin Castle abound.  Mysteries lurk in the shadows there.   The house is riddled with secret rooms and hidden passages.  Tunnels creep underneath the house and old stories lay buried there.   In 1970, one of the occupants of the house found a secret room filled with the skeletal remains of babies.  Those that found the babies described hearing the phantom voices of crying babies long before they actually unearthed the remains.   Theories about the origins of the baby remains go from them being medical specimens, to them being the remains of Tiedemann's lost children, to them being the medical experiments of the mad doctor.

Ghost stories surrounding the Franklin Castle are prolific.   Residents and visitors have described hearing weeping babies and phantom children.  A black lady is said to be seen from one of the window. Nazi ghosts are prevalent and strange noises, voices, and lights fill the stories of all those who have wandered Franklin Castle.  The house gathers ghost stories like a child collects Halloween candy while trick or treating.    

The house's recent history is as odd as its past.  The house was burnt to a ruin in 1999.  In 2004, the house was bought and it was said it was going to be turned into a club.  The website for this club still remains.   http://franklincastleclub.com/.   This was shown to be a scam by a Mr. Mislaps.  He got into some trouble over back taxes and was ordered to stop giving tours of the house. 

The house has recently been rezoned as a 3 family dwelling.   One thing is for sure, with more people living in the house in the future, there are sure to be new ghost stories and new dark tales to fill the halls of this old house. 

What to Do When You Can’t Pay Your Bills

There is no doubt that one of the most horrifying experiences is struggling with money and not being able to pay bills.  I've overcome and am still overcoming financial struggles but there are so many more people and families that are in a more difficult situation. 

There is no magic pill or “one size fits all” method of fixing financial struggles or what I call “financial dis-eases.”  However, here are a few tips to help you get started.

Tip # 1: Assess the Problem

The most important step is to assess why you can’t pay your bills.  This could be because of a job loss, a pay cut, increase in fixed expenses, unexpected medical bills, an expensive mistake or poor spending habits.  After understanding the cause of the problem, the next phase of this step is to write out your budget. I encourage you to download and read “5 Steps to Building a Budget That Works.”  You may of course see that you are spending more than you make.  By writing this down in detail, you will understand your fixed verses flexible expense. 

  

Tip # 2: Fix the Problem

Once you understand what the problem is, you can now begin the process of fixing the problem.  Most people’s problem (like mine was) may be overspending.  If this is your issues, the best cure for this financial dis-ease is financial abstinence by eliminating the use of credit cards or unsecured lines of credit.  Also, cut back on eating out and reduce or eliminate flexible bills like cell phone, land line phone, cable or any other unnecessary expenses.

However, many people aren't overspending at all.  They are dealing with being under paid.  Their income does not meet their baseline budget of their fixed expenses.  If this is your issue, it is now a matter of increasing your income.  This is not an easy cure and may require lots of hard work to find and work a part-time job. You may want to establish a home-based business that generates extra income. 

Here are few ways to handle your financial situation:

1. Ask your family or friends for a loan or gift to assist you during your short-term struggle. Make sure that you only ask them once and make it clear that it is a gift (you do not have to pay it back) or it is a loan (you will pay back).  If it is a loan, establish the payment arrangements and make sure you pay them back on time.  Don’t be that family member that everyone ignores phone calls from because they know you are just going to ask them for money.
2. Contact the company(ies) and creditors to explain your temporary financial hardship and request to skip a payment for the month to get back on your feet or to modify your payments, permanently or for a limited time.  Many financial institutions have a loan modification program that you may qualify for.
3. Contact a debt management organization, like CCCS, to assist you with communicating with your creditors to reduce your monthly payments.  There are many organization out there, some free and some with a cost.  Make sure you do your research before you commit to their services and program, especially if they are requiring a fee up front.  I recommend that you find a non-profit debt management organization that does not charge a fee to assist you.
4. Although I am not an advocate of and try to sway my clients away from this, you may need to consider a short-term loan, payday loan, title loan, etc.  This should be your LAST resort and make sure that you understand the terms, rates you will have to pay and all of the fees.  If this is used the wrong way, you could find yourself in a worse financial condition than you were before you got the short-term loan.  Proceed with caution.
5. When all else fails and you have honestly tried everything stated above as well as other tips you've learned, another last resort option is bankruptcy.  “Bankruptcy is a tool, nothing more, nothing less” says Bankruptcy Attorney & Trustee Angelyn Wright of The Wright Law Alliance, P.C.  When used appropriately it can be the financial major surgery necessary to rebuild your financial well-being and give you a Fresh Start.  If you are considering this option, please make sure you understand what bankruptcy is and does.  When done the wrong way or with the wrong attorney, it may put you in a worse financial situation than you are now.  Get educated and ask questions before you proceed with caution.

Based on personal experience as well as observing and working with others who are dealing with and have resurrected from financial struggles, your financial situation can change if you are willing to work hard enough and can be disciplined.

By the way, don’t be afraid to ask for help.  There are many banks, credit unions, non-profit organizations, and financial coaches like myself that want to assist you.  Contact me at info@ProsperityNowFMS.com for consultation.

Week 7 Schedule...TBE

Today is the first day I start realllllly hitting the ole books hard. I've posted a schedule for this week (7 weeks out) below, and I hope to stick to it. I've allowed myself one free day (Sunday) during which I'll either do nothing or use it to catch up on shit I've not done during the week.

If you'll notice, my schedule isn't nearly as terrifying as Barbri's. That's because I actually want to accomplish it. I've added supplemental in case I finish my daily grind, but that's not required.


Hope it may help you, if you're departing upon this journey by yourself as well.

Happy Monday.

The Mummy of Bessemer Hall

Hazel Farris was a beautiful woman in life.   She was beautiful and notorious.   Hazel was born in Bessemer Alabama, but she was a fast living woman and ended up in Kentucky with a hard drinking husband by the time she was twenty-five.   Hazel and her husband both drank heavily and they were known to exchange blows from time to time.   One night,  one of their fights got out of hand.   Hazel grabbed the pistol and shot her husband three times.   The neighbors called the police and three police officers entered the house.   Three more gunshots pierced the night.   Reinforcements were sent and before the night was over five officers had been killed and Hazel had fled into the night.

Hazel ran home to Bessemer where she managed to avoid arrest despite a reward being posted for her capture.  In Bessemer,  Hazel got a job and went on with life.  She fell in love and in the heat of her passion,  she confessed her crimes to her lover.  Her lover was terrified by her confession and immediately turned Hazel in.  Hazel was mortified and heart broken.   She could take no more so she got completely intoxicated and took as much arsenic as she could get her hands on.   Hazel died in 1906.

Hazel's corpse was taken to Adams Vermillion's furniture store and funeral parlor.   Since no one claimed Hazel's body,  Adams placed her corpse in storage.   After a few months,  Adams noticed that Hazel's body was beginning to mummify.  It is believed that she began to mummify because of the combination of arsenic and alcohol she used to end her life.    Always one to make the best of situation,  Adams began showing the  modern mummy for money and eventually her body was sold.   After changing hats and going across the country in various sideshows as an oddity,  Hazel's body eventually came to the Bessemer Hall of History.  The mummy was displayed there from 1974-2004 and many believe that this is where Hazel's ghost lives on today. There have been reports of lights going on and off in the building and strange whistling noises.   Visitors have also reported feeling ill at ease at this building.   Even thought Hazel's corpse has finally been laid to rest,  her spirit walks on giving visitors a new nightmare to keep them up at night.

Plan of attack for Texas Bar studying--where I stand, where I want to go #1

As I prepare by myself for the bar examination, I've pledged to update y'all on my blawg as to how I'm studying, what I'm doing, and my plans for the future. Here is a breakdown of the examination and a written analysis of what I've set out to do.....

Texas Essays: 

There are twelve Texas-specific essays (2 Real Property, 2 Business Administrations, 2 UCC, 2 Family Law, 2 Wills and Estates, 1 Trusts OR Guardianship, 1 Consumer Law, w/ crossover topics of Federal Income Tax and Bankruptcy). I've already retyped the notes for Agency, Bankruptcy, Commercial Paper, Civ Pro, Community Property, Consumer Law, Family Law, Federal Income Tax, and Oil and Gas. I'm working on Trusts at this moment. 

This means I need to tackle Corporations, Wills, Texas Real Property, Secured Transactions, , and possibly Contracts. I already feel moderately comfortable with Secured Transactions, because I had a friggin awesome teacher for that, and it's a UCC (aka: mostly national standard) topic. 

For this portion, I plan on retyping the notes that will be most helpful to me, which also means I have to go back through during the final week's review and fill everything in, which will function as a great refresher. For the subjects I feel less strong with regard to or which do no lend themselves to effective outlining, I plan to chart. The next couple of weeks, I'll finish reviewing these subjects, then circle back and start charting some more, plus add in actual essay practice. I'll probably begin essay practice in two weeks. 

MBE:

There are six MBE subjects (Contracts, Constitutional Law, Criminal Law, Evidence, Torts, Real Property). I also plan to work six days out of the week. Thus, I will devote myself to one subject per day, particularly with regard to MBE questions, for the first few weeks. Toward the end, of course, I'll swap to varying questions and focus on subjects I am not doing as well in. 

Texas Procedure and Evidence:

Texas P&E has me nervous, but it also only counts for 10% of the exam. As I've said, I've already rewritten Civ Pro, which was 70 pages and killed a piece of my soul, I'm pretty sure. This means I have to go through the Texas Criminal Procedure plus Civil/Criminal Evidence sections with a fine-toothed comb, because I'm not sure of all the differences. I did well with non-specific criminal law and evidence, but I don't want to get stuck because I don't know the distinctions. 

This subject is also much different because it's a short answer portion, which I didn't have on my last bar examination. As such, I have to print out several of the past Texas tests and start quizzing myself on these. I plan to spend two days per week studying and preparing for the P&E. I will begin by going through the notes and either charting or rewriting them (there are LOTS of pages, so I'm not sure how long this will take me), then I will force myself to take an entire 90 minute practice conditions exam, grade it, then focus where I obviously know jackshit. 

MPT:

This section is also worth 10%. I've already been tested on this on the prior exam, but didn't do as well as I would have liked. I think I may procure a Kaplan book to help prepare, because I've heard that Kaplan really helps in this area moreso than Barbri, and anything that may bring up the score a few points can't be a bad thing. I plan on addressing this subject once a week. 

Ultimately:

I don't feel nearly as nervous as I did, and I attribute that in part to the chart I created acclimating myself with the Texas Bar Examination. (I did a breakdown. I'll attach it on my next blog post.) This helped me visualize the examination, and made it easier to understand which subjects I'm going to need to tackle. In short, it made it seem less insurmountable. 

While I initially thought I was going to do a calendar marking out the next seven weeks, I decided instead to break it down on a weekly basis. On Sundays, I'll analyze my progress, update my blog, and plan out the next week's course of attack. I think this will be more helpful because I won't feel like I'm failing if I spend more time on a subject I really need to address or less on one I find I already know. If you're interested in a blank, fillable study chart, let me know, and I don't mind sending it to you. 

101 Wednesday #1 (17, 54, and 81)

101 Wednesday. The day where I update you on my list and tell you what new and awesomely exciting things I've managed to cross off. This won't happen every Wednesday, because I'm not deluded enough to believe I'll actually accomplish one thing every single week. (Who knows, though?) (Also, I think it's safe to say I'm obviously not ambitious.)

Since I created my 101 in 1001, I've crossed off three things. It was shockingly easy to do. :)

#17 - Reconnect with two old friends

A few days ago, I received a text message from one of my oooolld high school friends. Rather than recounting it, I'll let it speak for itself.

Without even realizing it, I made a date with two very old friends, and we had a GREAT time chatting and reconnecting. I got my sushi fix, we got to catch up, and I can assure you that they have not packed on the pounds. (We actually all look almost the same as we did in high school, which we finished almost eight years ago.)

Probably the funniest moment was trying to figure out who in our original high school (in 11th grade, we swapped to an advanced boarding school) hadn't married (like us). We came up with two. Then Friend 1 asked "Who do we know that we went to (original school) with that got their advanced degrees?" Friend 2: "One of the girls we just named who isn't married." Me: "Naturally."

Ahhhh, the South. Where people seem to strive to be married, divorced, and laden down with children by the time they're 25.

#54 - Make Christmas cookies with my little brother

I have absolutely NO SHAME in informing you that I DO NOT make gingerbread. I tried a couple of Christmases ago using my mother's recipe, which calls for SIX cups of flour. After chilling, I was met with something roughly the size, texture, and hardness of a basketball.

(NEVER AGAIN.)

So a few days before Christmas, I picked up a box of gingerbread cookie mix (no judging), got out my cookie cutters, and ripped my little brother away from his electronics. Hilarity ensued.

Then we feasted.

Don't pretend like you're not drooling. 

#81 - Buy myself a piece of jewelry

The day after Christmas, I happened upon an ebay search I saved a while back. You see, after I graduated from law school, I wanted to use the money I received as gifts to buy the most perfect awesomest gift to remember it by EVAR (which I elected to be a ring with a red stone). And since I wanted it to be perfect, I still hadn't found anything by the end of the year. 

When I'm telling you I searched far and wide, I did. Rubies are hard to find, and I wanted a deep red stone. I considered garnet as well, but nothing I found was right. I wanted yellow gold. I wanted it close to my size so it wouldn't be difficult to resize. I wanted big, but delicate. I wanted something I could wear for-ev-ver. (Squints' voice from The Sandlot.)

I searched in jewelry stores. On ebay. In pawn shops. Nothing was perfect. 

Until this particular ebay search. A beautiful garnet ring popped up. In my size. In yellow gold. Flanked with white sapphires and diamonds. 

And now it's mine. 

My....precioussssss.