Financial Advice

How to Prep Your Credit for Whatever’s on Your Financial Wish List

Back in San Francisco in 2012, I was one of many NYC transplants desperately trying to find an apartment in a city that just didn’t have enough to go around. So many people were in the same boat that my husband and I began to see the same faces at weekend open houses. All friendly, but all beseeching — please don’t take this one.

Then, one day, we found a place. And all that stood between us and a coveted San Francisco apartment was our credit score. Would we be approved or rejected? Who could say? We knew our credit should be in good shape, but we were so desperate for approval after months of searching that we were in a near panic as we waited for an answer.

Then the property manager let out a long, low whistle and gave us our answer. We were approved. What’s more, she actually turned her computer — ever so slightly — and showed us our scores.

That was the first time I’d ever seen my credit score. Even though it was only a few years ago, these scores were shrouded in mystery. The only thing harder to figure out was what you would need to do to get a good score.

What worse feeling can there be than powerlessness in the face of a need as important as shelter? Luckily, you don’t have to go through that same need if you’re preparing for a big purchase in your life. That’s because you can now not only see your scores, but you can also see what goes into them.

So, if you’re preparing for a purchase that you’ll need to finance, read on. Here’s what you can do to prepare your credit and avoid the sleepless nights my husband and I endured in 2012, or the credit score dark ages as I like to call them.

How to Prepare Your Credit for a Purchase

Credit scores used to be shrouded in mystery but, finally, the curtain has been lifted and we can see what our scores (yes, we all have more than one credit score) are made of. Although there are two main players on the credit scoring block (FICO and VantageScore), the factors that influence your score remain relatively the same (though keep in mind that different credit scoring models weigh these factors a bit differently):

  • Payment history
  • Credit utilization
  • Length of credit history
  • Credit mix
  • New credit

Together, these factors tell lenders how long you’ve been using credit, how good you are with different types of credit, and whether or not you’re getting close to overextending yourself financially. Now, here’s what you can do if you’ve fallen short in any of these areas:

  • Pay off any past-due debt you might have.
  • Dispute any errors you find on your credit report.
  • Pay all of your bills on time.
  • Make sure your credit card balances don’t go above 30 percent of your total credit limit.
  • Keep old accounts open, even if you don’t use them much.
  • Don’t apply for new credit until you’re ready to make a purchase.
  • Apply for a credit limit increase if you’re getting close to being maxed out — but DON’T use any of that new limit. In fact, avoid making purchases on your credit card if you’re carrying this debt.

If you follow best practices like these, you’ll improve your credit for your next financed purchase and you’ll also establish practices that can help you maintain good credit for life.

But What If I Need Good Credit Now?

When my husband and I were searching for apartments, we didn’t have time to spare to improve our scores. And that might be how you’re feeling right now — especially if you’ve recently faced a situation such as a break down of your car.

There’s still hope. If you’re a car buyer, you can find out how to lease a car with less-than-perfect credit here. Or, you can search locally for bad credit car dealerships — just be sure to follow these tips for buying a car with bad credit so you don’t end up in a car that’ll cost you more than it’s worth.

But if you’re looking to purchase a home (not rent), you might want to go ahead and wait a few months until your credit scores improves. Given that your score determines credit approval and at what interest rate, it doesn’t take much of a change to drastically alter the amount you’ll pay by the end of a 30-year mortgage.

A few extra points on your score could be well worth it if they enable you to receive even a slightly lower interest rate on the mortgage. Some things are just worth waiting for.

This article by Shannon McNay first appeared on and was distributed by the Personal Finance Syndication Network.

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Financial Advice

5 Ways to Reduce the Cost of Operating Your Car

Buying a car is expensive enough, but most people would agree that owning a car is far more taxing on one’s finances, with unexpected repairs, gas money, parking fees and traffic summons quickly adding up.

In this article, we look at five unique things you can do to make owning a car cheaper.

1. Use OEM (specification) spare parts instead of branded originals.

OEM stands for Original Equipment Manufacturer. Original spares typically come at premium prices while OEM specification spares (sometimes referred to as "third party spares") are usually at much lower prices, minus the fancy logos and engravings. Everybody’s favourite knockoff capital in Asia produces loads of OEM specification spares, which you can easily order online (although many will come with instructions in Chinese or very bad English translations).

OEM spares can range from side mirrors to axles to headlight assemblies. You would have to be careful and exercise some due diligence though and only order from reputable sellers or ask your workshop to make the order for you. You wouldn’t want to save too much money on poorly made critical components like brake callipers that fail when you need them most.

2. Test fuel efficiency.

Do you decide on what gas to use depending on what the latest and flashiest advertisements say? Or do you depend on recommendations from friends? Or maybe you choose the brand based on the color of the logo? Or maybe you are a little more educated than most and use octane ratings?

Don’t try too hard to guess the right way to do it from the options above. They are all not recommended.

In reality, the best way to check what brand and type of fuel is optimal for your vehicle (in terms of fuel efficiency) is to actually test it out by measuring fuel to mileage ratios.

Different driving styles (aggressive vs. gentle), different road conditions (heavy traffic vs. light highway cruising), and different vehicles all contribute towards different rates at which car engines consume gas. What’s optimal for you may not be optimal for your neighbour even if you both drive the same make and model. That’s why so many people swear by different types of gas because in reality they all could be right!

3. Preventive maintenance pays.

There is a big difference between preventive and corrective maintenance. Preventive maintenance refers to routine servicings and checks while corrective maintenance refers to sending the car in for repairs after something has already broken. While you may be tempted to try to save money by skipping seemingly unnecessary routine servicing appointments, this can (and usually will) result in expensive repairs later on. For example, a routine schedule can bring to your attention leaking engine oil or cracked coolant pipes early when minimum or no damage has been done. If left undetected, these faults will result in seized pistons, which will require full engine overhauls to rectify.

4. Know your machine so auto mechanics don’t cheat you.

Most vehicles are pretty hardy. Yet, as cars consist of several systems working together and each system consists of several moving parts, wear and tear can set in very quickly.

An experienced mechanic will be able to tell you the parts that need changing and which can be used despite being in a bad state of wear and tear.

An enterprising mechanic, however, will probably try to make you change everything. This is when it is important to know your vehicle and some basic auto mechanic concepts or at least patronize a mechanic with a reputation for honesty.

For example, if your mechanic tells you that your brake discs need to be changed because they are warped, you ought to know that this is probably not true because your car comes to a halt smoothly with no sudden jerks or unevenness.

5. Aerodynamics

Keep your car aerodynamic. It seems simple enough, but most people don’t realize that by driving with windows wide open, they are creating strong wind resistance and that the engine needs to burn through more gas to overcome the additional forward-moving resistance. Open windows just enough to let in sufficient circulation (if you don’t prefer using the air-conditioner). Also, keep drag low by keeping tires inflated to recommended pressures. Keeping air resistance and drag low will improve fuel efficiency and this will translate into additional savings for you.

We went over five unique methods to reduce the cost of maintaining ownership of a vehicle. You can now look forward to treating yourself with the extra money you are going to save every month on the car!

This article by Dimitry Tretyak first appeared on The Dollar Stretcher and was distributed by the Personal Finance Syndication Network.

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Financial Advice

Defendants Settle FTC Charges in ‘Money Now Funding’ Credit Card Laundering Scheme

Michael Abdelmesseh and KMA Merchant Services LLC have agreed to settle a Federal Trade Commission lawsuit for laundering credit card charges for Money Now Funding (MNF), a business opportunity scheme that falsely promised consumers they would make thousands of dollars helping small businesses get loans.

In 2015, the MNF defendants were banned from selling business or work-at-home opportunities under court orders obtained by the FTC. In 2017, the FTC charged Abdelmesseh and KMA with helping MNF access credit card networks via fraudulent applications in the names of more than 40 fictitious MNF companies, in violation of the FTC Act and the FTC’s Telemarketing Sales Rule (TSR).

Under the settlement order, Abdelmesseh and KMA are banned from payment processing or acting as an Independent Sales Organization or sales agent, and they are prohibited from engaging in credit card laundering.

The order imposes a judgment of more than $1.3 million that will be suspended due to the settling defendants’ inability to pay. The full judgment will become due immediately if they are found to have misrepresented their financial condition.

In addition to the settlement order announced today, the FTC also announces that it is seeking to amend its 2017 complaint to add one count of assisting and facilitating violations of the TSR.

Litigation continues against the remaining defendants.

The Commission vote approving the proposed amended complaint and stipulated final order against Abdelmesseh and KMA Merchant Services LLC was 2-0. The FTC filed the proposed amended complaint and order in the U.S. District Court for the District of Arizona.

This article by the FTC was distributed by the Personal Finance Syndication Network.

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Financial Advice

Watch Out for These New Tax Scams

They’re at it again… tax scammers scheming new ways to steal personal information and money.

In the first scenario, identity thieves file a fake tax return and have the refund deposited into your bank account. The thieves then contact you, often by phone, and — posing as the IRS or debt collectors for the IRS — demand you return the money to the IRS. But following the thieves’ instructions actually sends the money to them.

In another version, after you get that erroneous refund, you get an automated call, allegedly from the IRS, threatening you with criminal fraud charges, an arrest warrant, and “blacklisting” of your Social Security number. The caller gives you a case number and a telephone number to call to return the refund.

Don’t take the bait. If you or someone you know gets an unexpected tax refund, follow the guidance outlined by the IRS for how to return the funds to the agency. The steps for returning paper checks and direct deposits differ.

In a different scam, criminals are using imposter tax preparation sites and phone numbers to steal peoples’ personal information. Here’s how this scam works: You go online to find a tax preparation service to prepare and e-file your tax return. But instead of landing on a legitimate site, you mis-click to a look-alike site created by scammers. The site looks real, and it’s set up to collect personal information that can be used to commit fraud, including identity theft.

The FTC has these tips to fight tax identity theft:

  • File your tax return early in the tax season, if you can.
  • Use a secure internet connection if you file electronically, or mail your tax return directly from the post office.
  • When using an online tax preparation service, look for the tax preparer identification number. The IRS requires all paid tax preparers to have one before filing any returns.
  • To determine if a website is encrypted, look for https at the start of the web address (the “s” is for secure). Some websites use encryption only on the sign-in page, but if any part of your session isn’t encrypted, your entire account could be vulnerable. Look for https on every page you visit, not just when you sign in.
  • Ask tax preparers about their data security policies, and how they protect your information.
  • Respond to all mail from the IRS as soon as possible.
  • If tax identity theft happens to you, visit to report it to the FTC, file an Identity Theft Affidavit with the IRS electronically, and get a personal recovery plan.

For more information, check out our imposters webpage.

If you spot a scam, report it at Your reports help the FTC and other law enforcement investigate scams and bring crooks to justice.

This article by the FTC was distributed by the Personal Finance Syndication Network.

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Financial Advice

Durham North Carolina Tax Return Preparer Sentenced to Prison

A Durham, North Carolina, tax return preparer was sentenced to 20 months in prison today for aiding and assisting in the preparation of false tax returns, announced Principal Deputy Assistant Attorney General Richard E. Zuckerman of the Justice Department’s Tax Division and U.S. Attorney Matthew G.T. Martin for the Middle District of North Carolina.

According to court documents, from 2012 through 2014, Laurean S. Robinson, 31, worked as the office manager and a return preparer at Tax Breaks, a tax preparation business in Durham.  Robinson admitted that she prepared false returns for her clients that fraudulently claimed the earned income tax credit and sought inflated refunds.  To qualify her clients for the earned income tax credit, Robinson falsely reported that they earned income providing household services, such as babysitting and caretaking.  Robinson trained other Tax Breaks employees to prepare false returns in a similar fashion.  In addition to fees charged by Tax Breaks, Robinson also often required her clients to pay her an additional fee in cash.  Robinson’s conduct caused a tax loss of approximately $600,737. 

In addition to the term of prison imposed, U.S. District Court Judge Thomas D. Schroeder ordered Robinson to serve one year of supervised release and pay a total of $ 120,980 in restitution to the IRS.

Principal Deputy Assistant Attorney General Zuckerman and U.S. Attorney Martin commended special agents of IRS-Criminal Investigation, who conducted the investigation, and Tax Division Trial Attorney Daniel McGraw and Assistant U.S. Attorney JoAnna McFadden, who prosecuted the case.

This article by the Department of Justice was distributed by the Personal Finance Syndication Network.

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Financial Advice

FTC Sending Refund Checks Totaling More Than $437,000 to Consumers Who Bought Bogus Weight-loss Products

Defendants bombarded consumers with illegal spam email pitching supplements

The Federal Trade Commission is mailing 18,301 refund checks totaling more than $437,000 to people who bought bogus weight-loss products from Colby Fox, Christopher Reinhold and their companies, Tachht, Inc. and Teqqi, LLC. According to the FTC, the defendants bombarded people with illegal spam email and used false celebrity endorsements and false weight-loss claims to pitch their products. The average check amount is $23.91.

In June 2016, the FTC charged the defendants with paying to send emails from hacked accounts to consumers, making it appear that the messages came from their family members, friends, or other contacts. The messages promoted the defendants’ unproven weight-loss products Original Pure Forskolin and Original White Kidney Bean.

Two court orders settling the FTC’s charges, entered in March and September 2017, barred the defendants from the allegedly illegal conduct and required the defendants to pay $500,000 for refunds to defrauded consumers.

Rust Consulting, Inc., the refund administrator for this matter, will begin mailing checks today. Consumers should receive their refund checks this month, and they must be cashed within 60 days or they will become void. The FTC never requires consumers to pay money or provide information to cash refund checks. Consumers who have questions, or feel they should have been included in the refund mailing but were not, should call 1-866-207-7028. New claims will be reviewed and if money is available, additional refunds may be provided.

FTC law enforcement actions led to more than $6.4 billion in refunds for consumers in a one-year period between July 2016 and June 2017. For more information about the FTC’s refund program, including its Annual Report, visit

This article by the FTC was distributed by the Personal Finance Syndication Network.

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Financial Advice

I Can’t Afford the Private Student Loan Payments Navient Wants and Don’t Know What to Do


Dear Steve,

I defaulted on my private Student loans with Navient due to not being able to pay! I already pay 900 dollars in Federal loans.

My private student loans were sent to collections due to missed payments. The collections agency wants to settle for 40,526- which I still can’t afford. We cannot seem to come to an agreement.

They recently sent me another letter with interest accumulating so now they are saying settlement for 41,000ish. I took the private loans out in 2006 to pay for college. I finished college in 2012. When I got out of college-started working in my field of study for the last 5 years; of course the job is not paying me very much to afford to pay private loans and federal loans so one of the loans gets neglected.

I can only afford to pay my Federal loans. I was on Navient “rate reduction” program twice for 15 months in 2013 and 2015. Once the program was over the payments resume to around 524.00 a month I cannot afford. So, of course, I defaulted on the loan and it was sent to collection this year, 2018.

Unfortunately, the collection agency & I cannot come to a different settlement than the one they are demanding. They are saying I have until 3/25/18 to pay. What are my options should I just wait until they send me a letter with the intent to sue- wait for the summons, respond to the summons then let the court decide?

I do acknowledge the fact that I did take the loans out and I should pay back, but what do you do when you cannot afford the high payments?

In my case, I defaulted, and I do not have thousands of dollars for a lawyer or for a settlement. What is the best course of action?

Furthermore, what is the point of getting private loans out of default when my credit is already ruined anyway?

Honestly, I never depended on my credit to buy things anyway. I do understand I can be taken to court & faced the possibility of losing the lawsuit.

How will I fight this in court?

Do I even have a valid argument based on information I provided? How long will it take for them to sue me? Will I be taken to court in the city/state I live in? Your help and advice are greatly appreciated. By the way, I live in Florida!



Dear Ciera,

You raise a number of good questions.

If you are taken to court the judge is not there to help you negotiate a reasonable agreement. They are there to enforce the legally binding terms of the contract you signed when you borrowed the money.

However, if you are sued you can still negotiate a settlement with the attorney suing you.

There is no crystal ball on how long it takes to be sued. It depends on a number of factors and the current creditor policy at any given time.

If you were sued on the private student loans it would be in your local court district. Not in federal court.

I would suggest you read Top 10 Reasons You Should Stop Paying Your Unaffordable Private Student Loan.

Part of a sound strategy may be to wait and see what happens but that works out best as part of a larger plan on how to deal with your overall current financial situation.

It is always better to plan and prepare for a default, collections, and/or getting sued. Just waiting for the truck to hit you is never a good idea.

One place you can turn for advice on this specific subject would be my friend and independent debt coach Damon Day.

You can at least talk to him and discuss a plan of action.

Keep in mind, any negotiable solution is going to require you to have monthly income to pay monthly installments.

Another option would exist if these private loans were used for expenses other than for school or the school you attended was not FAFSA approved.

Steve Rhode
Get Out of Debt GuyTwitter, G+, Facebook

If you have a credit or debt question you’d like to ask, just click here and ask away.

This article by Steve Rhode first appeared on Get Out of Debt Guy and was distributed by the Personal Finance Syndication Network.

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