| US Army Soldier in need for help |
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trybren
New Member
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Joined: 30 Oct 2004
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| US Army Soldier in need for help |
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Thanks to all who take the time to read this. My name is james I am stationed at Fort Bragg north carolina in the United States Army. I am married with two children, my wife and I bought a home earlier this year (March). Now we are haveing a problem keeping afloat due to our high debt balance. We do not have equity built into our home yet and our credit is suffering. I do not want to loose my home nor do I want to file bankruptcy. My wife and I have figured all our debts and with a loan in the amount of $20,00 it would pay off all our debts and get us current on our house, car, insurance ect. Thus reducing our monthly payments by almost $400 dollars. I tried to find somone in my family to cosign for me and I would set up an auto payment to the loan but their credit was worse than mine. I am ready to make a change in my life and start building a better future. But I just need somone who believes that. While I was in Afghanistain my wife applied for all kinds of credit no knowing it affected my becon score of course she kept getting turned down and now we can not get anything. Please if you have any advice or are willing to help email me at james.m.lloyd@us.army.mil thanks for your time.
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Sat Oct 30, 2004 6:54 pm |
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Andrew
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Location: Texas
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Hey James,
First let me say thanks for the sacrifices you've made.
I'm sure that we'll have expert advice for you soon. Please check back.
Are you a reservist or enlisted? I'm guessing enlisted, but if reservist the Soldiers' and Sailors' Civil Relief Act of 1940 provides some help...
http://www.defenselink.mil/specials/Relief_Act_Revision/
Also here is some information on VA Loans...
http://www.army.com/money/valoan02.html
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Sat Oct 30, 2004 8:52 pm |
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BlankenshipFP
Money Talk Advisor
Cash: $ 79.56
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Joined: 05 Oct 2004
Location: Illinois
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James (trybren):
I echo Andrew's thanks for your sacrifices. We, as Americans, are truly proud and honored to have you and your fellow soldiers giving all that you do for our country. Bless you.
On to your questions:
Assuming that you are unable to secure the loan that you are looking for, the only answer to your situation is to develop a plan that will start to dig you out of the debt problem that you find yourself in.
Begin by developing a list of your monthly expenditures (food, clothes, housing, insurance, etc.), but not including debts. Separately, develop a list of your debts, including balance, minimum payment, rate, etc..
Once you've developed the list of monthly expenses, review the list and make sure that you've pruned things down to the point where you are covering your basic needs - assuming that there could be items in the list that might be either reduced or eliminated. It's a painful process, but you must do this in order to begin digging your way out.
Assuming that this process has resulted in a positive difference between your income and these necessary outflows (not including debt payments), consider the amount that is left over. Of this amount, take a portion, even a very small portion, and put it into a savings account. Make a promise to yourself that you will not touch this money unless it is a true emergency.
Take the remaining amount left over, and begin to apply it to your outstanding debts. You may not have enough to cover everything (and it sounds like you don't), so there are two ways to attack it:
1) pay off your debt with the lowest balance first; or
2) pay off your debt with the highest rate first.
Paying off the debt with the lowest balance first will give you the quickest tangible result, that is, you'll see an actual "success" quicker. Once that debt has been paid off, go after the second lowest, adding the amount that you had been paying on the first debt to what you are currently paying on the second debt. Keep this process up and you'll soon find yourself digging your way out.
The second method is the most efficient, in terms of ensuring that your highest expense debt is being covered first and foremost. The same method holds true after this first debt is paid off as discussed just above for the first method.
Two more thoughts - First, while going through this payoff process, don't just ignore your other debts. Call up the company and explain what you're doing. See if you can get them to lower your rate, or give you a break on payments or fees for a while, until you get things in order.
Second, if your cash flow doesn't allow you any excess for starting the payoff process - it's time to do something to increase your income. That may mean taking on additional work or odd jobs or maybe even going for a less expensive house.
As I said, it's a painful process, but it is also the only proven way to get out of the mess. Oh yeah, one last thing: As you go through this process, remind yourself over and over again that you will not do the things that caused you to get into this situation again.
Best wishes,
Jim Blankenship, CFP�, EA
Blankenship Financial Planning, Ltd.
www.BlankenshipFinancial.com
Standard IRS Circular 230 Notice Applies
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Mon Nov 01, 2004 4:22 pm |
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BlankenshipFP
Money Talk Advisor
Cash: $ 79.56
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Joined: 05 Oct 2004
Location: Illinois
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With regard to my suggestion that you call the credit companies to explain your situation:
I recently read where some banks, specifically in this case Bank of America, will eliminate its interest on credit cards when someone is in trouble.
You won't know if you don't ask. Of course, this doesn't eliminate the debt, but it slows the bleeding.
Good luck,
Jim Blankenship, CFP�, EA
Blankenship Financial Planning, Ltd.
www.BlankenshipFinancial.com
Standard IRS Circular 230 Notice Applies
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Wed Nov 03, 2004 4:11 pm |
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xboxundone
Senior Member
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quote:
Originally posted by BlankenshipFP
With regard to my suggestion that you call the credit companies to explain your situation:
I recently read where some banks, specifically in this case Bank of America, will eliminate its interest on credit cards when someone is in trouble.
You won't know if you don't ask. Of course, this doesn't eliminate the debt, but it slows the bleeding.
Good luck,
WOW eliminate interest ahvent ehard of that but i have heard of major reduction in rates like going from 20% to 5% etc..
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Wed Nov 03, 2004 5:39 pm |
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domskynetlabs
Full Member
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A solider has an entire chain of command to utilize in regards to personal problems. every base and command has a relief society and a community services branch. I have seen over 2000 military personnel in hardship receive help from their own command.
It would be impossible for this solider to show that his deployment or mobilization affected pay negatively due to the fact that more money is made deployed.
hazardous duty pay
flight deck pay
aviation incentive pay
crewmember/noncrewmember pay
tax free zones
combat zone
imminent danger pay
family separation allowance
comrats
perdiem
these are a few of the many pay incentives military make when deployed not to mention eligibility to start j allotments amazing tax free high interest bonds
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Wed Dec 01, 2004 5:20 am |
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MoneySeeker92
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That sucks. I wish your family budget increases soon.
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Mon Jan 17, 2005 4:53 am |
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Sean A. William
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| Just find out some free money or government grants |
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 The government even has a web site for over 900 grant programs offered by the 26 Federal grant-making agencies. The site is aimed at organizations that apply for the government money and then give the money to people in need. The government web site does not tell the average person how to get their own grant money.
Do you know that many people qualify for grants regardless of income or credit history? To illustrate, you may go
http://www.freegrantsearch.org/government_grants
to have your first grant search generate a quick list of available grant programs that you can take advantage of immediately.
Best regards
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Thu Jan 20, 2005 5:35 pm |
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domskynetlabs
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Cash: $ 21.09
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| Re: Just find out some free money or government grants |
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scamish site with straight out scam offerings when you give them an email quote:
Originally posted by Sean A. William
:idea: The government even has a web site for over 900 grant programs offered by the 26 Federal grant-making agencies. The site is aimed at organizations that apply for the government money and then give the money to people in need. The government web site does not tell the average person how to get their own grant money.
Do you know that many people qualify for grants regardless of income or credit history? To illustrate, you may go
http://www.freegrantsearch.org/government_grants
to have your first grant search generate a quick list of available grant programs that you can take advantage of immediately.
Best regards
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Thu Jan 27, 2005 6:57 am |
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chiron
Contributing Member
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Joined: 10 Feb 2005
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James -
I wish I had seen your post sooner - my hope is that you're back on track already and that everything I have to say below is a moot point. However, I am posting this rather generalized message in the event you may yet find use for its contents.
Please note that I am not disregarding or attempting to disqualify the high-quality advice offered by others (especially BlankenshipFP) in terms of the need to budget and save and spend wisely and etc. However, I felt in reading through this thread that it would be no harm to address your question directly - which is, how to best prepare to get a loan with "bad credit" nipping at you.
Your Beacon score (which is simply a "brand" name for one of your three credit bureau report scores) was probably dinged for about -5 credit points for every inquiry made, with a rate of decay over time. While this adds up, it is unlikely that these inquiries alone fully account for a failure to qualify for a consolidation or personal loan of $20k.
Far more likely is that your credit mix, amount of recently assumed or applied-for debt loads, and revolving balance ratios are contributing in sum fashion to depress your score, as these segments account for something rather over half of your maximum algorithmic credit score (850).
Touching briefly on those points... your overall credit "mix" ought to be ok with a home mortgage in there, is difficult to quickly adjust, and in any event this portion represents only about ~10% of your score's total value. In turn, any recently assumed debt you cannot do much about (though again, a nod to the advice on rationing and budgeting from others), and in fact, your stated goal is to assume what is likely a bit more overall extension via this new loan.
The revolving balance is a significant factor, and you can perhaps work on this, with score-impacting results reported in as little as one bureau cycle (usually 30 days, give or take). This balance is not a published figure that I am aware of, but it is generally held that seeking to exceed no more than 30-35% of available credit maximums on any given credit card on a month-to-month carried balance is a good bet towards achieving an optimal rating. To summarize, if you have a $10,000 limit on a given card, sticking below about $3,000 in carry-over balance is a good idea. If you can do some balance transfers or pay-down one or more cards that may be in excess of this rough percentile guideline, such actions can raise your score and help you towards qualifying for a loan in a few months. I wish I could say sooner, but I want to be conservative in my estimates to best help you plan and prepare.
Equally likely, and perhaps most easily addressed with proper guidance, you may have (given your extensive dislocation from your stateside mail box in 2004) also been saddled at some point by one or more "negative" items, these being things like a late payment. A single such reported event (such as a late pay) engages a large fraction of ~35% of your aggregate credit score, and this portion of your credit report most often contains the most quickly resolved "score potential" and may be the difference between qualifying or being denied for a loan.
On this last part, if - using a late pay as an example - such an item is indeed being reported, this item may be addressed via the "dispute" process. Some people show a proclivity to raise their eyebrows at the concept of disputing what may be, by some definitions, a "valid" reported issue. However, I would submit to you, and to any who may read this, that the dispute process be considered for what it is: a simple request by the affected party (you) for complete validation by the bureaus and reporting creditors that the information on your report is 100% valid, verifiable, and accurate.
In my mind, it's your right to demand validation of detrimental claims, and flipping the table, requesting such verification is no different than the many proofs required of you to obtain a loan - the bank will ask for everything from your SSN to your driver's license, correct? So return the favor, and ask for some proof from the bureaus, and all's fair and well.
The credit bureaus have between 30-45 days to verify (initiated by the dispute letter) that a given item, like our example late pay, is 100% accurate. If the bureaus (Equifax is one, and produces the Beacon score you referenced) are unable to verify that their information is indeed 100% accurate, it's hardly your fault if they drop the disputed item (thereby raising your score). Back to the analogy of "the other side" - would you get your loan if you forgot to bring your ID?
Now, all of this fluff regarding "negative" item impact and your right to dispute and validate you can do yourself by using a sample dispute letter as a guide (the FTC web site has one), or by going directly to the bureau sites online (e.g. equifax.com) since Equifax has online consumer disputation programs available (usually at a relatively minor fee to you), or you could enroll in an experienced, legitimate credit repair program.
To note a full disclosure, I am biased towards this last option, the credit repair firm, and will thus prattle on a bit more on this theme, bias known and admitted. Note that the FTC, if you visit their site, will correctly mention that there's nothing a credit repair firm can do that you cannot do yourself.
Personally, I would respond that "if you are in Afghanistan, or are otherwise preoccupied with the security of this country, you might not have the time, ability, experience, physical means, tools, and/or detailed knowledge of the dispute-verify process to successfully repair your credit as quickly or efficiently as can a firm staffed by professionals."
Such a statement as this by the FTC could logically be applied to many areas in life with an equally sound rationale: consider the idea that "there is nothing a mechanic can do for your car that you cannot do yourself" by way of example. True. However, common sense quickly retorts that if you are busy and are not a mechanic yourself, and you want your car fixed properly and in a timely fashion, with warranty, it's time to call on a trusted automotive specialist.
And thus I recommend that if the above self-help sorts of credit building ideas are not sufficient to obtain the score and thus the financing that you require, locate a reputable credit repair firm, slap down a relatively inconsequential amount for their services, and let them help you get back into good standing, whereupon with your loan and the budgeting and savings plans observed by others, you can continue to work your way back to personal financial stability and health.
James, I have written this in hopes that all or a portion of what I have said may benefit you and your family. This response to you and the information I've attempted to supply is a small token of my personal gratitude for your service and sacrifice. And to any of our personnel here or abroad, a gigantic thanks from myself, my wife, and my son.
Take care all, and thanks again.
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Fri Feb 18, 2005 12:00 pm |
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jlknauff
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Give a call to your veterans service officer-he/she will have a number of resources to help.
Thanks for your contribution to the country!
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Thu Mar 10, 2005 5:14 am |
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