Points of Interest ©

"My credit has some problems.  Do you think I can get a new mortgage?"
                                                                            ~ Recent Prospective Customer

Credit data and the storage, reporting and sale of the data is big business.  Look at the three biggest companies in this field and you get some idea of the enormity and demand for their services.  And one of their biggest sources of revenue is selling your data, your personal information.  More likely than not, it's being done without your knowledge or permission.

Who hasn't had some detail on their credit report that they didn't want there?  It may have been an error or maybe it actually happened.  It may have been a late payment, a collection account, a tax lien, bankruptcy, short sale or even foreclosure.  And it doesn't matter whether it is the result of a divorce, loss of employment, medical illness, business, accident, or just the crush of everyday life.  It would be better if it weren't there.

If you asked, "Is there a legal and practical way to have this information permanently removed from my credit report?", I would say yes.

There is a huge myth the credit bureaus like to keep alive:  that derogatory information on your credit report has to be reported or stay there for some minimum time.
 
There is no law that says that derogatory information has to be reported.

There is no law that says that it has to be on your report for a minimum time.

There is a maximum time frame of 7 years for most items, but NO minimum.  That's a myth.

Got a problem?  You may be able to get it fixed.

This past January rates fell on one day and only for hours.  The move was swift due to the imbalances in the credit markets.  We locked loans as fast as we could for those we knew were interested in getting a lower 30 year fixed rate.

Some of the rates we locked were as low as 5.25% with zero points*.  No points.  Many of our potential customers thought it might go lower and decided to wait.  It was over in a matter of hours.  We had rate changes for the worse starting around 2 pm when the market began to right itself.

These opportunities do present themselves from time to time.  And when they do, you must be ready to take advantage of them. 

We may be in store for something very similar.  Credit spreads have risen dramatically of late.  And the need to raise additional capital for many of the financials grows each day.  Fannie Mae and Freddie Mac are rumored to be nationalized any day.  This could cause the flight to panic behavior of immense treasury bond buying which drives down interest rates.  Will you be ready?

* 5.287% APR

Last week, the Commerce Department revised downward (a bunch) GDP figures for the fourth quarter.  The first quarter numbers were also revised downward, but not by as much as the previous quarter's.  Some of you cynics may suggest that we just need to wait for next quarter's reading to get the full markdown of the first quarter.

What is so terrifying about the word recession?  9 letters and 4 syllables!  Despite clear and reasonable evidence the powers that be declare that we are not in a recession.  Why all the fear?  Wouldn't it be better to tackle our problems head-on without obscuring the truth in some economic gobbledygook?

Recessions and all things resembling them have a specific purpose.  They cleanse all wrongs since the beginning of the last growth cycle, wringing out the excesses of the much too plentiful cheap money much like mom used to wring out your wash cloth after a bath.

They don't usually last that long, typically no more than a year.  The worst aspect is conjuring up what might happen.  What if China's economy goes in the tank?  What if we run out of oil?  What if house prices keep falling?  What if we don't win any olympic gold?  I could go on ad nauseam.

These are the times that smart people take advantage of the situation particularly if they are currently renting.  Heck, completely turn the tables and buy someplace and rent it out.  Let that tenant pay for your mortgage and future equity.  Fairfax, Loudoun and Prince William, Virginia are full of opportunity and great real estate deals exist.

Each person's situation is different and demands their own consideration.  Be sure to sit down with a professional who can help you sort out the pros and cons.