BAD CREDIT

Michael Holigan: Joe and Beth Miller, like a lot of people, had some credit problems a few years ago. Their situation worsened and they thought their dream of owning a home would never be realized.

Joe Miller: That was our main credit problem, is we had some delinquencies. The student loan and there was a couple of other things that were past due. And that was the main problem, that they were past due.

M.H.: Credit is a personal profile of your financial life. All lenders need to do to check up on it is send out a few letters and make a few phone calls. There are three different credit agencies you need to know. TRW, Trans Union and Equifax. Each m onth, companies send information to these bureaus. It's likely your files are spread out among all three. If there is anything incorrect in your files, you do have the right to correct. But in most cases, they do reflect a true picture of your credit. And what causes bad credit. Charge-offs and late payments. Charge-offs are also called profit and loss accounts. This means you didn't pay something off, like a student loan or a credit card. The companies say the note is uncollectible and charge it off. Late payments are noted on your record when it take 30 days or longer to pay your bills. The Miller's had these same credit problems, but to their surprise, they still qualified for a loan.

J.M.: We never thought in a million years we would qualify. We thought, you know, there's these black marks, and it was mainly on my credit. And Beth really doesn't have much of a credit report at all.

Beth Miller: Yeah.

J.M.: She has no good or bad credit. But I had some bad credit.

M.H.: The reason the Miller's qualified for a loan is because they corrected their credit problems and they put their finances in order. Next time we'll show you how they did it and we'll show you how you can do it too.

 

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Episode 38 1996 - 97 Season

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