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Show Your Business PAGEA8 MONDAY, APRIL 4, 2005 Building/Fixing your credit: a starting point information about you on their files, so it's important to get a copy of your credit report from each one of them. You can do this by contacting each one in- Nicole Bourgerie Your Business Writer W e all make mistakes. Here's how to fix a common, but crippling one. First of all, you need to change some of your habits and behaviors with regards to money. Track your spending for a month and then take a look at where all your money is going. You may make more or less than you think. The most important thing you need to do to clean up your finances is to make a budget and stick to it. If you simply can't control your plastic, put your credit cards in a plastic container full of water and stick it in the freezer. That way, your practical side will have afightingchance while you wait for the ice to thaw or run it under hot water. Now we'll move on to how you can begin to salvage your credit and start rebuilding. As you might be aware, there are three credit reporting agencies and they all may have slightly different dividually (Equifax: 1-800-685-1111, Experian: 1-800-682-7654, Trans Union: 1-800-9168800) or you can get a joint report from a commercial group such as consumerinfo. com, which also offers a credit monitoring service for a fairly substantial fee. You are entitled to a free copy of your credit report within 60 days of being turned down for credit if the agency that gave the information causing the decline was Equifax or TransUnion. Experian also offers a free report in the event of being turned down and also offers a free annual report. Otherwise, the agencies charge a small fee. The first things to look for when you receive your reports are any potential errors and outdated or irrelevant information. Go through your report item by item. If you find errors, you should notify the offending credit bureau through certified mail so you have proof they received it. Don't bring up more than three errors per letter and wait thirty days for a response. If after a month, you still haven't heard back, send a second letter. If there is STILL no response, send a third copy to the FTC. After you've scoured your report for errors and fixed everything you can fix, you need to start proving that when someone gives you credit you'll pay the money back and on time. The following ideas benefit both those with bad credit and those with little or • no credit. •Piggyback onto someone who already has good credit: if y o u are lucky enough to know someone who is willing to do this for you, this is an excellent way to rebuild credit. Be aware that any mistake you make will now reflect poorly on your cosigner. AH you need to do now is make payments on or before the due date. The best thing you can do is wait until the bill arrives so you can establish a "pay on time" history and pay the bill in full. If you need, repeat the cycle of creating debts and paying in full until you no longer need the co-signer. •Obtain a secured credit card: Open a savings account with a merchant offering this type of card. Usually they will require a minimum of a couple hundred dollars. Once the account is established you will be issued a credit card that you can use as you would any other card up to the amount you deposited. Keep in mind that although return payment is guaranteed for the debtor, interest is still charged. Now use the method outlined above in the co-signed segment and repeat until you establish unsecured credit. •Apply for store cards: Department stores charge high interest and often benefit if you are late on payments, so they are generally easier to get approved for. But be care- ful: if you apply for different cards too many times and are declined, you will have an "excessive inquiries" note on your credit report, lowering your score further. Applying for financial aid: how to start Nicole Bourgerie ! Your Business Writer It's generally a good idea to apply for financial aid, whether you think you qualify or not. There are a lot of different factors affecting your eligibility and they can change every year. That said, where do you start? To apply for student financial aid from the federal government, including a Pell Grant, Perkins Loan, Stafford Loan and work-study, you will need to submit a fafsa application. All state and many school student assistance programs also require the FAFSA. You need to fill out a FAFSA form for every year you want aid. A FAFSA form can be obtained from the financial aid office or by calling 1-800-4-FEDAID. An even easier way to complete the application pro- cess is to do it online at www. fafsa.ed.gov. To get a PIN (your electronic signature) go to www.pin.ed.gov. The UVSC financial aid office also requires supplemental forms. You can get these by visiting the office in person or you can download them through OnAccess (www.uvsc.edu, click on OnCampus. Click on the OnAccess tab on the top left hand side of page and select Finan- cial Aid). Before you begin filling out forms, gather all the information you will need to complete them. Items needed to fill out a FAFSA form, along with most other financial aid forms, are: driver's license and social security card, income tax returns, W2 forms, and 1099 forms for the previous year, documents for spouse (if married), parents' income tax returns, W-2 forms, and 1099 forms for the previous year, current bank statements and mortgage information, records relating to stocks, bonds, mutual funds, and other investments, documentation of non-taxable income, such as Social Security income, AFDC, and Veterans Benefits, business and farm records, and records relating to any unusual family financial circumstances, such as medical and dental expenses not covered by health insurance, tuition expenses at elementary or secondary schools, unusually high child care costs, death, divorce, and loss of unemployment. Make sure to keep these documents on hand because you may be asked to verify them by the financial aid office. Five steps to buying your new car 1. Find out how much car you can, or want to, afford: Before even looking at a car you need to do some realistic budgeting. How money do you really have left in the bank on an average month? Have you taken into account maintenance and insurance? Do you really want to spend the maximum you can afford? *Note: what you can afford is almost never as high as what a dealer says you're qualified for. 2. Make a list of priorities: These will naturally vary from one person to the next. Like leather? Like it enough to give up a few years' reliability? Be honest about what features you need and don't and then search for the car that covers all the needs and the highest portion of wants. 3, Figure out the financing: First off, DON'T LEASE. In very few circumstances is leasing ever a better option than buying. After you've decided to buy,, shop around for the best interest rates on used/new cars. Your credit union likely has them for used; Dealers may be the best on new. Neither of these options come close to the savings of buying with cash. The general increase in reliability of autos over the past decade makes buying used cars with cash far less difficult and risky than your buddy, who "only buys new" would lead you to believe. 4. Research and test-drive cars in your wanted price range: Find the car with the mix of reliability, amenities, and comfort that suits you. If buying used from an individual, take the car to a trusted mechanic and have them look it over. It's more than worth the $50. 5, Bargain your deal: Always bargain as if you're paying cash and always up from the dealer's cost. The dealer's cost can be found by purchasing a report from Consumer Reports(r) for a fraction of what it will save you. If purchasing from a regular person, bargain up from the low book or trade in value and never make a 2nd offer until they counter your first. Don't pin your hopes on one car atoneplace;jthere a r e several dealers/individuals with the type of car you want. Make the phone calls and let them fight for your money. You earned it. |