Available Workshops

Best Credit Service, Inc. offers a number of workshops to the community in addition to the financial literacy information you can find on the "Free Counseling" tab of our website.

The purpose of these workshops is to bring financial literacy awareness to our local community, meeting the need for education on various financial topics. Our educational department works in conjunction with local non-profits, schools, community outreach programs, and businesses to provide free workshops to the community and employees.

If you are looking for an educational resource to utilize then please don't hesitate in contacting us. Our educational staff is more than willing to provide assistance through our free workshops.

Below is a list of the workshops we are currently offering. In addition to what is listed, our educational department can compile and deliver information that is specific to your situation or workplace. Simply click on the image for contact information.

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Getting Back on Track:

• Includes Information on Achieving Financial Stability
• Provides Suggestions on The Following Issues
• "How To" Track and Evaluate Expenses
  
  
  • Prioritization
  • How To Contact Creditors
  • Making Spending Changes
  • Creating and Evaluating a Spending Plan
  • Savings and Different Ways to Save
  • What Financial Services to Avoid

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Choose Your Financial Destiny:

• Discusses How To Plan For Your Financial Future
• Highlights the Following Themes
  
  
  • How To Set Financial Goals
  • Organizing Your Records
  • Calculating Net Worth
  • Comparing Income and Expenses
  • How To Implement Lifestyle Changes
  • Creating A Spending Plan
  • Importance Of Savings
  • Writing A Financial Plan
  • Includes a Financial Plan

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Buying Your First Car:

• Reviews the Ins and Outs of Car Purchasing For First Time Buyers
• Discusses The Following Themes
  
  
  • Goal Setting For Large Purchases
  • Responsibility and Car Ownership
  • Different Types of Lenders and Interest Rates
  • What to Look for In A Car
  • Insuring Your Car
  • Includes a Goal Chart

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Give Yourself Credit!

• Emphasizes Credit Building and Management
• Covers The Following Topics
  
  
  • What Credit Is
  • Advantages and Disadvantages of Credit
  • Why Credit Is Important
  • How To Establish Credit
  • Credit Reports and Scores
  • How To Use Credit
  • Credit Cards
  • Credit Protection Laws
  • What Creditors Can and Cannot Do
  • Identity Theft
  • Includes a Financial Plan

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The Basics (For Teens):

• Specifically Designed For Teens
• Covers The Following Topics
  
  
  • Needs vs. Wants
  • Setting Financial Goals
  • Creating A Spending Plan
  • Recording Expenses
  • Understanding Credit
  • Credit Reports And Scores
  • Includes a Comprehensive Test

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The Basics:

• Explores The Concept of Budgeting And Credit
• Includes Information On The Following Subjects
  
  
  • Compares Income and Expenses
  • Writing Financial Goals
  • Advantages And Disadvantages of Credit
  • Why Credit Is Important
  • Credit Reports And Scores
  • "How To" Use And Establish Credit

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Educational Materials

Credit Reports

Now that you know how they determine your credit score and how to improve it, where can you go to find out what it is and why should you bother. Examine these facts and determine for yourself if reviewing your history isn't important.

• According to the U.S. Public Interest Research Group, 70% of credit reports examined contained an error.
• "Dumpster Divers" wade through your trash and steal your identity. Checking your credit report can help minimize the damage.
• Knowing your credit history and score is knowledge, and knowledge can be bargaining power when it comes to negotiating interest rates or purchasing something new.
• By checking your credit history, you see where you can improve to increase your score, either by paying a forgotten bill or ceasing filling out applications (which, in quantity, can hurt your score).

There are three main agencies that house ALL of your reported credit information and provide it for you, and lenders, to view. When you order your credit report, you will need to provide your name, address, social Security number, and date of birth. Also, to confirm your identity, you will be required to provide information only you would know, such as the name of the lender on your mortgage.

While you should know that each of these agencies charge a small amount for you to view your credit history and score (no more than $10), there are some conditions where you can receive your history for free.

• Federal law allows you to receive one FREE report from each bureau every year, regardless of your situation.
• Have been denied credit within the past 60 days.
• Unemployed and will be applying for a job within the next 60 days.
• Are receiving public assistance.
• There is reason to believe that your file contains inaccurate information due to fraud.
• If you request a fraud alert on your account.

You can order all three of your FREE credit reports through one website:
www.annualcreditreport.com,
or call 877-322-8228.

Annualcreditreport.com does not provide the option to view scores, however credit scores can be purchased for a small cost ($5.99 to $7.99) by contacting the agencies individually, you can do so with the following information.

	Website:	www.transunion.com
	Phone:	1-877-322-8228
	Website:	www.equifax.com
	Phone:	1-800-685-1111
	Website:	www.experian.com
	Phone:	1-888 397 3742

Here are some examples of what CANNOT be done with your credit report.

• Utility services can request your report to determine if they will charge you a deposit, but they CANNOT deny you service.
• Your credit score will not affect those around you unless you have co-signers or are a co-signer.

If a credit bureau violates the law you can complain to the Federal Trade Commission by going to their website. www.ftc.gov. Record the name, address, and phone number of the credit bureau, as well as the dates, nature of the problem, and all relevant documentation.

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WHY YOU SHOULD BE CONCERNED ABOUT CREDIT

Your credit score affects your finance rate on large purchases. A 1% difference can either help you save or loose thousands. For instance, financing a home for $100,000 over thirty years at 8% will cost you $24,645 more than if financed at 7%. Your credit score is more than just a score; it translates into money.

Your Credit Score

There are things in this world not even professionals can figure out…airline ticket pricing and credit scores. But we're going to try and provide some explanation on the latter as to how they are decided and the impact they can have on your financial future.

While each Credit Bureau has their own scoring system, they are generally based around the Fair Isaac and Company (FICO) method.

Credit scores range from 350 to 900, and anything above 750 is considered good. Here is a breakdown of what FICO bases their scores on, and then we'll discuss each one.

35%	Credit History - How you are paying, and have paid, on your accounts
30%	Amount Owed - How much you currently owe on open accounts, and how close to the credit limits your balances are. What is being looked at is if you are managing your credit wisely. The closer you are to your limits, the more it appears like you're overextended.
15%	Length of Credit History - How long your accounts have been open. For the most part, a longer history increases the score.
10%	New Credit - A lot of new accounts does not look good. Opening new accounts in a short time indicates a greater risk. Longer, established histories are more favorable.
10%	Types of Credit - Scoring looks for a mix of different types of credit. In general, unsecured store cards (credit that can only be used at specific stores, like Best Buy) are not as favorable as general use credit cards. Bank, home, and car loans report well.

More information can be found at www.myfico.com or by calling 1800-999-2955

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IMPROVING YOUR SCORE

• Pay your bills. A score is an indication of your credit worthiness. It is a standard by which lenders can determine if you are trustworthy.
  
  
• Pay on time. Being late results in fees, and is reported as "slow pay", which can negatively affect your score.
  
  
• Pay consistently. No magic needed. Only time will heal your score. With every 8 months of consistent, on time payments, your score will improve by 20 points.

Managing Credit Cards

Handling Collectors

Here is where we provide some useful information on how to appropriately handle collectors. We're going to discuss what creditors can and cannot say or do and in the event that they act illegally, what measures you have at your disposal to effectively handle the situation.

First, you need to know that there are different kinds of collectors because original creditors are not generally governed by the FDCPA (Fair Debt Collection Practices Act of 1977). However, several states have laws that apply to both kinds of collectors and are stricter than the FDCPA.

1. Original Creditor - Sometimes called credit grantors. These are the guys who first extended you credit or loaned you money. Most Credit Card companies have an in house collection department.
   
   
2. Collection Agency - This is an individual (usually a lawyer) or agency that is hired by the original creditor to collect on a past due debt. Third party collectors include…
   
   
   • An original creditor that collects its debts under a different name or sends letters signed by lawyers.
   • A lawyer who regularly collects debts
   • Any company that purchases debts with the purpose of collecting them.

  The terms BILL COLLECTOR or DEBT COLLECTOR can refer to either an original creditor or a collection agency.

  Beware of "urgency-payment" suggestions. These are attempts to get you to...

• send the check by express or overnight mail
• wire the money
• have your bank wire the money
• put the payment on a credit or charge card
• visit the creditor directly and bring the payment
• have the collector visit you and collect payment

Below is a sample letter requesting more time…

Collections Department Smiths Department Store 375 Center Drive Birmingham, AL 97333 April 20, 2006 Re: Frank Boyd       Account No. 22593-6341 To Whom It May Concern: I've received your notice indicating that my account is overdue. I would like to pay, but a family emergency has prevented me from doing so. My daughter was in a severe automobile accident. She is unable to go to school and I have had to take time off to care for her. My financial situation will improve in the near future. I will be returning to work in a few weeks and I expect to be able to pay you on July 1, 2005. Thank you for your consideration in this matter. If you wish to speak to me, please feel free to call me at my home at 435-555-8725. Sincerely,

Here are some examples of what collectors CAN'T do…

1. Lawyers cannot authorize a form letter (a generic letter with their name copied at the bottom) without reviewing each particular debtors file.
   
   If you suspect you've received one of these letters, call the law firm and ask to speak with the attorney. If he doesn't exist or has no recollection of your file, contact the collection agency, point out the violation, and threaten a law suit. You can report both the collector and the lawyer to the Federal Trade Commission at their website, www.ftc.gov. You can also report the attorney to your states bar association.
   
   
2. Collection agencies cannot…
   
   
   • use or threaten violence
   • harm or threaten to harm you, another person, or your reputation or property
   • use obscene or profane language
   • publish your name as a person who doesn't pay bills (child support agencies are exempt from this)
   • list your debt for sale to the public
   • call you repeatedly or place calls to you without identifying the caller as a bill collector
   • add interest, fees, or charges not authorized in the original agreement or by state law
   • accept a check postdated by more than five days unless it notifies you between three and ten days in advance of when it will be deposited
   • deposit a post dated check prior to the date on a check
   • solicit a post dated check (this is a common ploy)
   • put any words or symbols on the outside of the envelope that indicates it is trying to collect a debt
     
     
3. A collection agency can't lie. For example…
   
   
   • claim to be a law enforcement agency or suggest it is connected with the federal, state, or local govt.
   • falsely represent the amount you own
   • claim to be an attorney or that communication is from an attorney
   • claim you will imprisoned or your property seized
   • if a letter states, "final notice" then they can't contact you again
   • falsely claim you've committed a crime
   • threaten to sell your debt to a third party
   • not allow you to dispute a debt
   • cannot send you a document that looks like it's from a attorney or court
   • use a false business name or claim to be employed by a credit bureau unless the two are the same company

HOW DO AGENCIES FIND ME?

You may wonder how collection agencies find you. While Social Security documents, unemployment, disability, census, and other government records are not accessible by bill collectors, here are some of the other methods they use to locate your whereabouts.

1. Credit Application. On it you have listed your phone number, address, employer, bank, credit references, nearest living relative, and so forth. Even if you've moved, a reference may know where.
   
   
2. Collection Agencies. They will call your friends, employers, or relatives posing as a friend or relative to locate you.
   
   
3. Post Offices. These are checked for forwarding addresses, and regional phone books are examined. Major credit bureaus with their own collection agencies receive change-of-address information for two million people every month from USPS.
   
   
4. State Motor Vehicle Departments. Recorded is your address from when you last registered your vehicle or paid taxes. While casual searches cannot be done, legitimate creditors or an agent can access the database to verify your address.
   
   
5. Voter Registration Records. If you've reregistered in the same county, the registrar will have your new address.
   
   
6. Utility Companies. While a difficult source to access, are another source of information if you live in the same area. They also may have your new address if you've moved out of area because they sent you a final bill.
   
   
7. Banks. If you move but leave an account open, the bank will probably have your new address.
   
   
8. Data Aggregators and Internet Search Engines. Data aggregators collect data from public records, surveys, purchase data, and demographic data. Internet search engines have all kinds of random information from property ownership to classmates.
   
   
9. Skip Tracers. Individuals hired to use traditional and high-tech techniques in locating you. They may search the Social Security number you provided the credit card company, telephone company call records, military and selective service lookups, prison inmate lookups, business and corporate records, and even Ebay seller searches to name a few of the databases they have access to.

Below are some tips you can use when talking to a creditor…

• Be honest, but paint the bleakest possible picture. Explain what is going on if you're behind. If there has been illnesses, accidents, layoffs, car repossessions, back taxes, and so forth, then tell them so.
  
  
• If you're considering bankruptcy, then tell them. However, any new debt after saying so may not be discharged in your bankruptcy case.
  
  
• NEVER disclose where you work or bank. You can simply reply with "no comment". If you're sued and a judgment is issued then they now know where you bank.
  
  
• Don't send a check FROM your bank, or anything that has personal information on it. Get a cashiers check or money order from another institution.
  
  
• Don't hire a lawyer unless you owe a lot because lawyers cost. Because of their experience, they may be helpful.
  
  
• If contacted by more than one collector for the same debt, then this means your account has been sold again. This usually means you can settle for far less than you owe because it was probably bought at 30 to 50 cents on the dollar.
  
  
• If you do settle, be sure that the collection agency promises documentation that states "satisfied in full" or "paid in full". You can then report that documentation to the credit bureaus.
  
  
• Depending on how much you settle for, you may have to pay taxes. Everything over $600 that is forgiven is reported to the IRS.

Below is a sample letter you can replicate and send to a collection agency if you wish that they stop contacting you.

ACME Collection Service 28 River Place Austin, Texas 89000 October 10, 2006 Attn: John Howard Re: Mary Oakwood      Acct No. 24-09-68 Dear Mr. Howard, For the past three months, I have received several phone calls and letters from you concerning an overdue Rich's Department Store account. This is my formal notice to you under 15 U.S.C. § 1692c to cease all further communications with me except for the reasons specifically set forth in the federal law. This letter is not meant in any way to be an acknowledgment that I owe this money. Sincerely,

Avoiding Identity Theft

HOW IDENTIFY THEFT IS COMMITED

• "Dumpster Diving" - going through personal or business trash looking for anything with a personal information.
  
  
• "Shoulder Surfing" - watching a victim punch in a PIN number at an ATM or enter a telephone credit-card number.
  
  
• "Y2K trick" - Tricking a victim over the phone to divulge personal identifying information or financial information.
  
  
• "Pretext" - Posing as someone who legitimately and legally needs information about a victim, such as a landlord or employer.
  
  
• Over the Internet by gaining access to databases containing dates of birth, social security numbers and mother's maiden names.
  
  
• Employees with access to accounts or credit card numbers who then sell or uses this information.
  
  
• Pick pocketing.

Identity theft often goes undetected. Within a month of being committed, half of the crimes still remain unnoticed. One in ten stays hidden for two or more years.

• Identity thieves change the address on an account so the victim doesn't receive the bills. They will often pay the minimum balances on accounts they have opened, so as to avoid calling attention to the account and having it cut off. They may even use the identities of children or deceased persons so that the crime is less likely noticed.

INTERESTING FACTS ABOUT IDENTITY THEFT

Average loss due to ID theft-$551 in losses when detected using online banking vs. average $4,543 when detected from paper bank statements. Due to the slow nature of monthly bank statements and the almost instant access of online banking, users see abnormalities, much sooner and act to correct them.

According to the National Association for Computing Safety, the most successful form of phishing is fake e-mails from banks.

If identity theft continues to grow at its current rate, by 2015, Americans will have their identity stolen nearly three times per year.

Identity theft is a growing problem in the United States, with complaints rising 73 percent from 2001 to 2002.

Identity theft is the most popular form of consumer fraud because it is the most profitable. Identity thieves stole nearly $100 million from financial institutions in 2001, an average of $6,767 per victim.

In 1992, TransUnion received around 35,000 calls about identity theft; in 2001 calls reached over one million.

The FBI estimates that 700,000 to 1.1 million Americans are victims of identity theft.

On average, victims spend 175 plus hours and $1,000 in out-of-pocket expenses to clear their names.

According to the National Center of Victims of Crime, around 19% of their survey respondents who reported identity theft had a personal relationship with the suspect. They were a family member, roommate, co-habitant, neighbor or a co-worker/employer/employee.

In 2002, the FBI broke what may be the largest identity theft case in U.S. history. A help-desk employee of a third-party credit agency was able to access confidential information about the company's corporate clients.

Authorities believe that this employee and three others used password and subscriber codes for auto dealerships, banks, health care facilities and public utilities to obtain credit histories of nearly 30,000 individuals, which they sold in turn for $60 per name. Total losses from this case are estimated at $2.7 million.

PROTECTING YOURSELF AGAINST IDENTITY THEFT

• Shred all pre-approved credit card offers, documents containing personal information, receipts, cancelled checks, bank statements, medical/insurance documents, and cards you no longer use.
  
  
• When you receive statements of any kind, check them in detail and look for unexplained charges or activity. Keep track of your statements and when they arrive. If they're late, it could be because they've been stolen.
  
  
• If possible, opt to have your statements and bills sent electronically and make payments via the internet. All credit card companies offer electronic payments, and most banks offer free internet banking and even provide a small monetary incentive for not having to send out a paper bill. Check with your utility companies as well.
  
  
• Carry only the necessary cards in your wallet, and bring only one credit card with you when you shop. Keep cards in different places so that if your wallet or purse is stolen, they haven't retrieved all of your information. Do not carry your social security card in your wallet.
  
  
• Do not print your Social Security number, drivers license number, phone number, or date of birth on your checks, and be wary of any email that requests confidential information. Just because it appears legitimate doesn't mean that it is. Contact the company via phone or mail if you are unsure, and even then be careful. Many schemes are very elaborate. Few businesses have a legitimate reason for asking your Social Security number.

HOW DO YOU KNOW IF YOU'RE A VICTIM?

Are you…

• Being denied credit, or being offered less favorable credit terms, like a high interest rate, for no apparent reason?
• Getting calls or letters from debt collectors or businesses about merchandise or services you didn't buy?
• Receiving Credit Cards you didn't apply for?
• Noticing suspicious activity on your statements or credit report?

WHO SHOULD I CONTACT?

If you suspect that you are a victim of identity theft, I suggest taking the following steps…

If your credit card has been used, contact the security department of that credit card company.

• Close involved accounts registered as "closed at customer request" rather than stolen or lost.
• Acquire new account numbers, and protect the accounts with passwords.
• Send a follow up letter giving the date, the name of the person who helped you, and what actions were taken to each credit company involved.

Contact the three main credit reporting agencies

• Have all three agencies flag your accounts with a "fraud alert." Ask how long the alert will remain on your report, and how to extend the time, if needed.
• Ask that all creditors contact you at a phone number you provide to verify all future applications.
• Add a "victim's statement" to the report. Include your name, the problem, and a telephone number where you may be reached.
• Have a copy of your credit report sent to you from each credit bureau. They will help you trace where and when any fraud occurred in your accounts.

Obtaining A Loan

HOW CAN I OBTAIN A PERSONAL LOAN?

1) Credit Card
The factors that determine loan acceptance are credit status, debt to income ratio, length of residency, number of dependents, and current business and employment status. This may vary depending on the type of loan.

Types
There are four types of credit cards

1. American Express (cards begin with the numeral 3)
2. Visa (cards begin with the numeral 4)
3. MasterCard (cards begin with the numeral 5)
4. Discover (cards begin with the numeral 6)

• Installment Loan: Generally, it is a method of repayment using a fixed interest rate over a fixed period of time, usually three to five years (e.g. auto loan). You cannot reuse the amount you paid off after the loan is issued. If you pay off everything, there is no extra money to be used.

• Line of Credit: It can be regarded as the opposite of installment loans. The variable rate, which depends on prime rate, is applied. The repayment period is not determined. It requires 2 to 2.5 % of the loan balance for the monthly payment, but you may pay off the balance at any time. You may also reuse the amount you have paid off within the credit limit.

HOW CAN I OBTAIN A LOWER INTEREST RATE FOR A CAR LOAN?

An auto loan is regarded as a secured loan. You may purchase a car or truck without too much trouble, even with a bad credit history or low income. However, they might require a higher down payment or apply a higher interest rate. Also, if your credit is considerably bad, they might require a co-signer.

Duration of loan
Usually it is from two to six years. For used cars, it is a maximum of three to five years. The reason for the shortened maximum period of time for used cars is that the lender cannot guarantee the history of the car and resell of that vehicle in the event of repossession becomes more difficult.

Amount of Loan
The amount granted for a car loan is dependant on your credit score, payment history, and current income. Bankruptcy will severely hinder your ability to obtain a car loan and/or lower interest rate for any large purchases. The amount you choose to accept should be made only after a budget has been created that accurately details your income and expenses. This way you have a true picture of your finances and what you can afford.

Interest rate
It depends on the prime rate and is determined by your credit score. Your credit score is divided into four to five types and the duration of the loan is divided into three to four types. The higher the credit score and the shorter the duration of the loan, the lower the interest rate will be. For instance, when purchasing a car, if your credit score is 690-729 and duration of the loan is 4-5 years, your interest rate will be about 7.25% - 7.5%

Things to consider
When purchasing a car, the dealer will have to get the loan approved and set the interest rate. This will count toward your number of inquires on your credit report

Tip
If you know your credit score, you may want to figure out the interest rate that can be applied for when purchasing a car. This is a way of minimizing the interest amount.

Terminology analysis

MSRP

Manufacturer's Suggested Retail Price is offered by car companies and it does not include tax or dealer's margin.

Repossession
If you do not pay the monthly payment for about 2 to 3 months after purchasing a car, they may take the car back. The record of repossession is kept on your credit report for seven years and even if you made a down payment, you have to pay the rest of the loan amount or current market price.

WHAT SHOULD I KNOW ABOUT HOME MORTGAGE?

Before purchasing a house, you must consider the pros and cons of renting verses owning a house. The good side of purchasing a house is that you have 15 to 30 years of payment terms, making it a type of Certified Deposit for old age. The federal and state income tax exemption can be applied and the amount of equity can be reused when you need money. The bad side is that if you move and repair costs of the home, renting may benefit you more. Also, the monthly payment is higher when buying than renting.

There are five important factors to consider when buying a home:

• income
• credit status
• employment
• debt rate
• closing costs

• Confirmation of down payment amount
• Past two years W-2 forms and current pay stub, or last two years of signed tax returns
• Past ten years of mortgage payment records or copies of rent fee checks
• Bank statements of checking account within three to six months?
• Personal property status (e.g. car, stocks, CD)
• Period of employment or business ownership
• Current debt status (loans, credit cards, etc)

HOW CAN I GET A HOME EQUITY LOAN?