The Credit Card Trap

Credit cards can work for you, or against you.

If you're sick of credit cards or have been treated badly by a credit card company, you're likely to want to close that account. While that may seem like the best answer, it's really not. Because closing a line of credit lowers your credit score, which in turn can make it more difficult to get a loan or new credit card.

You could pay the balance and just stop using the card. That way the open line of credit works in your favor without any debt piling on. However, some credit card companies are adding annual fees and inactivity fees, which can ruin that plan.

What it comes down to is knowing your credit to debt ratio. How much outstanding debt do you have in relation to the amount of available credit? The more debt you have, the lower your credit scores, the more risky you appear to other lenders. In the wake of the credit crisis, lenders are paying more attention to credit scores than ever.

Feel like you don't understand what's going on? Need someone to help explain your credit report? United Credit Source helps with all of that. We're walk you through the credit repair process, talk you through understanding your credit report, and help you figure out the best strategy for your credit profile, depending on your goals.

Money & Your Marriage

Money problems are one of the largest reasons couples split up or divorce.

When you or your spouse is in a rough spot over money, communication is the key. It's really hard to admit you've made a mistake or that big changes need to be made. But if you wait too long, matters can spiral out of control.

Turn off the TV, step away from the computer, put down your phone, and sit down and talk with your significant over. Put everything out there. Be completely open and honest. Only together can you truly work to solve a problem.

A hugely helpful tool to solving money isues is to make up a budget. Yes, the B word. It doesn't have to be huge and scary. You can use an online budgeting tool to help you or just grab a piece of paper and write down how much you earn in a month. Then write down every expense you have, including bills, groceries, clothing, insurance, credit & debt,etc. Once you see how much money is coming in versus how much money is going out...well, adjustments will need to be made. But you can do it, and you can do it together.

Get your financial situation under control before it gets too large and out of control...

and before it hurts your marriage irrevocably.

Loan Modifications

Starting June 1, 2010, home owners applying for mortgage modifications will have to provide paperwork upfront to prove they qualify. They will need the following documentation:

1. Two pay stubs

2. An electronic form that allows a servicer to pull up a tax return online

3. A request for modification that includes a hardship affidavit.

The goal of this new process is to decrease time delays and increase the success rate of turning trial modifications into permanent modifications. Around 66,000 homeowners have accepted offers to change from trials to permanent modification programs.

This new program applies to borrowers who live in their homes and whose housing debt expenses are more than 31% of their income. Simplfying the process should make things easier overall.

Under modifications, intrest rates are reduced, then terms of the loan are extended. Homeowners usually have to complete the trial of three months of making payments on time, and then they can enter the permanent phase.

United Credit Source can help you clean up your credit report and help you better qualify for programs like this.