Podcast
Questions and Answers
What is the FICO score often referred to?
What is the FICO score often referred to?
- An 'I love debt' score (correct)
- A savings score
- A spending score
- A budgeting score
If you were to inherit $10 million tomorrow, it would have __________ effect on your credit score.
If you were to inherit $10 million tomorrow, it would have __________ effect on your credit score.
no
What are the five components of the FICO score?
What are the five components of the FICO score?
debt history, debt levels, duration of the debt, type of debt, new debt
What does the FICO score measure?
What does the FICO score measure?
What is a credit bureau?
What is a credit bureau?
Beware of _________________________; the only information that may be legally removed from a credit report is inaccurate information.
Beware of _________________________; the only information that may be legally removed from a credit report is inaccurate information.
Individual account information is removed from your credit report ________ years after the last activity on the account, except bankruptcy, which stays on for ____________ years.
Individual account information is removed from your credit report ________ years after the last activity on the account, except bankruptcy, which stays on for ____________ years.
What are the three main credit bureaus?
What are the three main credit bureaus?
What is the Fair Debt Collection Practices Act (FDCPA)?
What is the Fair Debt Collection Practices Act (FDCPA)?
If a creditor hires a collection agency to get you to repay a debt, its debt collector is not allowed to: use ______ with you.
If a creditor hires a collection agency to get you to repay a debt, its debt collector is not allowed to: use ______ with you.
____________ is the fastest growing white-collar crime in North America today.
____________ is the fastest growing white-collar crime in North America today.
What you should do if you think you are a victim of identity theft: -_______ a copy of your credit report and look for any suspicious activity.
What you should do if you think you are a victim of identity theft: -_______ a copy of your credit report and look for any suspicious activity.
What you should do if you think you are a victim of identity theft: -Place a _______________ alert on your credit bureau report (stays on for 90 days without police report).
What you should do if you think you are a victim of identity theft: -Place a _______________ alert on your credit bureau report (stays on for 90 days without police report).
What you should do if you think you are a victim of identity theft: -If your purse or wallet is stolen, _________ all cards immediately and get replacements.
What you should do if you think you are a victim of identity theft: -If your purse or wallet is stolen, _________ all cards immediately and get replacements.
What you should do if you think you are a victim of identity theft: -File a ___________ and keep a copy of the report for your personal records.
What you should do if you think you are a victim of identity theft: -File a ___________ and keep a copy of the report for your personal records.
What you should do if you think you are a victim of identity theft: -________ any suspicious charges and accounts to the appropriate credit issuers and credit bureaus immediately.
What you should do if you think you are a victim of identity theft: -________ any suspicious charges and accounts to the appropriate credit issuers and credit bureaus immediately.
What you should do if you think you are a victim of identity theft: -Remember, this is _________. You owe nothing and should pay nothing.
What you should do if you think you are a victim of identity theft: -Remember, this is _________. You owe nothing and should pay nothing.
What you should do if you think you are a victim of identity theft: -Contact the fraud-victim division of the three main credit reporting companies and furnish _________________.
What you should do if you think you are a victim of identity theft: -Contact the fraud-victim division of the three main credit reporting companies and furnish _________________.
What you should do if you think you are a victim of identity theft: -Be persistent. This will take some time. You now have a new _______.
What you should do if you think you are a victim of identity theft: -Be persistent. This will take some time. You now have a new _______.
What was the Fair Credit Reporting Act (FCRA) intended to address?
What was the Fair Credit Reporting Act (FCRA) intended to address?
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Study Notes
Credit Score and FICO
- The FICO score is often referred to as an "I love debt" score, reflecting an individual's borrowing habits and payment history.
- A common myth is that one needs to take on debt, such as credit cards or car loans, to build a credit score.
Credit Score Impact
- Inheriting a large sum of money (e.g., $10 million) has no effect on a person's credit score.
Components of FICO Score
- The FICO score comprises five key components:
- Debt history
- Debt levels
- Duration of debt
- Type of debt
- New debt
Understanding Credit Bureaus
- A credit bureau collects and sells individual credit information to creditors, aiding in their loan approval decisions.
- Key clients of credit bureaus include banks, mortgage lenders, credit card companies, and financing agencies.
Credit Report Management
- Beware of credit clean-up scams; only inaccurate information can legally be removed from credit reports.
- Individual account information remains on credit reports for 7 years after the last activity, while bankruptcies last for 10 years.
Major Credit Bureaus
- The three main credit bureaus are Experian, TransUnion, and Equifax.
Consumer Protection
- The Fair Debt Collection Practices Act (FDCPA) provides protection against harassment by creditors.
- Debt collectors cannot use abusive language, call during unreasonable hours (before 8 a.m. or after 9 p.m.), or threaten to notify employers or friends about unpaid bills.
Identity Theft Awareness
- Identity theft is currently the fastest growing white-collar crime in North America.
Steps if Victim of Identity Theft
- Obtain a copy of your credit report to check for suspicious activity.
- Place a fraud-victim alert on your credit report (valid for 90 days without a police report).
- Immediately cancel all cards if your wallet is stolen and request replacements.
- File a police report and keep a copy for your records.
- Report and cancel any suspicious charges and accounts to credit issuers and bureaus both via phone and in writing.
- Remember that identity theft constitutes theft; victims owe nothing.
- Collect and provide documentation to the fraud-victim division of the main credit reporting companies.
- Accept that dealing with identity theft may become a new hobby; persistence is essential.
Consumer Rights and Legislation
- The Fair Credit Reporting Act (FCRA), enacted in 1970, addresses accuracy, privacy, and fairness in consumer credit reports.
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