We all get that periodic letter saying that we have missed a payment on a bill and it will be sent to collections. Sometimes, we catch it in time to avoid damaging our credit report. Other times, we do not. This is when millions of consumers panic. Collection activity has changed over the last few years. It is good to know what you are up against.

$1.9 trillion – that is a lot of money. When politicians market this amount as stimulus to help all Americans, we have to realize it will help a few much more than most everyone else. President Joe Biden has said every taxpayer will receive $1,400 in this stimulus. There is a problem though. Take $1.9 trillion and divide by the number of United States taxpayers –144.3 million according to the Tax Foundation – and each taxpayer should receive $13,167. There is a huge difference between $1,400 and $13,167 – only $11,767! Where’s that extra $11,767 going? This is where most Americans lose.

The pandemic has really changed the way loans are repaid and how it impacts a person’s credit sanding. Several politicians have asked lenders to skip payments on a variety of loans including mortgages, auto and credit cards. We now have some political leaders asking lenders to not only skip loan payments, but also are asking the government to forgive the education loans for many students. So, what they are saying is a loan doesn’t have to be repaid according to the terms of the agreement, right? Where are we going with this?

With the US Government spending money during this pandemic like there truly is no tomorrow, can the government run out of money? One could say, "No", but there is that possibility. It depends on the credit rating of the US Government. In essence, the US Government does have a credit score. How could the credit rating of the US Government impact your personal finances? There are many ways it impacts all of us.

Several months ago, I addressed the biggest mistake most homebuyers make. This mistake costs many homebuyers thousands of dollars. You can click on that blog here: https://mycreditplan.org/Blog/the-most-costliest-home-buyer-mistake   There is another – the second biggest mistake - that most homebuyers make. It is nearly as costly as the first one. It is following incorrect advice from those (mainly loan officers) that really do not know the correct answers to your credit situation. It is sometimes innocent, but it also involves laziness and a "how dare you question me!" type attitude prevalent among lenders. It is your money and don’t you want to fight for a lower monthly mortgage or auto loan payment? In most cases, lenders will not do it. This hidden, but substantial problem, costs many homebuyers thousands of dollars.