Consumer Gets Credit Ding After Donating Motorhome

In July 2010, one of my clients put an ad on CraigsList offering to donate her motorhome to a charitable organization. She received a call from an organization that picks up vehicles, sells them, and sends the proceeds to a charity of the owner’s choice. While waiting for a representative to pick up the motorhome, the owner received a a Mr Bob Kaufman who said he was coming to get the motorhome. The owner said OK thinking he was with the group that works with charities. Turns out, Kaufman was acting on his own. Investigating the matter, we found an...

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Home Loan Modifications Impact Credit Scores

Today, the San Francisco Chronicle reports on the problem of homeowners who get a loan modification and who end up with a ding on their credit reports. The problem is that the banks holding the mortgages report the homeowners are late on their payments or that they are paying less than is owed. Either way, the consumers’ credit scores suffer. This in turn often causes banks to increase credit card interest rates and to reduce credit limits. That in turn may impact consumers’ ability to get credit. There should be a legislative fix for this problem.

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California May Bar Credit Checks on Job Seekers

Employers are increasingly running credit checks on prospective employees. This practice will be prohibited in California with some exceptions if a bill in the California Legislature is enacted. Assemblyman Tony Mendoza (D-Norwalk)’s bill, AB 482, would restrict credit checks except for jobs that involving handling money or certain personal information. As reported in the San Francisco Chronicle, Mendoza points out that credit checks discriminate against blacks, Latinos and lower income people who tend to have worse credit. Credit history often has nothing to do with job performance.

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Banks Starting to Modify Mortgages Under U. S. Treasury Refinance Program

Throwing a lifeline to homeowners under water on their mortgage obligations, the U.S. Treasury announced its Home Affordable Refinance Program in mid-February. The program is supposed to facilitate mortgage servicers in modifying troubled homeowners’ mortgages so that their monthly payment is reduced to no more than 31% of gross monthly income. Eligibility requirements include that the loan have been originated on or before January 1, 2009 and that the mortgage is a first lien on owner-occupied property. The unpaid principal balance can be up to $729,750. Income must be documented and the homeowner must sign an affidavit of financial hardship....

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Credit Monitoring Services Are a Waste of Money — Free Alternatives Are Available

Writing in the San Francisco Chronicle, Kathleen Pender demonstrates that the credit monitoring services offered by the credit bureaus and other companies at a cost of $60 to $200 a year are a waste of your money. The services won’t detect many types of identity theft and it is pretty easy to check your credit reports for identity theft for free. Credit monitoring services promise to notify you of “key” changes in your credit reports by email or cell phone text message. How soon you are notified varies; Equifax offers daily notification, but the notification could be 30 days after...

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