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Credit Repair – Help Me Find the Best Methods

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Last year, without consulting the BAD community, I moved forward with a paid credit repair place to the tune of $400….over a year later and nothing has changed. In fact, it has mostly gotten worse.

$400 down the drain!

Now, I am wiser, I hope, and way more cautious. But I desperately need to make progress on my credit score. With that being said, I have been doing quite a bit of research.  That’s where the Self Lender loan idea came from.  I am looking at 609 letters, goodwill letters, paying things off and so on. But I want to make wise decisions and use my time and efforts wisely.

Credit Warriors

One place I have found particularly helpful, and no, I have not spent a dime, is Credit Warriors. I especially like their Facebook group. It’s good to hear about other’s successes in traveling the path I am just now started. My number one goal is get to my credit score up significantly. And in learning more about it, I want to teach my kids more about it.

So BAD Community, here I am asking for your best tried and true guidance for credit repair: links, first hand stories and so on. I am game to hear it all.

 


Three Recent Purchases

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I’ve been talking about all this money we’d spent in summer but haven’t given specifics. There’s a lot to talk about in the context of that whole conversation, but today I wanted to pop in quickly with 3 recent purchases (made in the last 3-4 months).

1. Hot Water Heater

When we bought our house in November, we new we would need to purchase a new hot water heater soon. It was original to the house (almost 30 years old) and had a huge dent in the side. Most of our home had been updated semi-recently before we bought it, but the hot water heater was still original. It never really worked great, but over the summer it totally puttered out, requiring a replacement. Not a huge expense, but an easy $350 on the old Home Depot credit card. (Cha-ching!)

2. A New Tire (again)

Can we all agree that I have the worst luck in the world with tires? I replaced two tires in April, then we had a blow-out in June which required 2 more tires to be purchased. If I’d purchased all at one time I could’ve saved a lot of money, but I hadn’t realized I was in a situation where I’d be buying 2 more tires only two months after the first 2 tires. And the blow-out occurred while driving on a cross-country trip, so it was a pretty huge ordeal at the time. WELL, fast forward to early September. I was driving on my way to work and had another blow-out. All I can guess is it was due to construction debris along the highway. There was no real “cause” (didn’t hit or run over anything obvious) and the tires were brand new. Guess which tire blew out? One of the two that were replaced in that out-of-state tiny-town repair shop. No warranty. So add another tire to the credit card (cha-ching!)

3. Halloween Masks

I really have no business being in any retail stores right now, but the girls had a friends birthday party at a Michael’s Craft store (did you know they hosted parties? the kids really had a blast!). Anyway, while walking around I noticed that all the Halloween stuff was 60% off!!! I love Michaels because they’re one of the only places that will do big sales before a holiday (not just after it’s passed). These little face masks were originally $1.00, but I scooped them up for 40 cents each. I bought 8 in total and have invited some of the kids’ friends (and their moms) over for a playdate this weekend. The friends’ parents are going to bring craft stuff to decorate with (e.g., sequins, feathers, pom-poms, etc.). I’m going to provide the masks and paint (which we already own) and will have some snacks we can share from our pantry/Costco snack stash. Cheap little playdate. Also the only one of the 3 items on this list that I was pumped to buy! Forty cent face masks?! Can’t argue with that! Woo!

 

What’s one of your recent purchases?


Hope’s Debt – October, 2017

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Creditor
Balance

(as of 10/14/17)
Interest
Min. Payment
Car$10,0007.00%$308
Credit Card$5,00017.00%$36
Summer Camp (2018)$3,3750.00%$500
Student Loans$34,3492.88%$307
Computer Equipment$2,73822.90%$84
Taxes (State)$6,0000.00%$100
Self Lender$1,01310.57%$97
Collections 1 (Medical)$618
Collections 2 (Apartment)$499
Collections 3 (Ex-husband)$6,9546.25%$246
Amazon$52726.99%$25
Total$71,073$1,703

Credit

Car – I recently wrote a post on this new debt. You can read it here. My goal is to pay this car off in just at two years, by paying $500 per month.  My first payment of $400 will be paid this week.

Credit Card – For the last several months, I have been paying this card off every month and then charging everything I could to it…monthly bills, groceries, gas and so on. In doing that, I have paid less than $10 in finance charges. The problem is that I can’t get it to a $0 balance. And this bothers me. I am literally paying it and then using it. I don’t think this is wise and I want to get it to a $0 balance. The nice thing is that I do earn points with every dollar spent that I can convert to cash.

Amazon – this is a line of credit with Amazon that I typically pay off every month. I use it frequently for household items, etc. But now I am at the point that I would like pay it down to $0 and keep it there rather than rolling it every month.

Computer Equipment – I know this was a dumb decision, but it’s one I cannot regret. All three of the kids have new laptops. With me being gone some much, a lot of their schooling is online. It makes it easier for me to track their time, help them remotely and they have Skype classes specifically with a Spanish tutor. And, of course, the majority of Sea Cadet’s 11 college hours are online. This is my personal number one priority to pay off.

Chosen Debt

Summer Camp – I mentioned this in my recent budget update, technically I could stop paying this at any time or wait until next summer and pay it in one lump sum.  But paying every month, with a pay off in April makes me more comfortable and assures that my kids have a plan for next summer without me scrambling. The total amount covers 6 weeks of camp next summer.

Self Lender – this is also a “chosen” debt. It’s actually a CD that I will gain access to next September when paid in full. They report to the credit agencies which was my motivation for opening the account. I need massive repairs to my credit and this is essentially forcing me to save (thinking Christmas next year.)  Have you heard of it? Thoughts?

Collections

Collections 1 – I will argue to the day I die that I do not owe this debt. This is medical debt from the twins which the state is supposed to pay in full via the provided medical insurance. A couple of years back, the state inadvertently cancelled the twins insurance, and while they turned it back on the next business day, this fill fell through the loop.  I have called medicaid, the state, the twins caseworker, and so no to no avail.  In order to get it off my credit I may have to pay it, but I definition do not owe it!

Collections 2 – Evidently our apartment charged me for damages to the apartment we moved out of a year ago this past April. I NEVER received any notice of that, it just showed up on my credit report. Two things regarding this…they kept my entire deposit. No problem, we had animals, I respect that. But two, our apartment was as spotless as an apartment can be after people live in it for almost two years. The carpet was clean, the apartment was clean, we hadn’t hung stuff on the walls so there was no wall damage.  But as it has been so long and I have no “proof” I am probably going to have to pay this one too.

Collections 3 – Another unknown debt that appeared on my credit report, again from my marriage. It has to do with a line of credit on our old house, which he bought me out of 8 or so years ago. I am working on fighting this one too, but for now, I have made payment arrangements with them and they have removed it as a derogatory statement on my credit report.

Taxes – This is a placeholder debt. With all our moving around, mail is just starting to catch up with me. This state tax debt is from the year my ex and I divorced. While I have filed every year, he may not have. I have arranged a payment plan of $100 per month while I track down tax filings, etc. to defend my “lack of liability” for this debt. We will see how it goes.

With all this on out on the table now, what do you recommend as my plan of action? What should my priority be?


Hope’s Weekly Budget – Week of 10/15

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This has been a very hard week. I mentioned previously how my kids have been struggling. One in particular has been seeing a counselor for some time now. Between the big move, the sudden change in our lifestyle, some of my parenting choices and teenage years, in general, led to a battle with depression and a very tumultuous home life.

To be honest, I wish I had the time and resources to see a counselor myself. Life has just been slamming us!  I don’t feel like I have time to take a breathe between emergencies. Please keep my family in your thoughts and prayers as we work toward a new normal, and I work really hard toward being a better mom, creating a more regular schedule and being more patient.

Celebrate Adoption

That being said, we have a lot to celebrate this month. Six years ago this month, the twins were placed with as as foster kids and three years ago today, their adoption was finalized.

Job Loss

In addition, it was two years ago this coming Monday that I lost my job. Our lives changed forever then. It has been hard, but we have so much to be grateful for. We have had so many new experiences that we would never have experienced without that push. We got to experience Tiny Living, Glamping and then a big move to a new tiny town. October is a big month for us.

Next Week’s Budget

I am more and more committed to becoming debt free, creating some security for my little family and getting healthy mentally. I must keep moving forward for my kids if for nothing else.  Without further ado, this is our budget for this next week:

Gas 16-Oct-17 -35
1099 17-Oct-17 150
Groceries 17-Oct-17 -25
W2 19-Oct-17 1786
Debt Pymt 19-Oct-17 -83
Gas 20-Oct-17 -35
Allowance 20-Oct-17 -100
Utility 20-Oct-17 -154
Cell Phone 20-Oct-17 -286
Car Payment 20-Oct-17 -400

We have been much more successful in our No Spend Month this week. We didn’t even spend our grocery budget last week. I am really excited that I have found a way to cut my cell phone bill a bit beginning next month. I am also excited that I am starting to pay for my new car, and am already anticipating paying it off by 2019. Debt update getting published this weekend…finally!


Facing The Harsh Reality (Re-Do!)

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Edited: HUGE thanks to those of you who reached out after my last post completely disappeared! It seems silly because its such a trivial thing compared to real-world issues, but I was SO BUMMED when I thought the post was gone! I really appreciate those of you who took screen shots, typed up word docs, and provided links so I could re-access this content! I’m sorry I can’t re-publish the previous comments, but at least the content was saved! THANK YOU! <3

This was a tough one for me to write and to post. I’m about to let you take a peep into our current financial situation. It’s not pretty. I appreciate constructive feedback, but go easy on me!

I’ve already talked about a dozen times about how our finances got out-of-control over the summer months. Everything was fine through April-ish. But then a perfect storm hit that we did not weather very well. First, my final paycheck from my part-time job was in April (even though I worked into May, my contract was written with 4 lump sum payments and the final one was paid out in April). Just like that, we were down $3,000/month (that’s how much my part-time job paid. Note – I had to leave my part-time job because I got a big raise at my full-time job and had to sign a non-compete).

Hubs’ income from his company had been dwindling for months as he was back in school full-time and only had one crew working for him. He continued to pay for all his business (and personal) expenses, but when his licenses and insurances all came up for renewal the best option for us was to call it quits. By mid-June, he was out of money and all his expenses (that he’d previously budgeted and paid for separately out of his business income) needed to be included in the regular household budget. We lost his income and added a few line-items to the “expenses” portion of our budget (specifics in a future blog post).

Our income had plummeted overnight.

We’d grown accustomed to an income of over $10,000/month! And then, just like that, we were down to an income of only about $3,000/month (my take-home pay from my full-time job). We basically kept on spending like it was business as usual. My raise would go into effect mid-August. I thought that if we could just hold out until September (my first full month at my new rate of pay), that we’d be golden! I was expecting to have a huge bump in my take-home pay. I was hired at $55k and when my raise went into effect I’d be at a $95k salary (in 2 years’ time!). I thought my take-home would be over $5,000/month – somewhere in the $5-6k range (note: I have a lot of automatic payroll deductions – see more here).

What I did NOT expect was that my first paycheck with my raise (for 2 weeks of work) would only be $2269. We’re talking under $4500/month. Nearly a thousand per month under what I’d been anticipating, and less than half of what we’d grown accustomed to bringing home.

I spent a lot of time in August (after that first paycheck) looking at our budget trying to make sense of it and see how I could make it work. From an objective perspective, I know $4500/month is a lot of money. Many families get by with half that amount! When I first started blogging, our household income was only $4,000/month so we’d done it before! And that was when our babies were in diapers still! Surely we could do it again!

But the numbers just didn’t work. Our lifestyle had become inflated. Our budget was bloated. We’d picked up a lot of monthly payments that didn’t used to exist (more on that in a future post). And no matter how I tried to look at it, our expenses exceeded our income.

 

And so, we continued to live on credit cards.

The blog was just purchased by its new owner at that time. I didn’t know if I’d even be blogging anymore. So, I gave up. Without the public accountability and with our financial situation seeming so bleak, I didn’t think it could be done. I didn’t see a way to win.

Fast forward to today. Last month (September) was the first month that we were able to balance our budget since April. For four months (May – August), we were in the negative every month and supplementing our lack of income by relying on credit.

We’re still not in a good place.

Although we didn’t go into the red last month, it was just barely by the skin of our teeth! I had to implement that surprise No Spend Week the last week of the month. And, oh yeah, September was a 3-paycheck month!!! How will we do it with a normal (2-paycheck) month? How can we get by on our current income?

I did change my payroll deductions so I have a slightly higher take-home pay. Instead of $2269, my paychecks are now $2440. Among other things, we also have a huge tax debt we owe. I could adjust my withholdings to get a little more back per check but am purposely not doing so until the tax debt has been paid in full. It’s going to be awhile.

Bottom line, we need to get a budget in which we are somehow living on $4880/month. At this point, our expenses exceed that amount. Heck, our debt obligations alone are over a third of that! It’s kind of scary stuff still.

We’re committed to cutting back in many places. Hubs finishes his personal training course this month and will hopefully be able to land a part-time job. And we’ll supplement in the mean-time by selling everything we can to try to earn some side-cash and STOP increasing our debt by living on credit. Gulp!

More concrete budget details to come.


Lost Post

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Hi all,

Just popping in quickly. I published a post yesterday (10/10/17) titled, “Facing The Harsh Reality” that, sadly, has disappeared into the interwebs.

The issue was caused by a migration of servers and unfortunately my post was caught in the cross-fire. The big bummer is that there’s no way to recover the post and I don’t have it backed up anywhere. It took me a long time to write (and was pretty tough to publish to begin with), so I don’t know that I’ll be able to recreate it.

If, randomly, anyone has any copy of it (e.g., if you were subscribed and received an emailed version or for some reason took a screen shot or have any other electronic copy of it), please post a comment here so I can reach out to you! I’d love to re-publish it if I’m able but due to the server migration it’s been totally lost and I lack the time (and am feeling a little too defeated about it) to try to recreate it right now. Major frowny face!!!

~Ashley


Hope’s Weekly Budget – Week of October 8

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We are almost at the end of our first week of our No Spend month. It has been really hard. It’s amazing how much you suddenly crave a candy bar and soda when you have committed to not spending any extra money! I have been very pleasantly surprised at how well the kids have taken to the challenge, especially Gymnast.  Three nights a week we are an hour away from home until 9pm or later, I have gotten in the habit of getting him something to eat on the way home. He didn’t even blink when I reminded him about No Spend Month, and contentedly waited until we got home to eat. (I am keeping power bars in the car for him as there are times he really can’t wait to eat.)

We did eat out once, but in my defense, we did not spend any “money”…I had a gift card to Chic Fil A with $23 left on it. We used $18 to eat dinner one night while we were in South Carolina waiting on Sea Cadet to finish his Police Explorer meeting.  It was a long day and I just couldn’t wait until 10pm when we got home to eat.

Next Week’s Budget

 

1099 10-Oct-17 150
Groceries 10-Oct-17 -25
Internet 10-Oct-17 -65
Auto-Gas 12-Oct-17 -35
1099 13-Oct-17 850
Savings 13-Oct-17 -85
Allowance 13-Oct-17 -100
Debt Pymt 13-Oct-17 -200
Clothing 13-Oct-17 -250
Debt Pymt 13-Oct-17 -250

Clothes Shopping

We go clothes shopping this weekend. Gymnast is going to wait until next week since he has a full schedule (the $250 in this upcoming week’s budget is part of last week’s $900 I had set aside, not in addition to.) They were all thrilled with their $250 budget, and I was thrilled that it left me with $150 to buy a few things for myself!