Carol,
One of the most popular questions parents ask me is about the effect of certain events on their credit score. Recently, I came across this chart from a Fair Isaac blog about how certain real estate defaults affect your score. Interestingly, the higher your score to start, the more you get "hit." And, all things being equal, it takes much longer to recover if you, too. I never realized the high expectations of a "good" credit score. Does this mean you need to do whatever you can to avoid the options outlined below? People who meet with me often proudly say "they would never" default on a mortgage. Well, of course you do not intend to find yourself in the situation of foreclosure or even being late on a payment. But if you find yourself in trouble (and better yet --- in advance of trouble) take reasonable steps to evaluate your lifestyle and make adjustments where you can to make your payments on time. The hard truth, however, is that circumstances occur --- some by mistakes we make and some by events beyond our control. And that may mean your best intentions to pay on time fall short. If you are in a spot where you are digging a deeper hole for yourself each month while you're trying to pay the mortgage or hold onto a rental property, you may want to take a step back and review your total financial picture. Make sure you are not just paying to protect your credit score without consideration of all of the parts of your financial health. If you are struggling, seek the help you need either through a free consultation with me, by talking with an attorney, or meeting with another impartial source to review your situation. Sincerely, Kristin Kristin C. Harad, CFP® VitaVie Financial Planning (415)409-6402 kris@newparentfinances.com http://www.newparentfinances.com @VitaVie | If you no longer wish to receive our emails, click the link below: Unsubscribe 195 Moulton Street San Francisco, California 94123 United States (415) 409-6402 |
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