Your Credit Questions — ANSWERED! - The Perlowitz Show

We made a video about a year ago, which was a smashing success, and now we decided to do a little questions and answers. People are very intrigued with on the topic of credit card debt, and I posted on my status earlier this week that anybody can ask any question, and we're going to ask the team. We got a lot of questions. We're going to pick the most relevant questions and ask it to the Wise Consulting team and hear the answers. This is a very very interesting topic. Like this. Somebody sent in, can settling a credit card debt for less than the full balance hurt my credit score? Debt collections. >> Very good question. But I'll try to explain it to the best possible way. Someone has debt, whether it's 10,000 or 20,000. Number one, in order to settle with a bank, a bank should want to entertain a settlement offer. You have to already be negative, meaning it has to be past due. And therefore, they have a reason to want to settle with you. You're [clears throat] up to date with your payments. >> So what you're saying is the payment slacking mid? >> I'm not recommending him what to do, but if he's in a situation that it's already past due, >> Got it. >> then settling it is not going to make it worse. It's starting the path forward back to normal. But I always always explain this to people. There's something called credit and there's something called debt. Credit is the part where [snorts] I want to apply for a car, a house, a mortgage. I need good credit. Debt is I have a balance with American Express. I owe them $10,000. That's Now, I have two problems. Number one, I have a credit problem. They're reporting it past due. Now it's 30 days, 60 days, 90 days, and eventually charged off in collection. >> Mhm. >> Then I have another problem that's called the debt. American Express wants you to pay back their balance. And if you're not going to pay it back, you're going to ignore it, it's going to go to collections. They're going to bring their legal team in, and it's going to go to court, and they may obtain a judgment. So >> That's what that's that's on the ticket on a >> It's two separate issues. [laughter] It could be Sunday, it could be Monday, and you can be surprised. You wake up one day, there's a freeze on your account, and there's a judgment. >> I'm sure you get those phone calls. >> We We get it a lot, unfortunately. One problem doesn't automatically fix the second problem, which means if you go and pay back American Express the $10,000 you owe, even if if it was past due 3 months we're talking, doesn't mean that after you pay it down, your credit is now back to normal. Meaning it's still going to be reported as a collection, just a paid collection. That's not going to fix your credit problem. Although they're not going to take you to court, you paid back the balances. And vice versa the same and you can have good credit, but that doesn't mean American Express is not going to take you to court now for the balance that you owe. >> Mhm. >> So that's to explain the difference between credit and debt. And to answer this question, settling the debt isn't going to hurt your credit more. It's your path forward back to good credit, but that in itself is not going to fix your credit fully. >> Another question somebody asked over here, how much how much does credit card utilizations affect my score? And what percentage should I aim for personal credit? >> Okay, interesting question. So first of all, it's very simple answer, but for those who don't know what utilization means, utilization is the overall available credit on your credit report, which means let's say you have one credit card from American Express with a $10,000 limit, one credit card from Chase Bank with a $15,000 limit, your over overall credit limit available credit is $25,000. Now, if your statement on one of those cards close with let's say a $2,500 balance, that means you're currently using 10% of your overall utilization, okay? It doesn't have to be 2,500 on one card, it can be 1,250 on one card and 1,250 on the other card. It will calculate based on your whole available credit. Um generally speaking, you should try to be under 30% the less you are, the better. If you're utilizing less than 10%, it'll bring your score even better. Now, not to say that if this affects your credit long term, meaning it depends on 100% maxed out hand and it will not affect you in a month from now. It's not going to long term impact your credit. You can be maxed out now, pay it down in a month from now and your credit will be back to normal. >> Wow, very interesting. Kevin on to the next. Can someone can I combine all my credit card payments into one monthly payment that is $1,000 towards one loan and eventually pay off all my cards like that? >> Yes. Actually, what we can do is it's a service that we do. What we do is basically let say a person has $20,000 debt, right? On $20,000 on average interest rate, let's say he pays $5,000 a year. So his minimum payments, most of his minimum payment goes towards interest, money in the garbage. Basically, what we can do is we take that $20,000, we enroll it into usually a five-year payment program, and he has a set minimum payment, and he basically pays it off. He can always pay it off sooner. And let's say a person has multiple credit cards and he wants to combine it, we can also do that and do it under one big payment, and he pays it off with a lower APR. What we focus most is getting the lowest interest rate and the lowest monthly payment. But we can also do all credit cards under one big payment. >> lot of people do that uh people ask yeah? Here's another way you probably get a lot of this. Are you able to settle SBA loans? >> The answer is yes. However, we do have to individually look at each business, how it's currently doing, and based on that we evaluate if it's worth, if we can make a settlement. Also depends on the business's financials, how you are capable to settle, whether or not you are capable to settle. But there are options out there. It's something you can reach out to us about, and we can certainly look into helping you. Happens to be we also had a lot of people reach out recently that the SBA during COVID loans and the SBA started reporting. Some of them are by Treasury and they're reporting on the people's credits, and we got a lot of requests to help people with that. This is something we can also assist with. You can always feel free to reach out to us as you'll get the information towards the end of this video. >> Nice, nice, nice. All right. We have a lot of questions, but I think we're going to wrap it up for today. We got a lot of important questions covered. How do people contact you? I mean, I'm sure many people are going to watch this video and they're going to contact you after hearing your advice. >> I hope so. >> What is the contact information? >> Uh we can be reached at 718-603-8995. You can WhatsApp us, you can call us. We'll be there to answer. Sometimes you are a repeat customer. If you're not a customer, you can call with your questions. And you should never have any trouble with debt. >> I mean, after I did the last video with you, I remember hearing from friends of mine, from clients of mine, that the the rating is like 100 by you guys. Like the rating that you really, you know, it's not always that everybody can help their clients. But we have that high rating that is taken care of. So we all hope nobody gets into debt, but if somebody does get into debt and somebody isn't debt, you know the number. Wise Consulting that they're for you 24 hours a day, 6 days a week. I'm sure you guys get WhatsApps in the middle of the night as well, no? Somebody sees in the middle of the night account is frozen, it's going He's not waiting till the morning. He's WhatsApping you in the middle of the night. So message them and they're going to take care of you. Thank you so much. >> [music]