Money Matters: Blacks Making Financial Progress

Are you feeling economically free?

The African American community is continuing to make financial progress and feel more economically secure than the general population. While the group is advancing, African Americans still continue to face challenges like debt, financial priorities and the support of family. 

Photo Credit: Thinkstock

Redemption: I Survived A Home Foreclosure

A personal recovery story from the subprime mortgage crisis

Jamaica native Melonie Griffith had pretty much all she really wanted: marriage, children, and a dream home in Boston.

Despite having declared bankruptcy in her early 30s, the paraprofessional in Boston Public Schools and her husband were able to purchase a $470,000 Dorchester duplex in 2004 at the height of the real estate bubble.

But she separated from her husband a year later, and it wasn't long until she fell behind on the $4,000 monthly mortgage payments.

When the housing bubble burst in 2007, the value of Griffith's two-family property plummeted to $260,000, nearly half of the amount of her mortgage. Although U.S. Bank and Countrywide were her original lenders, Griffith says it was the New Hampshire-based subprime firm Ocwen, which took over her mortgage, that she ended up fighting.

[Here's How To Go From Foreclosure To Home Ownership]

Within four years, the bank foreclosed, and a sheriff was at the door ready to forcibly evict her and her three children.

“They weren’t really working with me,” Griffith said. “One of the things they were unwilling to do was reduce the principal.”

City Life/Vida Urbana, a Boston-based organization, staged a blockade for Griffith in January 2008. Dozens of community members formed a human chain blocking the officers from her front porch. That kept the eviction from happening and brought the bank to the negotiating table. But initial talks fell apart.

Two months later, the bank issued another 48-hour eviction. City Life staged a second blockade, which again kept Griffith and her three children off the street.

In the end, she couldn't come to an affordable long-term agreement with the bank and she had to leave the home -- but at least not with a police escort.

She moved into an apartment down the street. After a year, Boston Community Capital helped her move into an affordable condo. She’s been there ever since.

“One of the names people use for us is ‘Project No One Leaves,’” said Steven Meacham, organizing coordinator for City Life. “We urge people not to move when the bank tells them to move. You can win all kinds of [agreements] you’d think were not possible. And that understanding is spreading.”

Twinkies to Hit the Shelves This Summer

As plant operations resume, union workers will not.

Twinkie hoarders need worry no more, all of the classic Hostess snack brands will return to national store shelves this summer. 

“We expect to be making and selling in July,” said Michael Cramer, executive vice president of Hostess Brands LLC, in an interview with NBC News. “Probably the later half of the month before the product hits the stores.” Some of the treats will be available until August and September. 

Last November, all 36 Hostess Brands Inc., plants shut down manufacturing after an extended stand-off with the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union and has almost completely shut down its operations, selling its assets. The bulk of Hostess brands were purchased in April for $410 million by Apollo Global Management and Metropoulos & Co. 

It is the new company, Hostess Brands, LLC, that will resume operations in plants in Georgia, Indianapolis, Los Angeles and Dallas. The company will also resume hiring, but the jobs will not be in conjunction with the unions, Cramer said. 

"We're sure not going to invite the unions in. We don't have to do it," he said. "Though of course nothing prevents the workers from unionizing down the line."

[SUBSCRIBE TO LOOP 21 RSS FEED]

Photo Credit: ABC News 

How to Avoid the Biggest Credit Mistake

Closing a credit card account may affect your credit score.

We all know that failing to pay your bills on time will get you on the fast track to a bad credit score, but not all credit mistakes are obvious. Among the biggest? Closing a credit card account. 

[SUBSCRIBE TO LOOP 21 RSS FEED]

Redemption: I Had A Huge Student Loan Burden & Paid It Off

Sheer will clears bills, keeps 25-year-old debt free

Brian McBride paid the price for fulfilling his debt obligation -- in more than just the personal sacrifices it took to write the final check.

He skipped meals. He washed the mold off pruned vegetables and cooked meat past its expiration date. He turned off the air conditioning in his Atlanta apartment.

He paid off $26,500 in car and college loan debt less than two years after graduating.

[The Top 5 Highest Paying College Majors]

Then when he wrote about his achievement for CNN Money, he paid another price -- public derision.

In only a few hours after his story was published, responses accused him -- a single, black, college-educated male -- of being too atypical to be relatable; that he oversimplified the scope of his debt; and that repayment was more difficult than he explained.

The skeptical reactions highlighted an issue among nearly 37 million student loan borrowers. There are few examples or easily accessible road maps to how to become debt free quickly. The national average of student loan debt is $24,301. In 2011, student loan debt was $1 trillion nationally.

 
See Nerd Wallet's video on credit, debit and prepaid cards:

“I’ve got $100k in student debt,” wrote one commenter, identified as Adam. “I’m working for $9/hour now and pulling 12 hour days just to keep my head above water.”

Money Matters: Options for Taxpayers in Debt

For taxpayers in debt, the best bet is to contact the IRS.

For most entrepreneurs, fulfilling the dream of being a business owner doesn't include the headache of tax collection issues. 

According to the Internal Revenue Service, one in six taxpayers owe Uncle Sam money. In fear that the IRS will act aggressively to collect, taxpayers often go unresponsive to letters and don’t reach out to the agency, instead prowling for advice and quick fixes from third parties. In the case of tax debt, however, any information or tips offered that seem too-good-to-be-true usually is. The IRS offers the following tips for tardy filers that could save time, stress and money in the long run:  

To those that owe, avoid finding yourself deeper in debt by communicating with the IRS directly. Blindly trusting in a debt-settlement company is likely to keep you stuck in a tax bill. 

If you owe $50,000 or less in combined tax, penalties and interest, set up an online tax payment agreement for up to 72 months. Visit irs.gov and search for the “Online Payment Agreement Application” form. It only takes a few minutes and you can also request a payment agreement by filing IRS Form 9465. 

If you are facing financial hardship, ask the IRS for an “offer in compromise,” or OIC for the agency to accept less than full tax payment under specific circumstances. Use the agency’s OIC pre-qualifier tool on its website to determine your eligibility. 

If your income is low, find help through the agency’s Low Income Taxpayer Clinic program ran by the Taxpayer Advocate Service for low-cost assistance. 

Online, the agency offers a series of videos about the collection process with tips on hiring someone to represent you before the IRS. 

Do some research and learn about the agency’s collection process before consulting a tax professional for help. Ultimately, if you’re in tax debt, the best way to get out is by communicating with the IRS. 

Photo Credit: Google Images 

Financial Incentives Can Help Achieve Weight Loss

Do you need to get paid to get healthy?

You've heard the saying "money makes the world go 'round." Well, it also makes your weight go down. A recent study found that weight loss participants who received financial incentives were more likely to follow the assigned weight loss program strictly and, in turn, drop pounds than those who didn't receive any reward. The incentive group would receive $20 per month if they achieved the goal of losing four pounds a month. And those who failed to do so would instead need to pay $20 each month towards a bonus pool. Researchers noticed that 62 percent of the participants in the incentive group achieved the goal, while just 26 percent from the non-incentive group hit the target. "The financial incentives can improve results, and improve compliance and adherence," said Steven Driver, M.D., an internal medicine resident at Mayo Clinic. (Science World Report)

[SUBSCRIBE TO LOOP 21 RSS FEED]

New Credit Card Settlement Brings New Fees For Customers

American Express customers and some states are exempt from the new fees.

Starting Sunday, many merchants will be free to impose a surcharge on customers paying with a credit card. The new surcharge comes as a result of a $7.2 billion settlement reached last summer between credit card companies and merchants. Gerri Detweiler, director of consumer education at Credit.com, doesn’t expect there to be too many merchants that will exercise this right at first but the number could grow.

The amount legally permissible will be between 1.5 percent and 4 percent of a purchase price. American Express customers don’t need to worry: AmEx’s contract with retailers forbid imposing a surcharge. Also, ten states prohibit credit card surcharges: California, Colorado, Connecticut, Florida, Kansas, Maine, Massachusetts, New York, Oklahoma and Texas. (ABC News)

[SUBSCRIBE TO LOOP 21 RSS FEED]

Dating: Should We Ask Our Sexual Partners Their Credit Scores?

Which are you more concerned about -- stats on romance or finance?

It's a new year, and people don't have anytime to play around on the dating scene. For good reason; it's pretty ratchet out there.

Now more than ever, the term "people are crazy" is applicable to everyday life no matter where you live. Not to mention, the economy is not at its peak at the moment. Times are tougher than most, and people want to know that whoever they are dating is bringing more to the table than what they're eating.

Proof of this comes in a recently published "New York Times" article titled, "Even Cupid Wants To Know Your Credit Score."

In it, people shared stories about going out on dates and being bluntly asked, "What's your credit score?" Yes, it's getting that real out there.

[Also Read: Is It Ever OK To Use Groupon On A Date?]

“It was as if the music stopped,” Jessica LaShawn, a 31-year-old flight attendant from Chicago, told the Times. She says she was out on a date with a tall, handsome gent who "popped the question" over dinner. “It was really awkward because he kept telling me that I was the perfect girl for him, but that a low credit score was his deal-breaker.”

Wow. With questioning dates about how many people they've had sex with being still somewhat taboo, the next most logical question to ask would be "What's your credit score?" Right?

All last year, we explored various relationship conundrums, asking questions like "Is Sex Fun Anymore?" to which the general consensus was "No, not really." We asked if the number of a mate's sexual partners mattered and we came to a similar conclusion. So if sex and past relationships aren't necessarily deal breakers anymore, it may only make sense that financial irresponsibility take their place.

And believe it or not, there are still people out there who date to find a spouse and not just a good time. For them, knowing their potential partners' credit score could save a world of headache in the future.

[Also Read: Black Americans Face Lasting Credit Damage]

The Credit Reports You Don't Know, But Need To

Intellicorp This agency collects data on your criminal background and provides it to whomever's inquiring. You may want to get familiar with them if you have a checkered past or an incident that landed you behind bars that you want to make clear was resolved or rectified when potential employers start asking questions. You can request a report for free.

Thumbnails

Photo 1 of 10

• 
• 
• 
• 
• 
• 
• 
• 
• 
• 

Financial reporting agencies in addition to the Big 3 that can impact your life.

By now, we're all pretty familiar with the three main credit bureaus aka The Three Wise Men (or The Axis Of Evil depending on whom you ask). Equifax, TransUnion and/or Experian are commonly used by entities ranging from employers to car dealerships to landlords to look up your credit history and determine if you qualify to make certain purchases. If your credit score isn't up to par, you may find yourself sitting outside singing one of those FreeCreditReport.com songs.

However, the big three aren't the only ones watching your money moves and impacting whether you get that financial deal you desire.

The Consumer Financial Protection Bureau has compiled a list of 40 other financial reporting agencies [PDF] that track what people do. According to Bloomberg Businessweek, these agencies sell the data they compile to places like insurance companies deciding how high to set your premiums, health insurers looking to see if you have preexisting conditions that can impact rates, potential employers trying to determine if you’re trustworthy, or banks calculating how high to set your credit card limit or whether to allow you to open a checking account.

So that you don't get caught off guard the next time you try to make a big purchase or apply for credit, here and in the gallery above are 10 financial agencies you may want to check out to see if you made their list:

Intellicorp: Intellicorp.net, 866-202-1436

National Consumer Telecom and Utilities Exchange: NCTUE.com, 866-343-2821

Tenant Data Services: TenantData.com, 800-228-1837

Insurance Information Exchange: ISO.com, 800-709-8842

Chex Systems: ConsumerDebit.com, 800-428-9623

CoreLogic Teletrack: Teletrack.com, 877-309-5226 

CoreScore Credit Report: Credco.com, 877-532-8778 

Early Warning Services: EarlyWarning.com, ​800-325-7775  

Pay Rent Build Credit (PRBC)/Microbilt: Microbilt.com, 877-772-2123

Milliman IntelliScript: RxHistories.com, 877-211-4816

[SUBSCRIBE TO LOOP 21 RSS FEED]