Credit Questions? Just Ask Nicole

Will Big 3 Auto Leases Soon Become Out of Reach for American Consumers?

The auto leasing business has been booming for the past several years. Lots of people have been able to drive really nice, brand new vehicles (which in a lot of cases would otherwise be out of their price range), thanks to the affordability of low lease payments and flexible lease terms.

But now with all the changes Chrysler, Ford and GM are making with the leasing arms of their business, will auto leases soon become out of reach for many American consumers?

Effective August 1st, Chrysler is getting out of the leasing business all together. No changes, no adjustments... just adios, sayonara, ciao, arrivederci, buh-bye!

And then, also effective August 1st, both Ford and GM are significantly scaling back their leasing business.

Among some of the changes expected to take place: Ford is planning to raise lease prices on trucks and SUV's, and GM will no longer lease to consumers who fall into their lowest credit rating categories.

At the core of this phenomenon is a combination of high gas prices, a mass exodus from truck and SUV ownership, declining resale values of leased vehicles, and overall sluggish auto sales.

Consequently, leasing has become more problematic for the Big 3 auto makers than profitable, and now they're doing something about it.

However, what they're doing just may solve their problems, but in turn, cause problems for their customers.

You see, the auto makers aren't the only ones getting out of the leasing business or scaling back. No sir! So are several major banks and auto financing units, which are frequently used by auto dealerships to shop lease terms for consumers.

This will impact consumers in a major way.

With credit standards tightening, and financiers closing their doors, starting August 1st, consumers who lease will have to shop around a lot harder to find a good deal.

Kanye West & MTV Give Financial Help to Young Veterans - WATCH TONIGHT!

Tonight at 10 pm EST, Kanye West and MTV will present a news special called Choose or Lose & Kanye West Present: Homecoming.

This special will highlight the lives of three young Iraq war veterans and the challenges they face since returning home from duty.

Kanye West, on behalf of The Donda West Foundation (named in honor of his late mother), and MTV, present these veterans with life-changing financial gifts such as paying off their debts, paying their rent, and paying their tuition.

You can read an article about the show here, and watch the video trailer for the show below...

I'm expecting this show to be really good and touching. I'll definitely be tuning in. It warms my heart to see nice things being done for veterans.

After sacrificing their lives and safety for our country, they should be the LAST ones suffering financially! Something is DRASTICALLY wrong with this picture!

Watch tonight. 10 pm EST. MTV.

Two More Banks Fail: Another in California, One in Nevada

This past Friday (July 25th) two more U.S. banks failed, and the FDIC (Federal Deposit Insurance Corporation) was named as their receiver.

They are First Heritage Bank, Newport Beach, CA, and First National Bank of Nevada, Reno, NV.

These two banks mark the 6th and 7th banks to fail just this year alone. Prior to this, IndyMac Bank was the most recent bank failure, having closed just a couple of weeks ago on July 11th.

The FDIC entered into agreements with Mutual of Omaha Bank, Omaha, NE, to take over the deposit accounts of the two banks.

Depositors of First Heritage Bank and First National Bank of Nevada will automatically become depositors of Mutual of Omaha Bank.

And as of today, the combined 28 branches of the two banks are opening as branches of Mutual of Omaha Bank.

First Heritage Bank had 3 locations and mostly corporate customers. First National Bank of Nevada had 25 locations and also operated as the First National Bank of Arizona.

For more information on the bank failure of First Heritage Bank, visit the FDIC's website by clicking here. And for more information on the bank failure of First National Bank of Nevada, visit the FDIC's website by clicking here.

To verify if your account is insured, click here.

Customers can also call the FDIC directly for more information at 866-674-8944 and 800-523-8089.

Can't make rental payments on sunken dozer. How bad will this affect my credit?

This question comes by way of Longview, Texas...

"I have good credit now and I am 25 years old, I co-signed on a rental note for a dozer and basically the dozer got sunk in a pond, the insurance while it was being repaired did not cover down time, it's rental bill is $28,000. I do not have the money to make monthly payments or pay this. Do you know how bad this will effect my credit? Will they take my credit card back that I already have? I know it will screw me in the long run just wondering how bad... If u have a answer to my problem please help me understand better."

Well, how bad this may affect your credit is really going to depend on how it all plays out and the policies and practices of your lender.

First of all, I'd brainstorm with the person you are on the note with to figure out a game plan. After all, this is not your debt alone. They say two heads are better than one, so you just may be able to come up with a way to make the payments after all.

Second, I'd thoroughly review your insurance policy to make sure they were not liable to help cover your payments while the dozer was being repaired. Insurance companies are infamous for not wanting to pay out on claims and sometimes you have to kick them in the butt and STAY on their butt to make them do so.

If you find the insurance company is not liable to pay, then definitely consider making an adjustment to your policy to prevent this type of thing from happening in the future.

Third, I'd call AND write your lender to explain the situation. For maximum impact, both you AND your co-debtor should call (repeatedly if you have to), and the letter should be signed by you both (write repeatedly if you have to).

In your phone calls and letter(s), ask the lender for a work-out plan or payment arrangement plan. Express and stress to them your willingness and intent to pay, but because of your current incapacity to pay, you need their help right now to make good on your agreement with them.

Also, tell them that this is only a TEMPORARY bad financial situation that you are in and that you are working diligently and vigorously to correct the financial problem.

If the insurance company will end up having to pay, make sure the lender is aware of that, and stay on top of coordinating the payment from the insurance company to the lender so that it gets processed ASAP.

Hopefully they will be helpful to you and willing to work something out with you.

Be sure to stay in constant communication with them (think stalker taken down a notch), and don't be afraid to escalate your case to a supervisor, manager, or even the President to get some results.

But keep in mind that in the meantime, if the rental payments continue to go unpaid, the lender could repossess the dozer. And a repossession would be horrible for your credit.

And... if you have a credit card with the same lender that financed your dozer, they could easily close your credit card account, reduce your credit limit, or raise your interest rate.

Hell, even a different credit card company could do the same things if they were aware of your late payments on the dozer (i.e., universal default).

If your credit card gets closed and you still have a balance on it, or if your credit limit gets reduced and your balance is higher than the reduced credit limit, that will negatively affect your credit. The credit scoring model does NOT like outstanding balances that are higher than the credit limit.

Hope this bit of info helps, and best of luck to you!

Wanna know what I'm doing? Follow me...

I'm now officially on Twitter!

For those of you who wanna know what I'm doing, you can follow me on Twitter at http://twitter.com/NicoleHamilton.

Could be a little TMI. You decide... :)

Don't try to keep up with The Joneses!

This video cartoon demonstrates in a humorous way how trying to "keep up with The Joneses" can cause you to get way in over your head financially. Check it out...

Cartoon... Last Wish? :)