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ACap Asset Management
Protecting Your Financial Health
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Fee-Only Financial Planning and Investment Services
For health care professionals, business owners, and individuals
Get a pulse on your financial position

How an $8 Mistake Cost a Man His Dream House

Buying A Home

By Ara Oghoorian.

I am fanatical about protecting my credit score because one minor error can cost me thousands. This is exactly what happened to one of our newest clients. Liam was in escrow to buy his first dream house. He had his down payment ready to go, was prequalified through his lender and had an excellent interest rate since his credit score was over 750; the table was set and everything was going great, until a late credit report filing.

Liam had recently paid off one of his student loans owed directly to his university and was given verbal confirmation that his balance was zero. With no further statements or bills from the university, he assumed the debt was clear. Unbeknownst to Liam, there was still an $8 outstanding balance. The university reported the unpaid balance to two of the three credit reporting agencies while he was in escrow to buy his house and it dropped his credit dramatically. As a result, the lender cancelled the loan and Liam was forced to find a lender who would accept a letter from the university acknowledging the error. The issue is still unresolved.

Unfortunately, this occurs frequently when a borrower thinks they have good credit only to find out someone has reported a late payment on them or there is an unpaid balance. Your credit score is used help you qualify to buy a car, get a job, or buy a house. You can stay on top of your credit score by reviewing your credit report annually. You are entitled to a free copy of your credit report every year from each credit reporting agency. The report does not show your credit score, but your credit score is derived from what is shown in your report. Google “FTC free credit report” to find the only government approved site to obtain a copy of your credit report. Don’t lose the house of your dreams over an $8 mistake.

Ara Oghoorian, CFA, CFP®, CPA is the President & Founder of ACap Asset Management.

ACap Asset Management, Inc. is a “Fee-Only” investment management firm headquartered in Los Angeles, CA specializing in helping doctors and healthcare professionals make sound financial decisions.

Contact ACap at info@acapam.com or 818-272-8511.