Cheat Sheet Q&A:

Today’s topic:  Financial complications after a divorce

Here’s the two part question:

I have two issues both as a result of my divorce.

My ex and I had combined our school loans. She stopped paying her ½ and I could afford to pay all so we were delinquent until the court ordered them to be separated. I paid mine back in full, contacted the lender but they refused to alter the credit report.

How long will it impact my credit?
We were also both on the title of the house. My name was not removed from the title, she stayed in the house and she defaulted. We had a short sale which was supposed to erase debt but a mortgage loan remained some how and I still get calls from creditors.
How long will this debt remain before they stop calling and how long will it be on my credit?


Bottom Line:  Let’s get started with the student loan issue…

The short answer to the question is that an unresolved student loan issue will permanently impair your credit.  Student loan debt issues never go away, not even in bankruptcy and will literally persist until your death if not resolved by that time.  In your situation it seems as though you’re not getting the cooperation of the lender to adhere to the court order.  Have you provided a copy of the court order to the debt resolution department of the lender?  If you haven’t that’s where I’d start.  If you have then the solution I’ll recommend will also be the recommendation I’ll offer up for the second issue. 

So now about the short-sale…

Did you obtain a full wavier of deficiency from the lender at the time of the short-sale?  The difference between what was owed on the mortgage and what the property was sold for is called a deficiency.  Without a wavier of deficiency the lender can pursue the deficiency against you after the short sale.  Also were there are other outstanding loans against this property (Ex: Home equity loan, second mortgage)?  If so were they resolved during the short sale?  If not those would still be outstanding against you as well. 

My recommendation would be to contact a nationally recognized but locally based non-profit group called  The principals are terrific people I worked with and they should be able to comprehensively review your outstanding issues and assist in permanently resolving them.  These problems aren’t the type that will just go away on their own. 

Good luck & best wishes…

If you have a topic or question you’d like me to address email me:

Audio Report:


Revolutionary email product that lets you un-pop the cork:

Bottom Line:  To date there hasn’t been an actual way to truly unsend that email you just sent and instantly regret. Until now. 

There is a new free web-based email service called Pluto mail that lets you do just that.  Better still it works with the leading email services (Gmail, Outlook, Apple,etc.) so you don’t have to register a different email address. 

Pluto mail is a web based product that doesn’t require any plug-ins.  You simply register your existing email accounts with them and they will be able to filter your email to provide control of your email after it’s sent.  Among the functions it enables:

  • Allows you to delete an unread email you’ve already sent
  • You can set email to auto delete immediately after its been read
  • You can set a email to delete if it’s been unread after several days
  • You can specify that a read email only remains for a certain length of time after its been opened

You get the idea.  Near complete control of email after its been sent.  Here is the direct link to the new service:

Audio Report:

How your tax money was spent in 2013:

Bottom Line:  Now that you’ve put the 2013 tax year in the rear view mirror (unless you get audited or filed an extension), let’s take a look at where tax revenue was derived from:

Total revenue collected:  $2.8 trillion

  • $1.3 trillion from individual income tax
  • $887 billion from Social Security tax
  • $680 billion was borrowed (debt issued)
  • $274 billion from corporate income taxes
  • Every thing else was under $100 billion

So our third biggest revenue source was debt issuance…  Not good.  So did our money go?

·        $886 billion to Health and Human services (Medicare & ACA)

·        $867 billion in Social Security

·        $608 billion in defense spending

·        $399 billion to the Treasury department

·        $156 billion in agriculture spending

·        $139 billion in Veterans affairs

·        All other spending under $100 billion

So it’s clear why we can’t solve our debt problems without reforms in Medicare and Social Security.  If you compute the actual amount of money spent that was debt last year:

  • 21% of all money spent was borrowed

This story clearly doesn’t end well if we don’t get our arms around our long term obligations and our ever growing budget deficit and reliance on borrowing just to pay the bills.  One day the tough decisions will be made.  The question is if we’ll make them ourselves or if our debt holders will make them for us.

Audio Report:

Now that tax year 2013 is behind us it's time to plan like the 28% for next tax year:

Bottom Line:  We’re more than a quarter of the way through 2014 already but it’s not too late to become smarter about your money right now.  Research from the National Federation for Credit Counseling revealed the following:

  • 56% of Americans plan to ensure a tax refund every year
  • Just 28% plan not to receive a refund every year

I’ll cut to the chase.  If you plan for a refund or even if you just happen to be inline for a significant refund year after year…  You’re most likely grossly mismanaging your finances and doing yourself an enormous disservice. 

While a big tax refund may be fun and exciting to receive, unless it’s due to one time life events (often huge deductions from a life event or significant transaction like a property purchase), you’re doing yourself a constant financial disservice. 

A tax refund is an interest free loan to the Federal Government.  You lose:

  • Access to that money year round
  • The ability to use it to invest or pay bills or reduce debt

So only 28% of the country is engaged in proper tax planning…  Not good.  If you aren’t aware of changes you can make in Federal withholding to better position yourself to retain your money year round you could:

  • Seek assistance from HR professionals at your company or…
  • Sit down with a tax planner and have them assist you in setting up your withholding schedule

A bank would never provide you with an interest free loan.  They’d go out of business.  Don’t do the same to yourself. 

Audio Report:


Why the poor stay poor & how to rise above that type of behavior:

Bottom Line:  A few years ago Ashley and I decided to be more strategic with charities and non-profit groups we work with and/or contribute to.  There are many terrific organizations and no shortage of people in need.  So we decided to exclusively work with organizations that help people who will help themselves given the opportunity.  It gets back to the “teach a man to fish” concept.  Here are some of the reasons that the poor remain poor:

  • The cost of credit for poor credit is 40% higher than excellent credit
  • The average full-time salary of someone who uses payday loans is $28,500, 69% of payday loan users, use the service on a recurring basis
  • 56% plan on getting tax refunds every year
  • 27% don't participate in employer offered retirement accounts

So…  Let me just link a few of these together.  The average tax refund is $2800.  That means that you’re overpaying by $233 per month.  If you had an additional $233 per month would you be able to pay your bills on time and improve your credit?  Would you be able to end the practice of using payday loans?  Just that step alone would put significant amounts of money back into your pocket and begin to break the practice of being poor.  Pass it along… 

Audio Report: