by Michael Killian

Created on: February 01, 2009

Bogey Never Said It

Did you know there was an extensive list of erroneous and misleading pieces of information being distributed in the field of credit and debt management? Just as Bogey never said, "Play it again, Sam." there are select pieces of information that have slipped into our societal psyche but are as untrue as the oft-misquoted line from Bogey in Casablanca.

In some cases the errors have been caused by changes since the original true statements became ingrained in our societal fiber. But some of it was incorrect to begin with yet slipped into an accepted standard. Unfortunately the misinformation was often times authored in order to financially benefit to the person saying it. Yet regardless of the cause so much misinformation is still proclaimed misinformed, misleading or sometimes simply inept "authorities" in this field.

BTW Bogey's line was, "You played it for her. You can play it for me. Play it, Sam." Here are other examples.

Did you know these truth which are oft contrary to held opinions?

1. The average consumer can pay off all debt including the mortgage with the money currently being earned in about 7.5 years.

2. All debt does not have to be and actually should not be included in a debt management program.

3. You do not have to surrender all your credit cards when entering some debt-counseling program.

4. A debt-counseling program does not have to ruin your credit if done correctly. In fact it can actually improve your credit rating.

5. You have heard "Don't pay off your mortgage it's a tax deduction." Though the statement is true, the real truth is that for every $$ you pay in interest, you might get back 25 cents which is not a sound financial move.

6. You are currently paying whatever interest your mortgage broker set up for you (i.e. 6%, 7%, etc.) The real truth is the average homeowner is paying in excess of 75% interest each month. Example: A 30-year mortgage at 8% having been paid consecutively for 15 full years (1/2 the life of the loan) will still require 77% of the payment that month to go to the interest. Don't beliieve me? Look at someone's monthly statement.

7. Universal Default (that most agree to when signing a credit card application) voids the premise that interest will not go up as long as you always make your card payment on time. The truth is, Universal Default says they can raise your interest rate if you are late on ANY debt even your dentist if reported to the credit bureau.

8. Your credit card agreement is not etched

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