Credit Scores & Reasons for Debt

If you have a loan, a credit card or a mortgage, you have a credit score. Whether you have a high or low credit score depends on how well you managed your finances. Your debt plays a part in your credit score. People have many reasons for going into debt. Whatever the reason, carrying large debts hurts your credit score. How Credit Scores Work When factoring your credit score, the Fair Isaac Corp. considers how much credit you have, the types of credit you have, how many times you applied for new credit in the recent past, how long you...

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How to Pay Off Bills on My Credit Report

Banks and other lenders loan money based on your credit report. When you have unpaid or delinquent bills on your credit report, you credit score is reduced and the chances of getting a loan also are reduced. The first step in improving your credit rating is to pay off those bills. This can seem difficult, but with determination and setting a budget, you can pay off those bills and start improving your credit scores. Instructions 1 Obtain a copy of your credit report from each or the three major credit reporting agencies: Equifax, Experian...

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Collection Agency Problems

A collection agency may work on commission for a creditor, receiving a percentage of the amount it collects, or it may purchase bad debts from creditors for far less than face value. The agency then makes a profit by adding interest charges and fees and collecting more from the debtor than it paid to buy the debt. Although collection agencies are required to follow the law, consumers should be aware of potential problems that may arise when their...

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Rules for Home Equity Lines of Credit

A home equity line of credit (HELOC) frees up part of the excess equity in your house. Because your house is collateral, the interest on your withdrawals most likely is tax-deductible. When housing values were rising, lenders only had to be concerned with the continued credit-worthiness of the borrower. When they were falling, as happened in 2007 through 2009, lenders began reducing those lines to protect themselves from loss. As a result, the federal...

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How to Order a Credit Report & Score

A credit report is information about how you pay your bills, whether you've been sued, arrested or declared bankruptcy, and your general credit history. The Fair Credit Reporting Act allows consumers to receive a free copy of their credit report through The Annual Credit Report website, from the three major national credit reporting companies, once every 12 months. Those three companies are: Equifax, Experian, and TransUnion. Once you receive your...

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Positives & Negatives of Credit Cards

Credit cards are everywhere, from the pile in your wallet to the ads you receive in the mail and the payment portals at retail stores and on websites. Before you decide to apply for a new credit card or use your card for a purchase, consider the positives and negatives of credit cards. Positive: Build Credit If you do not have any credit, the credit bureaus cannot generate a credit report for you. Not having a credit report makes you a huge credit risk because lenders have no idea whether or not you will be able to handle making payments....

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Simple and Effective Strategies for Debt Reduction

Debt has a number of advantages. It allows the purchase of a home over time, the acquisition of large-ticket items, such as cars, on a pay-as-you go basis and the convenience of credit cards. It also has the stellar disadvantage of high usage cost through interest rates and the tendency to allow a person to live above their means. Paying down debt takes time and effort but isn't complicated. Renegotiate It takes gumption to call your credit card companies and ask for the interest rate to be decreased. Talking with a customer service representative...

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Can Wages Be Garnished in North Carolina for a Domestic Judgment?

Failing to pay debt may result in negative consequences. A creditor may respond to your past due debt by sending you collection letters and calling you to convince you to pay your debt. If your account becomes more than 30 days past due, the creditor may also report the delinquency to credit bureaus, which can reduce your creditworthiness. A creditor may also sue you for the debt in a North Carolina court. However, in most cases, a creditor cannot garnish your wages in North Carolina. Domestic Judgments The North Carolina Wage and Hour...

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How to Answer a Summons for a Delinquent Credit Card Account in Ohio

In Ohio, a summons is the notification of a lawsuit, according to Ohio Legal Services. Attached to the summons is a complaint, which explains why you are being sued and provides details, such as when you opened the account and when you stopped making payments. The summons also lists the address of the court, the name of the party filing suit against you and the deadline for you to respond to the allegations. If you fail to respond, a judge will hold you in default and enter a judgment against you for the full amount. Instructions 1 Write...

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Business Debt Relief Scams

Debt relief scammers prey upon those who are already in difficult financial straits, hoping to con them into paying big bucks in return for reducing their current debt burden. While there are plenty of ethical debt relief and credit consulting firms, this sector of the financial industry remains a hotbed of fraud and deception. Before you seek debt relief, arm yourself with the knowledge of scammer tactics. Contact If you're in the market...

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Hardship & Debt Reduction

Debt can be reduced at the debt collectors discretion. This is usually done if the person owing the debt is experiencing some sort of financial hardship. These arrangements arent mandatory, but when they occur, debt reductions due to financial hardship require verification and are accompanied by a payment agreement. Hardship Definition Hardship is anything that causes a borrower to become unable to pay for basic needs of food, shelter and clothing. It is caused by job loss, death of a primary earner, disability or catastrophic event. ...

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Credit Repair Programs

There seems to be a plethora of companies advertising credit repair programs. Some claim that they can raise your score in a matter of weeks, while others promise to ease the burden of debt. Unfortunately, there is no magic formula to improve credit, although some company advertisements promise otherwise. Exercise caution when dealing with credit repair companies. It is better to work with a company that will develop a long-term solution to debt...

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Can a Collection Agency Sue After They Put Collections on a Credit Report?

A collection agency can sue you at any time it likes. What is important to you as a debtor is how likely a collection agency is to win a lawsuit. Only after a collection agency wins a lawsuit can it pursue direct action against your assets in an attempt to garner payment. Being on the wrong end of a lawsuit as a debtor can be much worse to your credit report than a collections notation. Credit Report and Collections A creditor will not normally assign your account to collections unless you are seriously delinquent. Different creditors have...

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What Can You Do When You Are Unable to Pay a Payday Loan?

A payday loan is a loan issued for short time, usually several days to a month, that carries a very high rate of interest -- up to 391 percent, according to the Federal Trade Commission. In addition to interest payments, many payday lenders also charge various fees to borrowers, particularly for defaults on payments. There are a number of things that you can do to avoid defaulting on a payday loan. Issuing Loans When a lender issues a payday loan, it will generally require that you provide it with some form of payment in advance. This will...

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What Portions of a Debt Can Be Disputed With Collection Agencies?

The federal Fair Debt Collection Practices Act (FDCPA) lays out specific rules related to how debt collectors can and cannot treat you. Just because you owe a debt does not mean you can get harrassing phone calls, or have your work and neighbors called about your debt. In fact, you can legally request that collectors communicate with you through mail instead of the phone. Unfortunately there are times when debt collectors have things wrong, and...

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Does Debt Relief Hurt Your Credit?

When you are in financial trouble and your debt level is becoming impossible to handle, you will probably begin to notice the many advertisements enticing you to try debt relief. If you notice, the term "debt relief" is supposed to calm you down and lure you in. Before you complacently turn your trust and your money over to a debt relief firm, you may want to consider how debt relief hurts your credit. Types Differences exist between legitimate...

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Are Adult Children Responsible for a Deceased Parent's Debt?

When your parents leave debts behind when they die, you will not be directly responsible for the debt. However, the debt can negatively impact your inheritance and will have to be paid if some assets are still left to pay them. Otherwise, debt will be forgiven by the creditor at that point. Inheriting Debt When your parents pass away with a debt, you will not simply take over the debt when they die. For example, if your parents racked up a credit card debt, you will not have to come up with the money to pay for that credit card debt when...

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How to Calculate the Time to Pay Off a Credit Card

One of the most frustrating aspects about credit card debt is how long it can take to pay it off. Each month you make a minimum payment, but it seems to barely reduce the total balance. It's easy to wonder if you'll ever pay off the debt. There is a way to determine how long it will take to pay off credit card debt and how to calculate your payoff date. Instructions Time to Debt Payoff: The Fast Way 1 Don't use your credit card. Your calculations won't be accurate if you continue to use the credit card. Also be sure to make your payments...

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How Long Is Money You Owe on Your Credit Report?

Failing to pay money owed to your creditors or lenders can significantly hurt your credit score. Creditors and lenders regularly report delinquencies to the credit reporting bureaus, and this information serves as warning for future creditors. Stay current on your bills and pay monies owed to creditor to avoid credit damage and a lower credit score. Types of Delinquencies Different types of delinquencies indicate failure to pay money owed to a creditor or lender. After several months of non-payment, creditors and lenders may update your...

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Commercial Credit Tools for Kids

Children should be taught about money and how to use it wisely. These lessons can help prevent kids from facing financial hardships later in life and teach them how to deal with them when they do face them. There are a variety of tools available to help parents teach their kids about money in fun, practical ways. "Financial Peace Jr." Dave Ramsey's "Financial Peace Jr." is geared toward kids ages 3 to 12. This program includes an audio...

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Why Do a Financial Statement Analysis?

Financial analysts comb through companies' accounting reports for the same reason attentive parents delve into their children's grade reports: to find out how well a company performed during a specific period, and identify elements that dragged overall performance down. Financial statement analysis requires attention to detail, familiarity with accounting principles and knowledge of regulatory rules. Financial Statements By preparing accurate, complete financial statements, corporate management provides valuable information about the firm's...

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What Makes Credit Scores Better?

Credit scores build up over years of credit and payment history. Whether you have poor, good or excellent credit, these tips will help better your score and ensure you receive the best interest rates. Pay Down Your Balance Roughly 30 percent of your credit score is calculated by the amounts and balances on your accounts. You will get more bang for your buck paying off your credit cards than you will paying off installment loans. Credit rating agencies see credit card spending as a sign of daily financial health--and the more debt, the more...

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How to Compare Automobile Insurance Rates

Each state in the United States requires its residents to register vehicles that are operated on roadways with the Department of Motor Vehicles. Because automobile insurance also may be a state requirement, compare rates to save yourself money. Insurance Premiums An insurance premium is the amount that the company charges you to provide you with automobile insurance coverage. Always compare the cost of the insurance coverage, as well as weighing...

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Can My Wages Be Garnished if I Am Below the Poverty Level in Oklahoma?

The federal government uses the federal poverty income level guidelines to help figure out eligibility for various low-income assistance programs. The guidelines apply to most states, including Oklahoma. The state of Oklahoma allows creditors to garnish wages for delinquent debts. Depending on your situation, your wages cannot be garnished if you are below the poverty level. Identification The amount that constitutes "poverty level" depends on the size of your household. For example, in 2011, the poverty level for a family size of two is...

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Steps to Help Me Negoiate With Credit Card Companies

Negotiating with your credit card companies is something that you can do on your own. As a CNN report points out, the only thing a debt counseling company is going to do for you is add fees to a process that you could conduct on your own. It is important to have an understanding of what to expect from the credit card companies and to have a plan before you start negotiating. Your chances of a successful outcome are much better if you go into it prepared. What They Want The credit card company just wants their money. And they do not want...

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Debt Settlement Pros & Cons

Debt settlement companies specialize in helping overwhelmed consumers reduce the amount of their unsecured obligations such as credit card bills. Some require a lump sum upfront to make settlements, while others manage monthly payment plans for their clients. Debt settlement companies have a number of advantages and disadvantages that should be carefully considered. Warning Always check into the reputation of a debt settlement company before signing up, especially if they will be administering monthly payments on your behalf. Some companies...

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What Happens If You Stop Paying on Credit Cards?

Creditor Contact If you stop paying on your credit cards, the credit card company will contact you by phone, mail or both to find out if it was a mistake and remind you that the payment is due. Communication with the creditor is crucial at this point to avoid high interest rates, collections, negative marks on a credit score or possible wage garnishment. Most creditors are willing to work out a payment plan that will benefit both parties. ...

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Can a Creditor Take Child Support Money to Satisfy a Levy?

State governments across the country consider child support money a domestic support obligation for debt purposes. This gives child support payments the highest priority when multiple creditors place levies on a debtor's bank accounts or personal property. This debt priority is also the province of other government creditors, including the Internal Revenue Service. Bank Levy Definition A bank levy is a creditor-initiated seizure of a debtor's bank account or personal property for the payment of a delinquent account. Most creditors, including...

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Spousal Responsibility for Credit Card Debt Before Death

Whether you are responsible for your spouse's credit card debt depends on two factors: where you live and how the card was signed. Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin are community property states, meaning each spouse is responsible for all debts incurred. Community property laws vary by state. The second factor regarding responsibility for credit card debt is to whom the card was issued. ...

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Unsecured Debt Problems

When you accumulate debt, it's categorized in two ways: secured and unsecured. Secured debt is a type of debt tied to a piece of collateral, such as a mortgage that is tied to your house. Unsecured debt is not tied to any collateral, which is the case with credit cards. When you have too much unsecured debt, it can be a particularly stressful time in your financial life. Unsecured Debt Issues One of the issues with unsecured debt is that it typically carries with it a high interest rate. When compared with unsecured debt, secured debt has...

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How to Handle Delinquent AMEX Account

When an AMEX (American Express) account becomes delinquent, it can seriously damage your credit score. You should handle all delinquent credit card accounts as expeditiously as possible. Depending upon how delinquent your account is, you may be able to resolve the matter directly through AMEX. Otherwise, you may have to handle the matter through a third-party agency. Instructions 1 Contact the American Express billing department if your account has not been placed with a collection agency. If you are unsure whether your account has been...

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How to Delete Inquiries on a Credit Report

In some cases, you may be able to delete inquiries on a credit report. This is important, because excessive inquiries can reduce your credit score and make you look bad to potential lenders. Multiple inquiries, even if you did not receive or accept an offer of credit, make it seem that you may be taking on more debt than you are able to handle. If you need to delete inquiries on a credit report, here's how to do it: Instructions 1 Determine...

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Partnership & Cancellation of Debt

When debt held by a partnership is canceled, the debt is classified as income for a partnership. The income from cancellation of debt is taxable unless certain exclusions are met. Distribution of Cancellation of Debt According to "Joint Ventures Involving Tax-Exempt Organizations" by Michael Sanders, the income from debt cancellation is distributed to partners according to their distributive shares in the partnership. If two individuals own...

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How to Set Up a Debt Repayment Plan

A little debt may not seem like a big deal, but when it grows to the point that it seems uncontrollable, it is more than just out of control. Debt can consume your life, especially if it comes from a crisis such as unforeseen medical bills, job loss and even unintentional overspending. Set up a debt repayment plan to help you find freedom from your financial woes and develop good spending habits. Instructions 1 Make a list of all the debts...

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Should You Pay Debt From an Insurance Policy When Someone Dies?

A life insurance policy provides cash to the named beneficiaries when someone dies. Generally, when purchasing life insurance, the holder has a specific purpose in mind for the money. Most parents purchase it for themselves so they can provide for their children after they pass away. Life insurance policies are separate from an estate and do not have the same regulations and taxes as an estate has. Insurance Policy Goes to Named Holders A...

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Statute of Limitations for Collecting Debt in Louisiana

Louisiana's statute of limitations places some restrictions on creditors seeking to collect delinquent debts from residents. The statute doesn't erase debts that residents owe, but it does give them some protection from legal action that creditors and collectors may take. However, differences in the statute also may create problems for people who have delinquent credit card debts. Louisiana Statute Louisiana doesn't have the same statute of limitations for all types of debt, which could create debt-collection problems for residents. A statute...

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How to Consolidate Alternative Student Loans

Alternative student loans, also known as private student loans, are designed to help students pay for any tuition, fees and living expenses remaining after federal aid is dispersed. Alternative student loans are credit based, meaning applicants must have sufficient credit in order to qualify. In addition, alternative student loans generally have higher interest rates than federal student loans. Alternative student loans must be repaid, just like...

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Credit Card to Help Rebuild Credit

Having bad credit is not in and of itself a bar to getting a credit card. However, if you don't learn how to use a credit card responsibly, no credit card will help your credit score. Consumers who want to improve their credit need to understand how credit scores are calculated and how to use a credit card to raise their scores. Credit Scores Your credit score is based on your past activity as a credit user and calculated by various companies...

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