Welcome to our website credit and debt managementr.

New offers options to American consumers who need an effective debt reduction plan. We have settled over 150 million dollars worth of unsecured, credit card debt while saving clients thousands of dollars. AmeriGuard believes it is important to make an informed decision especially when it affects your financial health. Understanding your options can be overwhelming; that’s why we offer experienced, knowledgeable guidance along the way. provides the information you need to participate in creating a better future..

Sunday, September 30, 2007

Grants for Medical Debt

Grants for Medical Debt

There are many grants available from the government to assist individuals in financial need. In most cases, these grants are designed to help those in a specific situation. Grants to pay debt itself are not common, but there are grants that will help you avoid accumulating medical debt in the first place.

Disease or Illness Grants

    Try searching for grants that are designed to help cover treatment costs of your medical condition. For example, there are special funds designated for those suffering from HIV or AIDS, Alzheimer's, Parkinson's, cancer and leukemia. There are even grants to cover your pharmaceutical needs. Research grant opportunities before your medical debt begins to pile up.

Hospital Grants

    Hospitals often receive grant money from the government to help patients in need. If you are unable to pay for treatment due to a lack of insurance or gap in your insurance coverage, contact the hospital. Some hospitals will even waive the treatment costs for qualified applicants.

Private Grants

    If you are unable to find government grant money to cover your medical debt, try seeking a grant from a private organization or contact a local church. The Patient Advocate Foundation and Shepherd's Hope Inc. are national charities known to offer grants to cover medical expenses. Community Action organizations are local private assistance groups that help pay patients' monthly expenses such as rent and utility bills. Community Action organizations are located throughout the United States.

How to Build Credit Without Social Security Numbers

How to Build Credit Without Social Security Numbers

The large market of illegal immigrants in the United States--which has reached 11 million people by some estimates--represents a huge untapped market to many retailers and banks. Therefore, many companies like Bank of America, Wells Fargo, and even Verizon have tried to make it easier for undocumented immigrants to gain and use credit in order to increase their purchasing power.


Credit with the Bank of America


    Open a checking or savings account at the Bank of America and deposit a small amount of money. The Bank of America has a program that extends credit to people with no credit history or Social Security, number as long as they meet certain requirements.


    Keep your account open for at least three months. If you make any withdrawals, make sure you do not overdraw the account. The Bank of America stipulates that to be eligible for credit, you have to be overdraft-free for three months. If you overdraw your account, your three month period will begin again.


    Apply for a Bank of America credit card, but make sure that you read the fine print before you begin to use the card. Bank of America has acknowledged that they charge higher interest rates on cards that go to people with no Social Security number.


    Make only purchases that you can pay off easily, and do not fall into the cycle of credit card debt. The lower the balances on your card, the higher your credit score will be, because your score drops when you use too much of your available credit. Using this card responsibly will allow you to build a solid and positive credit history without needing a Social Security number.

Using Matricula Consular Cards


    Sign up for a matricula card at the consulate for the country where you were born. A matricula card is an individual identification card tied to your home country. Most Mexican consulates can process applications for matricula cards, but you can also get a matricula card at the Guatemalan consulate.


    Use your matricula card to apply for an IRS individual tax identification number, or ITIN. Once you have an ITIN, your income will be reported and you will pay taxes on it just like any regular citizen. However, you also receive the benefits that come with an ITIN, such as the ability to finance a home with a mortgage.


    Search for banks and companies that are friendly to matricula card holders. Business Week reports that by mid-2005, Wells Fargo held 525,000 accounts for matricula holders without Social Security numbers and was opening 800 more such accounts each day.


    Apply for a mortgage or a bank credit card after you have built up savings in your bank and demonstrated you are responsible with your money. Even if you cannot get a credit card initially with a matricula card, you can apply for a mortgage, which will create a favorable credit history for you as long as you make your payments on time each month.

Saturday, September 29, 2007

Colorado Statute of Limitations on Collections

Collecting a debt can involve a variety of activities, the most serious of which is using the court system to enforce payment of the debt. The first step in using the court system is filing a lawsuit. In Colorado, the viability of a debt collection lawsuit can depend on whether the creditor filed the lawsuit before the statute of limitations expired on the debt. Determining when a debt is expired is subject to several factors, including the basis for the debt and where the debt was incurred.

Liquidated and Determinable Debts

    The general statute of limitations affecting debt collection cases in Colorado is the six-year limitation period set forth in Colorado Revised Statute 13-80-103.5. This statute applies to "liquidated debt or an unliquidated, determinable amount of money due" to the creditor filing the lawsuit. For example, debts based on a promissory note, credit card account or an installment payment agreement is subject to this statute because the amount of the debt can be determined by a simple calculation.


    For debts based on contracts, whether written or oral, a three-year limitation period applies as set forth in Colorado Revised Statute 13-80-101. However, if the debt based on contract is liquidated or capable of being determined through a simple calculation, the six-year statute applies rather than the three-year statute. For example, even though a debt is the result of a credit card or charge card account established by a written agreement, the debtor cannot use this three-year statute as a defense to a creditor's lawsuit.

Promise to Pay Expired Debt

    The expiration of the statute of limitations on a debt does not mean the debt is extinguished, only that the creditor's right to enforce it through a lawsuit is lost. The creditor may continue to use reasonable activities to collect the debt, such as calling or writing to the debtor requesting payment. The creditor may attempt to solicit a promise from the debtor to make a payment on the debt or otherwise acknowledge that it is owed. Under Colorado Revised Statute 13-80-113, such a promise will have no effect on the statute of limitations --- unless it is in writing signed by the debtor. In that situation, the statute of limitations will begin again on the debt from the date of the written promise.

Debts From Other States

    Colorado Revised Statute 13-80-110 adds an interesting element to determining the statute of limitations on a debt when the debt was originally incurred in a state other than Colorado. Under this statute, even though the debtor resides in Colorado, the debt cannot be enforced if it has expired under the statute of limitations in the state where the debt was incurred. For example, credit card debt is subject to a three-year statute in Delaware and four-year statute in California (see Resources). Debtors from those states moving to Colorado can raise the shorter time periods under those state laws as a defense if the creditor sues on the debt in Colorado.

What Is Included on Business Credit Reports?

A business credit report is an important tool that creditors use to decide if a company is eligible for financing. Suppliers sometimes also pull a company's credit report before extending credit on orders. If you're a newly established commercial entity, you should take the time to understand the various items that may be included in your business credit report.

Concept of a Business Credit Report

    The concept behind business credit reports is similar to an individual's personal credit history. The agency reports information about various credit accounts and other financial transactions that the company performs over time. A number of credit reporting agencies, including Dun & Bradstreet and Experian Business, offer these reports for viewing by other entities who want to gauge the creditworthiness of the company in question.

What Is Included?

    When reporting a business' financial history, credit bureaus commonly include information about company credit cards, loans and lines of credit. If the business owner opens a bank account in the company's name, that data are reported. Suppliers and vendors that do business with the company can also report information regarding the company's payment history. For instance, if the company does not fulfill an invoice per the agreed upon terms, a supplier can submit that information to a business credit bureau.

Business Credit Score

    In addition to the financial history of the organization, business credit reporting bureaus also offer a credit rating for the company. Business credit scores range from zero to 100, and a score of 75 or better is generally considered a good credit risk. Like a personal credit score, this business score is based on the company's credit history.

How to Improve Business Credit History

    One of the most crucial steps for improving a business credit history and score is to ensure that the company operates as a separate entity from the owner. So instead of continuing to operate as a sole proprietorship, the company owner can ensure that positive information regarding the company's financial activities gets reported to the business credit bureau by incorporating or creating a partnership. It's also important to get an Employer Identification Number (EIN) to separate the owner from the business. The business owner can then register directly with one or more of the business credit bureaus.The owner can also ask suppliers and creditors to report positive payment information to those bureaus.

How to Establish Credit After a Debt Settlement

Establishing good credit after completing a debt management plan takes time and patience. But your recent status under debt management doesn't have to be a strike against you.

You have an advantage---after all, you could have filed for bankruptcy and endured a much longer period before having access to credit at reasonable rates. Those fresh from a debt management plan may have limited access to credit, but they still have access.

With a well-established plan in place to keep you on track,
you soon will be on your way to establishing excellent credit.


Build up your credit, bit by bit


    Establish a savings plan and build up a good cushion of general savings in addition to college or retirement accounts before applying for credit. Determine how much money you can save per month and, preferably, save until you have accumulated at least three months' worth of expenses.


    Apply for a gas or store credit card first, as these types of cards typically are easier to obtain. As always, apply in moderation; start with one or two cards at the most and charge only as much of a balance as you can afford to pay off in full each month.


    Apply for a secured credit card. These cards act as debit cards, because the funds are deducted from a preset amount you deposit. A secured credit card can help you to re-establish your creditworthiness after completing a debt consolidation plan.


    Research credit-building cards offered by various credit card companies. Some banks will offer cards with low balance and market them as credit rebuilding cards or cards for those just starting out with credit. These cards will bring you even closer to accessing larger amounts of credit at good rates, especially if you pay off balances in full every month.

Friday, September 28, 2007

Can You Return a Car Purchased on eBay?

Returning a vehicle which was purchased through an online auction website, such as eBay, is just as difficult as it is in the real world. Support for returns of these large ticket items is virtually non-existent because any return policy might serve to diminish seller confidence and increase the instances of returns based on buyer remorse.

Seller Return Policy

    Every eBay seller is permitted to create a return policy as he sees fit. Before purchasing a large ticket item, including an automobile, it's a smart move to review the seller's posted return policy and determine if the item you're purchasing will qualify under the seller's terms. A "no questions asked" return policy can allow you to make a large purchase with confidence knowing that if you're not totally happy with it, the seller will take the vehicle back and refund your money

All Sales Final

    The seller is under no obligation to refund your money from an eBay auction or direct sale if the automobile you purchased from him is in good working order and is in the condition described in the seller advertisement. You may consider making a personal appeal to the seller if the purchase has put you in a difficult financial circumstance or created a family hardship in other areas. The seller may choose to accept the return though it's not guaranteed.

eBay Buyer Protection

    eBay offers a buyer protection service for received items, which are inaccurately described or damaged in some way which was not disclosed at the time of purchase. The problem with this service is it does not apply to most items listed in the website's Motors section, which includes new and used cars. A buyer who purchases a car using eBay is unable to appeal directly to the website if a problem exists with the vehicle.

Appeal to Attorney General

    A last recourse to find some satisfaction in returning a vehicle purchased on eBay is a written appeal to the attorney general's office in the state you reside in and the state of residency for the seller. If the sale is a matter of fraud in that the buyer intentionally mislead you into purchasing the vehicle, you may consider filing a complaint with your local police department.

How to Shorten the Life of a Mortgage Loan Through Amortizing

Shortening the life of a mortgage loan through amortizing is a relatively simple process for those who have the ability and fiscal discipline to carry it out. The benefits to shortening a loan are numerous. Not only is it possible for you to save thousands of dollars in interest payments and retire that monthly mortgage obligation early, you can also choose the times you make the extra payments. If money becomes tight for a while, you are under no obligation. Benefits of a early loan payoff strategy include more freedom, less stress, better liquidity and security.



    Look at your mortgage loan amortization schedule, which your lender should have provided you. If not, you can make your own using a computer program or simply look up the estimated date to maturity. This is important to determine how much you wish to shorten your loan.


    Enter information into a loan calculator that reflects your current loan conditions. This should include your outstanding balance, number of months left on the loan and current interest rate. The result should be close to the same as your current payment.


    Plug in a new payment number. Some calculators may simply have you add this information all on the same line and others may have a line for an additional payment on the principal. The amount you wish to pay is up to you.


    Experiment using different years in the loan length field. For example, if you have a 30-year mortgage, type in 25 years to see the new terms. A 30-year, $100,000 home mortgage at 6.25 percent interest will have a payment of $615.72 for principal and interest. However, if you want to shorten that loan by five years and save more than $20,000 in interest, you can add $50 per month to the payment.


    Check with your lender to make sure there are no penalties or fees associated with early payoffs. Fees are especially common if you want to make more than one payment each month. Begin paying the amount you're comfortable with. If, during some months, you wish to pay more, you can do so. If the average over the years is your targeted amount, you should come very close to meeting your target payoff date.


    Inform your lender on each payment that the additional money is to be applied to the principal. Most lenders will assume that is what it's for, but it never hurts to make sure and also to keep a record of it.

What Boosts Credit?

Giving your credit score a boost can have a positive effect on whether a lender will give you a loan. Whats more, with a high credit score you can perhaps negotiate favorable rates on credit cards and loans. Knowing the elements that make up your credit score contributes to a higher rating.

Timeliness and Scores

    You can give your personal score a boost by simply adjusting your payment habits and recognizing the importance of paying by the due date. Creditors tend to mail statements and due dates well in advance. Some debtors wait until the last minute to submit payments, which can increase the likelihood of a late arrival. Lateness also triggers late fees and possible interest rate increases. Timeliness makes up 35 percent of FICO scores, and keeping a high rating is dependent on how well you regard due dates.

Outstanding Debts

    The less you owe, the more it benefits your credit history in numerous ways. Owing a low balance on credit cards helps improve your credit rating, and the less you owe to creditors, the more money you can acquire when financing a car or house. Outstanding balances make up 30 percent of FICO credit scores, and debtors hoping to give their score a fast boost can add points by paying down high balances, then paying off new charges each month as fast as is feasible.

Length of Credit

    Recognize the danger of closing credit card and older accounts. The length of credit history -- which is the number of years that you've had accounts opened -- makes up 15 percent of your credit score. Regrettably, some debtors choose to close older credit cards to decrease their number of credit cards. This simple move can hurt FICO scores because shutting down an older account can decrease a debtor's credit history. Debtors who want to cancel a few accounts should start with the youngest accounts first, and keep older accounts active.

Other Factors

    According to Myfico.com, other factors such as new credit and types of credit make up 10 percent of credit scores. Debtors looking to increase their personal scores should not disregard these factors, and should practice good habits to build a strong history. A combination of accounts helps strengthen the score. For example, debtors may acquire a couple credit cards, an auto loan, and perhaps another type of loan to create a mixture. Debtors need to watch their number of credit inquiries carefully, because applying for too many accounts in a short period can lower scores. If a batch of inquiries happens within a short period of time in the search for such things as a mortgage, an auto loan, or a student loan, credit reporting companies typically will not count these as multiples or against your score.

Help to Pay Off Payday Loans

Payday loans, also known as cash advance loans, post-dated check loans or deferred deposit loans, can put customers in a bind because of their high fees and short repayment period. Payday loans generally charge around $15 to borrow $100 for two weeks, although the amount varies depending on the state. These fees can get very expensive over the long term, so people having trouble paying their loans should look to other options.

Understand the Cycle

    Although the fees when first getting a payday loan might not sound too bad, the problems come when people use a new loan to pay off the old one. This is because the lenders charge fees on each loan. If, for example, someone pays $45 in fees for a two-week loan of $300 and extends this loan every two weeks for a year, this is equivalent to an APR of 390 percent. Consumers who understand the long-term financial implications of this practice are more likely to turn to alternative options than those who do not.

Credit Card

    Anybody who has a credit card with available credit should use this instead of a payday loan. Even if the credit card has an APR of 30 percent, this is still exponentially less expensive than a payday loan. Consumers can either use the credit card for everyday purchases, such as groceries, to free up cash to pay off the payday loan, or they can get a cash advance on the card to directly pay off the loan. Cash advances sometimes have higher interest rates than regular purchases. Consumers who use credit cards to break the cycle of payday lending should then focus on paying down the credit card balance with the money they would have spent on payday loan fees.

Get a Different Loan

    Consumers can use a personal loan from a credit union or a loan from a friend or family member to pay off the payday loan. For example, if someone has been extending a payday loan of $300 at a cost of $45 every two weeks, he could borrow $300 from a friend to pay off the loan. He could then give the friend seven payments of $45, one every two weeks, to repay the $300 loan. Although this plan will cost the same amount as the payday loan for those 14 weeks, at the end of that time the consumer is out of debt instead of still owing $300 to the payday lender.

Tighten the Budget

    Payday lending is often due to people spending slightly beyond their means and falling behind on necessary payments. One solution is to spend less money and gradually reduce the amount of the payday loan. Some simple ideas for tightening a budget include eating at home or packing a lunch instead of eating out, purchasing clothing only when needed and cutting back on phone and cable packages. Consumer credit counseling organizations often offer free or low-cost budgeting assistance to people who need help developing a budget.

Objectives of Debt Management

Objectives of Debt Management

Some people spend blindly from month to month, never knowing where their money is going and how much they have in the bank at a given moment. This can result in a financial crisis if hard economic times catch you by surprise. Managing your money and being responsible enough to have a budget is a vital part of being an adult and being prepared for the future. You will be able to set financial goals and reach them if you practice wise debt management.

Reducing Stress

    If you manage your money wisely, you can avoid having to stand in a supermarket checkout line, wondering if you have enough money to cover the purchases. Having many credit cards or other types of loans can escalate rapidly into a situation where you cannot even afford to pay the minimum payments on your bills each month. The stress, left unchecked, can become so intense it affects your health.

Budget Awareness

    Creating a budget and giving every dollar a place to go is one of the most efficient ways to manage your money. Writing up a budget for you and your family to follow is very simple and only requires a sheet of paper and a pencil. Document the money coming in each month and all the regular bills that you have to pay. Designate a certain amount that each person can use as blow money on "wants." Make sure each person is aware there is never going to be a time when you will allow them to borrow blow money from next month's budget. It is vital to designate a portion of your income to a savings account and emergency fund. You should build up an emergency fund of at least $1,000, according to financial adviser Dave Ramsey's website. An emergency fund will keep you from having to use credit cards when caught in a bind. After you have your emergency fund built up, you should start a savings account that you build each week for your future goals.

Invisible Savings

    Managing your debt and controlling your credit cards will save you money in the long run. If you have an emergency fund for true emergencies, and then steadily build a savings account each week, there will never be a need to use credit cards for emergency purchases. Once this is the case, you will be saving money that you were not even aware of, by not having to pay the high interest rates or late fees on your bills. Retailers that promise to give you a certain percentage off if you use your credit card are not wise purchases. Typically, most people will not pay the total amount at the end of the month; they will make minimum payments, thus increasing the actual cost of the item. Retailers are quite aware of this trend, thus the reason for offering advantages and discounts only if you purchase the item with a credit card.

How do I Get Good Creditors to Report to Raise Credit Score?

How do I Get Good Creditors to Report to Raise Credit Score?

A bad credit score will make it hard for you to be approved for a car loan or a home mortgage. A good credit score could get you a loan to open a business, put your child through school or even buy property. To raise your credit score, you'll need credit bureaus to receive information from creditors that signals you are in good standing. Fortunately, getting creditors to communicate to the bureaus that you are a responsible credit holder isn't difficult.



    Apply for credit at the right places. Only certain bills are reported to credit bureaus. Cell phone bills, car insurance and electric bills don't get reported unless you are sent to collections. However, most credit cards, lines of credit and large loans such as car notes and mortgages get reported to the bureaus each month. Make sure you apply for credit at places that will report to creditors.


    Pay your bills on time. You need to make sure the information the creditor reports is good. One reported late payment will have a negative effect on your credit report. Pay all your bills on time so the creditors will report you never missed a payment.


    Keep your balances low. Credit card balances that are close to or over their available limit will be reported negatively to credit bureaus. To make sure you are reported in good standing, keep credit card balances as low as possible and avoid maxing out credit cards at all costs.


    Contact creditors to make sure they are reporting correct information. Get a free copy of your credit report each year by going to AnnualCreditReport.com. Look at the report carefully to make sure all of the information is correct. If you find any mistakes on your credit report, contact the credit reporting agencies, Equifax, TransUnion and Experian, and the specific creditor to have your report corrected.

Thursday, September 27, 2007

Free Help for Debt Consolidation

The easiest way to obtain free debt consolidation help is through the consumer's or business' primary financial institution. Some financial institutions offer debt consolidation loans that offer an attractive alternative to other high-interest forms of debt. The specifics of the loan itself need to be weighed against the initial debt obligations to ensure that, at the very least, short-term payments are less expensive than the individual debts they are replacing.

Pros and Cons of Debt Consolidation Loans

    Debt consolidation loans can be either a money-saving life preserver or the proverbial last nail in the financial coffin depending upon spending habits after the consolidation loan. Consumers and businesses need to carefully consider what factors led to the initial debt crisis in the first place and alter spending practices accordingly. A debt consolidation loan without the backing of the behavior change can quite often result in accumulating more debt by freeing up credit cards and other methods of spending, compounding the problem. When used properly, a debt consolidation loan can provide a company or individual the basic cash flow necessary to survive a short-term crisis.

The Hidden Cost of 'Free' Debt Consolidation

    The devil is in the details, and the contracts relating to debt consolidation loans are no exception. Always read the entire contract and ensure interest rates are clearly highlighted and that the loan issuer carefully explains all aspects of the loan. Lending money, even through debt consolidation, is a for-profit business. Generally, to earn that money, the monthly payment is reduced to spread the payments over a longer period of time, which may or may not lead to a higher total debt repayment cost. In many cases, the added cost is a necessary price to pay when considering the lower monthly payment. Some loans may have terms that penalize loan recipients for paying out early.

Creating a Personal Budget as an Alternative

    Creating a personal debt repayment budget can be beneficial in cases where the debt is still within a level at which a debtor could conceivably pay all monthly minimum payments and survive safely on current income. In many cases, redirecting the income necessary to pay down personal debt is a matter of limiting luxury spending on expenditures such as entertainment, dining out and unnecessary consumer goods. A consolidation loan becomes a superior financial tactic when it is not possible to make minimum payments every month, even with austerity measures that limit unnecessary expenditures.

Debt Management and Long-Term Success

    Having a personal or business debt crisis does not have to be an insurmountable roadblock. Carefully calculating a course of action after weighing all the alternatives will allow virtually anyone to get back to square one and even start turning a profit. Unfortunately, the reality of debt crisis can sometimes mean shutting down a business that is not making money or liquidating a home and downsizing to a condo or rental suite temporarily. The basic premise for long-term fiscal success is to live and spend within one's means.

How to Defer a Federal Student Loan

Financial aid in the form of student loans can be expensive to repay. There are ways that can help you when you have periods when you have trouble making loan payments. One step is to consolidate your student loan. Other ways to defer repayment include requesting a forbearance or cancellation of your loan. It is generally difficult to discharge a federally-insured student loan by filing bankruptcy. If you work in certain careers or the military, you may be able to avoid repayment through cancellation of your loan(s). Finally, you can often have your loan balance reduced by working as a volunteer in Americorps or the Peace Corps. Read on to learn more about how to defer a federal student loan.



    Establish a basis for deferral, cancellation or forbearance. Generally, repayment is automatically deferred until six months after leaving school.


    Attend college, if you wish. While are a student attending at least half-time, you can defer repayment. You will need to provide certification of attendance from your present college. Deferral is also available for periods of military, teaching or while practicing medicine in certain communities.


    Seeking employment is another method of deferring repayment. You can utilize this ground for deferral for a total of up to three years.


    Volunteer at an Americorps-approved agency. This can reduce your loan balance up to several thousand dollars.


    File a request for a hardship deferral. Use of this basis can be utilized for a maximum of three years.


    File bankruptcy. Discharge of a student loan, particularly a federally-insured loan is difficult. However, in a few cases (usually involving permanent mental or physical disability) bankruptcy can discharge these loans. You will need to file and serve an adversary proceeding in the bankruptcy court. An adversary proceeding is generally just a lawsuit filed in bankruptcy court.


    Try to cancel your loan. Diagnosis by a physician or psychiatrist that you are permanently mentally or physically disabled can form a valid ground for cancellation of a student loan. Temporary disability only results in temporary deferral of repayment. Your doctor will need to complete a form for any claim filed using this method.


    Request a forbearance. Any grounds available for deferral or cancellation of a private loan must be specified in your loan agreement.

Debt & Refinance Guides

Debt & Refinance Guides

Refinancing debt means taking on a new loan with new contract terms and conditions that effectively replaces the previously existing loan. Refinancing is common with home and auto loans, but is also used by business and consumes who want to refinance other personal loans. Refinancing is typically used to improve your financial position by making debt more manageable.


    Loan refinancing is commonly used by business and consumers to trade in a high interest loan for a lower interest rate when market conditions drive rates lower. Refinancing is often done through the existing creditor or bank, but you can also refinance with another lender that simply pays off your existing loan with the new loan funds. Refinancing offers a few basic benefits, but you must consider potential drawbacks as well.

Benefit: Lower Rates

    The most obvious benefit and reason to refinance your mortgage, auto loan or other loan product is to take advantage of lower rates. Market factors often move interest rates lower at some point following your initial loan funding. Lowering your interest rate even a fraction of a percentage on a long-term loan, such as a mortgage, can lower your payments and dramatically lower your total interest paid over time.

Benefit: Lower Monthly Payments

    Another main reason someone refinances a loan is to reduce monthly payments. For instance, if you have paid off several years on a 30-year fixed mortgage, you could refinance for another 30 years, and spread out the repayment. This reduces the monthly outlay. Ideally, you would refinance to a lower rate, which is more financially beneficial. Some borrowers do refinance to similar, or even higher rates at times to reduce monthly payments because they are struggling to keep up.


    Refinancing does not always make financial sense, even if rates are lower. You often pay up-front closing costs to refinance, especially if you are looking at a mortgage refinance. You must decide whether you are going to stay in your home, or hold on to your secured asset, long enough to recoup your closing costs from the interest savings. Some mortgages have prepayment penalties intended to keep you from refinancing too early. Check your loan contract to see if you have one. This might make refinancing a bad move.

Wednesday, September 26, 2007

The Best Way to Pay Off a Debt Interest Balance

The Best Way to Pay Off a Debt Interest Balance

Debt can easily become overwhelming. High-interest debt, in particular, can become burdensome in a hurry. If you have a loan that is tough to repay or, even worse, is accumulating a higher balance each month, you need to take action. There are several strategies that will ultimately pay off a debt, but the best strategy is the one that repays the debt the fastest, thereby eliminating as much in interest payments as possible.



    Take stock of your situation first. If you do not have a very clear understanding of your financial standing, you will not know how to attack the problem. Add up all of your debts and monthly payments. Add up the amount you have in savings and retirement funds. Lastly, using your bank statements, figure out exactly how much you spend each month in non-essential expenses.


    Redesign your budget to cut non-essential spending. Make sure you don't cut too drastically, though. If you leave no room in your budget for a small amount of fun, you may end up resenting the plan and ditching it altogether.


    Liquidate your savings accounts. You probably do not want to liquidate retirement accounts because you will probably face huge early-withdrawal penalties for doing so. However, if you are serious about debt reduction, bite the bullet and use your savings to pay your debt.


    Pick up a second job. Any extra income can go directly toward debt repayment, assuming your primary work was carrying all of your expenses. Consider working part-time at night if you have a standard nine-to-five job.


    Use the snowballing technique when you begin actual repayment. This means attacking the debt with every spare penny you have. Using your budget, determine the whole dollar amount (in addition to the minimum payment) you can pay against the bill.


    Repeat the snowballing technique if you have multiple bills that need to be repaid. Make sure to attack the highest interest debt first and pay minimums on all other accounts.

Fast Credit Debt Removal

Bad credit can happen to almost anyone. Unexpected job loss, emergencies and bad luck can contribute to not being able to fulfill credit obligations. There are thousands of companies out there that promise quick and easy credit debt removal. Knowing what is and is not possible with credit repair will help you when the chips are down.


    Before looking for a credit repair solution, it is recommended that you understand what possible scams are out there. If you wish to have negative information on your credit report removed, it is important to understand that only information that is false can be legally removed from your report. Any accurate information will stay on your credit report for a seven-year period. When looking for credit repair companies, never pay money up-front for a service that has not been completed. If there is an issue with a fraudulent accusation on your report, you can fix it yourself by writing the company that made the report.


    Consumer Credit Conseling Service (CCCS) is a service that can help you negotiate with your creditors for a smaller payment plan and lower interest rates. CCCS can also counsel you on legal ways you can help repair your credit report quickly without running into scams. Paying off your debts with CCCS does not affect your credit report and allows you to get bad marks off your credit report quicker than trying to sort it out on your own. CCCS services are often free or require a small charge.


    Negotiating with your creditors can help you remove negative information from your credit report. You can talk to your creditor to change payments that went to collection, where a third party was involved in collecting a debt, from a non-satisfactory payment to one that was paid as agreed. Most creditors and credit collection agencies are more worried about getting their money than giving you a negative report. You have the legal right to request the removal of a collection agency notice from your credit report Try to get any correspondence with a credit collection agency or creditor in writing when going through negotiations.

The Government Rules for Consumer Debt Relief

The Government Rules for Consumer Debt Relief

The economic downturn has led more consumers to seek assistance from debt relief companies. These companies help consumers negotiate their debts with creditors in an effort to reduce the amount owed. They frequently charge consumers several hundreds and even thousands of dollars for their services, in addition to monies the consumer is usually required to put into a fund offered as part of a settlement with a creditor. As demand for these services increases, some unscrupulous companies have entered the market and have been reported to charge excessive fees, fail to negotiate settlements or take consumers' money without delivering services promised. The Federal Trade Commission (FTC) instituted a new set of rules in July 2010 to crack down on these practices and protect consumers.

Bans Upfront Fees

    The FTC's new rules forbid creditors from charging any fees to consumers until a settlement is reached. The rules state a company cannot impose or collect fees from a consumer until a settlement between the creditor and consumer is accomplished that revises the terms of at least one debt obligation; an agreement (i.e., debt management plan) is reached between the creditor and consumer; and at least one payment toward the debt is made. Furthermore, the rules now state the fee charged to a consumer when a settlement is reached for one debt must be in proportion to the entire fee otherwise charged if all debts were settled. In cases when the provider's fee is determined by the percentage of the consumer's savings from the settlements, the percentage levied must be the same for each of the consumer's debts. This rule change is to deter debt relief providers from charging fees upfront for multiple debts in a single debt relief program.

Expands Disclosure Requirements

    The FTC rules also mandate debt relief companies to disclose certain information to consumers. Beginning in September 2010, debt relief companies must provide consumers information about the cost to enroll in the debt relief program. In addition, debt relief companies must relay to consumers how long it takes to negotiate a settlement as well as any potential negative repercussions a consumer may sustain using their services. Companies must also supply information about their practices related to dedicated accounts for holding deposits for settlement agreements, if required of the consumer. The debt relief company is required to disclose this information before enrolling a consumer in their program.

Prohibits Misrepresentation of Services

    Under the new rules, a debt relief company is prohibited from making unsupported or bogus claims about the services it proposes to provide consumers. This rule as well as the other two rules, ban on upfront fees and expansion of disclosure requirements, applies to sellers of debt relief services as well as telemarketers hired by debt relief companies to push their services.

How to Get Debt Consolidation Loans with Bad Credit

Consolidation of debt has been a popular option for those with high amounts of debt spread out over several credit cards or other debtors. Since debt consolidation consists of a loan approval process, those with bad credit will have a much more difficult time getting the needed loan approval. Sometimes it can be helpful to be creative in finding an acceptable way to borrow money at a lower interest rate to pay off debt at a higher interest rate. Included below are some possible ways for borrowers with bad credit to secure a debt consolidation loan.



    Take a look at your existing credit cards. Review the interest rates and available credit for all of your active credit cards. Make a list of each card with the current amount of debt and the interest rate. The easiest way to save money and consolidate debt is to transfer the balance of several credit cards that have a high interest rate to a higher credit limit card with a lower interest rate. The amount owed will go down and only one payment will be due each month. Make sure to consider the balance transfer fee into the evaluation.


    Find out if personal loans are available from your employer or credit union. If you are working then you have some financial clout. Credit unions sometimes offer personal loans even for those with bad credit if a direct payment is set up out of your paycheck. Look for this type of option for a low interest loan you can use to pay back higher interest credit cards.


    Use the equity in your home to take out a loan to pay back high interest credit cards. Having equity is more of a rarity these days because of the sinking housing market, but if you qualify then you will be able to significantly lower your monthly payment since home equity loans can be taken out for up to 30 years.


    Borrow against a car you own. That is right, banks and credit unions will loan money to people who own their cars. A percentage of the value of the car can be borrowed, just like you are buying the car from a dealer. The interest rate for this type of loan is typically based on the model year of the car. The bank will need to appraise the vehicle and verify ownership before approving the loan.


    Apply for a debt consolidation loan. This type of loan consolidates all of your debt payments into one payment. It is more difficult to get a debt consolidation loan at a low interest rate if you have bad credit, but it is possible depending on your financial circumstances. Make sure the loan consolidation company is legit before providing them with any personal information. Check with the Better Business Bureau and be sure they are registered as a state certified bank through your state auditor's office.

Tuesday, September 25, 2007

Legal Consumer Credit Counseling

Millions of Americans have run into debt trouble in recent years. Many of them turn to consumer credit counseling organizations for assistance. In fact, attending a consumer credit program is a requirement for individuals filing for bankruptcy. However, not all consumer credit counseling organizations are created equal. Before you sign on with a specific outfit, take some time to understand the industry.

Credit Counseling vs. Loan Consolidation

    Many credit counseling organizations do great service, offering unbiased, impartial and expert advice to consumers overwhelmed with debt problems. They are frequently able to help clients work with creditors, obtaining favorable settlements or lower, more manageable debt payments. Some outfits, however, have attracted the scrutiny of regulators, because they provide little benefit to consumers. In some cases, they signed customers up for expensive debt consolidation loans, often causing their clients to be in worse shape than they were before.


    Generally, consumer credit organizations are regulated at the federal level, which places strict limits on the activities of credit counseling firms. For example, firms must provide a full disclosure, in writing, of all fees and costs associated with their services. They can also not collect money from the client until after they have delivered on their promises made in the contract.

IRS Regulation

    Many credit counseling organizations have filed for tax-exempt status as 501(c)3 organizations. This is a special section in the tax code that provides important tax advantages for nonprofit organizations, such as educational groups, churches and other religious organizations and charities. The IRS has been placing a good deal of scrutiny on some credit counseling organizations, however, for acting like for-profit institutions. They have moved away from their focus on education and advocacy, and instead have emphasized credit repair and selling commercial loan services, in violation of their 501(c)3 charter. The Credit Counseling Compliance Project is an IRS initiative that reviews the activities of credit counseling services, and, where appropriate, revokes their tax-exempt status.

What You Should Expect

    As a consumer, you can expect your consumer credit counseling agency to comply with the law. They must be nonprofit institutions under state law, they must charge fees that are reasonable, and they must provide full disclosure of these fees and charges in advance. If they handle money on your behalf, their employees must be bonded, and they must have the financial strength and stability to remain operational throughout the life of any payment plan they support.

Monday, September 24, 2007

How to Get Credit at a Department Store

Getting credit at a department store can be a lot easier than being approved for other forms of credit. The MSN Money website reports that department store cards are relatively easy to get because the risk to the department store is small. Department store cards generally offer lower credit limits than bank-issued credit cards, such as MasterCard or Visa. Department store cards are popular with people applying for credit for the first time and for people who are trying to rebuild their credit.



    Establish some basic credit qualifications. You should be at least 18, have a job or income and a stable address.


    Review your credit report. Get a copy of your report from the website Annual Credit Report. You may not have a report if you have never applied for credit or a bank account, but checking your report is free and easy. Annual Credit Report is operated by the nationwide credit bureaus and offers free reports as required by the Fair Credit Reporting Act. Visit the website to view and print your report (see Resources).


    Challenge any wrong information on your report by writing a letter to the credit bureau. Mail the letter to the credit bureau's address on the report. Also make sure that any present credit accounts you have are paid up to date. Allow about 60 days for information on your credit report to be updated.


    Apply for a department store card by applying in the store or at the department store's website. Ask for the customer service department to apply in the store. Provide requested information about yourself including your Social Security number and driver's license number.

How to Apply for HOPE for Homeowners Act of 2008

How to Apply for HOPE for Homeowners Act of 2008

The HOPE for Homeowners bill of 2008 is meant to help homeowners avoid foreclosure by refinancing their loans. Homeowners who find they are not eligible for the Making Home Affordable program may be able to obtain assistance with the HOPE for Homeowners mortgage solution, which is offered by the Federal Housing Administration.



    Prove you cannot pay your existing mortgage by putting together all sources of income in order to show your lender. If you have a home equity loan or line of credit on the home, you must pay this off first before you can get help from the HOPE for Homeowners program.


    Submit an application to the HOPE for Homeowners program through the FHA website, which connects you directly to an FHA approved lender, or contact your mortgage lender. Your mortgage lender must agree to the terms of the HOPE for Homeowners program before you can proceed.


    Compile all of your mortgage papers and federal tax returns, going back at least three years. In addition, have your monthly mortgage statements, insurance papers and a listing of any assets you might have. You will also need to have some sort of identification that is government issued.


    Apply for a HOPE for Homeowners refinancing loan through your lender, if your lender agrees to participate. If you loan is approved, you will get a fixed-rate, lower interest loan that is insured against default by the FHA. However, the FHA will be able to claim part of the equity in your home if you sell after certain time periods.

When to Know It's Time to File for Bankruptcy

The decision to file bankruptcy is a tough one, and a bankruptcy has long-term consequences. Creditors will report the bankruptcy to the credit bureaus and your credit score will decrease. For this reason, reserve bankruptcy as a last resort to turn to for a fresh start only after you've exhausted every other option.

Overwhelming Debt

    When credit card debt, medical bills and loan payments are wreaking havoc on your finances and morale -- when illness or job loss have complicated things further -- it may be reasonable to look for a way out, even if it involves some negatives. Some creditors work with consumers to provide affordable loan terms and solutions. When, however, it is apparent that there is no way to meet the terms offered, bankruptcy can begin to seem like an attractive, logical solution worth taking a look at.

Facing Loss of Property

    Getting behind on payments to creditors and home lenders can result in loss of personal property which can include your home or any other item pledged as collateral for a loan. Lenders have the legal right to take items used as collateral for loans in order to recoup their loss if you default. Filing for bankruptcy protection can stop foreclosures and repossession and help you retain your personal property. Speak with a lawyer for additional information on how to file bankruptcy and keep your residence.

Ready to Start Over

    Having a strong desire simply to start over is a top reason for some consumer bankruptcy filings. Wiping out debt gives consumers the opportunity to acquire new credit accounts and manage their debts more efficiently. While credit scores do drop after a bankruptcy, recovery is possible with wiser credit habits and smart debt management. Consumers can open a high-interest new line of credit immediately following a bankruptcy and with good payment habits (no late or skipped payments) can increase their score and possibly qualify for a mortgage loan after two years.

Bankruptcy Warnings

    While a bankruptcy does offer protection and a way to erase overwhelming debt, it can stay on a credit report for seven to 10 years. Acquiring credit after filing bankruptcy can also be a problem; lenders may require a co-signer or down payment. If you are approved for credit after bankruptcy, you'll pay a high interest rate, which increases the payment on the account. A bankruptcy can also result in higher insurance premiums and limited job opportunities in the finance industry.

How to Keep Deferring Your Student Loan

How to Keep Deferring Your Student Loan

An old joke says college is a party with a $100,000 cover charge. However, you won't be laughing when student loan repayment begins. There are ways to keep deferring your student loan payments, sometimes for several years. This can be particularly helpful for the new graduate having trouble making ends meet.



    Contact your lender. Deferments are not typically given automatically. Your lender will be able to send you the necessary paperwork to fill out or direct you to its website.


    Fill out the paperwork. Paperwork for a deferment generally includes answering questions about your income as well as how long you have been out of school.


    Return the paperwork to your lender. Include any supporting documents if the lender requests them, such as pay stubs or proof you are looking for a job.


    Enroll in school. One way to defer loans indefinitely is to enroll in a degree-granting program. While this could increase your debt (if you take out more loans to pay for it), it will also stave off repayment until you graduate or drop out. You will hopefully be able to earn more with your advanced degree than with an undergraduate degree.

Easy Ways to Get Out of Debt

Easy Ways to Get Out of Debt

Being in debt can make you worry, causing you to lose sleep, fight with your loved ones and start to feel that your life will never improve. There are easy things you can do to help you quickly lower your debt obligations. The sense of freedom may inspire you to do everything you can to live a lifestyle where you are debt-free or keep the debt manageable. Once you enjoy time without all the debt and the stress that comes with it, you will never want to go back to that burdensome, out-of-control feeling.

Downsize Your Home

    Many people are in debt because they bought too large of a home, not realizing that just because they can get a loan for a home does not mean they can afford it. Sell your home and move to a smaller, less costly rental home or apartment. You can downsize for a year or two to get out of debt, save an emergency fund and save a nice down payment on another home so that your future mortgage payments are not as expensive.

Sell Your Car

    High car payments are common when people are in debt. Sell your car to get rid of the payment. Buy an inexpensive used car with cash. If you are a two-car family, consider downsizing to one car. You can pay the amount you were spending on a car payment towards your debt each month and once the debts are paid, you can use the extra money to build an emergency fund and a savings account.

Garage Sale or Online Auction Sites

    Have a huge garage sale and get rid of all the junk and extra stuff that clutters your home. Price your items fairly; you are not trying to recoup the price you bought the item for, you are just trying to get rid of it and make some extra cash, according to the Dave Ramsey website. Alternatively, you can sell items online at auctions sites such as half.com, eBay or on Craig's List. Take good pictures of the items and show any defects they might have. People are leery about purchasing items online unless the pictures are clear and show that the item is in good condition. Use the cash you make to pay down your debt.

Part-time Job

    Getting a part-time job while you are reducing your debt is an excellent way to pay bills off quickly. Part-time income even for just a few months will lower the debt and your stress level. Delivering pizzas or newspapers, babysitting or being a telemarketer are all part-time jobs that are readily available and will help you reduce your debt and build your savings.

Cut Up Credit Cards

    Cutting up your credit cards and always using cash for purchases is the best way to reduce debt quickly. This forces you to save for luxury purchases and gives you plenty of time to determine if you really need the item.

What Happens When You Max Out a Credit Card?

What Happens When You Max Out a Credit Card?

Using credit cards is a convenient way of making purchases, both online and off. With banks making checking accounts accessible through the use of debit cards, which act similar to actual credit cards, many people shop without taking much time to think about the differences. But there are differences between credit cards and debit cards, and that difference becomes quite apparent when bill time rolls around and you find you've maxed out your credit card.


    Credit scores are affected greatly by your credit card being maxed out. Thirty percent of one's credit score is affected by what happens on a credit card. One negative "ding" is too high a ratio of credit you've used on your card relative to the limit you were given; therefore, maxing it out is a huge ding. The more credit cards you have maxed out, the more negative dings you acquire.


    By maxing out credit cards, one reduces their buying power. When no longer able to use credit, one must resort to using cash, which reduces bill-paying power. Soon, there is no credit and no ability to pay down limits. This can create a poor money management cycle that can get worse over time.


    One common mistake is paying the minimum payments on a maxed-out card. Often, it is thought that by paying this way, the maxed-out card's balance will lower in the same manner it did before. This is not the case. The card will accrue a higher level of interest, and depending on how low your payments are, the interest can even take the card over the spending limit and cause over-limit fees that increase the balance even more.


    One should consider that with high balances or maxed-out credit cards, one's credit score and buying ability can be reduced. Sometimes a credit card account can be closed until the balance is paid in full. This balance can include finance charges that the holder can be liable for, since finance charges continue to accrue despite the closing of the account.


    If you are trying to refinance your home, seeking loans for repairs or even for education, the damage to your credit rating by having maxed-out credit cards may make you unable to get financial assistance. Even if you are making payments, having a maxed-out credit card shows poor planning and money management, which lenders view in a poor light.

How to Get 2nd Mortgages With Bad Credit

How to Get 2nd Mortgages With Bad Credit

Upon financing your home, you created a loan referred to as a mortgage. As the value of your home increases, you gain equity in the home. Equity is the difference in the amount of money you owe on the mortgage and the amount of money the house is worth. When people want to borrow money using the equity in the home and using the home as collateral, they can take out a 2nd mortgage loan. Even if the homeowner has bad credit, it can still be possible to be approved for a 2nd mortgage.



    Visit zillow.com and enter your home street address including city, state and zip code. Zillow will provide you with a value of your home based on the information the site has on your property as well as sales in your area. While this value will not be exact for your home, it will provide a general estimate of the current value of your home.


    Compare the value of the home listed on Zillow to the amount of money you owe on your mortgage. Subtract the amount you owe on the home from the value of the home listed on Zillow. This amount is a rough idea of your equity.


    Contact your lender. You can find their customer service number on your monthly mortgage statement. Tell them you are looking to take out a 2nd mortgage and be upfront with them about your credit situation. If the lender feels you may qualify for a 2nd mortgage, he will require an appraisal to determine the exact value of the home. The higher the equity in the home, the better chance of obtaining a loan as the lender knows he can recover any money you do not pay by gaining possession of the home.

Sunday, September 23, 2007

Will a Collection Agency Remove My Debt If Paid?

After purchasing your unpaid debt from your original creditor, a collection agency reports the account to the credit bureaus -- resulting in the collection account showing up on your credit report and bringing your credit score down. While paying the debt absolves you of your legal obligation, it does not improve your credit score. In some cases, you can negotiate with debt collectors to have the collection account removed from your credit report.

Paying Collection Debt

    When you pay a collection debt, the collection agency must report to the credit bureaus that you paid off the account. It does not, however, have to remove the account from your credit report. Paid collection accounts have the same derogatory effect on your credit score as unpaid collection accounts. Unfortunately, many consumers pay off collection debts with the belief that resolving the debt either improves their credit rating or will result in the collection account vanishing from their credit reports.

Credit Reporting Period

    Once a collection agency reports a debt to the credit bureaus, the Fair Credit Reporting Act mandates that the account remain an integral part of your credit history for seven years. The seven-year reporting period for the debt begins the day your payment to the original creditor was 180 days late -- not the day the collection agency purchased the debt. After the reporting period passes, the credit bureaus must remove the collection account from your credit report whether you paid it or not.

Account Deletion

    The only way to improve the effect a collection account has on your credit rating is to remove the collection agency's notation in its entirety. One way to accomplish this goal is by negotiating with the company to delete its derogatory report in exchange for payment of the debt. When negotiating with debtors, debt collectors often claim that the company does not have the ability to modify reports it previously made to the credit bureaus. All information providers, however, can modify reported information at any time. Even so, not all collection agencies are willing to modify their reports in exchange for payment.

Precautionary Measures

    If you are successful in convincing a collection agency to remove its credit notation once it receives your payment, ask for a copy of the agreement in writing before paying the debt. Because many debt collectors work primarily on commission, unethical individuals have considerable motivation to lie in order to earn additional income. If you do not have the company's approval in writing, you have no way to enforce the agreement yourself should the company deny all knowledge of the previous negotiation after receiving payment.

How to Reduce Outstanding Debt on Your Credit Score

According to Myfico.com, outstanding debts make up 30 percent of credit scores. Consumers hoping to add points to their personal score and qualify for better interest rates on loans should pay down their credit card debts and existing loans. Reducing outstanding balances is often a lengthy process. But with a plan and self-control, you can get rid of balances.



    Settle debts sooner with higher monthly payments to your creditors. Use disposable income to pay two or three times more than your minimum payment on credit cards and other loans. You will pay off the balance quicker and reduce how much you owe in interest.


    Inquire about reduced interest rates on credit cards. Simply asking your creditor for a rate decrease can result in paying less interest on your credit cards. This slashes the amount you owe in interest each month and speeds the reduction of your principal.


    Pull out your credit cards only in an emergency. View your credit cards as a last resort and pay for items with cash to stop accumulating high balances.


    Resolve credit card balances each month. Give yourself limits and only use credit if you have the money to pay off the charge once you receive the statement in the mail.


    Earn extra money to pay down your outstanding balances. If your salary isn't enough to pay outstanding balances, have a weekend yard sale, take items to a consignment shop, start working a part-time job or do odd jobs around your neighborhood such as babysitting, car washing and mowing grass.

Friday, September 21, 2007

Fourth Type of Credit Report

Your credit report is a compilation of how you've handled credit throughout your life. Credit bureaus monitor how much debt you take on and how you pay off that debt. They report to potential creditors both a detailed account of your credit history and a score that gives a numerical rating of your creditworthiness. Most people know about the three major credit bureaus, but there is a fourth credit-reporting organization---Innovis---of which many people are not aware.

Big Three

    The three "major" credit bureaus are Experian, TransUnion and Equifax. When you file for a three-bureau credit report, these are the entities from which you get information. When you apply for credit, some potential lenders will look at only one credit report, while others may look at two or even all three.


    Innovis is a fourth credit reporting agency. Although Innovis started out by selling sales leads to potential creditors, it now gathers and reports on credit information for those same potential lenders. Innovis has a history of being harder for consumers to get information from than the other credit history bureaus.

What to Do

    Whenever you want to check or clean up your credit report, go to the website for Innovis and follow the directions for obtaining a report from that agency. Innovis does not participate in the standard three-bureau checks, in which consumers can receive free copies of their credit reports through a central agency once a year. Innovis has more rigorous requirements for a consumer to request a report. For example, while the three major bureaus allow Internet ordering of credit history, Innovis requires consumers to order reports by telephone or to make requests by letter. Depending on the state in which you live, you may be charged a fee, although you are entitled to a free report if you've recently been denied credit or if you meet other conditions.

How to Assume the Debt of a Marriage Partner

How to Assume the Debt of a Marriage Partner

In most cases, assuming debt for someone else isn't a wise financial move since creditors will hold you liable for the debt you assume. However, sometimes assuming debt for a marriage partner can be beneficial. For instance, paying off your spouse's creditors can boost his score so that he -- or both of you together -- later qualify for better financing if needed. It may also make sense if your partner has cognitive or physical trouble paying and tracking the debt. The two primary ways of assuming debt for your partner are refinancing and signing an assumption contract with your spouse's creditor.




    Investigate the total amount of debt you will assume so you know how much you need to borrow through your refinance loan.


    Check the property and debt laws for your state. In a separate property state, you are not responsible for your spouse's debts unless you cosign on those debts. In a community property state, you can be held responsible for debts even if you don't cosign. If you live in a community property state, you may not have to refinance some or all of the debt since the law already considers you liable for any debt your spouse gains during your marriage -- refinancing still would be necessary for debts obtained prior to your union.


    Obtain a copy of your credit score. Refinancing requires good credit because you are applying for a new line of credit through the refinance loan. The better your credit score, the better interest rate you usually can get. Gather financial information that shows your ability to repay the refinance loan, such as copies of your pay stubs.


    Shop around at local lenders. Provide them with copies of your credit score, as well as the other financial data you have that supports your ability to repay the refinance loan. Apply for a loan only in your name with the lender that can provide you the best terms and interest rate. Finalize the paperwork.


    Use your refinance funds to pay off your spouse's debt. At this point, you owe the amount she owed since your name is on the refinance loan. She may still be held liable for this new debt in a community property state, but the lender will approach you first for payment.



    Contact the creditor with whom your spouse has a debt balance. Ask the creditor if you can assume your spouse's debt through a debt contract. Some creditors will do this, but others will not. Provide the creditor with documentation that verifies your relationship with the debtor and your financial ability to assume the debt.


    Write a formal contract that indicates you will assume your spouse's debt. State the amount you are assuming clearly, as well as your full name, contact information, the exact terms for repayment and data about your spouse and the account involved.


    Sign the contract along with your spouse and turn it over to the creditor. Have the creditor sign the contract and provide you with a copy for your records.

Debt Reduction & Counseling

Anyone facing a massive amount of debt might need some type of debt reduction program or debt counseling to get back on track. These programs can assist you in managing your finances and help you to budget and make the most out of your income.

Debt Relief Programs

    There are a number of debt reduction programs that can help you resolve debt issues. Debt relief programs are designed to help you settle your debt. Sometimes you can settle for more than 50 percent of the outstanding balance.

Consumer Credit Counseling

    Debt counseling is another option designed to help you regain control of your financial situation. At consumer credit counseling you work with trained representatives who will examine your debt situation and make recommendations and solutions in the form of a spending plan.

Debt Management Programs

    Consumer credit counseling may allow you to enter a debt management program. You will be required to submit a list of all debts. You will make a lump sum payment to the program, which will make payments to your creditors. This program enables you to receive a lower rate of interest on your debts.


    A Chapter 7 or 13 bankruptcy will allow you to reduce your debt. With a Chapter 7 bankruptcy you turn your assets over to the court, except exempt items, and a substantial amount of unsecured debt is waived. A Chapter 13 bankruptcy allows you to keep your home and car while you continue to make payments.


    Many creditors will work with you to settle your debts. Use your negotiating skills and see what you can work out with your creditors. Creditors would rather settle with you than receive nothing at all.

Estate Laws Upon Death in Florida

When a resident of Florida dies, specific legal steps must be taken to ensure that the estate is closed properly. The legal process determines what debts must be paid and to whom remaining assets are to be distributed. The proceedings also legally change the title and property ownership to heirs or beneficiaries as part of the last step.

Probate Requirements

    If an estate contains assets valued at $75,000 or more, then an official probate court case must be opened for the decedent in the state of Florida. Decedents who owned a home and had a retirement account normally have assets valuable enough to require probate states the Brandon Family Law center, but a simpler process of summary administration is available for smaller estates.

No Probate Required

    When an estate does not contain real property or assets, it may qualify for "disposition without administration." According to Glenn Lee Nye, an attorney in Deland, Fla., closing an estate without a formal probate process means that creditors can request payment on outstanding debts for up to two years after a person's death. With a formal probate proceeding, creditors must make their claims within 90 days.

Debt Repayment

    The probate process is designed to help smooth the legal transition of a person's death. Heirs and family members cannot inherit debt, so part of the probate process is to ensure that all outstanding debts are paid in full with whatever valuables the decedent left behind. Assets are liquidated as needed until all debts are paid, including any court fees and funeral expenses.

Asset Distribution

    All assets and valuables that remain after the estate debts are paid belong to heirs and beneficiaries. If the decedent left a will, then the remaining assets are distributed according to the terms of that will. If there is no will, the court distributes the remaining assets according to state law.

Tips on Credit Information

Information from the United States government, national credit bureaus and financial publications can help you understand how to manage your credit to maintain a good credit rating. The most useful information provides insight into how credit-scoring models work and includes realistic steps consumers can take to improve their credit scores.

Credit Scores

    Creditors and lenders use credit scores when they're deciding whether to approve a credit or loan application. They also use the scores to determine what interest rate an applicant will pay. That's why it's important to know what type of information is used to calculate your credit score. Your bill-paying habits, the amount of debt you have and the length of time you've had your credit and loan accounts are usually taken into consideration when your credit score is calculated. Credit-scoring systems compare such information with consumers who have profiles similar to yours. The scoring systems then essentially award points for each factor that suggests you're likely to repay a debt.

Scoring Models

    There are different types of credit-scoring models, but they have many factors in common. You can avoid unintentionally lowering your score by knowing which factors are usually given the most weight by scoring models. Consumers' payment history is typically the top-rated factor in scoring. For example, 35 percent of the Fair Isaac Corporation's, FICO, score is based on a consumer's payment history. Therefore, delinquent accounts that appear in consumers' credit files can significantly lower their scores.

Credit Reports

    Advertisements that claim bad debts can immediately be erased from credit files can mislead consumers. According to the U.S. Federal Trade Commission, no one can arbitrarily remove accurate, negative information from a credit report. Negative information about bad debts can remain in people's credit files for at least seven years. There are ways to improve your credit score, but there's no way to determine how much any action will boost scores because of the differences in scoring models. Still, scoring usually rates similar factors, such as the balance on your credit cards. Your score will likely drop if your credit cards are close to their limits. The national credit bureaus Experian and TransUnion provide tips on their websites about improving credit scores.

Credit Offers

    A credit card offer you receive in the mail may not be the best deal you can get. You may be able to get better rates by shopping online for credit cards, especially if you have a good credit rating. The "Kiplinger" magazine website includes a search tool that allows users to hunt for credit card deals that are tracked by Bankrate.com. The search tool is particularly useful because it allows people to look for cards based on their goals and the type of credit history they have. For instance, someone with a good credit history can search for the cards that offer the best deals on balance transfers.

Thursday, September 20, 2007

The Best Strategy to Take When a Boss Denies You an Annual Raise

In many positions, it is customary for a person to receive a raise after a set period of time. This raise is intended to both reward the person for hard work and to help the person cope with rises in the cost of living, which will typically rise along with inflation. However, if you're denied an annual raise, there is a good strategy to handle this occurrence and perhaps change the result.

Schedule a Meeting

    When wishing to discuss your refusal to receive an annual raise, it's critical to discuss this with your boss face to face. While some bosses may prefer to handle this over email or with a phone call, it's critical for you to present your argument in person. This allows a greater opportunity for dialogue, and it's often harder for a boss to refuse a request in person.

Ask Questions

    When you have your meeting, ask your boss directly why you did not receive the raise that you requested or expected. If your boss is vague, ask specific questions. When doing this, try hard to remain emotionally neutral. Getting angry with your boss will make it significantly less likely that you will get that raise, as it may confirm in his mind that you don't deserve it.

Prepare an Argument

    When your boss has explained the reasons for your not receiving your raise, explain reasons why you should receive your raise. If there was anything factually inaccurate about the reasons he gave, the politely correct him. In some cases, the denial may have happened through a misunderstanding. Cite company policy or your own performance as it aids you.

Explain Your Requirements

    If your boss still refuses, be frank about whether his refusal to provide you with a raise will influence your decision to stay at the company. In many cases, it may cost your boss a lot more time and money to hire someone new than to pay you more. Therefore, make clear what salary you will need to be paid for you to stay on at the firm.

Wednesday, September 19, 2007

What Is LVNV Funding?

LVNV Funding is a company that buys outdated consumer debts or "junk debts." LVNV Funding then forwards the debt it has bought to Resurgent Capital Services LP, its debt collection and management arm. While the debt appears on the credit report as owned by LVNV Funding, consumers are directed to work with Resurgent Capital Services, based in Greenville, S.C. Both companies are under the umbrella of Sherman Financial Group, LLC.

Junk Debt

    Consumer debt, such as credit cards, have a lifetime expectancy of six years for most states. Called a statue of limitations for consumer debt, this means that if a consumer does not pay a collection agency off within six years, the collection agency will treat it as a useless and noncollectable. After the statue of limitations expires, most states will treat the debt as not legally payable.


    LVNV Funding, or companies like it, buys outdated consumer debts (those that completed the six-year life cycle) and tries to collect from the consumer. When LVNV Funding buys the debt, the company will appear on the consumer's credit report as the owner of the debt. On paper, this can look like current debt and therefore payable.

Bringing Junk Debt Current

    The only way junk debt becomes current is if the consumer makes a payment. If the consumer makes a payment agreement with LVNV Funding, that will also bring the debt current. LVNV Funding will then be able to take the consumer to court to collect the money.

Note from LVNV Funding

    According to LVNV Funding's company Web site, the company purchases the "portfolios of both domestic and international consumer debt." They turn the debt over to Resurgent Capital Services LP after purchase. Resurgent Capital Services is in charge of managing the purchased debt and acts as the debt collector.


    According to several consumer reports, LVNV Funding goes under multiple company names and are said to "harass" consumers. The reports also state that LVNV Funding has tried to re-open debts that were already paid off. Ensure that you are aware of your debt and know how much you owe and to whom, in case LVNV Funding places a judgement against you. Check with your individual state's statute of limitations for consumer debt to see if your debt has surpassed the lifecycle and is there for legally unpayable.

How Can I Raise My Credit Score and Erase My Bad Credit?

How Can I Raise My Credit Score and Erase My Bad Credit?

A credit score affects your ability to purchase a home, vehicle and secure a job. Credit reports track your credit accounts and if you've made timely payments in the past. It also keeps track of bankruptcy information. If you're struggling with a low credit score, correcting inaccuracies and making simple changes can help you boost your credit score.



    Order a free credit report. Every 12 months you can order a free credit report from the three major credit bureaus, including Equifax, Experian and TransUnion (See Resources). When ordering your credit report, be ready to answer some detailed questions. For example, a credit bureau might ask you to verify your monthly car payment (right down to the penny) before giving your access to the report.


    Review the report for errors. Errors can seriously drag down your credit score. After you've printed out your credit reports, review each credit account for accuracy. Look for inaccurate reports of late payments. Also, look for suspicious accounts. At the end of the credit report, there will be a section that lists bankruptcy and court settlements. Look for inaccurate information in this section.


    Correct credit report errors. After you've identified inaccurate information, contact the credit bureau that is reporting the errors with a letter disputing the inaccuracy. The Federal Trade Commission (FTC) recommends including your legal name, current address and explanation of dispute in the letter as well as supporting documentation. For example, if a company is reporting an inaccurate late payment, include a bank statement copy that proves when the check was cashed.


    File a police report. If there is fraudulent activity under your credit report, file a police report right away. This will help you clear up inaccuracies with the credit bureaus. After the police report has been filed, place a fraud alert on your account. This needs to be done with each credit bureau individually. Call them directly to initiate the process. A fraud alert makes it difficult for someone else to access your credit.


    Ask for a correction letter. After the credit bureau has approved your dispute claim, ask that a correction letter be sent. If you request it, credit bureaus are required to send a letter to anyone who has pulled your credit within the last six months, according to the FTC.

How Can I Settle Debt?

Settling debt is not easy. Creditors usually want all the money owed to them. Economic circumstances sometimes makes that impossible and debt settlement becomes an option. Individuals can either attempt to settle debts on their own, or use a debt settlement companies. Before engaging the services of a debt settlement firm, make certain you are dealing with a reputable company.


    One way to settle debt is by attempting it yourself. Although there are debt settlement companies available, nothing prevents you from contacting your creditors on your own and trying to work out an arrangement. Doing research beforehand helps you to negotiate the best deal. Talk to others who have settled debt, either on their own or with the help of debt settlement companies. Find out the settlement terms, allowing you some idea of what to expect. When you contact the creditors, make sure they provide terms and conditions involving the debt settlement in writing. Try to guarantee any negative credit attached to the debt gets removed upon settling the debt. When attempting to settle the debt, be persistent. If the person assisting isn't helpful, ask to speak to a manager.

Debt Settlement

    Debt settlement companies work to settle debts on behalf of their clients. Do research before using a settlement company and only deal with reputable companies. The National Foundation for Credit Counseling provides helpful guidelines designed to steer people away from unscrupulous debt settlement companies. Companies asking for payment prior to providing results are suspect. Consumers should also be wary of companies making broad claims seeming too good to be true. Insist the company provide all conditions and guarantees in writing.

Debt Management

    Debt settlement companies engage in debt management plans. The debtor pays a monthly sum to the debt settlement company. The company disburses the money to the various creditors. In some cases, the creditors agree to lowering the interest rates or to drop penalties and late fees. Any conditions and agreements need to be made in writing.


    An area to consider when settling debt is the Internal Revenue Service. When settling debts for less than their full amount, the difference is considered income. For example, someone takes out a loan for $50,000 and only pays back $20,000, the IRS considers the difference of $30,000 as income. Filing for bankruptcy and some forms of debt settlement in mortgages are exceptions.

Credit Consolidation Facts

If you're having trouble paying all your creditors each month, credit consolidation can sound like an attractive option. Companies promise to consolidate all your debts in to one monthly payment that can reduce the amount you are paying creditors while also making payment easier. If it sounds too good to be true, it usually is. Credit consolidation may reduce your monthly payments, but the facts are, it often comes at a steep price in the long run.

Impossible Terms

    For those who need credit consolidation the most, money is often difficult to come by. Securing a consolidation loan through a bank, credit union or other reputable lender is contingent upon the one thing most people who have trouble paying their bills do not have -- a great credit score. The debts that are consolidated in a consolidation loan are often unsecured, meaning that all the bank or other lender has for collateral is your word you'll pay. If your credit history is littered with late payments and/or charge-offs, your word is unlikely to be enough for most creditors.

Consolidation Programs

    When a bank is not an option, companies that offer debt consolidation programs can seem like the best way to pay down debt. According to an article on Bankrate.com, less than 35 percent of people who enter these programs actually benefit from them.

    Debt consolidation programs may advertise themselves as "non-profit," but that does not mean they do not charge fees for their services. These fees can sometimes be steep. According to Bankrate.com, compare the minimum payments you currently pay your creditors to the payments proposed by debt programs; if the program does not save you more than 5 percent, you won't benefit.

Tricks and Scams

    The Federal Trade Commission warns that many debt consolidation programs, also known as debt management plans, may not be on the up-and-up. Think twice before enrolling in consolidation programs that charge high up-front fees, do not spend adequate time reviewing your financial situation, won't send you information about their services without acquiring personal information from you, make no attempt to teach you money management skills or require that you make payments to them before your creditors agree to the program.

Credit Counseling

    Working with a Better Business Bureau-listed credit consolidation company can help you to negotiate better terms with your creditors while also learning important money management skills.

    Unlike credit consolidation or debt management plans, credit counseling plans help you to pay down your debt by negotiating lower payment terms and/or interest rates with your creditors. These programs also require you to learn better financial skills.


    When a bank loan or home equity loan is out of the question, and a debt management program does not seem right for you, you may find that negotiating with your creditors can, in fact, benefit you as much or more than credit consolidation.

    Many credit card companies and other lenders offer hardship programs that can temporarily -- or in some cases, permanently -- reduce the amount of your monthly payment and/or cut your interest rate. While you won't be paying one payment rather than several, the money you can potentially save may be more appealing.

Tuesday, September 18, 2007

Does Terminating a Lease Affect Your Credit?

Breaking a lease before it ends can have a negative impact on your finances. Your landlord may turn your case over to a collection agency and may even sue you for the balance on your lease. Before moving out, work with your landlord to come to a mutually agreeable lease termination agreement.

Lease Termination

    Breaking a lease is like breaking a contract. If you don't fulfill your responsibilities, such as paying your rent for the duration of the lease, the other party (your landlord) can take legal steps to recoup her losses. While many states require landlords to make a good-faith attempt to re-rent a home after a tenant terminates a lease early, if your landlord can't find a new renter, you may be responsible for paying the rent for the duration of the lease, even if you aren't living in the home.

Leases and Credit

    If you break your lease and don't pay your rent as agreed, your landlord or his property management company may decide to aggressively pursue payment. You may first receive a bill for the rent you owe under the lease. If you don't pay the rent due, your former landlord or property management company may hire a collection agency. The collection agency, or property management company itself, may report your debt to the credit bureaus, damaging your credit. Some landlords or collection agencies may also take you to court.


    If your landlord or a collection agency successfully sues you, the case becomes a matter of public record. Credit bureaus research public records and include information about court judgments on your credit report. A judgment can stay on your report for up to seven years if you pay the judgment. If you don't pay the judgment, it can remain on your report until your state's statute of limitations on debt runs out.

Working with Your Landlord

    If you must terminate your lease, make an attempt to work things out with your landlord. Help him find a new tenant for the place, or offer to pay an extra fee to terminate the lease. If your landlord does agree to let you out of the lease, be sure to get this agreement in writing. Having a written agreement can prevent your former landlord from later trying to sue you for breaking the lease.