January 2013 ~ Credit And Debt Management

Wednesday, January 30, 2013

Credit & Debt Repair Overview

1:06 AM No comments

Even if you are knee-deep in debt, you can start a credit and debt repair plan on your own and avoid the expensive fees associated with credit repair agencies. The Federal Trade Commission suggests you contact each creditor in writing to request a payment workout plan, negotiate with collectors for repayment of past due accounts and pay bills on time to help rebuild your credit.

Write each creditor and explain your financial hardship. Include documentation to support your case, such as a note from your physician if you are suffering from a medical disability, or an unemployment verification letter to prove job loss. Request the company create a workout plan or modify payments in order to keep your account current. Your creditor is unlikely to reduce past finance charges but may waive future interest fees or temporarily reduce your minimum payment until your financial situation changes.

Deal with collectors. Ignoring a collection agency can cause a judgment to be filed against you for wage or bank account garnishments. Some collection agencies and their creditor clients are open to negotiating down the debt, such as agreeing to settle for a portion of the debt if you offer a lump-sum payment. Verify any negotiations made in writing and send the letter by certified mail. Learn your rights when dealing with collectors; consult your state's department of consumer affairs as well as the federal Fair Debt Collections Practices Act (see Resources).

Pay every bill on time to re-establish your credit. Creditors may agree to remove late payments from your credit report if your payments have been current for at least six months. Rebuild credit slowly. Apply for a small cash loan with your bank using money in your savings account as collateral. A department store may extend credit to you if you can show an ability to pay. Review your credit report yearly and dispute any debts you no longer owe. Judgments, liens and other delinquent debts can stay on your report for seven years.

Control spending, stick to a budget and limit your debt. Use cash for most daily purchases and save your credit cards for financial emergencies. Set aside a rainy day fund to pay for large purchases rather than putting them on plastic. Rotate your credit cards and carry only one card at a time. Charge small amounts, taking care not to use more than 15 percent of the credit limit, and pay off the balance each month.

How Can I Get a Creditor to Accept Less Than Full Payment?

12:52 PM No comments

When you have outstanding debt that you can no longer afford to make payments on, the result can be very stressful. Creditors and bill collectors might be hassling you day and night to get their money. Even though you can't afford to pay back the full amount, you do still have some negotiating power. Creditors want to get something from you, so you may be able to get them to accept less than full payment.

Instructions

Figure out how much of the debt you can afford to pay. This might mean paying less than the principal amount or less interest over time. These are the numbers you will use during negotiations.

Call the creditor directly and make an offer. Don't start with your bottom line. There will likely be several rounds of negotiation. For example, if you want to pay 90 percent of the debt, start by offering to pay 70 percent. If you want to pay 5 percent interest, rather than 12 percent, offer to pay back the principal with no interest.

Ask to speak with a supervisor. The first person you speak with would probably reject your first offer and might not even have the authority to accept it. You need to talk with a supervisor.

Listen carefully to the counteroffer made by the supervisor. Legal terms might be used that you do not understand. Ask what the terms mean and make sure you understand everything being said.

Continue to negotiate with the supervisor. Once you get to your bottom line, such as the maximum amount you're willing to pay, stick to it. Do not give up. What you're offering the creditor is better than nothing. When a deal is finally made to pay less than the full amount, request it all in writing. Never accept terms until you get them in writing.

Debt Garnishments on Social Security Benefits in Wisconsin

3:37 PM No comments

If a person owes money to another party, the creditor will sometimes bring a lawsuit against the debtor for payment. A creditor that wins such a suit will have several new options as for collecting the money owed. While wage garnishment may be available to him, he cannot likely garnish Social Security benefits.

Federal and state laws restrict the practice of garnishment in Wisconsin. A creditor can only garnish the wages of people who are above the federal poverty level. In addition, only certain types of income can be garnished. In general, private creditors can only garnish a person's wages, not benefits provided by the federal government, such as Social Security benefits.

Social Security benefits, including retirement, disability and Supplemental Security Income, are protected by federal law from garnishment from creditors. A creditor is not allowed to serve a garnishment order on a federal agency unless he himself is working as a representative of a federal agency. This would not actually happen, as a civil judge would never grant a creditor permission to garnish a person's Social Security benefits in the first place.

A private creditor is not just barred from garnishing a person's Social Security benefits, but he also cannot seize money from a person's bank account if the money derives from federal benefits. If the person who the creditor is seeking money from has few assets and is only supported by federal benefits, then the creditor may not be able to recover the money without finding another source of income of the debtor.

While private creditors are barred from garnishing the wages of a debtor, the same does not hold true of federal government agencies. Many government agencies, such as the Internal Revenue Service, can garnish federal benefits, including Social Security benefits. However, many of the same low-income exemptions apply to federal agencies. Therefore, if a person is living solely off of federal benefits, garnishment by the government may be impossible.

Does a Repossession Stop a Car Purchase?

7:02 AM 1 comment

When a person takes out a loan on a car, the loan is generally secured by the car itself, which acts as a form of collateral. If the borrower misses a number of payments on the car, the lender will generally have the right to seize the car, in a process known as repossession.

When a lender repossesses a car, the borrower is not longer obligated to continue making payments on the car. The car is now legally transferred to the lender. However, the borrower this does not mean that borrower does not owe any additional money. He may, in fact, still be obligated to pay off part of the car's cost, as well as additional fees.

When the lender repossesses the car, the lender will generally sell the car, so as to help pay off the debt still owed on the vehicle. If the proceeds from the sale of the car are not enough to cover the outstanding debt, the borrower is liable for paying this difference, as well as the cost of the repossession. For example, if a borrower owes $10,000 on the loan and the car is repossessed and sold for $8000, the borrower still owes $2000 to the lender to make up for the difference between the outstanding debt and the sale price of the car, as well as any fees that lender accrued is repossessing and selling the vehicle.

Although the borrower is not required to do, before the car can be resold, many states give the borrower the right to buy back the vehicle by paying the amount owed on it, plus the costs incurred by the lender in the course of repossessing it. According to the Federal Trade Commission, borrowers should check with their state's consumer protection office for specifics of their laws.

According to the Federal Trade Commission, borrower's may have a legal right to contest any judgment leveled against them for the difference between the car's sale price and the outstanding loan under a number of conditions. If the lender violated the law when seizing the vehicle or didn't sell the car in a way that ensured it would fetch a fair price, the borrower may have grounds to sue him.

Even if the sale of the repossessed vehicle is enough to cover the cost of the repossession and the outstanding loan, the borrower's credit rating will stick take a large hit. According to the law offices of Carreon & Associates, a vehicle repossession stays on a person's credit report for up to seven years.

How Does Being an Authorized User on a Credit Card Affect Your Credit Score?

7:18 PM No comments

When you open a new credit card, you have the ability to add authorized users to the account. This gives the authorized users the ability to spend with the card, but it can also affect those users' credit histories and credit scores. If you are an authorized user on a credit card account, you need to be aware of the potential impacts to your credit score.

When you are listed as an authorized user on a credit card account, the credit card will generally show up on your credit report. To your lenders, it will look like it is simply one of your credit cards. There is no distinction on your credit report as to which credit cards are opened in your name and which ones only list you as an authorized user. This makes becoming an authorized user a very important credit factor to consider.

When you are going to be added to a credit card account, it is very important that you consider with whom you are associating. If you are added onto the credit card of a person who has a low credit score, this may negatively affect your credit score as well. If the person racks up large balances on the credit card and then does not make payments on time, this can significantly hurt your score.

Because of the importance of that credit bureaus place on authorized users, some people have begun to manipulate this phenomenon. If you have poor credit, you could potentially rent the credit history of someone who has solid credit. For a one-time fee, you could be added on as an authorized user of someone else's credit card account. You could also be added on to the account of a family member who has a good credit history to ultimately help your own credit.

If you are trying to apply for a loan, you need to think about the impact of being an authorized user on someone's account. Even if you have a great credit history otherwise, you may want to remove yourself from any credit card accounts that are associated with people who have bad credit histories. The credit card balance will also be used when calculating your credit utilization ratio, and it will look as if you have used more credit than you actually have.

When Does a Collection Account Go to a Credit Report?

4:17 PM No comments

Any account owned by a collection agency is a collection account. Collection agencies buy unpaid consumer debts from creditors at a reduced rate. They then pursue each debtor for the full amount he originally owed. Collection agencies report their accounts to the credit bureaus. As soon as a collection agency reports a debt you owe to the credit bureaus, it appears on your credit reports and damages your credit rating.

The Fair Debt Collection Practices Act (FDCPA) contains a specific set of laws that all third-party debt collectors, such as collection agencies, must follow when collecting consumer debts. Collection agencies must first notify you, in writing, that you owe a debt and provide you with 30 days in which to dispute the debt.

Although the FDCPA provides collection agencies with the right to report consumer debts to the credit bureaus immediately, if a consumer takes advantage of her right under the FDCPA to dispute the validity of the debt, the collection agency cannot conduct any form of collection activity before providing the consumer with written proof of the debt.

Just because a collection agency has the legal right to report your unpaid debt to the credit bureaus immediately, does not mean that it will do so. Collection agencies know that informed consumers have little incentive to pay off a debt once a collection account appears on their credit reports. Paid collections are just as damaging to credit scores as unpaid collections. Therefore, some collection agencies promise not to report the debt to the credit bureaus in exchange for prompt payment.

After reporting your collection account to the credit bureaus, the account appears on your credit report immediately. It does not, however, linger there indefinitely. The Fair Credit Reporting Act (FCRA) limits collection accounts to a reporting period of no longer than seven years. The seven-year period begins 180 days after you ceased making payments to the original creditor. Thus, if the debt itself is older than seven years, a collection agency cannot legally insert the debt on your credit report.

A collection agency can ensure that its collection account appears on your credit report beyond the federal reporting period by changing the dates on the account. This practice is illegal, but does occur. The Federal Trade Commission reserves the right to fine any debt collector that engages in this practice or revoke the company's business license.

Credit Card Debt Consolidation Solutions

7:33 AM No comments

Debt consolidation not only puts multiple credit card balances into just one account to simplify the payment process, but it can also lower the monthly payment amount or secure a lower interest rate. Consumers have several options for how to consolidate credit card debt and the best option varies depending on the individual's circumstances and desired outcomes.

Most credit cards allow cardholders to transfer a balance from another card. If you have a credit card with a large enough credit line to hold all of your balances, transfer them to simplify the payment process. However, the balance transfer might require a fee, in which case the fee should be less than the difference between the credit card interest rates to make sense.Another option is to apply for a new credit card that offers a low introductory rate for balance transfers. If you repeat the process and transfer the balances to another card before the promotional rate ends, you can keep paying very low rates. However, opening many new credit cards can hurt your credit score.

If you own a home and have equity, meaning that the home is worth more than the outstanding balance on your mortgage, you can borrow from your home equity to consolidate credit card debt. Lenders offer home equity loans and home equity lines of credit to qualified borrowers who meet the lender's credit criteria. Home equity borrowing typically costs less than carrying credit card balances and it can also result in lower payments by stretching out the repayment over a longer time period. However, if you default on a home equity loan, you can lose your home. In contrast, credit card companies cannot go after your home if you default on credit card payments.

Credit counseling companies often lead consumers to take out an unsecured personal loan, also known as a signature loan, to consolidate credit card debt. Credit unions also often offer these loans to members. The loan might have a lower interest rate than the credit cards, depending on your credit. You should be able to get a loan that lowers your monthly payments by extending the repayment term. However, be aware that paying back debt quickly saves you the most money in the long term because you do not owe as much for interest.

Many other types of lending are available for consolidating credit card debt. For example, if you have an employer-sponsored 401(k) plan, you can usually borrow from the money you have saved there and repay yourself. However, this can backfire if you lose your job and must repay the loan immediately. If you have a life insurance with cash value, you might be able to borrow from that, which reduces the amount your beneficiaries would receive unless you repay it. You might even have friends or relatives who are willing to lend you money to pay off credit cards. In this case, work out a payment plan and follow through on your commitment so you do not ruin the relationship.

How to Stop Collections Agency Calls to the Previous Owner of My Telephone Number

7:30 AM No comments

Credit card and collection agency companies are persistent; they want their money and they want it right away. Some companies will call customers repeatedly, even after they have moved or changed telephone numbers. Often, informing the caller that the customer no longer owns your telephone number is not enough. If you are still getting calls from creditors who are looking for someone who you don't know, there is a way to force them to stop calling your number once and for all.

Instructions

Answer the phone and wait to speak to a representative. Inform the operator that they are calling the wrong number. Tell them that you are the new owner of the number and request that your number be removed from their database.

Ask for the name, telephone number and address of the collection agency.

Write a cease and desist letter to the collection agency. Include your name and telephone number and explain that they are calling a wrong number and that the person they are trying to reach no longer owns the number.

Sign the letter and keep a copy for your records.

Send the letter to the agency via certified mail with return receipt, which will document the letter's delivery for your records.

Keep track of all calls you receive. If you believe you are being harassed, report the agency to the proper authorities, such as the Federal Trade Commission.

North Carolina Deceased Debt Probate Law

7:16 AM No comments

North Carolina uses a standard probate process to settle a person's estate when she passes away. The probate process is designed to ensure all assets are accounted for and valued, all debts are paid in full and the wishes of the decedent are carried out according to the terms she set down in her will. If there was no will left, the state of North Carolina distributes remaining assets according to state law.

A probate court case is used to help transfer ownership, titles and deeds to real or personal property legally. Probate is not needed when a decedent did not own real property; however, it can be useful if a lot of debt is left outstanding because the probate process limits how long a creditor can make a claim on the estate.

An estate executor or personal administrator is responsible for handling the paperwork and legal steps of closing an estate. Part of an executor's responsibilities in North Carolina include notifying all creditors of the decedent's passing, creating an inventory of real and personal property or assets including current market values, submitting asset and debt lists to the court, paying off debts with the assets and distributing remaining assets according to the decedent's will or the terms of North Carolina laws.

Estate administrators publish a death notification in local newspapers as part of their first duties, then they send death notifications by mail to all outstanding creditors. In North Carolina all creditors must stake their claims against the estate within three months of receiving the death notification.

After the three month waiting period has passed and all estate assets have been inventoried, the estate executor then uses any or all of the assets to pay off the outstanding debts. The estate must pay debts incurred from death as well as previously held debt from when the decedent was alive. Funeral expenses and court costs, for example, must be paid from the assets of the estate along with credit card debts, personal loans and any other valid debt claims.

How to Eliminate Bad Credit on Your Credit Report

5:52 PM No comments

A low FICO score and derogatory remarks on your credit report can stop you from getting a home loan, auto loan and other types of credit. And even if a lender approves you for financing with bad credit, this likely results in a high interest rate. Fortunately, you can reverse bad credit and clean up your credit report.

Instructions

Submit payments to your creditor. A good payment history helps increase your FICO score and eliminate bad credit. Know your due dates, and pay your bills on time.

Decrease debt-to-income ratio. Aim to use cash for everyday purchases, and develop a strategy for reducing your outstanding balances, which helps increase your credit rating. Use personal savings to get rid of debt, or consider a home equity loan or refinance to pay off your high-interest debts.

Pay off a collection account. Paying off a collection account doesn't automatically remove the remark from your credit report. Once you've paid the account in full, contact the original creditor or collection agency and ask it to remove the negative remark.

Limit credit inquiries. Applying for numerous lines of credit knocks points off your credit score, and this impulse can result in bad credit. Inquiries stay on your report for up to two years. Apply for credit when necessary, and reduce your number of inquiries.

Consider piggybacking. If you can't obtain good credit on your own merit, use the piggyback method wherein you add your name to a spouse, parent or sibling's credit account. Find someone with an impeccable credit history, and become a joint account holder on that person's credit card.

Pay attention to your credit report. Failure to analyze your credit report once or twice a year can result in bad credit. Wrong account information and identity theft can ruin your score. Order a copy of your report annually, and dispute any errors.

How to Decrease the Interest on Your Student Loans

3:12 AM No comments

According to the Project on Student Debt, the typical 2009 college graduate had $24,000 in student loans, and many leave school owing $100,000 or more. Federal student loan programs typically offer the lowest interest rates, so students should tap this source first, but private lenders can also offer favorable terms if you shop around. Reducing your interest rate can reduce your monthly payments as well as your total amount due, but it requires dedication and careful attention to details.

Instructions

Obtain a student loan from a federal program if you can. Federally subsidized loans have lower interest rates than private loans and also offer more flexible repayment plans. As of July, 2011, dependent students (which includes most students in college) can borrow up to a total of $31,000 for their undergraduate education. Graduate students can borrow up to $138,500 under the federal student loan programs.

Shop around for private student loans if the cost of your education exceeds the federal loan maximum. Most major banks offer student loans, but interest rates and fees can vary widely. Before applying for a loan, compare programs. Some banks have low interest rates while you're in school, but the interest rate increases after graduation. While banks may offer a longer repayment period at a lower interest rate, that could increase the total cost of the loan. A higher rate for a shorter period may be the best value.

Take advantage of borrower benefit programs. Many student loans offer a discount of about 0.25 percent on interest rates for paying your monthly bill through automatic direct debit. While this may seem insignificant, over the life of a loan, you can save thousands of dollars.

Some banks offer an interest rate discount for making payments on time. Typically, a lender will offer a discount of one percent for making 36 consecutive on-time payments. Be aware, however, that even one late payment, if only by a day, will end your eligibility for this discount. In addition, if you have a forbearance or deferment on your loan, you will lose your eligibility.

While these discounts are available to most borrowers, few will maintain their eligibility for these programs. Tim Fitzpatrick, the former CEO of Fannie Mae, stated that "the bottom line is that less than 10 percent of borrowers will earn all the advertised repayment benefits as they will either consolidate their loans or miss a scheduled payment sometime during the first several years of repayment."

Consolidate your loans, which may result in a reduction in your interest rate. Ask several lenders about their options before deciding whether to take this step. In many cases, consolidation, even at a lower interest rate, can mean more money owed over the life of the loan.

Get a co-signer. Some banks offer lower rates to students who have a co-signer, usually a parent, on the loan. A co-signer, however, is obligated to repay the loan for you if you do not make payments. Be sure that any co-signers can afford to pay your debt if the need arises.

How to Get Late Payments Removed from Credit Report

2:28 AM No comments

A late payment can drastically effect your credit score. Timely payments can contribute up to 35% of your credit score. This article will show you step by step on how to remove these late payments from your credit report.

Instructions

Get a current credit report from the 3 major bureaus (Equifax, Experian, and Transunion). Search your report for any errors on your report. If you find an error, file a claim with the credit bureau to have it investigated. The original creditor will have 30 days to provide documentation that is correct. If they don't provide this information, it will be considered inaccurate information and removed from your credit report.

Try contacting the creditor yourself. A phone call can go a long way if you get a hold of the right person. If you have always had a good payment history with them and missed a few payments here and there, talk to them and see if they will be willing to remove these late payments. This is commonly referred to as a goodwill request.

A way to avoid late payments is to sign up for automatic payments. If you try to the step above and they still refuse to remove your late payments, sign up for automatic payments and try again. They will see that you have signed up for automatic payments and might be more inclined to grant your goodwill request because they are ensured that they will receive their money on time from now on.

Lastly, you can always try to dispute an account and hope that the creditor does not provide the documentation within the alloted thirty days. This may not be considered honest by some people but it is worth a shot if you are desperate. Good luck!

How Does Credit Card Debt Accumulate?

3:54 AM No comments

Credit card accounts have revolving balances that allow cardholders to make purchases and pay later.

Most credit cards give borrowers the option of paying the minimum amount, which is usually reflective of a small portion of the balance. For many consumers, it is simply too convenient or appealing to only pay a minimum amount each month. For other consumers, it's a financial necessity. Some cardholders don't realize the rapid accumulation of credit card debt until they receive a statement and discover that their balance is much more than they thought it was.

Unless a credit card falls into a special introductory period without interest, most credit card accounts have interest charged on balances that aren't paid in full before the due date. Extra interest is sometimes charged for cash advances or balance transfers. When interest is charged, it becomes a part of the balance due. This means that the next billing cycle, the original interest becomes a portion of the total balance and incurs interest charges. It is this compounding interest that makes balances on credit cards grow exponentially.

The Process of Rent to Own Computers

11:14 PM No comments

If you want to get a new computer you can either purchase it outright with cash to take full ownership or make regular payments per a leasing agreement. The latter arrangement is most common for a business computer rental. One other option that a computer shopper has is to enter into a rent-to-own agreement.

A rent-to-own computer agreement is a borrowing arrangement where you make regular lease payments for the computer then opt to purchase it with cash after the term is up. The computer manufacturing company or an associated computer financing company sets up the leasing contract. The financing company owns the computer during the term of the lease, but if you decide to buy the computer the contract changes into a purchase agreement and you take over full ownership.

To enter into a rent-to-own agreement for a computer you must first fill out a lease application and pass a credit check. As with any lease agreement, you must also provide information about your personal or business income as well. Upon approval, the computer leasing company determines a monthly rental fee based on the cost of the computer, the results of your credit check and the length of the agreement. You must sign a lease agreement that contains a clause regarding buyout terms. This clause includes the estimated residual value of the computer, which in most cases is equivalent to the offered buyout purchase price.

A rent-to-own computer agreement is useful if you do not have the money to purchase a computer at this time but you need to use one regularly now. You can then buy the computer when you have the money later. Also, when you rent-to-own you have the opportunity to test out the computer to make an educated buying decision. If the computer becomes obsolete you can simply opt-out of buying. Some computer financing companies even offer $1 buyout offers, where you can buy the equipment for just a dollar after the lease is up. But keep in mind that a rent-to-own agreement containing a $1 buyout offer commonly comes with a higher monthly rental fee.

Though rent-to-own computer arrangements have benefits, they also come with a few key downsides. For one, you spend more for the computer when you lease compared to buying the equipment upfront. Also, you have to finish paying the lease even if you no longer need the computer. If you opt not to purchase the computer after the lease period, you may have to pay lease end fees if you don't return the computer in acceptable condition.

DIY Debt Reducers

4:39 PM No comments

Being in debt is a major stress faced by millions of people worldwide. Sometimes the feeling of being in debt can feel like an inescapable, dark hole. When faced with this situation, it is important to know that the first step is realizing that you can take action to get yourself out of debt. Reducing the amount of money owed to other people and organizations can happen if you follow some basic steps.

When faced with a seemingly insurmountable task like reducing a mountain of debt, it is important to focus on simple, manageable steps as a starting point. In this instance, this means avoid taking on new debt to pay the old. It is tempting to open up a new credit card or go to a payday loan business to pay bills and other debt, but doing so only digs the hole deeper. Fight the urge and work with your existing debts first.

The best way to examine personal finances and come up with a solution to reduce, or completely eliminate, debt is to track spending. By keeping tabs on every dollar that goes out, you can get an accurate picture of where your money is going. After spending some time tracking your money, take a look at what you are spending it on. Use this knowledge to find areas you can cut back on, such as eating out or entertainment expenses, and instead spend that money on paying down debt.

Paying off items with the highest interest first is a technique guaranteed to lower the overall amount of your debt and put you on a path towards financial well-being. High interest debt has a snowball effect that will keep adding to your debt. In order to avoid this, you need to pay more than the minimum required amount every month. Bankrate.com recommends paying "double, triple, quadruple minimum payments." Paying more than the minimum balance is a good idea to reduce debt, regardless of the interest rate.

Some people take to avoiding calls from creditors, but this doesn't get them anywhere. Creditors have a single objective -- get the money that is owed to them -- and this works in the favor of those willing to communicate. If you want to reduce your debt, be proactive. Call the credit companies and try to work with them. See if they are willing to negotiate a lower interest rate in exchange for setting up direct debit payments. Another option is to find out if a one-time payoff for a lower amount is possible. Doing so will be listed on your credit report as a charge off, which appears negative to future creditors.

How Long Can Creditors Try to Collect on a Debt?

6:05 PM No comments

The Fair Debt Collection Practices Act regulates what debt collectors can and cannot do as they attempt to collect from you. Although the federal law protects you in many ways, it does not include provisions for making debts disappear or expire. That means a debt collector could pursue you for the rest of your life for a debt that you legally owe.

Delinquent debts such as old credit card accounts can be listed on your credit report for seven years. The Fair Credit Reporting Act, another federal law, requires the information to be removed from your report after seven years. However, the removal of the information from your credit report has nothing to do with your liability. You still owe the debt, even though it's no longer being listed on your credit.

"The New York Times" reports that it is common for debt collectors to pursue old debts for years, with the debts frequently assigned or sold to different agencies. In a story dated July 30, 2010, "The Times" reported that one major bank had offered to sell an $8 million portfolio of defaulted credit card accounts that were written off by the bank in 2003. The asking price for the old debt was just $16,000, or two-tenths of a cent on every dollar. Debt collectors purchasing old debt in bulk have the right to legally pursue full payment from people who defaulted on the accounts.

State statute of limitation laws prohibit debt collectors from successfully pursuing really old debts in court, and that's important because the threat of a lawsuit is usually the debt collector's most powerful weapon. Statute of limitation laws vary by the state, but generally range from three to 10 years according to "The Times." After that, the debt becomes "time-barred," meaning the debt collector cannot successfully sue. However, that does not stop the debt collector from attempting to collect from you in other ways, such as by mail.

Some people choose to ignore debts that are time-barred by state statute of limitations and also are too old to appear on credit reports. The debt loses much of its significance once the threat of a lawsuit has been stripped away and it cannot be listed as a negative on your credit report.

"The Times" reports that making a payment on an old debt could reset the statute of limitations from the beginning. According to "The Times," that's a common tactic debt collectors use to regain the threat of a a lawsuit and to place a negative entry on your credit report.

How to Deal With Credit Calls

2:56 AM No comments

No one wants to be in debt, but when credit card bills get out of hand, debt collectors may call asking after the money you owe. The calls can get quite stressful--segueing into outright harassment at times--and as a consumer, you may wonder what you can do to stop them. Laws exist to protect consumers from harassing phone calls, and you can deal with the calls by taking a few simple steps.

Instructions

Write down a log of phone calls from credit collectors: when the call was made, how long it lasted and the topics discussed. Whenever possible, establish a paper trail of correspondence so that you know who you have talked to and what they said. If you can, record the phone calls when they arrive so you know exactly what is said. Some states require permission from the other party before you can record the call; check your local laws to ensure you are in compliance. If you receive any mail correspondence in addition to phone calls, keep them with your records so that it's all in a central place.

Ask for the creditor's name, the amount you owe, the name of the person speaking to you, a contact phone number and a contact address. Write all of it down and keep it with your log; never agree to pay any debt over the phone and never give out any private financial information, such as routing numbers, bank account numbers or credit card numbers.

Tell the person on the other end of the line that you will be corresponding by mail from this moment forward. Mail provides a more viable paper trail than telephone conversations, as well as allowing you to address the issues at your leisure instead of someone else's timetable.

Write a letter to the collection agency asking them to refrain from contacting you by phone. Send it certified mail through the U.S. Post Office, with a return receipt. That gives you proof that they have received your letter and by law cannot continue to contact you by phone.

Does a Debt Collection Agency Affect Credit Reports?

6:43 PM No comments

Having collection accounts on your credit reports has a long-term effect on your credit rating, even if you eventually pay off the accounts. Collection agencies have the same rights that creditors and lenders do when it comes to reporting the status of consumer accounts that creditors and lenders turn over to them.

Collection agencies buy overdue debts from creditors, lenders, medical providers and others in an attempt to profit from collecting all or a portion of what consumers owe on those debts. New collection accounts usually appear on consumers' credit reports after agencies buy their past-due debts. Agencies have the right to report to the credit bureaus all new activity associated with collection accounts because they purchased those debts. The information debt collectors provide to bureaus remains on credit reports for seven years. Agencies also may sell unpaid accounts to other collectors.

Information from the original creditor and all debt collection agencies associated with a debt appears on a consumer's credit reports, even if collection accounts sold to another company are inactive. However, credit bureaus must remove all accounts associated with one delinquent debt from a credit report at the same time after seven years, according to the Experian credit reporting company. The timing for the seven-year period begins from the first delinquency date reported to credit bureaus.

A collection company can't arbitrarily raise the amount of a delinquent debt by reporting to credit bureaus that you owe more than you do. For example, collectors can't try to collect interest and fees in addition to the original amount you owe in certain circumstances, according to the U.S. Federal Trade Commission. However, there are exceptions, because some state laws and consumer financial agreements allow collectors to attach additional charges to delinquent debts.

You may choose to pay a past-due debt in full, or a debt collection agency may allow you to settle an account by paying less than you owe. In either case, the negative information from the collection process will remain on your credit report for seven years. A collection agency may not be helping you by agreeing to less for less than the original debt, because a "paid in full" notation won't appear on your credit report. Experian notes that a settled account shows you never met the obligations of a financial agreement, which makes a settlement less favorable for your credit history than a paid-off account.

Do Not Call Letters for Debt Collection

11:37 AM No comments

If dealing with debt collectors has you at the end of your rope, take control of the situation and gain some relief from the endless barrage of phone calls. Take steps to enforce your rights under the Fair Debt Collection Practice Act to help gain some peace of mind and some time to get your financial house of cards in order.

The Fair Debt Collection Practice Act -- or FDCPA -- falls under the authority and oversight of the Federal Trade Commission. Adopted to protect consumers from abusive or deceptive debt collectors, the FDCPA provides consumers with various rights and protections. The act lays out illegal debt-collection practices, such as harassment and fraudulent statements, and gives consumers details on how to handle debt collectors in a proper fashion. This includes providing consumers with detailed information related to writing and sending do not call letters to debt-collection agencies.

Putting a stop to debt-collection calls requires a formal request in writing. Address the letter to the debt collector or a specific account representative, if you have that information. In the opening paragraph, reference the debt in question by including identifiable information, such as an account number or file reference number. Instruct the debt collector that you intend to exercise the rights provided to you under the Fair Debt Collection Practices Act. Request that the collector stop contacting you by phone immediately.

In addition to requesting that a debt collector not call you anymore, you may wish to include further details about the debt and the current situation for record-keeping purposes. These details can include a request for validation of the debt and a description of any violations, such as calling after 9 p.m., that you have documented to date. If you do not believe that you owe the debt, make a request for proof of the debt within 30 days from receipt of the notice of the debt. Debt collectors must provide this information. If they cannot provide proof of the debt, you can petition the credit bureaus to remove the false data from your credit report. In addition, the debt collectors must cease all contact with you concerning the debt.

Send all written communication to a debt collector via certified mail. When you send the debt collector a certified request to cease all calls, you will receive a receipt stating who signed for the letter and the date received. Keep this receipt for your records. Debt collectors can only contact you one additional time after receipt of a do not call letter. They can call you to notify you of their intent to take a specific route with your account, such as filing a lawsuit, or to tell you that they intend to cease contact with you from that point on.

About Equifax Free Online Credit Reports

3:40 AM No comments

A credit report is one of the easiest ways to track your financial history. It lists each creditor you owe money to, your payment history, and any delinquent accounts. Other creditors and employers use credit reports to make decisions about issuing new credit or hiring you to work for their company. Equifax's free online credit reports provide you with multiple ways of viewing your personal credit history. You'll instantly be able to compare information and monitor changes.

Equifax's free online credit reports offer many consumers a way to monitor their credit status. Knowing your current credit status can help you find the best deals when it comes to buying homes, cars or other major purchases. Free online credit reports offered by Equifax allow you to view any past or current creditor information. It also lets you know what companies or employers are prying into your credit history. Each time someone accesses your credit report, Equifax will display their details.

Monitor your credit history for inaccurate information. With Equifax's free online credit reports, each creditor will be listed for you to view. The contact information, amount owed and payment history will be displayed in a readable format. Having regular access to your credit report also helps you to prevent others from hijacking your personal or financial information.

Use Equifax's free online credit reports to fix incorrect information that appears in your credit history. Incorrect information can have a negative effect on your credit history. With an online credit report, you'll have instant access to a list of companies or employers that request your credit report. Calculate the entire amount you owe to past and present creditors by analyzing your Equifax's free online credit report.

One of the biggest mistakes you can make when it comes to your credit history is not to monitor it. Identity thieves are constantly stealing valuable financial and personal information from unsuspecting victims. Take the time to review your Equifax credit report at least once a year. It's your responsibility to save yourself from an unwanted situation because of an incorrect credit situation. It only takes a few minutes to gain access to your credit report.

Make a list of all of your past and present creditors. Compare it to your Equifax free online credit report. If there are accounts listed that you don't recognize, take the time to locate the contact details of these companies. Browse through all of your past and present bills to compare some of the details. Occasionally, unfamiliar accounts on your credit report are a result of company name changes. After comparing the information, if it still doesn't look familiar perform a search for contact details of the companies and call them.

How Long Do Inquiries Affect Your FICO?

7:42 PM No comments

FICO scores are a three-digit representation of a borrower's credit report. The higher the score, the better the credit. Lenders and employers use this score when evaluating an individual for creditworthiness and employment. Inquiries can affect FICO scores.

When a consumer orders his credit report and score, it is recorded as a "soft" inquiry. The request will not affect his FICO and is invisible to creditors or employers when reviewing his report. The inquiry will remain on his report for two years.

Employers often order credit reports and FICO score reports when interviewing potential candidates. This is also a "soft" inquiry and is invisible to any third party. As with a personal inquiry, the request remains on the report for two years.

Credit inquires for things such as loans, credit cards or mortgages are "hard" inquiries. These requests are visible to anyone viewing the credit report and will remain on the report for two years.

Consumers can dispute inquiries made to credit reports that they did not authorize. When the consumer is successful in the dispute the inquiry is removed before the two-year automatic expiration.

How to Remove Delinquencies From a Credit Report

4:30 PM No comments

Removing delinquent account entries from your credit report is entirely possible if you're willing to spend some money on it. Contrary to what lenders may initially tell you, all debts are simply contracts that can be renegotiated at any time. Creditors have a choice as to whether they report an account to the credit unions. It's well within the law for them to remove negative entries from credit reports, but they won't do it for free.

Instructions

Request a copy of your credit report from the three major credit bureaus (Transunion, Equifax and Experian). Find the delinquent account entry you would like removed from your credit report first. Take note of the company that owns the debt, the amount of the debt and their contact information. Even if the debt has been marked settled or paid in full, you can still get the entry deleted.

Contact the creditor and ask for a "pay for delete" on the account in return for a settlement offer. Start by offering 10 percent to 20 percent of the total amount owed and move up from there. Creditors will be more amenable to delete an entry from your report if you make an offer to them soon after the account becomes delinquent. If the person you are speaking to says that he can't delete credit report entries, ask for a supervisor. Although creditors are required to provide accurate information on the accounts they do report to the credit bureaus, they are not actually required to report the accounts themselves.

Ask that the agreement for the "pay for delete" be mailed to you in writing. Verbal agreements are very hard to prove, so wait until you receive a written agreement before you send payment. Ensure that you get an agreement to delete the entry from your report within 10 to 30 days of the creditor receiving payment. Otherwise, they may delay deleting the entry.

Send payment once you have received the written agreement to delete the account entry from your credit report.

Order your credit reports at least 30 days after you send payment for the deletion of the account. Once the delinquent entry is removed from your credit report, you should see a dramatic overnight improvement in your credit score.

How to Establish Credit With No Checking Account

4:04 PM No comments

Having good credit is very important. If you are just stating out and want to build up credit there are some simple ways to go about it that require no checking account.

Instructions

Get a credit card. Go online and fill out an application for a credit card. You will only get a small limit at first but thats fine. Once you get the card buy something and then pay it off quickly. Do not run the card to its maximum. It looks better on your credit report the more you have left on the card. Paying timely and paying off debt quickly is a great way to build a good credit score.

Buy furniture. Many furniture stores will do a line of credit for purchases. Go pick out some furniture and make the monthly payments on time and in full. If the furniture store clerk should ask for proof of your payment history you can get it from your utility companies. The utility company representative should be able to give you a printout that shows you paid your bills on time.

Buy a car. Used car lots, and some new dealerships, will deal with people with no credit history. Even if you have to have a co-signer, the payments will still be reflected on your credit. After making payments for a while see if you can refinance and get the co-signer off. That will improve your credit worthiness even more.

Sign up with store credit cards such as Sears. Sears reports to credit bureaus. Get your card and make purchases, then pay the monthly payments on time and Sears will report favorably on your credit. Again, dont max out the card. Keep buying and paying off purchases. This looks better than filling the card.

Lease an apartment. Many apartment complexes report to the credit bureaus. Just make your rent payment on time each month. This is a simple way to establish good credit.

Participate in any or all of the above activities for six months to a year and you will have established a credit history. The most important thing to remember is to pay all payments on time and not to use up all the available credit on any cards. None of these should require a checking account, but after you acquire a good credit history you may then be able to get a checking account if you wish.

Credit Card Debt Recovery Laws

8:23 PM No comments

Credit card debt is unsecured debt. If a borrower ceases to make his scheduled payments, the credit card company cannot claim any of his personal property in lieu of those payments. The creditor, however, has a legal right to the debt and will exercise all reasonable options in an attempt to recover it.

If your credit card debt defaults, your account will be turned over to a collection agency for recovery. All collection agencies are bound by the regulations set forth in the Fair Debt Collection Practices Act (FDCPA). The collection agency may call you about the debt, but only between the hours of 8 a.m. and 9 p.m. and never to the point of harassment. If you request in writing that you not be contacted, the collection agency must oblige. Other permissible debt recovery actions are sending letters about the debt, reporting the debt to your credit report and filing a lawsuit against you for the debt. No debt collector is ever permitted to threaten you or use profanity during collection efforts.

Any creditor to whom you owe a debt or who claims you owe a debt, may legally file a lawsuit to recover the debt. If you fail to respond to the court summons and do not appear in court, a default judgment may be levied against you. The burden of proof in debt recovery cases rests on the plaintiff unless the debtor fails to appear. If this occurs, the plaintiff wins the case by default. Depending on your state's laws, a default judgment may give your creditor permission to garnish your wages and your bank account.

Every state has a statute of limitations (SOL) for debt related lawsuits. The SOL for most states is around three to five years. If the SOL on a debt has expired, the debt is no longer legally recoverable provided the court is aware of the debt's expiration. Although an expired SOL grants you are an airtight defense in court, you will still end up with a default judgment if you fail to appear and present your defense.

The FDCPA grants every consumer the right to debt validation, a process in which the consumer requests proof in writing that he owes the debt. All debt recovery efforts must cease until the consumer is provided with sufficient validation of the debt. If validation of the debt cannot be provided, debt recovery efforts must cease permanently. If the debt currently appears on the consumer's credit report, it must be removed. Debt recovery efforts may legally resume if at any point in the future the creditor is able to provide the consumer with legitimate validation of the debt.

If, during the process of debt recovery, any FDCPA laws are violated, the consumer may file a lawsuit for damages. A common reason for a lawsuit is the debt collector has been unable to validate the debt, yet the debt's appearance on the consumer's credit report has caused him to be turned down for credit, or caused an increase in the interest rates of the debts he currently pays. Upon proving the damages suffered, he may recover the monetary value of his losses through the court. Any additional violations that can be proven, such as harassment or the use of threats, entitle the consumer to receive punitive damages of up to $1,000. Punitive damages may not exceed $1,000, even if numerous violations were committed.

What Are DMP Fees in Credit Counseling?

1:58 PM No comments

A credit counseling agency may be able to assist you in understanding how to manage your debts. It may also set up payment plans with your creditors that are easier for you to afford than what you are currently paying. Credit counseling services, however, are not free, and the service may include DMP (or Debt Management Plan) fees.

DMP fees are levied if you are assigned a debt management program by your credit counseling agency.

A credit counseling company charges a DMP fee to negotiate with your creditors to lower your interest rates or balances. The DMP fee also covers the service of allocating payments to your creditors.

A credit counseling service may charge an initial DMP fee to set up an account and then a recurring DMP fee each month for the bill payment service it provides.

Not everyone who seeks credit counseling will be assigned a debt management program. You should always check to make sure you are not mistakenly being charged a DMP fee if you are not enrolled in a debt management program.

The Federal Trade Commission warns that credit counseling agencies that charge high fees for their services may be participating in unethical business practices. It urges all consumers to seek credit counseling through government-approved credit counseling agencies.

What Happens If I Close My Bank Account for the Payday Loans?

11:17 AM No comments

Payday loans are small loans issued on a short-term basis, usually less than a month. The term "payday" refers to the idea that the loans are made to a person who receives a paycheck, who will pay it back after his next payday. Many payday lenders require borrowers to provide a number for a bank account to which the lender can deposit and withdraw the money.

Before lending, payday lenders generally require that borrowers either make out a postdated check for the amount of the loan plus fees or provide an account number for a checking or savings account. The borrower must also provide at least one form of identification. When the loan comes due, the lender will either cash the check or attempt to withdraw money from the account. If the account has been closed, the lender will take steps to recover the money.

If you close the account before the lender can withdraw money and make no other arrangement to pay, the loan goes into default. Because the lender will already know your name and contact information, you will not be able to dodge the debt. Instead, the lender will either attempt to collect the loan itself or outsource the debt to a collection agency.

If you default on a payday loan, penalties will be assessed. These may include punitive fees as well as a new, higher rate of interest. According to the Federal Trade Commission, the interest on payday loans can reach up to 391 percent. Therefore, the amount you end up owing the lender may be many times the amount of the original loan.

In addition to reporting the debt to a credit reporting agency, the lender may threaten legal action if you continue to refuse to pay. The lender may even attempt to garnish your wages or seize money from another of your accounts, depending on the laws in your state.

How to Negotiate a Credit Card Balance That Won't Result in a Charge-off

10:54 AM No comments

Your credit card company will expectedly charge off your account if you're more than six months past due. If nearing the six-month period, attempt to negotiate your balance for less than you owe to avert a charge-off and keep this derogatory item off your credit report.

Instructions

Prepare your personal finances to settle the account. You will need a lump sum to negotiate your credit card balance. After careful review of your disposable cash, settle on an affordable amount.

Approach your credit card company. The company that handles your credit account will not suggest or propose a debt settlement. You must initiate the process by contacting the company via phone or sending a certified mail request.

Provide details of hardship. Give sound reason behind your debt settlement request. Indicate any financial hardship, such as job loss or divorce. Disclose information about other outstanding debts and submit evidence (by mail, email or fax) of your present earnings.

Let the creditor know how much you're prepared to pay to settle the balance. The initial offer shouldn't be the maximum you're able to spend. Expect some bargaining from your creditor. The creditor will likely seek a higher settlement.

Confirm that the creditor will not charge off the account once you pay the settlement. Get this agreement and the settlement agreement in writing from the creditor. Send your payment after reviewing the agreement.

Can I Transfer a Line of Credit to Another Property?

9:28 AM No comments

Property used to secure a line of credit is called collateral. Real estate ranging from primary residences to undeveloped land serves as collateral, with creditors reserving the right to take the property if you default on the loan. Asking a lender to substitute collateral with another property will raise deep suspicions about your financial situation, with your request likely denied. Simply making the request could lead to a broad investigation of your finances, with forceful action by the bank possible if your finances are shaky.

Asking the lender to transfer collateral to another property likely will lead to a review of your credit report as the lender become suspicious about your motives. The lender may fear that you will default on the loan soon -- intentionally or unintentionally. Some people with say, their primary residence as collateral on the line of credit may want to protect the house by taking it off the loan. Such a move places them in a position to keep the property if they default on the line of credit. However, such transactions are not possible without the lender's consent

Lenders are wary of some borrowers who plan so-called "strategic defaults." These borrowers voluntarily choose to walk away from mortgage loans and forfeit the collateral. Strategic defaults are common in the home mortgage industry during tough economic times or during a huge slump in the housing industry that causes housing prices to drop. A request to move your line of credit to another property may lead bankers to believe that you are planning a strategic default.

As a result the bank may react aggressively following a review of your credit and declare that the entire balance on the loan is due immediately. Some loans are regarded as "callable" by the lender, meaning the lender has the right to demand payment at any time. The feature exists in many loan agreements, but usually is not exercised if payments are on time and regular reviews of the customer's finances are satisfactory.

Calling the loan could give the bank the right to seek foreclosure on the property currently held as collateral. At a minimum, the bank may close the line of credit, eliminating any further charges or withdrawals. The only effective way to remove the current collateral from the line of credit is to pay the loan off. One strategy could include selling off other assets and using the proceeds to pay off the credit line.

The Procedure to Lower Child Support Arrears in Texas

10:01 AM No comments

Owing back child support brings with it a lot of baggage. Children may believe a parent is disinterested in their well-being, and a Texas court might impose penalties that range from interest on the overdue support to potential jail time. For such reasons, eliminating child support in arrears often eases a lot of tension for all involved. In Texas, there are some specific steps required to lowering and eventually eliminating back child support.

If you cannot pay child support, you should contact the court in the Texas county where your child support order was issued. Do this immediately and inform the clerk of the court about your inability to pay and the reason for the hardship. According to the state's TX Access website on child support, failure to take action may lead to action against you by the court for violation of the child support order, and the penalties in Texas can include jail time and suspension of your driver's license. By contacting the court, you can begin the process of petitioning for a modification to your child support order. You must petition the Texas county court where the current court order was filed. This is true even if you have moved out of that Texas county or out of the state. In your petition, you can request a hearing to decide whether your child support should be lowered. A copy of the petition must be provided to the custodial parent along with a notice of the hearing date established by the court. The hearing must occur in the same Texas court jurisdiction.

To amend your child support order in Texas, the court will require you to provide proof of your change in financial condition. According to the Texas Division of Children and Families, you will need to provide recent check stubs, unemployment registration paperwork or other documentation showing how your income has changed. You should also provide current bills. Since you have back child support due, mention this to the court and provide any documentation that might show you should not be held accountable for all or a portion of the amount. In Texas, the court could cancel all or a portion of the back child support if it finds there was an error in calculating the amount you should have paid. If you had unexpected social security taxes, federal income taxes, state of Texas income taxes, union dues or health insurance expenses for the child, provide the court with copies of these expenses. Each of these expenses can be deducted from your income before the court calculates your child support payments. These financial liabilities might affect what you should have paid in child support and could allow the court to reduce your back child support.

In Texas, the court will not reduce back child support based only on a current financial situation. Only finances for the time you failed to pay are taken into consideration. If the court will not reduce back child support, you will remain responsible for the amount required under the old child support order, and you will remain in violation of Texas state law as it applies to following a court order and paying child support. Even if the court establishes a new child support order, you will have to pay the arrears. Ask the court to include the back child support on the new child support order. By spreading the arrears amount over several future payments, you can reduce the back child support and also avoid any negative effects of violating the previous child support order. Be sure, however, that the Texas court issuing the new order gives you credit for paying the back child support.

Obtaining custody of a child in Texas can allow you to eliminate the requirement for child support payments, but the order remains in effect until a new court order is established. You must petition the court to change the child support order. Until then, you will continue to be responsible for the child support payments to the other parent. Once you have a new court order and no longer pay child support, you can begin repaying the back child support. In Texas, the change in custody does not eliminate this debt, but it will make it easier to pay now that you no longer have to make regular child support payments.

How to Fix My Credit After My Credit Cards Have All Been Charged Off

2:18 AM No comments

A credit card company may "charge off" your account after 180 days or six months of being late on payment. Just because your account is charged off does not mean that the credit card company has given up collecting the debt. The account is typically sent to in-house collections or an outside agency where it is reported to consumer credit bureaus and appears on your credit report. Fixing your credit after a charge off requires you to develop a budget to repay the debt, contact creditors to work out a payment arrangement and possibly hire a credit counseling firm.

Instructions

Develop a budget. Calculate how much money you make each month and how you spend it. Look at your pay stubs for income information. Inspect receipts and credit card and bank statements for information on how you spend your money. Write down the expenses that are necessary each month. This includes your mortgage or rent, insurance, food and utilities. Separately list the expenses that are unnecessary. This may include entertainment, clothing and recreation. These expenses may be used to pay off debt.

Contact your creditors. Tell them you are serious about repaying the debt but need some assistance. Ask if they would be willing to work out an installment plan with you that is within your budget. The creditor may advise you to contact its debt-collection department or firm.

Contact a credit counseling agency. If you cannot adhere to the budget you created, keep track of your expenses or work out an installment plan with creditors, you may consider hiring a credit counseling agency. It can offer advice on managing your money and maintaining a budget. It can also provide assistance with debt collectors. Note that credit counseling agencies charge a fee for these services.

How to Respond to a Consumer Credit Summons

4:30 PM No comments

If a debt collector files a lawsuit against you, you will receive a legal notice called a summons. Usually the summons and the actual lawsuit---called a complaint---are hand-delivered by courier. The courier may attempt to deliver the summons to you at your residence or workplace. In some states, court officials send the summons and complaint by certified mail. Responding correctly to the summons is essential for avoiding a default judgment. Judges issue default judgments when defendants fail to show up for a court hearing or do not follow other instructions in the summons.

Instructions

Consult with a consumer affairs attorney even if you feel you cannot afford to pay a lawyer. The attorney may offer a free, or discounted initial consultation. Ask as many questions as you can about responding to the summons, and hire an attorney if possible. A reputable attorney can help in many ways, including filing legal motions to delay court hearings. This could give you time to save money for an out-of-court settlement.

Read the summons. Debtors stressed out by excessive debt sometimes are sometimes tempted to ignore notices about their bills. However, debtors should always read legal notices from the court. The summons provides important information about responding to the lawsuit. Read the summons to determine if you must appear in court on a certain day or begin by sending a written response to the lawsuit, called an answer.

Check state statute of limitations on debt collections in your state. The laws determine how long debt collectors have to use the court system to force debtors to pay. However, loopholes allow debt collectors to file lawsuits even if the debt is too old for consideration by the courts. It's the debtors' responsibility to cite statute of limitation laws as a defense during a court appearance. Find out the statute of limitations for your type of debt by contacting a local office for your state attorney general.

End the lawsuit by settling the case out of court if the debt is current under state statute of limitation laws and you legally owe the money. Contact the attorney for the debt collector to offer to pay the bill. Find the attorney's name on the summons. A settlement is a negotiation, but the debt collector has great leverage after filing a lawsuit. Attempt to settle for as little as possible, although the attorney may insist on the full amount. The attorney may offer a payment plan if you cannot pay in a lump sum. Get any agreement in writing and also ask the lawyer to send written confirmation that he will dismiss the lawsuit.

Provide a written answer to the lawsuit if the summons is requesting this. An attorney can advise how you should answer the lawsuit---or the attorney can handle the entire process. If you are defending yourself one option for answering the lawsuit is to simply write that you are denying each allegation in the lawsuit. This forces the debt collector to prove the allegations in court. Read the summons for instructions on sending the answer to the court and to the attorney for the debt collector.

Read the allegations in the lawsuit to determine how you should defend yourself for a court date. An inability to pay the debt is not a suitable defense. Identity theft and alleged fraud by the debt collector are suitable defenses---if you have documentation. Appear in court for the court date and appearance before a judge. Expect the judge to dismiss the case or grant a judgment for the debt collector based on testimony and evidence.

Who Can Ask for Your Credit Report?

10:02 AM No comments

Credit reports contain private information including current and past loans, credit accounts and any potentially outstanding accounts. It is important to know who can access that information. The Fair Credit Reporting Act enforced by the Federal Trade Commission states who has legal right to access your credit besides you.

When purchasing insurance for home, renting, vehicles or life, the issuing company has the right to pull your credit to gauge your ability to pay the premiums.

Landlords will often examine credit reports for any adult requesting to live on their property. The information they receive can affect security deposits, lease agreements and their ability to even rent an apartment or house.

When applying for a position or a promotion within a company, a credit report can be ordered. It is important to know that employers cannot order a report without your permission first.

Credit card companies evaluate credit scores when issuing a card and typically when a payment has been missed. Your credit score will determine the interest rate of the credit line.

Some financial institutions require a credit check before issuing a debit card tied to your checking account. In some cases, a credit report is secured when evaluating an individual's request to simply open an account.

Remember to watch your own credit, ensuring all information is correct. To order your free credit reports yearly, visit annualcreditreport.com.

What Wage Does a Nursing Assistant Make?

10:39 PM No comments

Nursing assistants, sometimes also referred to as nursing aides, work alongside doctors and registered nurses to help with basic medical and lifestyle tasks such as bathing and feeding patients. The average wage that a nursing assistant makes, as cited by the U.S. Bureau of Labor Statistics, can differ depending on where she works or lives.

The 1,438,010 nursing assistants in the United States -- the bureau estimates that this will rise 19 percent by 2018 -- earn an annual average of $24,980. When broken into percentiles, a better image of the salary range for this occupation appears. Nursing assistants in the 25th percentile bring in just $20,490 on average. Meanwhile, assistants in the 90th percentile net $33,970 annually.

America's biggest employer of nursing assistants are nursing care facilities, more commonly known as nursing homes. In a nursing home, a nursing assistant can expect an average salary of $24,080. The second-, third- and fourth-largest employers are hospitals, community care facilities for the elderly, and home health services, with respective salaries of $26,540, $23,320 and $23,070.

Oddly enough, the air transportation industry employs nursing assistants -- though just 40 out of over 1.4 million assistants. The industry's average wage for a nursing assistant of $41,720 makes it the highest-paying type of employer. The second-, third- and fourth-highest-paying employers of nursing assistants are scientific research companies, universities, and grant and donation companies. The respective annual salaries in each industry for nursing assistants are $35,000, $29,340 and $27,890.

The top three states with the greatest concentration of nursing assistants are North Dakota, Maine and Rhode Island. In each state, nursing assistants can expect average annual wages of $23,790, $23,980 and $29,040, respectively. Meanwhile, Alaska ranks as the top-paying state for assistants, doling out $32,390 a year. That's approximately $7,000 more a year than the national average. Nevada and New York rank second and third, with respective salaries of $30,970 and $30,850.

What Happens if You Have a Student Loan and You Enter the Military?

9:45 PM No comments

Out of all groups of individuals repaying education debts, no group enjoys greater repayment benefits than the U.S. military. If you enter the military after completing your education, the military can help place you in a position within your chosen field of study while simultaneously repaying or forgiving your outstanding student loan debts. Your eligibility for loan forgiveness or repayment assistance services may vary depending on which military branch you choose.

Each military branch has a student loan repayment program that makes enlisting in the service more attractive for former students who carry considerable student loan debts. The amount you qualify for will vary depending on the military branch. The Army and Navy, for example, each repays up to $65,000 in student loan debt while the Air Force pays up to $10,000 in student loan debt.

Not every new recruit qualifies for the military's student loan repayment program. The requirements you must meet will vary depending on which branch of the military you enter. In general, however, the U.S. government requires that you have a high school diploma and no prior military service. Your enlistment contract must also specifically state that you are enrolled in the program.

The military loan repayment program lasts three years. If you meet the qualifications, your service branch will pay your lender either $1,500 or 33 1/3 percent of your total loan debt -- whichever is greater -- each of the three years.

If you enter the military after college yet do not qualify for the government's student loan repayment program, you may be eligible for loan forgiveness under the College Cost Reduction and Access Act. The CCRAA provides loan forgiveness for individuals employed in public service and government jobs -- including military members.

Unlike the military's student loan repayment program, there is no cap on the amount of loan debt the CCRAA can forgive. You must, however, make your payments on time each month for 10 years before being eligible for loan forgiveness under the CCRAA. These provisions apply only to student loans issued by the U.S. Department of Education.

Your student loans fall into default if you stop making payments. No branch of the U.S. military allows individuals to enlist if their student loans are in default. If you carry defaulted federal student loans, contact the U.S. Department of Education at 1-800-433-3243 and enroll in the student loan rehabilitation program. Provided you make the next nine payments on time, the U.S. Department of Education considers your account "rehabilitated" and you are free to enlist in the military. The requirements for rehabilitating a defaulted private loan will vary by lender.

Can a Civil Judgment Be Removed From a Credit Report?

10:18 AM No comments

If you are the defendant in a lawsuit and lose the case, the court will grant a civil judgment to the plaintiff. Judgments are typically the result of lawsuits over unpaid debts. The judgment not only grants the plaintiff the right to use more aggressive methods when collecting the debt, it also appears on your credit report.

Civil judgments are severely derogatory public records that have an adverse effect on your credit score. Fortunately, they don't remain a part of your credit history indefinitely. The Fair Credit Reporting Act notes that the credit reporting agencies must remove a civil judgment from your credit report in seven years or when the statute of limitations for debt collection expires in your state -- whichever time period is longer.

According to the New York Neighborhood Economic Development Advocacy Project website, if you have grounds to contest a civil judgment's validity, such as improper notification of the original case against you, you can file a motion with the court to have the judgment overturned or "vacated." If you succeed, mailing notification of the court's decision to the credit reporting agencies will result in the derogatory entry being erased from your credit record.

Many consumers mistakenly believe that, once they pay off their judgments, the credit reporting agencies will delete all evidence of the judgments from their credit reports. Unfortunately, this is not the case. A civil judgment will remain a part of your credit history for the full length of time permitted by law -- regardless of its payment status. Once you pay off the debt, however, your creditor will update your credit report to reflect that you've satisfied the civil judgment.

The record of your judgment was provided to the credit reporting agencies by the court that rendered the decision -- not by the creditor who filed the lawsuit. Because of this, your creditor does not have the power to remove the judgment from your record. It can, however, file a claim with the court to dismiss the judgment. The judgment won't disappear from your credit file, but the court's entry will reflect that the original judgment against you was dismissed. This looks much better to creditors and lenders reviewing your credit history than an outstanding or paid judgment.

A civil judgment record should list the court that issued the judgment, the amount you owe, the case number and the name of your creditor. If any of this information is incorrect, the FCRA gives you the right to dispute the entry with the credit reporting agencies.

After you file a dispute, the credit reporting agency will attempt to verify the information with the court. If the court fails to respond within the 30 days permitted by law, the credit reporting agency must delete the judgment from your credit history.

How to Get Out of Default on School Loans

5:33 AM No comments

Not repaying your school loans places your debt into "default" status. According to the National Consumer Law Center, federal student loans fall into default after you miss nine months of payments. Private student loans, however, can fall into default if you miss a single monthly payment. The process for getting out of default on your student loans differs depending on whether your loans are private or federal. If you leave your loans in default, you could face severe consequences such as wage garnishment, a poor credit rating and losing your annual tax refund.

Instructions

Review your original loan contract. Sometimes private student loan contracts contain information regarding how borrowers can redeem a defaulted private loan.

Contact your lender. Explain your missed payments and ask about your options for restoring your student's loans standing. Your lender can inform your how many payments you must make before it revokes your loan's defaulted status.

Negotiate a monthly payment plan with your lender that you can afford but that also allows you to catch up on your loan payments and any additional fees you incurred by making payments late.

Make the required amount of on-time payments. Contact your lender after you satisfy the requirements for restoring your loan's status to ensure that your loan is no longer in default.

Contact the U.S. Department of Education at (800) 433-3243. Give the representative your name, Social Security number and account number. Notify the representative that you want to rehabilitate your defaulted federal student loan.

Negotiate a payment plan with the U.S. Department of Education, which may alter your monthly loan payments, within reason, to make them more affordable and help you catch up on your loan payments.

Submit your payments on time for nine months. After nine months, your federal student loan will no longer be in default and the U.S. Department of Education will update your credit reports to reflect the loan's status as "current."

How to Repair Credit Charge-Offs

1:16 AM No comments

A charge-off is a negative entry on your credit report, indicating that you defaulted on a credit agreement. After about six months of missed payments, creditors typically will close your account and list it internally as a write-off for tax purposes. You remain responsible for the debt, and the charge-off is listed on your credit report. Charge-offs hurt your credit score and can make it difficult to be approved for new credit. The Federal Trade Commission reports that charge-offs will remain on your credit report for seven years, and cannot be removed sooner unless the information is wrong. The only remedy is to pay the charged-off debt and move on.

Instructions

Order a free copy of your credit report and score from Annual Credit Report . According to the Federal Trade Commission, the website is the only site authorized by the U.S. government to offer free reports under the terms of the Fair Credit Reporting Act. You're entitled to three free credit reports every 12 months -- one from each of the major credit bureaus.

Review your credit report to find accounts that have been listed as charged-off.

Call the creditors or debt collectors for the charged-off accounts. Find their names and contact information listed on your credit report with the charge-off. Make arrangements to pay the balance due in full through a lump-sum or installments. Or offer to pay less than the full balance through a process called debt settlement. The SmartMoney website reports that creditors and debt collectors will sometimes settle for 20 to 75 percent of the balance.

Get the terms of any agreement in writing. The terms should include the amount you have agreed to pay, due dates and a stipulation that your credit report be updated to show the charge-off as a "paid charge-off."

Order a new copy of your credit report about 60 days after you complete payment of the charge-off. Confirm that your credit report was properly updated.

Does Debt Get Passed Down to Heirs?

2:04 PM No comments

When you die, your loved ones assume ownership and responsibility for your assets and possessions. Debts you owe are not an asset but a liability. Provided your loved ones never signed a contract agreeing to pay the original creditor, they are not liable for your debts and cannot directly inherit them. Your creditors, however, can still pursue payment from the estate you leave behind.

Any creditor that holds a security interest in an asset can repossess that asset should timely payments stop arriving--even if the owner of the asset dies. An heir that accepts ownership of an asset must also assume the payments lest he lose the asset to the secured creditor. For example, if you inherit and accept a home that carries a mortgage, you must obtain a new mortgage or assume the existing mortgage to prevent foreclosure.

Heirs can avert making payments on inherited items by forfeiting their right to the inheritance. The executor of the will then offer ownership of the asset to the next heir in line to receive it. Heirs are not forced to take on their deceased loved one's financial obligations involuntarily.

A probate court handles the distribution of the deceased's estate. Unsecured creditors lack the right to seize any of the deceased's assets when payments cease and must file payment requests with the probate court.

Depending on your state of residence, payments to unsecured creditors could take precedence over family allowances--reducing the inheritance heirs receive from the deceased's estate. In this case, heirs aren't directly responsible for payment but pay the debt indirectly through a reduced inheritance.

When two people share joint liability for a debt, such as a joint credit card account, and one of them dies, full liability for payment falls to the surviving individual--regardless of whether that individual is an heir to the deceased's estate.

Both account holders on a joint debt are legally liable for 100 percent of the debt. Thus, liability for payment is not "passed down." Because joint account holders are often married or closely related, however, the surviving account holder's responsibility for paying the full amount owed may appear to be debt inheritance when, in fact, his liability never changed.

Although a deceased individual's family members do not inherit her debts upon her death, creditors may still sell these debts to collection agencies that demand payment from the deceased's loved ones. Informing a consumer that he is legally liable for someone else's debts is prohibited under the Fair Debt Collection Practices Act (FDCPA)--but that does not stop collection agencies from using the practice to frighten misinformed heirs into making payments.

No matter what a debt collector tells you, it cannot transfer a deceased family member's debt into your name, insert the account on your credit report or sue you for payment. If a collection agency representative threatens to do so, you have the right to sue the company for violating the FDCPA.

Welcome to our website credit and debt managementr.

Wednesday, January 30, 2013

Request Workout Plan

Deal With Collectors

Rebuild Your Credit

Stay Debt-Free

Tuesday, January 29, 2013

Instructions

Saturday, January 26, 2013

Garnishment

Social Security Benefits

Private Creditors

Federal Government

Features

Effects

Buying Back a Car

Considerations

Warning

Friday, January 25, 2013

Credit Reporting

Poor Reflection

Paying for This Service

Considerations

Credit Reporting Rights

Delayed Reporting

Federal Reporting Period

Illegal Reporting Practices

Balance Transfers

Home Equity Borrowing

Personal Loan

Other Options

Instructions

Probate Case

Administrator Duties

Creditor Notification and Deadline

Estate Debt Payments

Thursday, January 24, 2013

Instructions

Instructions

Instructions

Wednesday, January 23, 2013

Making Purchases

Not Paying in Full

Accumulating Interest

Tuesday, January 22, 2013

Description

Process

Benefits

Downsides

Avoid New Debt

Track Spending

High-Interest Debt

Contact Creditors

Monday, January 21, 2013

Misconceptions

Expert Insight

Time Frame

Considerations

Warning

Instructions

Sunday, January 20, 2013

Process

Credit Reporting

Debt Balance

Settlements

Fair Debt Collection Practice Act

The Basics

Additional Details

Other Tips

Significance

Function

Features

Misconceptions

Expert Insight

Saturday, January 19, 2013

Personal Inquiries

Employer Inquiries

Credit Inquires

Disputing Inquiries

Friday, January 18, 2013