How to Negotiate a Lower Credit Card Interest Rate

The interest rate on your credit card affects how much you pay in finance charges when you carry a balance. The higher your interest rate, the higher your finance charges will be. I may be able to talk your creditors into giving you a lower interest rate.
In the end, you must to be willing to follow through on the threat to move to a lower interest rate credit card if the creditor doesn’t budge.

Going up?

Inflation, as measured by the Consumer Prices Index (CPI) has jumped to 2.9% and economic activity appears to be picking up with the UK now emerging , just, from recession. And as for 2011, there now a widespread assumption that the Bank rate may go up a bit further, perhaps even to 3% or so.

Derisory

Some saving accounts have been offering derisory interest rates to their customers.
According to the financial information service Moneyfacts there are 87 instant access saving accounts – 28% of the total – which are still open by pay 0.10% or less
Even among savings accounts that demand some notice to make a withdrawal, 23, or 15% pay this pay more than 5%


By: Pamela Yancy
Interest Rates Negotiations Officer

Everyday Savings Is A MUST!

“A penny saved is a penny earned.” We ALL know this saying. Unless you save you cannot make your wealth grow…SO TRUE! That, in turn, requires you to become more mindful of where your money goes and why, and whether you are spending it wisely and saving enough. Here are a few, simple ways to keep a few hundred dollars in your pocket for the year.
Drive more efficiently, more careful. Stop trying to be Speed Racer all the time. Driving at 55 miles per hour, instead of 70, will save you the equivalent of roughly 70 cents a gallon.
Conserve energy in your home. In the summer, set your air conditioner to 70 degrees. Make sure your home is properly insulated and that your windows, doors, chimney, & basement are properly sealed.
If you’re able, walking or biking, instead of driving or paying for a bus or train, could save you $5 a day, $25 a week, $1,250 a year. My mom always says don't buy lunch every day. Instead, make and take your lunch to work. This will save you another $1,250 a year.
Stop with the “cancer sticks”, QUIT SMOKING! With cigarette prices at roughly $5 a pack, someone who smokes two packs a day could burn through $70 a week, or more than $3,600 per year. Smoke like that for 20 years and, if you are still alive, you will have spent roughly $75,000!!!!
Try to stay away from paying “plastic”. Pay with cash or checks when possible. Credit cards are essential for a few things, such as online purchases, car rentals and airline tickets, but you’ll be fine most of the time without using them. Also, ignore the minimum payment on your bill. You should be paying the maximum you can afford. And if you can find a credit card with a better rate somewhere else, switch.

-Charis S., Enrollment Officer

5 LITTLE TIPS THAT CAN HELP YOU SAVE MONEY

It's the little things that add up to big savings over a year's time. So saving money on everyday expenses really does help. Following these money tips to start saving money right away.

1. Don't go shopping without a list. This is one of the biggest mistakes you can make. If you don't have a list of items that you need to buy than you always end up spending more than you needed to. If you have a list it helps you to avoid impulse spending.

2. Invite friends over for potluck dinner instead of meeting at a restaurant. It is usually cheaper to eat-in rather than dine-out. Especially if everyone brings a dish. Its fun sharing food and fun with friends at home and much more relaxing that going to a crowded restaurant.

3. Install a programmable thermostat to save money. This will allow you to control the temperature in your home automatically according to the schedule you set. A programmable thermostat can lower your energy bill by 10 to 20%.

4. Stop using your credit cards. Save money by not buying anything if you cannot afford to pay for it up front. Using credit cards makes it to tempting to buy more than you need and costs you more money in the long run when you add in interest and other costs associated with credit cards.

5. Take care of what you have. It is cheaper to take care of your home, car, appliances and electronics than to replace them. Make sure you follow all maintenance schedules and do yearly checks to avoid problems down the road.

Natasha Payton; Enrollments

LETS STAY OUT OF DEBT

Assess Your Debt—Understanding how much debt you’ve accumulated is the first step toward reducing it.
Set Your Goals—Set a big goal. Pay off your debt in three years and then break this goal into a series of smaller ones that will help you reach the finish line.
Create Your Plan—Put the plan for reaching your goal on paper.
Track Your Spending—Using the plan you’ve developed, track your spending carefully so you can look for additional ways to save. The more money you can apply to your debt each month, the sooner you should be out of debt.
Curb Your Spending—Freeze unnecessary spending while you assess the problem and make plans to eliminate debt. Cutting spending can come in many forms. It may mean passing on buying big-ticket items, or it may mean bringing lunch to work or school rather than eating out every day.
Pay Your Most Expensive Debts First—Interest can add up quickly on debts of any size. Be sure to focus on paying off the ones with the highest rates.
Understand Interest and Late Fees—Know your interest rates and what the late fees are on all of your debts. Avoid late fees to ensure they’re not adding to your debt, and explore options for lower interest rates. If you can’t make a payment, call the banks or companies you owe and talk with them about your situation. If you don’t understand or aren’t familiar with a debt term, you can refer to our online glossary for help.
Pay More Than the Minimum—Understand how paying more than the minimum can be a critical step in reaching your goals. This is particularly true for credit cards, though it may also be useful for paying other loans, such as those used to buy furniture, appliances, or electronics.
Reward Success—Commit to achieving your goal and figure out what’s going to keep you motivated to stay on track. Consider sharing your goal with someone and ask them to be your “Debt Coach” then ask him or her to help “keep you honest” by checking in on a regular basis to see how you’re doing.
Be Patient—It probably took you time to get into debt, so acknowledge that you’re not going to get out overnight. Keep yourself motivated. And remember, debt elimination will change your outlook on life. It’s worth the hard work.

Brittany Campbell/Negotiations

Minimum Payments are Not Your Friend

Many people love the fact that they can just make minimum payments on their credit card balances. The thinking behind this infatuation with minimum payments is that they can purchase something that’s worth $1000 and only pay $20 per month to own it. Unfortunately, this thinking is faulty. Minimum payments are designed to make money for credit card companies because they inflate the total amount owed on any one item. They can also make it easier for consumers to run up additional debt which creates financial problems that could have been avoided. Although they seem nice, minimum payments are not your friend.

Think about it; would a credit card company create minimum payments if it didn’t benefit from them? These companies exist for the sole purpose of making a profit. The minimum payments make them this profit because it leaves a high balance on the credit card for an extended period of time. The interest rate is applied to that balance each month so that the consumer ends up paying a big amount to the credit card company just for the right to keep that balance on the card. This means that the item that cost $1000 initially can cost several hundred dollars more than that by the time that it’s paid off.

Some people don’t mind that they’re paying more overall if they can pay less right now for their possessions. However, the minimum payment plan also creates additional problems for the consumer. Because the individual is only paying the minimum balance, the rest of their paycheck is available for use on other things. This can cause them to do excessive spending with money that should be going towards paying off the credit card. This can create a cycle of financial difficulty that ultimately causes the consumer to go into excessive debt.

Furthermore, consumers who get caught in this cycle can be caught by surprise when minimum payments unexpectedly go up. This can happen as a result of a missed payment or it can happen just from changes in the economy. When it occurs, people who rely on low minimum payments to get by each month will find that they’re out of money and have nowhere to turn to be able to meet those payments. While it may seem at first glance that paying only the minimum due on credit cards is a great opportunity to purchase things you can’t afford, a closer look reveals that the problems this causes aren’t worth the benefits.

Sean Boyett: Director of Sales

debt settlement

Blog: January 22, 2010
Mary Schnickel

As a concept, lenders have been practicing debt settlement thousands of years. However, the business of debt settlement became prominent in America during the late 1980s and early 1990s when bank deregulation, which loosened consumer lending practices, followed by an economic recession placed consumers in financial hardships.
With charge-offs (debts written-off by banks) increasing, banks established debt settlement departments staffed with personnel who were authorized to negotiate with defaulted cardholders to reduce the outstanding balances in hopes to recover funds that would otherwise be lost if the cardholder filed for Chapter 7 bankruptcy. Typical settlements ranged between 25% and 65% of the outstanding balance.

Alongside the unprecedented spike in personal debt loads, there has been another rather significant (even if criminally under reported) change – the 2005 passage of legislation that dramatically worsened the chances for average Americans to claim Chapter 7 bankruptcy protection. As things stand, should anyone filing for bankruptcy fail to meet the Internal Revenue Service regulated ‘means test’, they would instead be shelved into the Chapter 13 debt restructuring plan. Essentially, Chapter 13 bankruptcies simply tell borrowers that they must pay back some or all of their debts to all unsecured lenders. Repayments under Chapter 13 can range from 1% to 100% of the amounts owed to unsecured creditors, based on the ability of the debtor to pay. Repayment periods are 3 years (for those who earn below the median income) or 5 years (for those above), under court mandated budgets that follow IRS guidelines, and the penalties for failure are more severe.

In order to work with a debt settlement company, a consumer needs lump sum cash (best scenario), or build up enough funds over pre-determined period of time. Once enough funds are built up the negotiation process can begin with each creditor individually. Accounts can be held by credit card companies or may be sold to collections agency for average of $0.15 on the dollar. In which case debt can still be negotiated. The debt settlement company negotiates with the credit card companies for 35% - 50% of the existing balances. The debt settlement companies typically have built up a relationship during their normal business practices with the credit card companies and can come to a settlement agreement quicker and at a more favorable rate than a debtor acting on their own. Once the consumer pays the agreed upon amount, some debt settlement companies take a percentage of the savings of the forgiven debt as the fee. With the current economic crisis, more and more credit card companies may be willing to settle existing credit card debts rather add to their already large written off bad debt.

Two easy ways to stay out of debt

By Natasha Hopkins, January 25, 2010

First, do not borrow any more money, period. This is the most important rule, It might seem like a no-brainer, but far too often you will hear people say something like, "I was doing well with my get out of debt plan, but then my computer died, and I HAD to get a new one, so I bought it on credit." Soon enough their first bill will come in the mail, and they realize that they just have a new payment to worry about. They will get frustrated and most likely abandon their financial plan. If they really were focused on not borrowing any more money, chances are they could use the library computer, or borrow an old one from a friend until they could save up and pay cash for a new computer.

Second, Have a budget and accept that it won't be perfect. It's very important to have a budget, it is like a map which will lead you to the buried treasure of being debt free. We have to remember that getting out of debt is a marathon, not a sprint. We have to make progress bit by bit each month until all that debt is gone, and doing the budget and following it will make sure that you are going to reach the distance.

If you've ever tried to do a budget, you know that it doesn't always work out the way you had hoped. When a problem comes up, you stress because the money is not there to pay for it. Most people throw away their budgets and go back to living a reactionary financial life. Instead of just saying it doesn't work, be willing to revise your budget and account for the new expense(s) that come up.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

MONEY MANAGEMENT RULES TO LIVE BY…

When it comes to money, you should know the difference between a “need” and a “want”. “Needs” are limited in life. You NEED food, shelter, and a roof over your head. EVERYTHING else is a “want”, a choice that YOU have to make about fulfillment.

Do you know what an “opportunity cost” is? You simply give something up to get something else. Every choice has an opportunity cost. One thing though, COLLEGE is the BEST BET! The average graduate makes 70% more over his or her lifetime than someone with a high school diploma.

Supply and demand have A LOT to do with our money as well! If we have rare skills that are in high demand by employers, we can negotiate higher pay. If a lot of people can do what you can do, and the need for you is limited, the income is VERY much likely to be stunted or small.

Things run out, things get scarce. Some people don’t realize that and they spend beyond their limits. People who do this, start to rely on credit cards, home equity loans, and other forms or borrowing which can add up, to nothing good. This will leave them with NOTHIN got invest in for the future, not a good look AT ALL.

Federal Reserve Highlights Credit Card Reforms

Visitors to the Federal Reserve Board's website can find some last-minute information on ways their accounts will be affected by new rules affecting a wide variety of practices in the credit card industry.

At FederalReserve.gov, consumers can find a rundown of the various policy changes they can expect after February 22, in light of the Credit CARD Act that was approved by Congress last year.

For example, lenders will now be required to provide 45 days' notice before they can increase a person's interest rate or change fees, including late and annual fees, or making unspecified but "significant" changes to an account.

The Fed also clarifies that those with a variable interest rate that is tied to an index do not have to be informed of such changes in advance, nor do those who have an introductory rate expire or if payments are not made as expected in a workout agreement.

While much has been made of the new and more consumer-friendly way that fees and interest rates will be handled, another aspect of the federal bill should also be useful to borrowers when it comes to making longer-term plans for their personal finances.

The website provides a look at how credit card statements might look after February, with the usual information that ranges from one's new balance, minimum payment, and due date. However, there will also be a section telling people how long it would take to pay off their balance and how much they would spend on interest if they stick to just making the minimum payment.

The new monthly statements will also include warnings to customers that they could face a specific late fee and interest rate increase if a payment is not made on time as well as a warning that only making minimum payments will make it far more costly and time-consuming to pay off one's balance.

New Laws and their Advantages

1. Retroactive rate increases

Issuers can't raise rates on an existing balance unless a promotional rate expired, the variable indexed rate increased or you paid late by 60 days or more. No longer will they be able to punish borrowers for late payments on unrelated accounts under the practice of universal default or due to "anytime, any reason" clauses.

If the cardholder does trigger the default rate because of a 60-day delinquency, the bank must restore the lower rate once the cardholder demonstrates six months of consecutive on-time payments. This provision takes effect in August 2009.

In general, rates can't be raised in the first year after issuance, and promotional rates must last at least six months. Exceptions include expiration of a promotional rate, termination or completion of a workout plan, a change in the index rate or a 60-day delinquency.

Caveat: Issuers can raise rates at any time for any reason on new balances with 45 days' advance notice. Cardholders will still need to read correspondence from their creditors.

2. More advance notice of rate hikes

Consumers get 45 days' notice before key contract changes take effect, including rate increases. Under the current Truth in Lending Act, cardholders only receive a 15-day heads up. This change takes effect Aug. 20, 2009.

Caveat: This provision doesn't apply to credit limit changes. If your issuer slashes your limit, notification isn't necessary unless the reduction would trigger a penalty, such as an over limit fee.

The new rules also don't cap interest rates. The increased rate can still be triple your existing APR.

3. Fee restrictions

Cardholders will not face over limit fees unless they elect to allow the creditor to approve over limit transactions. Issuers can't charge more than one over limit fee per billing cycle.

In general, banks can't charge consumers a fee to pay their credit card debt, a cost some cardholders encounter for payments made by telephone or Internet. They can impose a fee to expedite a payment.

Advertisement

Payments received by the due date -- or the next business day, if the bank doesn't accept mailed payments on the due date -- won't trigger a late fee. If the cardholder pays at a local branch, the payment must be credited the same day.
The new law limits fees on "fee-harvester" subprime cards as well. In the first year after issuance, non penalty fees cannot take up more than 25 percent of the initial credit limit.

By Mr. Evan Cox

Four Simple Ways to Help Get out Of Debt & Stay Out

Step 1: Save up a small emergency fund. You’ll need a $1,000 or $2,000 saved up before you can start aggressively paying off debt so that you can pay cash when life’s little emergencies come up while you are paying off the debts.

Step 2: Create a written budget. This is an essential step. You need to know where your money is going, and you need to have a sense of control with your money. A written budget will give you control and tell you where your money is going before you spend it.

Step 3: List your debts smallest to largest, and start aggressively paying off the smallest debt, and working your way up to the largest debt. People that make decisions based on the numbers will think this is the wrong way to pay off debts.

Step 4: Save a Big Emergency Fund. Once you are out of debt, you need to make sure that you STAY out of debt. Once you change your behavior to get out of debt, you must keep doing those things to stay out of debt.

Brittany Campbell- Negotiations Representative

The Medical Debt Relief Act of 2009

A new piece of legislation on the table in Washington, if passed, would lessen the impact of medical bills on our credit scores. Currently, unpaid medical debts are treated just like any other collection account: Even after being paid off, they continue to harm our credit scores for up to seven years. 12 representatives of Congress are spearheading the Medical Debt Relief Act which would put an end to this practice. If this amendment to the Fair Record Reporting Act if it is passed, it would:

• Prohibit credit bureaus from including medical debts on a credit report more than 30 days after they've been paid off or settled

• Prohibit credit bureaus and other organizations from factoring paid off or settled medical debts into credit scores

The bill doesn't provide any relief for your current medical bills; those debts will continue to affect your credit rating as they always have. But the Medical Debt Relief Act would ensure that once you've paid off or settled a medical debt, it would no longer continue to harm your ability to secure a good mortgage or other loan.

Ignoring outstanding credit card debt can take a bite out of your paycheck.

Once a credit card account (or similar debt) goes into default and the credit card company cannot collect, the company may choose to sell the debt to a debt collection company. If the credit card company or debt collection company is unsuccessful in recovering the debt, then a lawsuit may be filed against the consumer in an attempt to recover its losses. If the lawsuit is settled against the consumer, the courts may intervene by issuing a judgment requiring your employer to "garnish" or withhold a portion of your wages or property to pay back the debt.

When facing credit card debt that can't readily be paid, the best plan of action is to act early, speak to creditors, reach some sort of payment arrangement and stick to a repayment plan.

DO YOURSELF A FAVOR ~AVOID WAGES GARNISMENT ~BE PROACTIVE~ ENROLL IN A HARDSHIPDEBT SETTLEMENT PROGRAM AND GET RID OF THE DEBT ONCE AND FOR ALL!!!!!!!!!!!!

College Students & Credit Cards

It’s back to school for most next week, time to crack the books open and get down & dirty with the academics (and parties, ssssshhhhh!). Well you know who else is ready to get down & dirty? Credit card companies! They have their eye on these vulnerable students who they can reel in REAL easily just by offering them a free t-shirt, or meal just by “simply” applying for a credit card.

It's become a college certainty. Even before this year's freshman class settles into their dorm rooms, the credit card offers will be rolling in. Most will bring limited credit lines and relatively high interest rates. And they are easy to get. There are few income requirements to worry about.

And students will have plenty of credit cards to choose from. Credit card issuers want their business because students tend to be loyal to their first credit card: They keep on charging long after graduation. Visa, MasterCard and American Express all have Web sites dedicated to college students and packed with financial tips and information, as well as online credit card applications.

Students seeking credit cards should view teaser rates -- those incredibly low introductory rates that last about six months -- with caution. What will the APR be after the introductory period?

The best way to avoid having to explain that bill to mom and dad is to learn to get by with one or two low-limit credit cards. Keep those balances down. A credit limit of $1,000 is plenty for most students.

Worse yet, falling behind on credit card payments hurts a student's credit and a bad credit rating can affect their ability to rent an apartment, or buy a car or house. The mark stays on a person's credit record even if the bill is later paid in full, and insurance companies and employers may also check credit reports.

So I say to you students, take heed, BE CAREFUL! If it seems too good to be true, IT IS! THINK! THINK! THINK about it before you sign that LONG application….do I REALLY need this credit card?!

-Charis S., Enrollment Specialist

Emotional Economics

Economies are cyclical whether Bull or Bare they are based on basic human action. Most human economic trends are irrational and impulsive. This leads to the extremes taking place around us. The overwhelming current status of the American economy seems to be based by overspending out of a false sense of entitlement… I am American therefore I deserve six figures a sports car and a dream home. Another driving factor would be the resilient philosophy “things will work out,” without much planning or preparation. Enduring these extremes and feeling the hardship they create; personal loss is the one redeeming factor for the current generation to snap out of the haze and change their mentality. Things will get better but the need for moderation may only be short lived. Once climbing out of debt and desperation generation “right now” may have short term memory when it comes to the downside of excesses and lead to another Bare market in our time. Create lasting wealth by limiting emotional spending. This nation is founded on the ideal that hard work will get you everywhere, not hard wishing and borrowing.

Wage Garnishments and Judgments

Credit Alliance Group may be the only company in the industry with the ability and the expertise to re-negotiate a wage garnishment or court judgment. If this is your situation, you have everything to gain and nothing to lose, except the first $19 draft fee.

Fax us your paperwork on that garnishment or judgment. We will contact the creditor with a diplomatic yet aggressive strategy to engage and re-negotiate your current circumstance. If we are successful, you will be several steps ahead of your current situation.

If an engagement is not possible, you will have the consolation of having tried to alter your situation. We will close your file and you are under no further obligation.

Need Debt Relief

By Jennifer Glennen, January 8, 2010

Bankruptcy is not your only option! Our goal is to help you determine the right course of action for you to take. We are a debt settlement company that will help you avoid filing for bankruptcy protection and help you rid yourself of credit card debt. The decision to reach out for help with your debt is not one that's easy to make. You were raised to "do the right thing" and you are desperate for debt solutions, but now it's nearly unbearable. You struggle along while your creditors are turning up the heat. And now you're at the point where the late fees, penalties and interest expense make it impossible to keep your head above water. Ask yourself this. If you could eliminate your debt without permanently damaging your credit, why wouldn't you?

Author: Jennifer Glennen Client Relations at CreditAllianceGroup (886) 543- 9073

Budgeting

Creating a budget is not the most exciting thing in the world to do, but makes a big difference in keeping your financing in order. Once you are done, you will be able to see how much money is coming in, where it is all going. This will be able to help you determine what you need to cut out and also help in paying off some debt faster. It does not take long. You can also try using the below steps to help you get started.

1. Gather every financial statement you can. This includes bank statements, investment accounts, recent utility bills and any information regarding a source of income or expense.

2. Record all of your sources of income. If your income is in the form of a regular paycheck where taxes are automatically deducted then using the net income, or take home pay, amount is fine. Record this total income as a monthly amount.

3. Create a list of monthly expenses. Write down a list of all the expected expenses you plan on incurring over the course of a month. This includes a mortgage payment, car payments, auto insurance, groceries, utilities, entertainment, auto insurance, everything you spend money on.

4. Total your monthly income and monthly expenses. If your end result shows more income than expenses you are off to a good start. This means you can prioritize this excess to areas of your budget such as paying more on credit cards to eliminate that debt faster. If you are showing a higher expense column than income it means some changes will have to be made.

5. Make adjustments to expenses. If you have accurately identified and listed all of your expenses the ultimate goal would be to have your income and expense columns to be equal.

6. Review your budget monthly. It is important to review your budget on a regular basis to make sure you are staying on track. Compare your first few months. This will show you where you did well and where you may need to improve.

Debt Settlement and Income Taxes

Learn about Form 982, 1099-C, The Truth about Reporting Forgiven or Cancelled Debt as Income, and How You May Be Able to Avoid Paying Anything By Declaring Yourself Insolvent.

*Disclaimer: I am not a tax professional, nor do I claim to be one. Any information on this website is based on my experience and is for informational purposes only and should not be acted upon solely on it’s merit. It’s recommended that you seek the help of a qualified professional to prepare your taxes.

Debt Settlement - A Quick Overview

With the tougher new bankruptcy laws, debt settlement is a much more palatable solution for a great majority of consumers. In review, debt settlement is an agreement between a consumer and a creditor to settle an outstanding balance for a significantly lower amount than what is owed. This amount is frequently less than 50% of the original debt with the remainder being forgiven. So you end up saving a bunch of money and your debt is gone forever.

Cancelled Debt is Considered Taxable Income

What isn’t commonly known is that creditors are required to report forgiven debts greater than $600 to the IRS on form 1099. This notifies the IRS that you have settled your debt for less than full balance. Here’s the thing: the IRS views this cancelled debt as taxable income and wants you to pay taxes on it.

Don’t freak out and stop your debt settlement proceedings just yet, though.
The truth is that most of those who choose a debt settlement solution are NOT liable for taxes on the forgiven debt. The IRS gives an out for debtors who are “insolvent” at the time of debt settlement.

The term “insolvent” simply means that your debts exceed the value of your assets. If you are in a situation where a debt settlement is necessary, you are probably insolvent. In other words, you would have a negative net worth where your liabilities outweigh your assets.

So How Do I figure Out If I Am Insolvent?

At the end of the year, you’ll get a 1099-C from the creditor with which you settled. The 1099-C will usually have a DATE that your debt was cancelled, and it should match your records about the time you sent them the settlement check.
The cancellation date is important because that’s the point of reference to determine your solvency. List all your assets and liabilities(debts) as they stood on that date. Use market value of your house and cars to determine their value as an asset.
I used www.zillow.com for my house’s market value (comparable sales) and www.kbb.com for the car’s value (private party sale). If you’re preparing your taxes well after the cancellation date, you can approximate their value for the cancellation date.
If your debts exceed your assets for that date in time, and the amount you are insolvent to exceeds the cancelled debt amount, then you can declare yourself “insolvent” for that settlement. (See Example Below) If you settled more than 1 debt, you must repeat this process for each cancelled debt.

IRS Form 982 and What to Attach to Your 1040

To let the IRS know about your insolvency, you must fill out IRS Form 982: Reduction of Tax Attributes Due to Discharge of Indebtedness. (pdf)
To make sure I filled out the form right, I called the IRS (you should too) to ask. They were very helpful and instructed me that for settlement of credit card debt, check box 1b, fill out line 2 and line 10a with my total cancelled debt for the year. Thats it for form 982. Be sure to attach it to your tax return with the documentation in the next section.

Christmas Sales Up from Last Year; Is the Economy making a Come Back?

By IsaBella, January 8, 2010

Retailers nationwide reported on Thursday an increase in November and December sales were up collectively 2.9% over last year. Overall, major stores such as Nordstroms, Macys, and Ross Stores exceeded their own projections and have raised their earnings estimates. Shoppers were holding off until the last minute in hopes of getting the deep discounts as they had last year. But the retailers held firm and as a result of having stringent control over their inventory did not have to resort to deeply discounting items, thus turning a larger profit. Traffic in stores appeared light, but internet sales were up significantly. Macy’s reported a 29.4% increase over last year. Best selling items were shoes, toys, and electronics.

Author Bio: IsaBella Senior Lead Credit Officer at Credit Alliance Group 800-339-3418

Your credit

Blog: January 8, 2010
Mary Schnickel

Your credit and debt are directly related to each other. The amount of debt that you have affects your credit score, and the way you handle your debt and make payments affects your credit score. When you think about credit or debt management, it is important to realize that these two things are linked together.

1. Credit Debt Management Tip: Always Pay on Time

Once you have taken out a loan, you must make your payments on time. This will help your credit score and it will make it easier for you to be approved on a loan in the future. Additionally it will help you pay off your debt more quickly, because you will not be charged late fees and be subject to interest rate hikes.

2. Credit Debt Management Tip: Pay More Than the Minimum Payment

If you only at the minimum payment on your credit cards it will take you years to pay off the loans. If you pay extra you will reduce the principle balance much faster and save money on interest charges over the years. You can really focus this power by applying an extra payment to just one card. This reduces the principle balance much more quickly. Once you have paid that card off then you apply the extra plus the amount of the payment to your next loan. This allows the power to build and speed off your debt paying process much more quickly.

3. Credit Debt Management Tip: Watch Your Debt to Income Ratio

Once you have too much debt credit card companies and other lenders will not be as willing to loan you money. They will also charge you a higher interest rate to do it. You should be especially careful when you buy your home. You should make sure that your home payment (first and second mortgage) is not more than twenty five percent of your income. Otherwise you really cannot afford the house.

4. Credit Debt Management Tip: Beware of Store Credit Cards and Sales

Often stores will give you a discount if you use their credit card to make the purchase, but if you do not pay off the card that month you will end up paying more in interest than you would if you paid cash for the item. The savings are not worth going into debt. Store credit cards usually have very high interest rates.

Additionally people spend more when buying with credit as opposed to buying with cash.

5. Credit Debt Management Tip: Break the Credit/Debt Cycle

In order to manage your money properly it is essential to stop using going into debt. You will never begin building wealth as long as you continue to make payments. You should stop using your credit cards, and borrowing money to make purchases for things other than your home. When you have that extra money that you would use for payments you can use it to begin investing and you will begin to build wealth. It is important to realize that wealth or being rich is not measured by how much stuff you have, but by how many assets you have and how much you have in the bank.

Signs To Look For When it Time to Start Looking For Help With Your Debt

Paying off debt with debt-If you are using another form of credit to pay off a debt, this is definitely a sign that you are in over your head. For instance, if you are using a cash advance or payday loan to pay your credit card bill on time, that’s paying off debt with more debt. If you then get a cash advance on your credit card to settle the payday loan, you’re definitely in trouble.

Countless bills-If you can’t keep track of how many people you owe money to, you definitely could benefit from the help of an expert. Debt relief companies will help you evaluate your total situation and factor in all of your different forms of debt. If you are unable to answer “How many bills do you have to pay each month?” or “How many people/companies do you owe money to?” it is time to seek help.

Considering bankruptcy-Filing for bankruptcy can seem like a good option for people who are in an extreme amount of debt and don’t see a way out. However, bankruptcy wreaks havoc on your credit. A bankruptcy filing will stick with you for a long, long time. If you file for bankruptcy, you may find yourself unable to buy a car or obtain any other form of credit in the future.

If you feel like bankruptcy is the only way out, seek help from a debt relief agency first. Fill out the form below for a free consultation now!

Paying in a panic-If you find yourself going bill-pay crazy on payday just to try to keep up, you should consider getting some outside advice. If this is your method of keeping up with bills, you likely find yourself with a nearly empty, if not totally empty, checking account before your next payday.

If you’re not realistically factoring in the cost of necessities like food and transportation with what you’re putting toward your debt, you could probably benefit from some outside expertise. Paying off your bills on time just to turn around and put your groceries on a credit card will not help you get out of debt.

A debt relief agency will negotiate with your creditors to make sure your payments fit in with the rest of your budget.

Where credit is due-Finally, if you are frequently transferring the balance of one credit card onto another credit card, it’s time to get help. Don’t wait until you owe even more interest or otherwise dig yourself into a deeper hole. Start researching debt relief now.

Brittany Campbell- Negotiations Representative

Minimum Payments are Not Your Friend

Many people love the fact that they can just make minimum payments on their credit card balances. The thinking behind this infatuation with minimum payments is that they can purchase something that’s worth $1000 and only pay $20 per month to own it. Unfortunately, this thinking is faulty. Minimum payments are designed to make money for credit card companies because they inflate the total amount owed on any one item. They can also make it easier for consumers to run up additional debt which creates financial problems that could have been avoided. Although they seem nice, minimum payments are not your friend.

Think about it; would a credit card company create minimum payments if it didn’t benefit from them? These companies exist for the sole purpose of making a profit. The minimum payments make them this profit because it leaves a high balance on the credit card for an extended period of time. The interest rate is applied to that balance each month so that the consumer ends up paying a big amount to the credit card company just for the right to keep that balance on the card. This means that the item that cost $1000 initially can cost several hundred dollars more than that by the time that it’s paid off.

Some people don’t mind that they’re paying more overall if they can pay less right now for their possessions. However, the minimum payment plan also creates additional problems for the consumer. Because the individual is only paying the minimum balance, the rest of their paycheck is available for use on other things. This can cause them to do excessive spending with money that should be going towards paying off the credit card. This can create a cycle of financial difficulty that ultimately causes the consumer to go into excessive debt.

Furthermore, consumers who get caught in this cycle can be caught by surprise when minimum payments unexpectedly go up. This can happen as a result of a missed payment or it can happen just from changes in the economy. When it occurs, people who rely on low minimum payments to get by each month will find that they’re out of money and have nowhere to turn to be able to meet those payments. While it may seem at first glance that paying only the minimum due on credit cards is a great opportunity to purchase things you can’t afford, a closer look reveals that the problems this causes aren’t worth the benefits.

People continue to struggle to pay off credit card debt as delinquencies and charge offs increase

Debt on credit cards continues to haunt some people as a recent report from a financial services company shows that delinquencies and defaults on accounts increased.

Moody's Investors Services' Credit Card Index for November showed that charge offs increased to 10.56 percent during the month. The two months before saw charge offs drop, with October posting a rate of 10.04 percent.

The firm noted that it expects charge offs - or credit card debts that lenders deem uncollectable - will reach a high of between 12 to 13 percent during the middle of 2010.

One of the things that could lead to a further increase in the number of credit card defaults is a rise in account delinquencies. Like charge offs, delinquencies of 30 to 180 days rose to 6.2 percent in November after coming in at 6.1 percent the previous month.

However, the Moody's index also showed that early-stage delinquencies dropped to 1.6 percent in November.

Many experts have noted that one of the driving forces behind a number of different loan delinquencies and defaults is unemployment. The most recent statistics available from the government show that the unemployment rate is at 10 percent in the country, with many expecting it to remain at that level for much of 2010.

And as consumers find it more difficult to pay off their credit card debt, lenders are also making efforts to reduce their risk in a more difficult credit market. Some have upped their credit score requirements for accounts, while others are implementing account changes.

These changes are also in anticipation of new account regulations put forward by the Credit Card Accountability, Responsibility and Disclosure Act. A few of its provisions took effect in August, though the bulk of them are slated to start in February 2010.

Heather Boyett

New credit card rules adopted today, coming in 2010

Today the Federal Reserve adopted long-awaited rules to limit some of the most egregious credit card industry practices. Unfortunately, the changes won’t go into effect for about 18 months, on July 1, 2010.

The new rules will protect consumers by:

• Prohibiting credit card companies from raising interest rates on money already borrowed unless it was borrowed on a variable rate card, or the minimum payment is made more than 30 days late.

• Protecting new cardholders by prohibiting interest rate hikes in the first year of an account. The only way interest rates can go up in the first year is if the card issuer disclosed a future rate hike at a preset time when the account was opened.

• Imposing a new rule that "zero interest" really means zero, ending the practice of so-called deferred interest.

• Prohibiting credit card companies from charging a late fee if the cardholder’s bill was mailed out less than 21 days before the due date.

• Requiring that payments be allocated fairly among credit card balances with different interest rates. Payments must either be allocated to the highest interest balance or prorated.

• Prohibiting credit card companies from charging interest on amounts already repaid, through two-cycle billing.

• Restricting the financing of fees on credit cards where the fees or deposits use up the majority of the available credit on the account.

For a fuller explanation of the rules, and some worthwhile reforms that didn’t get enacted, see this blog from Consumers Union, the nonprofit publisher of Consumer Reports.

Though the changes should be a good thing for consumers, credit card companies have warned that since it will be more difficult for them to raise rates on existing customers, new customers applying for a card may be subject to higher interest rates and fewer low introductory offers.

The American Bankers Association’s statement about the regulations today said: “they may result in increased costs for most card users and reduced credit availability, particularly for consumers with lower credit scores or limited credit history.”
Bear in mind that cardholders’ terms could be altered before the rules go into effect. So keep a close eye on your accounts in the meantime.

Stuart Mazlish

Know What Creditors Look for on a Credit Report

By Natasha Hopkins, January 8, 2010

Understanding what types of information most creditors evaluate is important. Your credit report is a key part of your credit score, but it is not the only factor. Other factors are taken into consideration, such as:

• Paying your bills on time
• How many accounts you have and what kind
• Longevity of accounts
• The unused portions of lines of credit
• Collections actions
• Current total of outstanding debt

Terms You Need to Know:

Annual percentage rate (APR). The APR is a measure of the cost of credit, expressed as a yearly interest rate. Usually, the lower the APR, the better for you, remember that the interest rate and minimum monthly payment affect how long it will take to pay off your debt and how much you will pay for your purchase over time.
Grace period: This is the time between the date of the credit card purchase and the date the company starts charging you interest.

Annual fees: Many credit card issuers charge an annual fee for giving you credit, typically ranging from $15 to $55.

Transaction fees and other charges: Most credit card issuers charge a fee if you don't make a payment on time. Other common credit card fees include those for cash advances and going beyond the credit limit.

$0 Fraud Liability: You are not responsible for unauthorized charges made on your account, regardless of whether they are online or offline. There is no deductible for this program.

Other options: Credit card issuers may offer other options for a price, including discounts, rebates and special merchandise offers. If your credit card is lost or stolen, federal law protects you from owing more than $50 per card

Paying Your Bill:

If you carry a balance on your credit card, the lower the annual percentage rate (APR) of your card, the less you will pay in interest or finance charges during a given year. In short, if you never pay your bill in full and the features and benefits of all your cards are the same, the one with the lowest interest rate will save you the most money over time.
If you always carry a balance, making your monthly payment early in the billing cycle (even before the stated due date on the billing statement) will also save you money.

Why?

Because most credit card issuers use the average daily balance method to figure monthly interest or finance charges. If you make your monthly payment early in the billing cycle, you reduce the daily balance for more days in that cycle. This also reduces the total balance used to figure the average daily balance for that month.
If you only use your credit cards for purchases and you pay your monthly bills in full each month by the due date, you will avoid all interest charges.
Protecting Your Credit:

Once you have obtained credit, it is necessary to protect it. This means being careful with your credit, debit and ATM cards, as well as your account and personal identification numbers (PIN). Following these tips will help to ensure your credit is protected.

• Carry only the cards you expect to use, and keep the others in a safe place.
• Maintain a list of account and telephone numbers of the companies that

issued your cards. That way, if the cards are lost or stolen, you can notify the companies quickly. Be cautious about giving anyone your account numbers, especially over the telephone when someone calls you.

• Save sales receipts to compare with your bill, and when you discard documents with account numbers on them, be certain that the numbers can't be read.

• If you disagree with an item on your credit card billing statement, you are responsible for notifying your credit card issuer in writing within 60 days of the date of the statement. You should include your name, account number; the item you believe is in error and the reasons why.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Talk It Out

Making progress doesn't mean you're no longer feeling weighed down. Kathleen Hall, founder of the Stress Institute, suggests setting up a time each week for everyone in a family to sit down and talk about finances.

If you have children, be honest about how you're feeling without scaring them, and challenge them to find creative ways to help save money. One child can be in charge of making sure the lights are off when no one is in a room; another can help look for coupons.

At a separate time, meet weekly with just your spouse.

Find Serenity

Every day, do something that makes you feel calm. It will help clear your mind and reset your brain.

Make an effort to fit in some heart-pumping exercise, as well. You don't need to pay for gym membership—a run, some jumping jacks or a walk will do just fine.

Quick Tips for Managing Credit

MANAGING CREDIT WISELY (BY: CHRIS GARNER)

Here are a few important steps to help consumers use and manage their credit wisely.

1. Pay on time.
Paying your credit card account on time helps you avoid late fees, which can pile up. In addition, it enables you to maintain a good credit history. Ultimately, a good credit history can qualify you for lower rates in the future. If your bill is due at an inconvenient time of the month — for example, if it's due on the 10th and you get paid on the 15th — ask your credit card issuer to change your billing cycle to fit your cash flow. It can be as easy as a phone call.

2. Stay below your credit limit.
Every credit card has a limit of how much money you can charge. Going over this amount will accrue a fee and increase your interest rate. To avoid this, keep a record of your spending, and check your balance online or over the phone. Remember that some merchants, such as hotel and car rental companies, put a "hold" on your credit card based on their estimate of the amount you will charge. This can reduce your available credit until the final charge is processed.

3. Understand account fees.
Credit card issuers charge fees for cash advances, transferring balances and having a payment returned. Some issuers charge a fee when you pay your bill by phone — find out the rules of your account. If you need a cash advance, withdraw enough money so that you don't have to take a second cash advance and incur a second fee later in the month. Read your credit card agreement to learn more about the fees that your credit card issuer charges.

4. Pay more than the minimum amount due.
Even if you can't pay your balance in full each month, pay as much on the account as you can. Over time, you'll pay less in interest charges and you'll pay off your balance sooner.

5. Watch for changes in the terms of your account.
Credit card issuers are allowed to change the terms and conditions of your account. When this happens, they will send you "change in terms" notices, which often include new fees, interest rates and billing features. At this point, you can decide whether you want to change the way you use the card. For example, if cash advance fees increase, you may decide to use a different card for cash advances. If you have a card with a variable rate or if you have an introductory rate that is ending, be aware that credit card issuers are not required to send you a notice. Interest rates are listed on your monthly bill — read your bill carefully and take note of any changes.

6. Sign up for online account servicing.
Online account services also allow you to monitor account activity on a daily or hourly basis and sign up to pay your bills automatically online. In addition, credit card issuers offer the option to receive your statement notification via email. This allows you to view your statement instantly, rather than waiting for them to arrive in the mail. Visit your credit card company Web site to learn how to sign up for online servicing.

New Universal Default Clause Rules

By: Evan Cox 01-07-10

Any time, any reason; universal default; etc.: Card companies no longer will be able to raise rates on existing balances unless one of four exceptions applies: The consumer is 60 days or more past due, a promotional rate expired, the consumer failed or completed a workout plan, or the variable rate increased due to index movement. If a late payment triggered the rate jump, after six months of on-time payments the issuer must reinstate the lower rate.

This ban puts an end to bait-and-switch tactics. "Basically, the rate that you have when you make a purchase with your card is going to be the rate that's applied to that amount forever," says Emily Peters, a credit expert for San Francisco-based Credit.com. Rate increases not related to the four exceptions will only apply to future transactions, and not to any incurred before the rate increase took effect.
According to a recent White House news release, 44 percent of families carry a balance on their credit cards. That's a big chunk of consumers who stand to benefit from this one provision.

In the meantime, some credit card issuers may continue to jack up rates while they can. "I think it's not unrealistic to think that by the time this law is enacted that you could see average rates hovering around 15 percent," says Curtis Arnold, founder of CardRatings.com in North Little Rock, Ark.

As of June 25, 2009, the average variable rate on credit card offers was 10.8 percent, according to Bankrate's weekly survey of interest rates.

10 Ways to Stay out of Debt for the Holiday

By Natasha Hopkins, December 8, 2009

1. Sell some stuff on craigslist or eBay to help fund your gifts fund

2. Prioritize your gift list and put a set amount of money you will spend on each person.

3. Get creative and make gifts for acquaintances like bosses, co-workers, your hair dresser, or children’s teachers.

4. Perform a service to someone as your gift. If you have your own company, give someone a free session of whatever service you perform or give someone a free pass to go out while you watch their kids. People will love this stuff, because they know it’s genuine, thoughtful, and worth a lot of money when you think about how much your time is worth.

5. Use your bonus to buy gifts. I’ll be doing this. We get a Christmas bonus every year at my work, and I always set the whole amount aside for gifts.

6. Spend time with loved ones. Setting aside a weekend at the beach or in the mountains might be the best gift you could give to a best friend, parent, or sibling. Pick a time later in the year for you both to go away, that way you can save up for that event and not go into debt doing it. Or, you can just plan a day to spend with loved ones if they live closer to you.

7. Avoid the pitfalls of Black Friday. You can shop on black Friday, but be strategic. Don’t buy stuff you didn’t plan on buying

8. Plan holiday events that are cost effective. If you do less expensive things with your family around the holidays, then you’ll have more time for gifts. Picnics and parties are great things to do that don’t cost much.

9. Buy stuff online. Most online retailers are offering free shipping, and if you order early enough, you’ll get the packages just in time.

10. Do a secret Santa with best friends. Instead of buying something for every best friend, pick names out of a hat, and get one nice thing for each person.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Llamadas de colección

Los cobradores de deudas están muy motivados para convencer a los deudores a pagar el dinero que le deben a sus clientes, ya que reciben comisiones cada vez que tengan los deudores a pagar. Estos colectores hará casi cualquier cosa para cumplir su tarea - incluyendo el mal comportamiento, tales como amenazas, intimidación, acoso, y el uso de mal lenguaje. Hay ciertas cosas que los cobradores de deudas se les permite hacer al pedir a los deudores a pagar. Ciertamente, el mal comportamiento como las mencionadas no está permitido. Las agencias de la colección aplican ciertas reglas a reunir deudas, pero tristemente, no todos agentes son vigilados, ni ellos huyen simplemente con su conducta mala. Las leyes dicen que estas agencias de cobro deben respetar su privacidad, por lo que no debe ser llamada cuando está en el trabajo, descansando en casa, o incluso cuando estás durmiendo. Si insisten con cualquiera de este mal comportamiento, usted puede presentar una queja ante la Comisión Federal de Comercio o su Procurador General del Estado.

Si usted está recibiendo llamadas de cobro, trate de obtener tanta información como sea posible y determinar si la deuda es realmente tuyo. Nunca defiéndase con su genio al hablar con ellos porque puede ser que asuman que la deuda es de hecho la suya. La deuda no puede ser realmente tuyo. Asegúrese de preguntar por los detalles, como el nombre de su cliente (el banco o compañía de tarjeta de crédito) y los detalles del préstamo, tales como cuánto es y la fecha del préstamo fue aprobado.

Watching Your Debt-to-Income Ratio

Lenders are paying close attention to the debt-to-income ratio of consumers of today's housing crisis.
In today's economy, getting credit is harder for many Americans.

It all boils down to a math game - and something lenders are looking at very closely nowadays.

Consumers have bought homes based on what someone told them they qualified for, not what they could actually afford every month.

In order to get a better understanding of how to determine your debt-to-income ratio, first add up your monthly debt load.
Then divide that by your total monthly net income, the money you actually bring home.
Lenders will use that figure to determine if you are too far in debt.
If the ratio is 40 percent or more, your credit situation is out of control.
Thirty-six to 40 percent is border line, but 30 to 36 percent is better.
You may get a loan at a decent rate, but you are still not in a great position. Your goal should be under 30 percent, so watch your other expenses to keep this debt low.

Posted by: Donna 12/4/209

Debt

Sometimes the only way to stop a snowballing problem is to go back to the top of the hill and find out what started it.
If you're up to your eyeballs in credit card debt, take a step back and recount your money missteps. Knowing your weaknesses could help prevent you from falling back into the bad-credit pit and show you a way out.

Transferring balances on high-interest cards to lower-rate cards can be an effective technique, but it's easy to make it a good idea gone wrong. Transfer a balance onto a card with a low introductory rate and you can potentially save money on interest if you refrain from charging on it and focus on paying off the balance before that introductory rate expires. But most people continue to charge on the new card and wind up with more debt once the teaser rate expires. In fact, new purchases may pull an altogether different interest rate. Read the fine print very carefully, and attempt the balance-transfer maneuver only if you can control your spending on the new -- and old -- card.
If you can't refrain from charging, balance transfers won't get you out of debt. If you're really in the hole, consider getting a part-time job and dedicating your earnings to your debt load. If that's not possible, go back to your budget and cut back on unnecessary expenses such as restaurant outings and cell phone extras. Put the money you save toward paying off your balances. Pay for any new purchases with cash or a debit card.

If you have credit cards, pull your credit report at least once a year and check it for errors. Purging your record of inaccuracies can be crucial for getting better interest rates, landing the job you desire and stopping an identity thief from ruining your credit rating. The scores on your credit report also determine how high your interest rates will be on future loans. Dispute anything you think should not be there. The Fair Credit Reporting Act allows for the correction or deletion of inaccurate, outdated or unverifiable information, provided that a reinvestigation into the disputed data sides in your favor. Unfortunately, negative but truthful data must stay put. A Chapter 7 bankruptcy filing, for instance, will remain on your credit report for 10 years, a Chapter 13 for seven years.
You can request one free copy from each of the big three credit reporting bureaus, Experian, TransUnion and Equifax, every year. Why bother? Errors on your report, such as a payment marked late that came in on time, could raise your interest rates, lower your credit score and affect your ability to obtain credit in the future.
If you do find a mistake, send a correction letter to each of the credit bureaus that show the error. All three allow you to dispute errors online.
Don't bother with so-called credit-repair clinics that aim to charge you hundreds or thousands to fix your credit record. Of course, if you're not willing or dedicated enough to write those letters and follow up with the credit-reporting agencies, paying someone else to do it for you may not be such a bad idea. Better to have someone dispute the errors rather than no one. But be extremely careful in selecting such an organization -- try to get referrals and seek out others who have been satisfied with the service.

You heard the rumor: Layoffs are coming to a department near you next week.
Don't wait until it happens to worry about how to pay your bills. Do some damage control right away. The best time to negotiate is before the problem spirals downhill, call the credit card company and explain the problem you're about to have. ask if they could temporarily lower your interest rate or extend your payment deadline. Some issuers have in-house help programs that provide such short-term services to customers.

Mary Schnickel

Staying out of Debt

By Jennifer Glennen, December 8, 2009

If your spending is more than your monthly earnings this should be a big warning for you. Most people don't get into deep debt overnight; they slide into over the years until one day they realize their debt has become unmanageable. Remember that unexpected bills come along a lot more often than unexpected money so if you just ignore the spending and hope that it will all work out most likely you will just be watering your debt so that it grows. The best way to correct this situation is to reduce your monthly spending. Take a long look at all your monthly bills and see where you can cut spending. Are there any monthly services that you don't really need? Can you save money on grocery shopping with coupons? Deciding where to cut spending is a personal thing that only you and the others in your household can decide. Make sure you can get your spending below your income.

Author: Jennifer Glennen Client Relations at CreditAllianceGroup (886) 543- 9073

Creditors Keep Calling Me. What Are My Rights?

Very few things are more aggravating and annoying then creditors constantly calling you at home or at work all day and all night. It can disrupt your home life and your performance at work. Unfortunately, this can be the goal of the creditor in order to intimidate you into making a payment directly to them.

As a debtor you do have rights. Creditors and collection companies are legally not allowed to contact you with reckless abandon. The Fair Debt Collection Practices Act was put in place to protect debtors from creditor harassment. Below is an outline of what creditors are allowed to do and what to do if a creditor does not comply with these guidelines.



Hours They Can Call

A creditor is allowed to contact you between the hours of 8:00am and 9:00pm, Monday through Sunday.

Frequency of Calls

If you speak with a creditor once during the day they are not allowed to contact you anymore throughout the day. This is also the case when you have spoken with them and have asked them to not contact you at work.

If a creditor calls you outside of these hours or contacts you at work after you have asked them not to, or continually calls after your have spoken with them, it is important to write the following information down:

• Time and Date of Call
• Creditor Name
• Name of the Person who Called
• Phone Number

Nature of the Calls

The creditor knows you owe them the money and you know you owe them the money. This does not give them the right to use any sort of abusive or condescending language or make threatening statements about garnishing your wages or threatening criminal actions. A creditor is not allowed to threaten physical violence if the debt is not paid. This also applies to the creditor calling and threatening to take action such as seizing property or garnishing wages before a judgment has been filed.

The language does not have to be vulgar to be classified as abusive or condescending. If a creditor uses this sort of language with you or makes these types of threats, it is important to gather and log the same information as above.

Giving Information to Other People than the Debtor

A creditor is not legally allowed to tell anyone besides the debtor the amount of the debt, how far behind the debt is or any other material information about the debt. The only time they can do this is when they have received a judgment and are moving to garnish a debtor’s wages are speaking with the employer.

Posing as an Attorney Sending Documents that Appear to be from the Court

A creditor is not allowed to call and say they are an attorney if they are not one. This can be a popular collection tactic but it is illegal! The creditor also cannot send documents that appear to be from the courts in order to intimidate debtors.

The Bottom Line

If a creditor does any of these, it is important to gather the following information and create a log:

• Time and Date of Call
• Creditor Name
• Name of the Person who Called
• Phone Number
• Save copies of the documents


Posted by Donna Millen 11/27/2009

Inexpensive Ways to Give at Christmas

(Posted by Deanna Haynes 11/30/09)

Offer Experiences, Not Things: How many gifts that you're received through the years do you remember? I'm guessing only a handful stand out in your memory.
But think about the trips, outings and late-night dinners filled with laughter. The experiences with family and friends are what truly enrich our lives.

You can give children a coupon for a special outing alone with Mom or Dad. Give friends with kids coupons for nights that you'll babysit their brood. Promise your spouse a weekend with no child care or home maintenance.

Think of other little tasks that you wouldn't mind doing and your friends would appreciate. What about a manicure, laundry, housecleaning, taking their carpool shift, a music concert or serenade? Can you host a birthday party for a friend with no backyard?

Pool Resources With Friends and Family: Chip in with your siblings or cousins to buy your parents an outstanding gift. Enlist friends so you can afford to give your friend that designer purse she wants.

Or what about only giving presents to the kids, not the adults? Make sure to communicate ahead of time so everyone can make appropriate shopping plans.

Go Small But Meaningful: You don't have to give the big gift to be thoughtful. Think about what your friends and family love best and look for a way to upgrade that experience. You'll discover for yourself that it is the thought that counts, while giving your wallet a break. You'll discover for yourself that it is the thought that counts, while giving your wallet a break.

A key test of consumers' debt management skills will unfold over the coming weeks in the form of the holiday shopping season.

By Cristina Gomez, November 30, 2008

Retailers tend to us different “traps” to get you to spend, spend, spend especially during the holiday season. Here are some of them and ways to avoid them while shopping for your loved ones. 3

Trap #1: Stores will put pricey goods at eye level and giant displays mid-aisle "so you'll stop, look and buy,"

Avoid it. Write down what you need beforehand and you won't be tempted to veer off course. Scope out bottom shelves, too; that's where the least expensive items are often located.

Trap #2: checkout
Merchandisers know you're probably tired and hungry when you're waiting to pay, which is why you'll find small items meant to spur impulse buys, such as lip gloss and candy bars.
Avoid it. Distract yourself by texting a pal.

Trap #3: a myriad of mirrors
"Shoppers who check out their reflections may be prone to self-critical thoughts, leading them to buy products to fix themselves,"
Avoid it. If you didn't walk in thinking you needed improvement, leave that tooth whitener on the shelf. See a mirror? Give yourself a compliment. ("Good-hair day!")

Trap #4: A racetrack floor plan
Many shops are set up as a circuit that guides you past the greatest number of items, so you linger longer. Trouble is, "The more time you're in the store, the more you'll be apt to buy,"
Avoid it. Don't wander around; go straight to what you need. And set a time limit. When shoppers exceed 30 minutes, there's a spending bump.

Trap #5: mega-baskets
Many baskets and carts are supersized these days, and that's no accident. "When you see extra space in the cart, you may wonder what you are forgetting—and then buy more,"
Avoid it. Skip the cart altogether and grab a small basket or, if possible, use only your hands.

Author: Cristina Gomez, Client Services Group at CreditAllianceGroup (866) 543-9073

Holiday Shopping Will Be A Test Of Consumers' Debt Management Skills

A key test of consumers' debt management skills will unfold over the coming weeks in the form of the holiday shopping season.

Over the past year, consumers have already paid down billions of dollars in credit card debt after spending much of the earlier part of the decade ringing it up. Conventional wisdom may suggest that during the holiday season, that trend will reverse somewhat.

However, millions of consumers have less access to credit than they once enjoyed, and a number of them are wrestling with unemployment and other problems that keep them from making minimum payments and otherwise buried by credit debt.

With that in mind, a new survey by the National Retail Foundation finds that 24.9 percent of shoppers plan to pay for holiday purchases with cash this year, making a 9.1 percent increase over last year's cash transactions.

The poll also found that 42.5 percent plan to pay for holiday purchases with check and debit cards, marking a 2.5 percent increase over last year. Credit card use is projected to fall by 10.1 percent, from 31.5 percent last year to 28.3 percent this year.

"If the strong promotions and sales we've seen the last few weeks are any indication of what retailers are planning, shopping on a budget this year will not be a problem," said National Retail Foundation CEO Tracy Mullin.

Also as of early November, 52.4 percent of consumers said in the survey that they had not yet begun their holiday shopping.

Many consumers are likely to open their wallets at least somewhat in the coming weeks, but recent projections suggest that bargain hunting and cautious spending will be the order of the day.

Heather Boyett

Simple steps show how you can get started to get out of debt

Work out where you are - it sounds obvious, but so many people begin to bury their heads in the sand when finances are hard. Be brave and confront your debt.
Budget - now you know exactly where you are in terms of debt, you need to consider thin terms of your total income and other outgoings.

Track daily spending - often, when completing step two (budgeting), people will not understand how they spend all of their income.
Shop around - it's very likely that you are not being charged the lowest price possible for your utilities.

Transfer debt - Bye bye bank - Look at online banks particularly, as these are often much more favourable than the larger high-street banks.

Review your mortgage - for most people, the mortgage is the biggest expense each month. Spend some time ensuring you are getting the best deal.

Brittany Campbell/ Negotiations Department

What not to do:

Using retirement savings to pay off debt

Newbies to the Your Money message board frequently post about their bright idea to raid their IRAs or 401(k) s to pay off debt. Your Money regulars quickly set them right, because such raids are:

• Incredibly expensive. Penalties and taxes typically eat up 25% to 50% of such withdrawals, but even worse is the loss of future tax-deferred gains that money could have earned. You should figure each $1,000 you withdraw from a retirement account now will cost you at least $10,000 in lost retirement income. That assumes 8% average annual returns over 30 years, which is a reasonable long-term assumption for a balanced portfolio of stocks and bonds.

• Often shortsighted. Grabbing money from your retirement doesn't help you fix the problem that caused the debt in the first place, which is usually overspending. That means you're just going to run up more debt after you've squandered your retirement cache. Furthermore, money in retirement accounts can be protected if you end up filing for bankruptcy.

Trust me; you don't want to wind up like poster upsydaisy:

"My husband has retired and we both are still working, him part time and me full time. We are overloaded with credit card debt and need to get out. He is 63 and I am 60 so time is running out for us. We have used all of our retirement savings trying to get out of debt and so far nothing has helped. . . . I know we need to pay off the credit cards but it seems impossible. Help!!!"

Improving your credit score

It’s important to note that raising your credit score is a bit like losing weight: It takes time and there is no quick fix. In fact, quick-fix efforts can backfire. The best advice is to manage credit responsibly over time.

Payment History Tips

• Pay your bills on time.
Delinquent payments and collections can have a major negative impact on your FICO score.

• If you have missed payments, get current and stay current.
The longer you pay your bills on time, the better your credit score.

• Be aware that paying off a collection account will not remove it from your credit report.

It will stay on your report for seven years.
• If you are having trouble making ends meet, contact your creditors or see a legitimate credit counselor.

This won't improve your credit score immediately, but if you can begin to manage your credit and pay on time, your score will get better over time.
Amounts Owed Tips

• Keep balances low on credit cards and other “revolving credit”.
High outstanding debt can affect a credit score.

• Pay off debt rather than moving it around.
The most effective way to improve your credit score in this area is by paying down your revolving credit. In fact, owing the same amount but having fewer open accounts may lower your score.

• Don't close unused credit cards as a short-term strategy to raise your score.

• Don't open a number of new credit cards that you don't need, just to increase your available credit.
This approach could backfire and actually lower your credit score.

Greenback Christmas

According to the National Retail Federation’s 2009 Holiday Consumer Intentions and Actions Survey, U.S. consumers plan to spend an average of $682.74 on holiday-related shopping. This is a 3.2% drop from last year’s $705.01. Only 28.3% of shoppers will use credit this year compared to 31.5% a year ago. No surprise to anyone in debt that when you use the PLASTIC it doesn’t hurt as bad as letting go of the GREEN. Using cash for those gifts will reign in unnecessary spending because consumers will stop to question the value of purchases versus the labor it took to earn the money! * Envelope System: ~Family ~Friends

Step 1. Put the cash in

Step 2. Write out your list on the outside

Step 3. Divide the dollar amount and go shopping!

*Remember~ dollar stores are a great source of inexpensive wrapping supply!

GIFT CARD “GOTCHAS”

( by Deanna Haynes 11/20/2009)

• If you don’t spend the card after the first 12 months, you could be hit with unexpected fees. In September, American Express announced it would no longer charge a $2 monthly service fee after 12 months -- and that change is retroactive to old cards, too. However, A study found that Discover, MasterCard, and Visa still tack on a $2.50 monthly maintenance fee after 12 consecutive months of inactivity.

• Store gift cards are free, others aren’t. There’s typically no charge to purchase a gift card from your favorite merchant. But if you choose to buy the gift card online instead of at the store, you could be hit with a handling fee. At Starbucks, for example, the fee is $1.50. Credit-card issuers, by contrast, always charge a purchase fee, typically $3.95, though it can vary depending on the card’s value.

• Pay attention to the "valid-thru" date. It’s something you’ll find on cards issued by credit card companies. While technically not an expiration date, it reflects the estimated lifespan of the card’s magnetic stripe. Shelf life for the stripe is about five years, and if you have a card with a past-due valid-thru date, contact the company for a replacement card.

• When buying a gift card from an individual merchant, be sure to ask if the card is valid for online use. While it’s not an issue for most retailers, some companies such as CVS, T.J. Maxx, and Marshall's do not allow their gift cards to be used online

5 Spending Habits that can lead to Debt

Debt isn't something that just happens as you go about your daily routines. There are certain spending habits that lead to debt.

1. Spending more money than you make.
This doesn't sound logically possible. If you only make $1,000 a month, how could you possibly spend $1,200 in a month? It's easier than you think. So easy, you might be doing it. Dipping into savings, borrowing from others, and using credit are the primary ways of spending more money than you bring in. You might be able to get away with doing this for a few weeks or months, but soon, your hole-digging spending habits will catch up with you. Before you know it, your savings is depleted, your credit cards are maxed out, and you can't borrow any more money.

2. Spending money you don't have.
Usually, spending more money than you make is enabled by spending money you don't have. You spend money you don't have by using credit cards and taking out loans. When you use these instruments to pay bills and make purchases, you're creating debt. If you can't repay the debt each month, it will continue to grow.

3. Using credit for ordinary purchases.
You should use cash to make everyday purchases like groceries, gas, clothes, and entertainment. The appeal of credit cards is the ability to pay later for items that you buy now. The caveat is that you're less to pay your credit card bill for items that you've already consumed, which most "ordinary" purchases are. Using credit instead of cash is a bad habit, especially when you don't pay your credit card bills in full each month.

4. Using credit when you have cash.
One of the quickest ways to get into debt is to choose to use credit when you have the cash to make a purchase. People do this with a "something for nothing" type of mindset. They want to receive the goods (or services) but they don't want to pay for them. The convenience of leaving your money in your wallet comes at a cost. Chances are, if you don't want to pay for it today, you're not going to want to pay for it tomorrow.

5. Using debt to pay off debt.
When you use credit cards to pay off other cards and loans to pay off other loans you're not paying off anything. You're just shuffling your debt around and incurring more debt each time you do so. Balance transfers have transaction fees and most loans have some kind of down payment or origination fee. So when you use debt to pay off debt, you end up worse off than when you began.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

11 Surprising Financial Facts about Women

(Donna Millen)

Although, “The Savage Truth on Money,” a book by personal finance columnist Terry Savage, was published a decade ago, many of the facts and figures are still meaningful. Here, summarized, are 11 financial facts about women, from the book (with our comments in parentheses)...

1. Women live between five and six years longer than men. (The oldest person in the world, a woman in California, was 115. But the next oldest person, a man in Japan, is 114.)

2. A 65-year-old woman today has an average life expectancy of 19.2 years. (These days, it’s about 20 years, vs. 17.2 for a man.)

3. Women earn, on average, 76¢ for every dollar that men earn, resulting in lower Social Security and pension benefits.

4. Women spend more time out of the workforce, resulting in lower pension benefits.

5. Women outnumber men in part-time jobs, two to one. (But since the recession
began, more men are seeking part-time work.)

6. Women who work part-time are less likely to work for firms with retirement plans. (Many firms hire only part-timers so they won’t have to pay benefits.)

7. Half of the women over 65 are divorced or widowed.

8. Women make up 75% of the elderly poor. (See above for reasons.)

9. Elderly unmarried women get 51% of their total income from Social Security.

10. 80% of women living in poverty were not poor before their husbands died. (In 2007, “poverty” meant an income of less than $10,590 for a person living alone, or under $13,540 for a couple.)

11. An average woman’s standard of living drops 45% in the year following a divorce, while a man’s rises 15%. (Draw your own conclusions.)

Friends vs. Debt

Sometimes sticking to our budgets is hard to do when friends on a different pay scale are constantly nagging us to go out and spend money. Don’t get me wrong, I know it’s hard to watch everyone else around you living the good life and enjoying the finer things. But the reality is, you don’t know their situation like you know your own. They may be putting on a big show for all you know. The only thing that matters is you accomplishing your goal…not to the detriment of your relationships with people, but if they truly care about you, then once you’ve put your foot down, they won’t complain (much).

Author: Lucinda Ramos, Client Relations at CreditAllianceGroup (886) 543- 9073

Credit Debt Management Programs

These programs can come in many forms and from many different places, but the common thing between them all is the benefits they provide to those who take advantage of them. Unsure of what a debt management service can do for you? Take a look at the following benefits and find out if it is right for you and what you are really getting when you sign up for one of these programs.

Organizational Benefits

These programs can help you organize your personal finances, by taking the following actions:

1. Determining how much debt you owe and how much interest will be added onto that debt while you are in the program. They will also try to work with your creditors in order to lower the interest rates on your credit cards and other debts.

2. Taking your monthly bring home income and subtracting your needed expenses, in order to determine how much you have available to pay toward your bills each month.

3. Putting you on a 3, 4, or 5 year debt repayment plan. This will be determined according to how much debt you have and how much extra income your have each month to put toward your outstanding debts.

4. Distributing your monthly payments between your creditors, based on the amount of debt owed. Companies who you owe the most money to will likely get a larger percentage of your payment, in order to ensure that everyone gets paid off within 3 to 5 years.

Educational Benefits

A debt management plan can also help you discover the life rules for staying out of debt, so that you don’t have to deal with this situation ever again. They can also show you what living within your means really is, how to come up with and manage a budget, and what current expenses you should be cutting back on to stay within your monthly budget. The most important thing you need to take away from this experience, however, is responsible spending habits. Otherwise, the entire experience will have been pointless. A budget does not work if you do not stick to it.

Structural Benefits

For those who need a way to streamline their personal finances, maintain stability, and want to eliminate debt, a debt management program is a perfect solution that will make their lives better. The only choice you have to make now is which kind of debt management program is best for you and what company you want to sign up with.
‡ Please Note: Unsecured debts concern any kind of debts or bills that are not secured by your assets, such as personal loans, retail and other credit card financing, and outstanding utility bills. Car or home loans are not unsecured as the loan uses them as collateral.

Presupuestar

Por Cristina Gomez, 20 de noviembre 2008

Crear un presupuesto no es la cosa más emocionante en el mundo para hacer, pero cambia mucho las cosas a mantener su financiamiento en la orden. Una vez que haya terminado, usted será capaz de ver cuanto dinero esta llegando, donde va todo. Esto podrá ayudarlo a determinar lo que usted debe recortar y también ayuda al saldar alguna deuda más rápido. No toma mucho tiempo. Usted también puede intentar de utilizar los pasos debajo para ayudarlo a empezar.

1. Reúna cada estado financiero que usted puede. Esto incluye estados del banco, cuentas de inversión, cuentas recientes de utilidad y cualquier información con respecto a una fuente de ingresos o el gasto.
2. Registre todas sus fuentes de ingresos. Si sus ingresos están en forma de un cheque de pago regular donde impuestos son descontados automáticamente entonces utilizando los ingresos, o la paga para llevar, la cantidad está muy bien. Registre estos ingresos totales como una cantidad mensual.
3. Cree una lista de gastos mensuales. Anote una lista de todos los gastos esperados que usted planea a contraer sobre el curso de un mes. Esto incluye un pago de la hipoteca, pagos de coche, el seguro de automóvil, los comestibles, las utilidades, el entretenimiento, el seguro de automóvil, todo en que usted gasta dinero.
4. Sume sus ingresos mensuales y los gastos mensuales. Si su resultado final demuestra más ingresos que los gastos está en un buen comienzo. Esto significa que usted puede priorizar este exceso a áreas de su presupuesto como pagando más en tarjetas de crédito por eliminar esa deuda más rápido. Si usted muestra una columna más alta del gasto que los ingresos significan que algunos cambios tendrán que ser hechos.
5. Haga ajustes a gastos. Si usted ha identificado exactamente y ha listado todos sus gastos que el último objetivo sería de tener sus columnas de ingresos y gasto para ser igual.
6. Revise su presupuesto mensualmente. Es importante revisar su presupuesto para asegurarse con regularidad permanece en el vestigio. Compare sus primeros pocos meses. Esto le mostrará donde usted hizo bien y donde usted puede necesitar para mejorar.

Por: Cristina Gómez, Relaciones de Clientes y Acreedores en CreditAllianceGroup 866-543-9073

Christmas and the Risk of Debit Cards

November 20, 2009

The shopping season is approaching and many consumers are choosing to use their debit cards instead of a credit card this Christmas season. But despite their apparent safety, there are a few precautions you need to take to make sure that you don't end up in debt despite avoiding credit cards this Christmas.

Keep close track of your spending. While debit cards are a lot better than credit cards in terms of avoiding interest, fees and debt that you need to repay, debit cards have their own set of pitfalls, including pain-free spending. If you carry cash it can be quite painful to part with it when it comes time to pay for a purchase. As with credit cards and debit cards, just swiping a card makes spending money less painful causing you to spend more. To avoid spending too much on you debit card, keep a running tally of what you are spending as you go from store to store.

Opt-out of overdraft "protection" programs offered by your bank. As we have mentioned before overdrafts can end up costing consumers more than what the price of the original purchase. The average overdraft price tag was $34 in 2008. To avoid spending as much as twice what you paid for an item, don't allow you bank to "protect" you with their overdraft program, just simply opt-out. Note: The Federal Reserve has created new rules, effective July 1, 2010, which will prohibit banks from charging overdraft fees on automated teller machine and one-time debit card transactions unless the consumer opts in to the overdraft service for those types of transactions.

Author: Evan Cox, Senior Credit Specialist

Minimum Payments are Not Your Friend

Many people love the fact that they can just make minimum payments on their credit card balances. The thinking behind this infatuation with minimum payments is that they can purchase something that’s worth $1000 and only pay $20 per month to own it. Unfortunately, this thinking is faulty. Minimum payments are designed to make money for credit card companies because they inflate the total amount owed on any one item. They can also make it easier for consumers to run up additional debt which creates financial problems that could have been avoided. Although they seem nice, minimum payments are not your friend.

Think about it; would a credit card company create minimum payments if it didn’t benefit from them? These companies exist for the sole purpose of making a profit. The minimum payments make them this profit because it leaves a high balance on the credit card for an extended period of time. The interest rate is applied to that balance each month so that the consumer ends up paying a big amount to the credit card company just for the right to keep that balance on the card. This means that the item that cost $1000 initially can cost several hundred dollars more than that by the time that it’s paid off.

Some people don’t mind that they’re paying more overall if they can pay less right now for their possessions. However, the minimum payment plan also creates additional problems for the consumer. Because the individual is only paying the minimum balance, the rest of their paycheck is available for use on other things. This can cause them to do excessive spending with money that should be going towards paying off the credit card. This can create a cycle of financial difficulty that ultimately causes the consumer to go into excessive debt.

Furthermore, consumers who get caught in this cycle can be caught by surprise when minimum payments unexpectedly go up. This can happen as a result of a missed payment or it can happen just from changes in the economy. When it occurs, people who rely on low minimum payments to get by each month will find that they’re out of money and have nowhere to turn to be able to meet those payments. While it may seem at first glance that paying only the minimum due on credit cards is a great opportunity to purchase things you can’t afford, a closer look reveals that the problems this causes aren’t worth the benefits.

Sean Boyett, Director of Sales

Building your Savings

• Whenever you're paid, put only what you need to live on for one month (or two weeks, if you get paid every two weeks) into your checking account. (If you put more into checking, you'll probably spend it.)
• If you can, put money equaling one month's expenses into your expenses account for unexpected bills. The idea is to build at least a small stash so you're less likely to use your credit card if your car needs a new tire.
• Begin building your emergency cushion by depositing a portion of each paycheck into your "cushion" savings account. If your goal is to have three months' living expenses, you could reach your goal in 30 months by saving 10% of each month's pay — or in 15 months by saving 20%.
• Put whatever is left into your "investments" account, including found money such as birthday and holiday checks, bonuses, or money made from a garage sale. If you get a raise, put the difference into this account on a regular basis.
• If your bank can't link your checking and savings accounts, or if you find it hard to control your spending when access to your savings is easy, ask your employer about direct deposit. You can have money taken from your paycheck and placed in a savings account automatically.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Getting through Christmas Debt-Free

If you're like many people, a lot of your current credit card bills include Christmas expenses from last year that you're still paying off. Most will be paying off last year's presents well into the middle of this year. One way to keep this from happening down the road is to start saving now, so you have the cash on hand to pay for those gifts outright instead of having to resort to putting them on a credit card. The savings can be substantial as the interest fees on those charges can add up quickly if they're not paid off promptly.

How can you get that far ahead? Well, you can start by making sure that you pay all your bills on time. Each of those late fees of $25, $35 or more can add up to a lot of potential gifts. And that isn't even considering the interest rates. If you have hundreds or thousands of dollars on your credit cards, you must remember how much you're paying in interest. Many credit cards charge 19 percent or even more in interest rates. That means you're paying a lot more on every dollar of purchased gifts than you initially charged. If left long enough you could be adding hundreds of additional dollars extra in interest just to pay off last year’s gifts. That's money that would be better spent on this year's Holiday season.

So, work diligently to pay off those debts. Do what it takes to clear those old charges. That may mean tightening your belt for a few months to make larger-than-usual payments on your cards. Remember, the faster you pay down your balances, the more money you'll be able to keep in your own pocket by not having to give it to the credit card company as an interest payment.

Once you get your cards paid off, begin saving for this year. If you're fairly responsible and have the will power, you can just put this money aside in your savings account – that's assuming, or course, you'll leave it there and not dip into it from time to time. If you do take a little here or there, be sure to replace it as quickly as possible, or you'll be sadly disappointed at the toll it will take on your available cash come Christmas time.

For many people, it's necessary to open a completely separate account for this purpose. Most banks typically offer some form of 'Christmas Club' savings account, but evaluate and compare them carefully before signing up. Many offer lower interest rates than regular savings account, in which case it might be better to simply open a second savings account that you personally earmark for your Christmas money.

While you may still be suffering the repercussions of last year's Christmas
spending, the painful bills don’t have to be an annual tradition. With a little extra planning and effort this year, your Christmas can be funded in advance and leave you entering the next New Year debt-free.

Author: Regan Ricci, Client Services Group (866) 543-9073

The Inside Scoop on Store Credit Cards

It seems like every retailer is offering its customers its own credit card nowadays. While the incentives to applying for a new store credit card are often enticing — many stores offer 25% off the first purchase, no interest for one year, or monthly discounts or gifts to cardholders — having so many store credit cards in your wallet can put you into debt in a hurry, if not seriously hurt your credit score.

High debt is often a problem for holders of store credit cards, since they generally charge much higher interest rates than bank-issued cards. Unless you plan to pay off the full amount of the balance each month, expect high finance charges, likely enough to render obsolete any card holder incentives you may have received.

Having a different card for each store you shop in may earn you some store rewards here and there, but holding so many cards does not look good to creditors and thus, your credit score is likely to take a beating. Consumers should balance their card portfolios carefully and only apply for cards with genuine value, according to the National Retail Federation's senior VP Mallory Duncan.

The reason why stores are able to offer such huge incentives to their cardholders is because they reap huge savings on the transaction fees that Visa, MasterCard, Discover, and American Express charge. Visa and MasterCard charge a fee of 2% for each transaction, which comes directly out of the retailers' bottom lines. When a retailer co-brands with Visa or MasterCard, often times that fee is halved. When they offer their own independent card, the retailers can avoid the transaction fees altogether. While some of these savings are passed on to their customers, consumers should still exercise sound judgment when offered a new store credit card. More is not always better.

Donna Millen

Benefits of Debt Management

Debt management means that part of your debt is immediately wiped out by your creditor. You will find instant financial relief in your monthly budget. And the rest of your debt payments are much more manageable. You will also find that you can start rebuilding your credit from this point on. Instead of juggling late payments, high debt loads, and other factors, you can focus on managing your credit better.

Author: Lucinda Ramos, Client Relations at CreditAllianceGroup (886) 543- 9073

Creating a DIY Debt Management Plan

Learn how to create your own personal plan for reducing debt

Believe it or not, being swamped in debt isn't the end of the world. You might spend the night worrying about how to make ends meet, but you don't have to. The key is to set up a debt management plan and take control of your life. While there are many companies that offer this service, it is something you can do yourself.

Question why you are in debt
How did you get in so much debt? Were the purchases necessary? Are you living above your means? All of these questions are necessary. You need to find out what led you to this situation or you'll just make the same mistakes in the future. Debt management also means finding a way to stop adding on more debt.

Calculate monthly expenses
This may seem time consuming, but it's necessary to see where your money's going each month. Create a spreadsheet for your cell phone and track all your expenses for a month. Each time you make a purchase, type in what it was and how much it cost. At the end of the month, take a good look at the total compared with your monthly salary. If more money is going out than coming in, there's a huge problem.

Cut monthly expenses
There are several ways to cut costs on almost every expense. You can switch to generic brands, choose a lower cost cable package, turn off unused services, etc. The exact cuts you make will depend on your expenses. Take a hard look at the spreadsheet you created and determine which expenses you can live without and which ones you can reduce.

Prepare a budget
A spreadsheet is the perfect tool for creating a budget. Type in all the expenses you have such as housing, electricity, groceries, etc. Once all the expenses are typed in, insert a formula to display the total. You want to have money left over. This money can be stashed in a savings account for emergencies. The key is to create a budget you can stick to and not spend more than you currently make each month.

Consolidate your debt
There are two ways you can do this yourself. First, if you're a homeowner, you may be able to refinance and use some of the equity to pay off your debt. Another option is to get a debt consolidation loan from your bank, which allows you to just make one payment each month.

Avoid additional debt
Once you've consolidated your debt, it's time to put away the credit cards. If you can trust yourself with this step of debt management, you can put them in your safe so you don't have them handy when you go shopping. If you can't just yourself, run them through the shredder. It's important to not close all your accounts at once because this will have a negative effect on your credit score. If you want to close them, do so gradually.

Mary Schnickel

8 Great Tips to Improve Your Credit Score

Make these changes to your lifestyle and you can improve your credit score substantially.

These are some basic instructions for anyone to help improve your credit score and to keep you from getting into credit trouble.

Even if your credit score is already pretty good, chances are that it could benefit further from reading thru this list and following at least a couple of these tips to keep your score high.

These tips may seem like common sense, but to those people with a lot of debt, they can be more than a little difficult to follow.
Start with the one you think you can handle, then slowly move up to the more difficult ones.

1. Pay Your Bills On Time
This seems like a simple concept, but poor organizational skills and spending habits can prevent you from doing this. Late payments will hurt your score tremendously.
If you think you will be having a problem paying a certain bill, contact the creditor and explain the situation. They will most likely be willing to work out a payment plan with you without reporting a late mark on your credit report.
The goal here is to develop a long history of paying on time.

2. Live On a Budget
If you don’t have one yet, start one today. Following a budget cures overspending. There are new, online-based budget programs that are very easy to set up and follow.

3. Have 1 Credit Card
Try to hold on to 1 credit card and pay it off every month. This will help establish good credit history. Cut up all your other credit cards including gas cards, store cards and others. This is a must.

4. Keep Card Balances Low
If you need more than 1 credit card, try to keep your balances to a minimum. Avoid a high debt-to-credit limit ratio, which can lower your score. This goes for all your accounts. Use the debt snowball method to kill off your debts 1 by 1, or hire a professional debt negotiator to help you settle your debts for less than full balance.

5. Avoid Playing the Balance Transfer Game
This is so tempting, and I did it for a long time. By transferring balances too often, you can lower your score. Too many revolving credit accounts is seen as a negative to the credit reporting agencies. Even if you close them after you’re done with them, it still can damage your score.

By doing this, you are pretty much delaying the inevitable, which is defaulting on one or more accounts. Shifting your debt around never removes it.

6. Don’t Go Crazy Opening New Accounts
If a lender sees a bunch of new credit inquiries or several accounts opened up in your name in a short amount of time, you may appear to be soon overextended and perhaps a bigger risk. This goes for all credit and loan applications, like mortgages and car or boat loans.

7. Check Your Credit Reports at Least Once a Year
Get a free credit report and review your credit report it carefully to make sure your accounts are being reported accurately. Dispute inaccurate and unverifiable negative items. Don’t worry about checking your own credit report often. This doesn’t affect your score.

8. Maintain Stability
Maintaining a stable lifestyle is one the biggest factors in improving your credit score.

Lenders prefer that their clients have a history of being employed by the same company for a few years and don’t move around too much. This says to the creditors that you are a lower risk, thus your chance of getting a great interest rate will be much better.

The ingredients in maintaining a stable lifestyle are pretty simple. Here are the major ones:

1. stay employed by the same employer for at least 3 years
2. live at the same address for several consecutive years
3. don’t open new credit or loan accounts frequently
4. have a long record of on-time payments

Last Stop Bankruptcy

When you are on a runaway train get off before it is too late detour by way of Hardship programs like Credit Alliance Group offers. Many solvent families become insolvent with only bankruptcy as a solution. How does this happen? Unforeseen medical procedures covered for the most part by medical insurance still rack up the out of pocket expenses in most cases to the tune of thousands of dollars. Take into account the current unemployment rates and those without insurance are in even worse shape. If these bills are the result of serious illness or injury it can prevent good people from working to afford even meager debt. Most American family’s budgets are so tight right now that that there is no room to afford new bills. Forget about savings to offset the massive medical bills. If your medical debt is too high to handle but too low to file medical bankruptcy call me, as a senior credit specialist we can help you reach your destination Debt Freedom intact!

Guide to Getting out of Debt

Imagine being free of debt -- no more sleepless nights over mounting credit card balances, no more ball-and-chain of debt feeding your anxieties, and no chance of threats from dreaded collection agencies. You can do it! Here's the scoop -- in one minute flat.

Make it a habit as fundamental as stopping for red lights. Realize once and for all that if you can't pay for it today -- you can't afford it.

OK Debt has an interest rate well under 10% -- preferably with some tax advantages to boot. In the best case, what you bought with borrowed funds will appreciate in value. Home mortgages and student loans are examples of OK Debt. Automobile loans are on the border: They often satisfy the low-rate piece, but automobiles almost never appreciate in value. Bad Debt is everything else -- from your titanium credit card to the 35% loan from Larry's Kwik Kash.

Out of all your cards, pick the one or two major credit cards that feature the lowest annual interest rate. Resolve to use those cards for emergencies only. As for all the other plastic pals in your wallet, remove temptation by taking them out of your wallet. Throw them behind a major appliance, freeze them in a bowl of water, or decoupage them to a shoebox. Do whatever it takes not to use them.

Line these up on the kitchen table. Find the minimum monthly payment for each account and then add these up to get an overall monthly minimum. Pledge to pay this overall minimum PLUS a hefty additional chunk every month -- enough to make a solid dent in the outstanding balance of at least one account.
If you can't pull this off, you'll have to make a drastic move to increase your income or lower your expenses. It's harsh, we know, but it's also an inescapable fact.

Next, order the latest bills according to annual interest rate charged. Apply the "hefty additional chunk" (beyond the minimum) to the highest rate account(s). Repeat this process monthly until the last Bad Debt account is paid in full.

Grab a bill from any account charging you more than 14% interest. Dial the toll-free number on the bill and ask to have your rate reduced -- say, to 11%. Tell them that you'd really like to stay with them out of customer loyalty (embellish according to your acting skills), but that you have received offers for much-lower-rate cards. Expect to be made very uncomfortable, but stand firm and remember that, to them, you are both a customer and a profit center. You also stand to save a bundle. The more calls you make, the more persuasive you'll become.

Be aggressive in paying down Bad Debt, but don't get so ambitious that you risk missing minimum payments on your mortgage, automobile, or any other secured credit account. (Secured means that if you miss enough payments, the bank can show up and take away your stuff.)

On our Consumer Credit / Credit Cards discussion board, you'll find plenty of emotional support and great ideas. Help others celebrate their debt-free "happy dance."

You're done when the Bad Debt is 100% exorcised and you can make remaining OK Debt payments with ease, leaving plenty of budget room for savings.


Brittany Campbell
Negotiations Department

Sound Advice for First Time Credit Card Users

Getting that first credit card is a rite of passage in America today. It’s an exciting experience, and it’s one that can be a little bit overwhelming. Most people know that credit cards open up a world of purchasing opportunities but they also create a lot of responsibility for the borrower. The smart first-time credit card user will do his or her research into good credit card practices in order to make sure that the card works to his or her advantage instead of becoming a problem.

Here is some sound advice for first-time credit card users to follow in order to avoid problems associated with credit card debt:

• Set a monthly credit card spending limit based on your budget. You should be able to pay off the entire balance on your card every month so set a spending limit based on this goal. This limit will likely be lower than the credit line on the card so you’ll have to stay organized about keeping receipts and sticking within the budget.

• Get in the habit of pausing before every purchase to consider whether it’s a smart choice. Just taking a moment to think before buying can make a great deal of difference in using a card wisely and using it to your detriment. If you know in your heart that you’re making a bad decision, this moment of truth will help you walk out of the store empty-handed.

• Don’t take the card when you know it could be a problem. If you’re going out for a night of drinking with friends, you aren’t going to be responsible with that card. Take out cash instead to limit your spending.

• Make sure that you clearly understand the terms of your credit card. You will accumulate fees if you fail to keep to the terms so make sure you know them. You should know what actions will cause you to get fees, what changes in interest rate can occur for which reasons and what other terms there are on the card.

• Know when your payment is due and make sure you mail it well in advance. Late payments are a frequent problem for new credit card users. This causes fees to be applied and can ruin credit scores. Don’t let it happen to you.

• Get advice from someone wiser. Everyone should have a credit advisor even if it’s just a best friend or a parent. Find someone that can give you good advice about credit card spending to get you through the initial years of learning.
Getting that first credit card is a rite of passage. Getting into credit card debt because of it doesn’t have to be.

Layaway programs could be useful debt management tool

Economists and retail industry experts are increasingly eyeing layaway programs as a potentially helpful way for consumers to meet their holiday shopping needs while staying focused on debt management.

Since last year, Americans have been significantly paying down their consumer credit balances, relying more on cash and debit cards to meet their spending needs. This is a contrast from earlier in the decade, when easy credit allowed millions to live beyond their means and make purchases whether they were affordable.

However, the current economic climate could actually undermine prospects for a recovery, since even if consumers are paying down an unsustainable debt burden, they're still somewhat reluctant to make retail purchases that in the past accounted for some 70 percent of the U.S. economy.

A recent report in the San Jose Mercury News cited the growing popularity of retail layaway programs, which were common up until about the late 1970s before credit card use began to become more prevalent.

According to the newspaper, some of the nation's top retailers and even some websites are now offering layaway options.

"When you don't really have the money to buy something, putting it on layaway forces you to budget. Use a credit card and you've already bought it and are enjoying it and you don't think as much about making the money to pay it off. So layaway is safer. This country wouldn't be in the credit-card mess we're in if we'd all just use layaway," one consumer, Kent Fong, told the newspaper.

Looking ahead, strong retail sales will be widely seen as a sign of a pending economic recovery after the holidays. With that in mind, merchants will be inclined to do what they can to get more shoppers through their doors.

Heather Boyett

Getting Out of Debt and Staying Away from Debt

By Natasha Hopkins, November 9, 2009

If everyone knew the answer to that, no one would be having financial problems. The problem is, some of us know what the answers are and don’t follow them, but some of us just don’t know. We’re guilty of not planning and thinking we can do more than what we really can. The sad part is that most of us are just one paycheck away from bankruptcy – if we were to be laid off, we would have no cushion to protect us. With today’s economy and the uncertainty of jobs, everyone should have at least two months’ pay in a savings account.
The original question was how to get out of debt. The first thing to do is get rid of the credit cards – at least until you pay them off. Develop a plan where you pay one off, and then add what you were paying on the other to the second, and so on until you have paid off every bill you have. During this period, you also want to avoid adding any new debt or increasing any other payments in any way, including moving to an expensive house or apartment, or even adding a cell phone if you don’t already have one. Pay off all the old debt before you add anything new.
Once the debt is paid, you have to develop a plan to stay out of debt. If you’re a person that likes to shop, then either stay away from the credit cards, or have their credit limits reduced so they become an “emergency” tool. Get into the habit of not charging anymore than you can pay off when the bill cycles unless it’s an emergency, and that doesn’t mean a new pair of shoes or jeans. We’re talking about a car that doesn’t run, or a sick relative out of town, or maybe an out of town wedding that wasn’t planned early enough for you to save money. You must also start saving money every payday so that if something does come up, like the out of town wedding, you have the money in the savings account to cover it without using any credit cards.
Keep your spending to a minimum. You don’t have to go out to dinner three or four times a week, and even if you find yourself running late and don’t feel like cooking, at least go to the supermarket and buy something to put in the microwave. It’s cheaper than stopping at McDonald’s and better for you as well. Take your lunch instead of eating out to save money. Certainly, you can go out to lunch or dinner occasionally, but limit it to once a week for each. If you tend to be a “stop on the way to work for breakfast” person, break that habit, too, and start buying things at the grocery store that you can take to work and eat.
It sounds like a lot to give up, but if you want to stay out of debt, you have to make some sacrifices. You have come this far, and you don’t want to get back to where you were. Follow the plan, and you will find you have more money for the things that you need.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Get a Handle

Almost every consumer in America today owes some money to someone else on an "extended credit program." If you're looking to get a handle on your financial life, then you MUST stop spending money and start managing it.

It's an American dream to live a life that is debt free as well as stress free. To live such a life you may have to suffer a bit as luxuries decrease and savings and investments increase. In a debt free life, your "true net worth" will increase in size. This happens because principal and interest payments will be eliminated, leaving more money on your bottom line. Net worth is simply defined as assets minus liabilities. It's up to you to take the necessary steps in order to get from one place to another!
• The First Step: The first step toward living a debt free life begins by sitting down and taking a realistic look at your life style and the cost of maintaining it. Analyze your household budget. If you're making minimum payments on your credit cards, you have a problem.

Making just the minimum payments on your credit cards each month may take a person over 20 years to pay off the principal (depending on the minimum due and the interest rate). For most people, credit card balances grow each month because the minimum payment isn't enough to cover the interest (finance charge) being added. In addition, late and over-limit fees are also adding to the growth of your balance.
• The Second Step: Next, you must realize the problem and sincerely want to fix it. Filing bankruptcy (Chapter 7 or 13) is certainly a cure for this problem, but should only be considered as a last resort. For many people, a consumer debt management program provides the best solution and alternative to filing bankruptcy.

Since consumer debt management programs are funded by donations from credit card companies, many of these companies will actually encourage people to seek help from an approved 501 (c)(3) non-profit consumer credit counseling agency that has certified credit counselors that provide budget counseling and money management education as part of the debt management program.
• The Third Step: Completing enrollment into a consumer debt management program is simple. All information is private and confidential. After creating a realistic livable household budget and repayment plan, all of your credit cards and other unsecured debts will then be consolidated into one new payment, which is typically 20% to 50% lower than the combined payments you were making prior to entering a consumer debt management program.

Sticking to the livable household budget that you and your credit counselor created is paramount to your success in living a debt free life. Achieving a debt free life is possible only through patience and discipline. After completing a consumer debt management program, we strongly urge consumers to continue their monthly debt payment into a savings vehicle. By allocating that same monthly payment into various savings vehicles, consumers soon begin to accumulate the kind of "true net worth" which can then be used for the purchase of a home, education for children, and retirement. It's never too late to start.

Don’t be a Victim of Identity Theft

Identity theft is one of those things that everybody is aware of but nobody worries about it until it affects them personally. Unfortunately, by that time, it’s too late. Once someone has stolen an identity, they can run up bills and waste the consumer’s money. This can not only put a financial burden on the consumer but can ruin credit history. Even if it all gets repaired, the time taken to deal with the problem is time that could have been better spent in other ways. Like with many other situations, prevention of identity theft is a far better choice than trying to treat the problem once it’s arisen.

The Federal Trade Commission recommends a three-pronged approach to reducing the likelihood that you will become a victim of identity theft. First, this government agency recommends that all consumers work to deter identity theft by carefully protecting their own financial information. Second, they encourage all consumers to detect suspicious activity as soon as it occurs by monitoring accounts regularly. And finally, they ask that victims of identity theft defend themselves by reporting the problem as soon as it occurs. You’ll notice that two thirds of the process is about prevention.Prevention starts with protecting your financial information. The area of greatest concern is the transmission of credit information through the Internet when the site is unprotected. Never deal with financial transactions online from a wireless location which has shared Internet. Make sure that your own home Internet is locked and password-protected. And make sure that your passwords are varied and not easy to guess.

Also make sure that every time you deal with a credit website, it’s legitimate. Hackers often set up fake websites that look just like the real credit card websites to encourage people to input their information into insecure locations. The key here is to be cautious whenever you are sent any mail that asks for your credit card information. Even if it looks like it’s from your credit card company, it might not be. Unless you’re positive that the information requested is legitimate, you should call the company and discuss the transaction with them before submitting financial information online.

The Internet is the biggest source of identity theft but there are still “old-fashioned” thieves out there. Some will steal your credit cards from purses or when they are left on restaurant tables. Others will steal credit information from the trash and get your identity that way. Always pay attention to your cards and always make sure to shred documents with financial information on them.

Finally, always be aware of what’s going on with your credit cards. Not only should you know where the cards are but you should also monitor their use. Make sure that every time a statement comes in, you agree that the transactions listed on it are ones you made. Prevention includes strict monitoring of your credit so that you note problems as soon as they occur. By taking the time to prevent identity theft, you save yourself time down the line … and you may even save yourself from becoming a victim at all.

Director of Sales, Sean Boyett

How to Avoid Holiday Debt

By Natasha Hopkins, November 2, 2009

1. Save up. Spending cash instead of using credit for your holiday purchases allows you to avoid holiday debt all together. If you haven’t started saving, put aside something each paycheck starting now and use that to finance your holiday purchases.Start a Christmas Savings Account

2. Set a budget before you shop. Setting a spending limit and sticking to it will keep you from overspending. Be disciplined and don’t go over your budget, no matter what.How to Plan a Christmas Budget

3. Make a list. Santa makes a list and checks it twice, so should you. Even though you might feel compelled to splurge on everyone in your life, you don't have to. People appreciate simple and meaningful over expensive and useless.


4. Don't shop for yourself. Avoid the "one for you, one for me" shopping mindset. You'll end up spending double what you would have had if you would have shopped only for the loved ones in your life.

5. Ignore "big" sales. More often than not, they're not really sales at all. Those "Buy 2, Get 1 Half Off" deals only trick you into buying more than you would otherwise. Remember, stick to your list.

6. Shop online first. The internet makes it easy to shop around. It also makes it harder to buy on impulse. Since most retailers have inventory on their websites, you can decide exactly what you want to buy before going to the mall.

7. Leave your credit cards at home. Without your credit cards, you’ll have a hard time charging them up. If you must use credit for your purchases, pick one credit card and stick to your spending budget.

8. Don’t buy if you can’t afford to pay. Keep in mind that when you use credit, you’re borrowing from your future income. You know your finances better than anyone. Only charge what you can afford and you’ll avoid paying on your holiday debt until the next holiday season.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Debt Problems: How to Get a Debt Collector or Creditor to Stop Calling You at Home and Work

Do you jump every time the phone rings? Have you been embarassed at work because a debt collector keeps phoning you? If so, then there is a simple way to get debt collectors and creditors to stop calling you.

Congress enacted federal legislation that regulates debt collectors and collection attorneys and protects the rights of debtors. This law, The Fair Debt Collection Practices Act, requires that debt collectors and attorneys stop phoning you at home and at work once you ask them to stop. The law specifies that your request must be in writing, therefore, you should tell them to stop calling you at home and at work the next time they call, but then follow it up with a certified letter, return receipt requested. (Our debt kit includes a sample letter on this subject and 20 other sample letters.)

Sample telephone script:

You: Hello.

Collector: Is this Jane Doe?

You: Speaking.

Collector: Hello, Mrs. Doe. I'm Charlie with Acme Collections calling again about your delinquent credit card account with XYZ Bank. Could I get a payment of $250 by check over the phone from you today?

You: No, I don't have the money. As I told you before, I am currently unemployed and simply can't pay right now.

Collector: Well, Mrs. Doe, this account is seriously delinquent and we will continue our collection efforts.

You: I understand, but I simply cannot pay right now. It is a waste of your time and mine to keep calling me when I can't pay. I am requesting that you not contact me by phone in the future. I do not want to receive any more calls from you at home or at work and am asking you to communicate with me only in writing.

Collector: Okay, Mrs. Doe, I'll put your request in our files.

You: Thank you. Goodbye.

If the debt collector refuses to comply with your do not call request you will have to quote the actual law:

Collector: No, Mrs. Doe. We will continue to call you until you pay this debt!

You: The Fair Debt Collection Practices Act requires that you stop phoning me at home and at work once I request that you do so. I intend to send you a certified letter tomorrow putting my no contact request in writing. If you continue to phone me, then I will file a complaint with the FTC and the attorney general."

If the original creditor refuses to comply with your do not call request:

The Fair Debt Collection Practices Act does not apply to original creditors, like a credit card company; it only applies to debt collection agencies and attorneys collecting debt. Therefore, do not quote the FDCPA to get original creditors to stop calling. Instead, quote state law which governs original creditors but usually has similar provisions to the federal legislation. Sample script:

You: It is my understanding that [Texas, Michigan, California] law requires that you stop phoning me at home and at work when I request that you do so, is that correct?

Creditor: Yes, but we will continue our collection efforts.

You: I understand that, but Texas law says that you must stop phoning me at home and at work once I ask you to. I am officially requesting that you not phone me at home or at work. If you need to communicate with me, then do it in writing. I will send you a certified letter this week officially asking you to stop contacting me by phone.

Creditor: Alright Mrs. Doe. As you request, we will not phone you in the future.

Note: Collectors do have the right to call you after you request them to stop phoning you if the status of your account changes. They can call you to tell you they are (1) giving up collection efforts; (2) are turning your account over to an attorney; or (3) are going to sue you. But usually, they won't call you again after you request that they don't. If a debt collector does contact you after you request that he stop, you might have the right to sue and collect damages.

Posted by Donna Millen

How To Establish Or Rebuild Your Credit Worthiness

All my articles this week have shown how you can find out your credit history and score and what you can do to improve it. But what if you have no previous credit or some of your accounts went to collection agencies and now no one will give you credit? There are a few steps you can take to build or rebuild your credit file.

First of all, if you have accounts on your credit history that are in bad standing, getting them paid off and closing the account as soon as possible is a good idea. Your credit file will purge the account 6 years after the date of last activity so the sooner you get it dealt with, the sooner the clock can start on it disappearing from your credit report. The 6 year rule even applies to bankruptcies, so no matter how bad it gets, you can improve your credit over time.

One of the easiest ways to get credit is through a secured credit card. These are really just regular credit cards but you provide a deposit equal to the limit you want for your card. This covers the bank from the perceived increased risk of someone with either poor or no history. Not only will it give you new credit to improve your file, since you’ll now have a credit card you can benefit from being able to rent a car, book a hotel room or order online. Capital One offers a MasterCard that has a minimum deposit, and therefore credit limit, of $75. Home Trust offers a Visa with a minimum deposit and credit limit of $1,000.

Having a checking or savings account with a bank can improve your chances for a loan. While it’s not something that gets reported to the credit bureaus, having a bank account without any NSF charges or frequent overdrafts will show your responsibility and your ability to manage money.
Another thing banks will look for is stability. The longer you have worked for a employer increases the chance that you’ll still have a job when your bill is due. The longer you’ve lived in the same place decreases the chance that the banks won’t be able to find you.

And finally, while not always at the best rates, you might find it easier to get a car loan or a credit card for a retail store. Both of these types of credit have an extra incentive to the person considering your application, that it increases sales for their business.

Posted by Cristina Gomez

!!Get Rich Quick!!

So what is the secret of wealth? The secret is... there is no secret! Almost anyone can become wealthy. The problem is the process of building wealth is not what most people want to hear. It takes time and patience when most of us would rather get rich quick.

Sr Credit Officer, Alexis Boots

6 Tips to Avoid Checking Account Fees

1. Think about what you need: Before opening a checking account, think about what services you need. If it's just simple checking, bill pay, ATM or debit card transactions, then look for a free checking account.

2. Check out the account differences online: Most banks offer three or four checking account options. Visit the Web sites of several banks and see the differences between accounts. Do you really need free checks if you're going to have to pay a fee for the account? If you pay most bills online, perhaps you only need a couple of paper checks per month and it would be cheaper to buy them yourself. Carefully review what each account offer.

3. Consider high-yield if it fits: Interest on the balance in your account may sound good, but unless it's a high-yield account, you'll be stuck with a service that probably requires a hefty balance and pays very little interest. There are some high-yield checking accounts that allow you to maintain a very low balance but require you to adapt certain behaviors, such as using a debit card for 10 or 15 transactions per month, having a monthly direct deposit or automatic bill payment, and accepting electronic statements. If those stipulations fit your lifestyle, then a high-yield checking account can be an excellent choice.

4. Don't Bounce Checks: Overdrawing your account is the single biggest way to rack up fat fees. The average non-sufficient funds (NSF) fee is now $29.58. The key to not bouncing checks is simply to know how much money is in your account. Check your balance daily if you're going to be making several debits throughout the day. Keep your receipts until you've reconciled debits and credits with what's been posted to your account. If it helps, maintain a paper register so you don't have to log on every time you want to check your balance. Keeping a cash cushion in the account is also useful.

5. Set up overdraft protection: If overdrawing is unavoidable, then set up overdraft protection with the bank. You'll need a savings account, credit card or home equity line of credit which will be linked to your checking account and debited when you overdraw. This is not an automatic bounce protection program; you'll need to sign an application. Modest overdraft protection fees always save you money over costly NSF fees.

6. Use your bank's ATM: Almost all banks impose a surcharge if you use an ATM that doesn't belong to your bank. The average transaction fee is now $2.22. ATM fees can be avoided by assessing your cash needs on a daily or weekly basis and withdrawing money when you have access to your bank's ATM. Sure, there are times you make last minute plans and you need some cash, but the majority of withdrawals can be planned. If you travel frequently to areas where there is no access to your bank's ATM, consider an account with a credit union or a community bank that doesn't have an ATM network and will reimburse a certain number of fees each month.

Glen Hamilton - Sr. Credit Officer

Is a high credit score worth the stress?

Think about your situation:

Let’s say you’ve struggled and sacrificed to make your credit card payments each and every month. Because of this, your credit score is relatively high. Ask yourself; is it worth feeling stressed out just to have a good credit rating? Chances are you’re not getting much sleep at night. The situation is making you nervous and you can’t shake the depression because you’re always thinking about the money you owe and how you’ll be able to pay it back. This is a legitimate concern, and one that has the potential to remain for several years from now.

Think about your options:

You can always continue to do what you are doing. Keep making those minimum payments and protect that high credit rating. Because you are struggling as is, it’s very likely that at one point or another you’re going to fall late with these payments. If you’ve made some late payments already and/or your credit cards are carrying high balances, your score is probably not as high as you may think it is. Ask yourself; will you be able to continue this stressful process for the next five to ten years? And at this point you need to consider another option. If you are buried deep in credit card debt, you probably shouldn’t be asking if debt settlement affects your credit score. Instead, you should focus more on becoming debt free than how high your credit score is. Negotiating reduced settlements with your creditors, through debt settlement programs, can save you thousands of dollars, help you avoid bankruptcy and finally get you to the point of being debt-free and stress-free again. Sure enough your credit is going to take a hit, but when all is said and done you’ll be in a far better position to start rebuilding your credit once you have eliminated your debt.

Taking one step back to take two steps forward is much better than not moving forward at all. Ultimately, you should probably take a good look at what matters most to you – a lifestyle free of debt and concern, or a high credit score. When it comes right down to it, the choice really is yours, so be sure to make the decision you’re most comfortable with.

Sr Credit Officer, Natasha Payton

What is a Good Credit Score?

Have you ever gone online to get a loan for you? And if you have gone then have you ever wonder that you have got pre-qualified for a loan without anyone asking you your monthly income? Have you ever wondered that how your loan can gets cleared so quickly while your neighbor is struggling for the same one? And if at all he gets it then, have you noticed that the interest rates for both loans are different?

The answer lies in your credit scoring. Credit scoring plays a vital role in determining your financial status, condition in the market. So, you often wonder what this credit score is. To get a better understanding of the benefits of good credit score let us have a close look at credit score, the factors come in to play in determining credit score and its effects on your financial credibility.

Credit Score
In general terms credit score is a number generated by a mathematical formula – algorithm. This mathematical formula works on the information provided in your credit report to compare the same information with another people using some standard comparison scale to derive credit score. This resulting number is a precise reflection of your credibility. It accurately predicts how likely you are going to make the re-payments.

With its scale running from 300 to 850, these credit scores are extensively used as a formula by many lenders to determine if you are credit worthy or not. It can be used for mortgage, a car loan, a credit card and if you are having these previously then the rates you have received are often the reflection of your credit scoring. As simple as it is – people having the higher credit scores get lower interest rates compared to the rates offer for the people having lower credit score.

Scoring Categories
Lenders and the firms offering loans use diverse credit scoring patterns to determine your credibility. As these credit scoring patterns do vary slightly in their formula giving different percentage factor to different parameters, they result in production of different credit scores from the same credit information of a person. That means credit score of a single person can be different and varied with different credit scoring models.

To bring certain kind of standardization in this process Fair Isaac Corporation (FICO), a California based company develop the first credit score using a certain standard scales for different parameters. This FICO score has been accepted by all credit scoring institution as a base platform.

The three major credit bureaus use their own version of FICO scoring model. These three companies are Equifax, Experian, and Trans Union. Equifax uses BEACON scoring model while Experian uses Fair Isaac Risk Scoring Model and Trans Union has the Empirica Scoring Model. As all these three versions of scoring models are different from each other, they come up with different credit scores.

In general, studies have revealed the American publics credit scores break out. 13 % of American public belongs to the credit score 800 and above. Nearly 45 % people are having credit score in the range between 700 and 800 while approximately 27% people contribute to the credit score ranging from 600 to 700.

Good Score
While the factors on which credit scoring varies, generally individuals with FICO scores above 700 is considered as a good credit score. Of course, there is no standardization in black and white narrating what the good score is; it is believed that the normal average borrower is having credit score in the range of 600 to 700.

A new scoring model known as VantageScore is slowly catching up as a unique scoring method for everyone as all three – Equifax, Experian and Trans Union collaborated on its development. Its scoring ranges from 501 to 990 and the scoring have letter grades from "A to F". So a score from 501 to 600 will correspond to "F" grade while a score of 901 to 990 will receive "A" grade. So in Vantage scoring system, credit scoring grade of ‘C’ is considered as good credit score.

Factors Affecting Credit Score
As per FICO scoring model more than 20 factors in five different categories are taken in to consideration to derive your credit score.

1. Payment History – One of the most important factors narrating your payment history placing the emphasis on recent activities. It accounts for the 35% of your total score. It is based on payment information on all types of accounts like credit cards, retail accounts and details on late or missed payments. It also considers pubic records like judgments, suits or bankruptcies and collection items.

2. Amount You Owe and Available Credit – This is the second most important factor about your outstanding debt. The accounts for 30 % of your total score. It considers the information regarding the amount owed on all accounts, information related to the accounts showing balances, how much total credit line is used, etc. Here one thing has to be remembered that carrying of debt does not necessary mean that you are having low credit score. In fact, people with higher scores use their credit sparingly and keep their balances low.

3. Length of Credit History – The longer you are having credit the greater will be your score. This accounts for 15 % of your total credit score.

4. New Credit – The opening of several credit accounts in a short period of time hampers the credit scoring of an individual. This accounts for 10 % of the total credit score.

5. Types of Credits in Use – This accounts for 10 % of your score and considers your mix of credit types and the total number of accounts you have.

Although Credit Scores vary with different scoring methods, it provides a standard platform to gauge your credit worthiness. And even it is not clear that which number can be considered as a good credit score for a specific purpose, it is always advisable to keep your score higher than 700. it can be explained in a much better way by giving this example. A person carrying a score of 625 can be scrutinized for mortgage lending but at the same time the same score can be well enough for getting a car loan. So brace yourself to achieve that 700 – 720 mark and you will taste the fruits!

Sr Credit Officer, Demond Smith

Exploding Debt

This explosion of personal debt has led to a new growth industry - debt consolidation companies! This has unfortunately spurred a huge growth in this industry!

“Everyone else has this problem” is the common view of the vast numbers of people who carry average or above average credit card debt! However, if more people could excise themselves from the “average” bracket, and have a lower outstanding credit card debt, then the overall average would drop! In recent studies, it has actually been proven that an ordinary household has an average credit card debt of 00; which for many people is considered to be “nothing”!

There are many households with a high credit card debt level. The good news is there are things you can do about it! Obtaining professional assistance is recommended in many cases. With this advice, you will be able sort yourself out quickly! Another thing that you may do for yourself is to go through a credit card debt consolidation company so that you can get all your bills lowered down as well as brought together into one lump sum; and only have one bill to pay monthly. One of the best strategies is to get all of your payments rolled into one payment - this will make it much easier to manage.

Despite the tough times recently, the average interest rate (A.P.R.) is 14.99% for credit cards in this country. The figure is humongous when you take that percentage and multiply by .3 trillion dollars (2,300,000,000) and now you will see why the banks are so keen to continue their ways. And while the average working person works two jobs to support his or her family, the CEO’s of the big banks and multinational corporations earn millions of dollars in annual pay. This country has a proud history of corporate success, or some would say excess. But you can put your foot down. You can choose to pay on your credit card debt balances for the rest of your life, or you can put your foot down and finally put a stop to a battle that you can’t win!

Make sure you avoid getting approved for another credit card! By doing that, you will only be making your credit card debts higher; even if you planned to put all your debts onto that one card! The only thing you will achieve, however, is possibly getting your interest rates lowered. Your focus should be paying down those credit card bills!

By: Evan Cox

New Credit Card Law goes into Effect in February

By IsaBella, October 23, 2009

Beginning in February, it will be harder for students to get credit cards. The Credit Card Act that passed this spring will prohibit credit card issuers from lending to anyone under the age of 21 unless he or she has a co-signer or has proof of their ability to make payments. Also, unsolicited card offers will be prohibited to everyone under 21, and credit card companies can't entice students into signing up for a credit card with any tangible item anywhere on or near a college campus or at a college-sponsored event. The new credit card law requires card issuers to show how long it would take to pay off a card if you made just minimum payments. That will be a shock to some consumers.

Parents need to show their child the consequences of paying late and not paying in full. And they should talk to their kids about grace periods and minimum payments. Also educate your kids about the high interest rates associated with cash advances and the dangers of using a credit card as an ATM, running up a balance and paying late.

IsaBella is a Sr Credit Officer, Team Leader at Credit Alliance Group 866-540-3134

Realizing you have a problem with debt

The experts say there is good debt and there is bad debt and there are consumers that will say I’m in no debt at all. Facing debt is difficult. For many, taking the first step is the most difficult in that actually admitting you are in trouble is harder than taking the steps necessary to correct it.

Whether you are certain you are on the good side of debt or unsure of where you actually stand financially, there is no time like the present to reevaluate your financial situation. When debt isn’t far off, there are some general signs that will proceed it. If you sit down and look at your situation, you may find there are some classic signs appearing in your own life.

When it comes to debt, take a good look and see if you see any of these signs in your own financial life. If you do, make a commitment now to regaining control of your money and most importantly, admit that you actually do have a problem. Here are some signs of debt danger:

You Have No Clue Where You Stand
Unless you are independently wealthy, money management should be a top priority. If you have no idea how much you owe or who you owe it to, you are already in trouble.

You Are Late Most of the Time
Even if you aren’t late on bills and payments all of the time, you might be headed down the wrong road still of you are late at any time. Take a look at why you are late. Do you not have the money before the due dates of your bills? If so, it might be time to look for supplemental income to help you catch up. If you are not making enough money, you need to find new sources of income or consider getting a better paying job if you have no time to take on a second one. If you are late because you forgot the due dates, then you may need a refresher course in money management. Get a calendar for bills only and start tracking the due dates for all of your bills each month with a notation on the days prior to ensure your payment makes it before the due date. This will eliminate wasted spending on late fees and penalties.

You Never Pay A Dollar More than the Minimum
When you spend on credit cards, the financially-savvy way is to spend only what you have to back up in cash, meaning you should already have the money to cover your purchases. At the end of the billing cycle, you should have all of the cash to cover the balance and remit a check for the full amount. If you find you are not even close to doing that each month and are only able to squeeze the minimum amount from your budget, you are headed for disaster, as your interest rates and penalties are sure to rise, adding to your balance due and leaving you to face years of payments to eliminate the debt.

Your Credit Card Has Become An Extension of Your Income
If you find that you now have to use your credit card for daily living expenses such as groceries, gas, and other bill payments just to survive, you are headed for financial disaster. Credit cards are not meant to be an extension of your income. You should not make purchases that you can’t afford in cash. Not having enough money to meet your daily needs means you don’t have enough money in general. Using credit cards out of desperation will only make you sink deeper in debt. This is especially true when you find you have taken cash advances from your credit card to meet your needs because of the often excessively high interest charges.

Your Family Life Suffers Because of Cash
If you find that you and your spouse argue a lot over money and the family finances, you may consider this to be a red flag in your financial life. Being defensive and frustrated about the lack of money much of the time means there is already trouble. It is important to work as a team to handle the finances for the family. Get the kids involved by teaching them early about spending and the differences between needs and wants.

Brian Joyce

What Lenders Look For

The criteria lenders use to determine their risk level when you apply for a loan: such as a house, car, boat, any major purchase, can be categorized into three areas. These areas are Stability, Ability, and Equity.

Stability is determined by job time, residence time (time at current residence, previous residence and time in general area), and the future outlook of the applicant’s employment. Preferably a lender wants to see at least five years of continuous employment with the same employer, along with a minimum of five years history at the current residence.

Ability is based on monthly income, debt to income ratios, credit score, payment history on similar purchases, and the realistic future ability to make the loan payments. Lenders want applicants who have a overall low debt to income percentage, a ratio of the projected payment, for the new purchase vs the net monthly income (20% or less, 30% or less for a house purchase), a high credit score (a score of 720 or above) and long demonstrated history of paying similar loans on time (two years or greater).

Equity can be classified as the amount which is borrowed (loan amount) vs the value of the item purchased. The more equity a borrower has initially, the more favorable a lender will score the loan application. A loan application with a down payment of 30 – 40% will rate better than a one with only a 5 -10 % down payment.

Lenders want applicants to rate high in at least two of the three categorizes. The ideal applicant will rate high in all three areas. If an applicant has a high rating in stability and ability then the amount of equity, in the purchase, is not much of a factor. But, if an applicant has an average rating in stability, a low rating in ability (due to low credit score or other factors) then a lender will look real close at the equity level. For the applicants who rate acceptable in only one area their chance of being approved is virtually zero.

Before applying for your next major purchase, access yourself. How do you rate in all three areas?

Glen Hamilton – Senior Credit Officer

Reality Check: Debt Reduction is not for the Faint of Heart

Our world has changed. Cheap credit is a thing of the past. So listen up!
These are your debt reduction options:

1. Can you end at least 4% of your debt balance as a monthly payment?

2. Can you get a low interest loan from your bank or a family member?

3. Can you take out a loan against an IRA, 401k, 403b, or a mutual fund IF that is available from that institution? BUT, consider the consequences!

4. Can you qualify for bankruptcy under the new laws?

5. Consumer credit counseling model: Credit Alliance Group can this for you. The CCC program lowers your interest rates on credit cards but accelerates payments to 5% of your debt balance. The CCC model applies only to credit cards. You have to enroll all of them. It cannot include personal loans. But the CCC model is not welcome by all major credit card companies. Unfortunately, sometimes a credit card company will begin a CCC program with you and then drop it.

Major consideration: The CCC model requires us to be present on your credit report because we would be making monthly payments on your behalf. A third party on your credit report indicates an inability to deal with money…doesn’t look good!

6. Debt settlement the CAG way: We confirm your debt balance up front and negotiate a 40% settlement with your creditors over your time in the program. The payment is based on your beginning debt balance. We have no upfront fees, no hidden fees at the end of the program or prepayment penalties. The downside consists of late payments reported to your credit report until each debt is settled. But, late payments cycle off after 3 years. There is no third party presence on your credit report. When an account is settled, you get the letter from the creditor agreeing to the negotiated amount (which you approved in our program) and the creditor’s agreement to report the account closed, paid or settled with a -0- balance. We do not show up on your credit report. It appears that you settled your own debt.

There is no easy way out of debt. The party is over. Tighten up your belt and your ego.

Deal with your debt. Call us!

Katherine Listi

How I $pend it!

For many of us, the new home edition, car, or vacation we had been hoping for has gone down the toilet like the economy. While that is depressing, it doesn’t mean you have to be depressed. While we wait for our bank accounts to turn color other than red… the good news is it isn’t how much we spend that dictates our happiness, it is how we spend the money we have.

Spending our money to create life experiences over getting the most stuff is what is going to bring the best quality of life! I know I can look at a new work outfit and think it isn’t as nice as someone else in the office, but I don’t look at my dinner when I am eating out and think it is less nice than someone else’s. In fact, I may appreciate my $38 dinner out just as much as I would a two day trip somewhere nearby. Meeting a friend for coffee, or sharing some tea with a friend in the office is a lot more invigorating these days than spending $100 at my favorite store.

For my money this month, I am making an effort to laugh until I cry or can’t breathe with an old friend over the phone, getting up early to watch the sun come up and enjoy it after I have worked out. Or singing at the top of my lungs with the windows down at a cross walk! I am going to feel just as good as I did last year when the windows were up and I was rushing somewhere to spend too much money on food and entertainment I couldn’t remember today if you paid me. What will you do?

Alexis Boots

The concern over Credit

Misinformation about credit and an incomplete understanding of debt settlement can muddle facts about how this debt relief option can affect your credit score. Fortunately, as consumers learn more about their credit score, and its influence on their financial lives, they want to know how debt settlement could affect it. Financial education and awareness can build a better understanding of the real correlation between debt settlement and your credit.

Debt settlement can be a viable debt relief option for people who cannot manage to repay their debts and are looking for an alternative to bankruptcy. Many people who qualify for debt settlement already have poor credit because they are, or are about to, fall behind in their payments. For people who have maintained good credit, debt settlement can be damaging. After missing one or more monthly payments, creditors may send your account to their collections department or a third-party collection agency, if they haven't already, and they will report to the credit bureaus that you are missing payments. In addition, missing around 6 consecutive months of payments may result in charge-offs also being notated on your credit report, which too is damaging to your credit score. Settlements may be reflected on your credit report as “settled for less than the full amount” or something similar. It is important to understand your credit will be negatively affected before enrolling in a debt settlement program.

But perspective is important. Here are some points to consider:

· If you are behind on payments to your creditors, your credit is likely already damaged.
· You may be able to get out of debt faster with debt settlement than with credit counseling.
· If you are truly in financial distress, your credit may suffer with or without debt settlement.
· As with debt settlement, other debt relief options can also have an effect on your credit or your ability to obtain loans.


If you have great credit and the ability to pay off your debts, you are probably not qualified for a debt settlement program. Otherwise, take a look at the larger picture to balance your desire for good credit and your need to reduce your outstanding debt.

Some people may have specific reasons for avoiding damage to their credit. For example, if you are planning to buy a home in the near future, damaged credit could interfere with your plans. The bottom line is to decide what's more important: maintaining decent credit with the ability to obtain loans and additional credit, or, attempting to settle your current unsecured debt.

If your credit is your only concern, you may want to consider the bigger picture before you completely rule out debt settlement as a debt relief option. Your present and potential credit standing and your overall debt situation must all be considered before you commit to any debt relief option.

Ben Yaffe

Understand the Compounding Effect of Money

(By: Chris Garner)

The compounding effect of money is extremely important when making any financial decision. The compounding effect of money is often overlooked or underestimated by people when making decisions. When applied to all of your financial decisions, this effect is the KEY to long-term success! To illustrate the compounding effect of money, let me use some financial examples:

Suppose you had invested $1,000 today in a 5% savings account. In one year, that account would be worth $1,050 [$1,000 + ($1,000 x 5%)], yielding a $50 gain. However, in year two, that same initial investment would be worth $1,102.50 [$1,000 + ($1,000 x 5%) + ($1,050 x 5%)], yielding a $52.50 gain. And in year three, the same $1,000 would be worth $1,157.63, yielding a $55.13 gain. By year ten, the initial $1,000 investment would be worth $1,629 and by year 25 it would be worth $3,386.

From looking at this example, you can see that investing $1,000 today is much more valuable than investing $1,000 even a couple of years from now. To accumulate wealth, you MUST use the time value of money and the compounding effect of money to your advantage.

This second example shows how the compounding effect can work against you:

Suppose you borrowed $20,000 to purchase a car and your auto loan was at a 10% interest rate (for 5 years). Your monthly payments would be $424.94. Because the $20,000 loan continues to compound over the life of the loan, you actually pay $25,496.45 over the five-year period, meaning that you’ve in essence paid $5,496.45 because you spent the money before you had it. In fact, in your initial payments, the interest alone will account for almost 40% of your monthly payments. In this case, the bank or lender that gave you the loan uses the time value of money to their advantage.

Now look at this scenario, where instead of making the $424.94 car payment, you invest that payment at the same rate as what your car loan was (granted it’s a little high for a savings rate, but not unreasonable for other investments). Now, instead of paying the bank, you are actually earning interest and compounding the benefit yourself. After one year you will have saved $5,340 and have earned $240 in interest. After two years, you will have saved $11,239 and have earned $1,039 in interest. By the third year, your investments will be worth almost $18,000 and you will have earned $2,457 in interest. By month 40, you will have enough money to purchase a $20,000 car in cash!

So let’s weigh the differences between the two scenarios above. In the first case you paid the bank $5,496 to borrow the money and in the second case you earned $2,457 and could buy the car in cash after just 40 months (just over 3 years)! The opportunity cost of the first alternative versus the second alternative results in a net difference of $7,953 (a $2,457 gain versus a $5,496 loss). That means that by making a simple deferral decision (buying the car in 3 years versus today), you can get ahead by almost $8,000!

8 tips to being debt free

Draw out your monthly budget
1. Keeping track of your budget will give you an idea about where, when and how much you’re spending. Doing this will allow you to see where you can free up some cash to go towards paying back your debts.

Determine your financial position
2. It’s important to make a list of everything you owe. Being organized and having a visual on your debt can play a big part in becoming debt free.

Prioritize and your debts
3. List all the amounts you owe from highest interest rate to the lowest interest rate. Concentrate on paying off your debts from top to bottom. Paying off the more expensive loans first will save you money and allow you to keep up the required payment amounts on the smaller ones.

Pay more than the minimum
4. The minimum payment usually covers the interest rate and makes little impact on the principle itself. Instead build in a fraction more than your minimum payment in your budget towards each of your debts. This will influence your overall principle balance and allow a faster payoff.

Use up savings, if necessary
5. Although it’s a great idea to have an adequate amount of cash saved, it doesn’t make any sense to save money on one hand when you’re carrying substantial amounts of debt in the other.

Cut up cards
6. Taking the scissors to the plastic is a great way to stop the rot. Instead use a debit card, which only draws cash from your bank account.

Communicate with your lenders
7. It’s good to talk to your creditors and informed them of your financial issues. You will find that most creditors are open to revising your repayments and/or extending the time you have to pay.

Seek professional help
8. Debt can be stressful and can put a lot of pressure on a family or the person itself. Getting professional assistance and advice can put a little ease to your peace of mind.

Natasha Payton

Don’t be haunted by debt this Halloween

10 Tips: Avoid ghoulish levels of spending this Halloween

Everyone knows that the Christmas season leaves millions of people grappling with relentless credit-card debt – but who knew Halloween could pack such a wallop?

According to the National Retail Federation, consumers spent an estimated $5 billion on Halloween last year. About $1.5 billion of that amount went toward Halloween candy. Costumes accounted for another $1.8 billion.

Do such frightening numbers make your hair stand on end? If so, read on. The following tips can help you avoid feeling the consequences of this holiday in your credit-card bills for months to come.

1. Make wise candy purchases. If you want to hand out candy, you can’t really cut costs by making your own sweets at home since that won’t fly with most parents. Instead, consider buying wrapped candies in bulk or purchasing generic – but still delicious! – brands in order to save money.

2. Consolidate your giving efforts. Do you live on a cul-de-sac or a nice, quiet street? Maybe you can team up with some of your neighbors, sit outside on lawn chairs and hand out candy together from the same spot. Everyone can save by divvying up all the candy costs.

3. Decorate your own way. Decorating your home and yard can really get expensive – especially if you plan to do it again in just a few weeks at Christmastime. Consider forgoing fancy, store-bought decorations and making your own using construction paper, poster board, old sheets, old costumes and cotton balls. (They make great spider webs!)

4. Make your own costumes. Sure, it’s tempting to rush out and buy costumes featuring characters from blockbuster movies and TV shows, but stop and think: Haven’t some of the funniest costumes you’ve ever seen been dreamed up by creative friends of yours? Why not try the same tactic this year? You also can borrow used costumes or arrange a costume swap between your kids’ friends.

5. Watch those admission costs. It can cost a pretty penny to visit some elaborate haunted houses and other Halloween attractions. Look for low-cost – or better yet, free – alternative activities by scanning calendar listings in the newspaper, staying alert for coupons and discounts, and visiting the Web sites of your city’s or county’s recreation departments.


6. Stay safe. Considering how costly an unexpected trip to the emergency room can be, remember to supervise young children when trick-or-treating or carving pumpkins, and also to eyeball all candy before letting your kids devour it.

7. Remember where you are in the stream of time. The holiday shopping season is coming right up, so now is the time to be disciplined about spending and plan ahead for other big holiday-related expenses. Try to anticipate what you’ll spend between now and the end of the year and stick to a budget.

8. Devise a plan for tackling credit-card bills. If you always pay your balance off in full, then you’re doing fine. But if you can’t pay your balance off completely when you receive your post-Halloween bill, take great pains to pay more than the minimum monthly payment due, and never be late with a payment. Otherwise, interest and finance charges and late fees may overwhelm you.

9. Seek out help with number-crunching. Call your credit-card company and ask the person who answers the phone to calculate how much you must pay each month to eliminate your balance within six months, based on your current interest rate. The company must share this information with you.

10. Pursue a lower rate if necessary. If your current interest rate is too high, ask for a better deal. Be sure to mention the offers you’ve received from multiple competitors promising lower rates.

Heather Boyett: Manager of Customer Relations and Consumer Affairs

Do’s and Don’ts of Closing Credit Card Accounts

Most of the time, consumers seek out ways to open additional credit card accounts. However, there are instances which compel an individual to consider closing credit card accounts. Sometimes it is because the individual particularly dislikes working with a specific lender and wants to cancel the credit card accounts associated with those cards. Other times it is because there are too many open accounts for the credit card user to keep them straight and organizing means downsizing.

These reasons are valid reasons for closing credit card accounts. But there are good ways and bad ways of making that decision. Moreover, there are good and bad ways to execute that decision once it’s been finalized. Opting to close credit card accounts in a bad way can decrease lending credibility and increase the financial hassles. As a result, it’s important to follow some basic “do’s and don’ts” of closing credit card accounts.

DO:

• Carefully consider the reasons that closing the account makes sense. Write down the pros and cons and make smart choices about which accounts to close.
• Review credit reports. Reducing the number of cards available but maintaining the same debt can lower credit scores. Knowing credit report details can make it easier to make smart choices about closing accounts.
• Consider speaking with a financial advisor. There are good and bad things about closing accounts and it helps to get a professional opinion.
• Speak personally with a customer service representative. The company will want to keep its clients so they often offer great deals to people interested in closing accounts.
• Request confirmation in writing that the account has been closed.

DON’T:

• Cancel a whole bunch of cards at once. This reeks of desperation and sends a red flag to credit card companies making it more difficult to get loans down the line.
• Argue with customer service representatives about canceling an account. Consider all that they offer during the closing transaction and make a firm decision based on current financial needs.
• Complete the entire transaction on the phone. After closing the account on the phone, it is important to follow it up with a letter in writing. Simply review what was said on the phone, list the account number and state that it’s understood that it’s now closed. This is a way to make sure that proof is available should there be problems down the line with the account remaining open.

Closing credit card accounts is normally something that is detrimental to credit. However, there are times when it is the right decision for a particular consumer. Working with credit card representatives and financial planners can make it easier to make the right decisions. Being reasonable and open-minded when closing accounts helps to make the process go more smoothly.

Director of Sales: Sean Boyett

Creditors Keep Calling Me. What Are My Rights?

Very few things are more aggravating and annoying then creditors constantly calling you at home or at work all day and all night. It can disrupt your home life and your performance at work. Unfortunately, this can be the goal of the creditor in order to intimidate you into making a payment directly to them.

As a debtor you do have rights. Creditors and collection companies are legally not allowed to contact you with reckless abandon. The Fair Debt Collection Practices Act was put in place to protect debtors from creditor harassment. Below is an outline of what creditors are allowed to do and what to do if a creditor does not comply with these guidelines.

Hours They Can Call

A creditor is allowed to contact you between the hours of 8:00am and 9:00pm, Monday through Sunday.

Frequency of Calls

If you speak with a creditor once during the day they are not allowed to contact you anymore throughout the day. This is also the case when you have spoken with them and have asked them to not contact you at work.

If a creditor calls you outside of these hours or contacts you at work after you have asked them not to, or continually calls after your have spoken with them, it is important to write the following information down:

• Time and Date of Call
• Creditor Name
• Name of the Person who Called
• Phone Number

Nature of the Calls

The creditor knows you owe them the money and you know you owe them the money. This does not give them the right to use any sort of abusive or condescending language or make threatening statements about garnishing your wages or threatening criminal actions. A creditor is not allowed to threaten physical violence if the debt is not paid. This also applies to the creditor calling and threatening to take action such as seizing property or garnishing wages before a judgment has been filed.

The language does not have to be vulgar to be classified as abusive or condescending. If a creditor uses this sort of language with you or makes these types of threats, it is important to gather and log the same information as above.

Giving Information to Other People than the Debtor

A creditor is not legally allowed to tell anyone besides the debtor the amount of the debt, how far behind the debt is or any other material information about the debt. The only time they can do this is when they have received a judgment and are moving to garnish a debtor’s wages are speaking with the employer.

Posing as an Attorney Sending Documents that Appear to be from the Court

A creditor is not allowed to call and say they are an attorney if they are not one. This can be a popular collection tactic but it is illegal! The creditor also cannot send documents that appear to be from the courts in order to intimidate debtors.

The Bottom Line

If a creditor does any of these, it is important to gather the following information and create a log:

Time and Date of Call
Creditor Name
Name of the Person who Called
Phone Number
Save copies of the documents

Posted by Donna Millen-10/23/2009

Debt Threatens Prada, Escada, and More

October 23, 2009

WWD has a monster of an article today about our dear friend The Economy; contrary to the usual treatment, however, this one's an in-depth exploration of how the financial crisis will most definitely affect our fancy European friends. As it turns out, they're not immune over there: Several fashion and luxury-goods houses should prepare themselves for the next twelve to eighteen months to come. What to expect?

A drop in revenues almost certainly, with the sector expected to contract in 2009. More seriously, however, industry experts believe there’s a risk of bankruptcy for some firms as heavy leverage cripples their operations.

Companies without debt, like Giorgio Armani, Dolce & Gabanna, and Hermes International should be fine — in fact, there's "significant opportunity" for these houses, should they want to invest during the downturn. But for houses where debt exceeds earnings, there could be trouble on the horizon.

Prada, for starters, finished 2007 with $703 million in net debt. Execs are "convinced that [they] are among those in a better place," financial speaking, but the numbers are such that in September there was speculation that they might sell a minority stake to investors in Dubai (where investors are practically rolled off an assembly line). Escada, meanwhile, has cut its annual forecast twice this year and is warning that 2008 may close with bigger losses than 2007's $36.8 million. And IT Holding — which owns Gianfranco Ferré and licenses Just Cavalli, Costume National C'N'C, and Galliano — is "in serious difficulty." They're carrying some $405 million in debt, and their parent company has an additional $178.3 million of debt of its own.

Of course, if and how these companies survive depends a lot on how they've financed everything. But just knowing gloom and doom are a possibility in the European luxury markets is a serious blow to our happy-go-lucky-fashion savy- coping mechanisms.

Author: Regan Ricci, Client Services Group

Save your Money

The smartest words ever said by anyone: “A penny saved is a penny earned.” Start small. Don’t give up. Don’t dip into your savings unless it’s an emergency. Every little bit helps. Did you know that if you saved $1 per day and invested it at 10%, you’d have almost $200,000 in 40 years? Every little bit counts and it is very important that you take this financial advice, get out of debt and save money - and start saving it now! Click here to get tips on ways to save money.

You can save money in many different ways. For example, using coupons at a grocery store or buying things on sale that you’d buy regardless of whether or not it was on sale save you money. You can also save money by foregoing spending until a future date or by foregoing spending on non-essential items. For some people, self-control is a real issue and if the money isn’t “accounted for” immediately, they tend to spend it on impulse and luxury items that are non-essential. If you find yourself in this category, or have trouble saving, you should create an investment account that is automatically funded each month. To do this, you may need to create a monthly budget to determine a monthly savings goal. If you do create a budget, make sure that it is realistic, matches your lifestyle and that it leaves plenty of room for miscellaneous expenses that seem to pop up regularly. If you create an unrealistic budget you’ll likely save less than what your budget calls for, become frustrated and resort to your old ways.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

In Case of Emergency Break Glass.....

I have hesitated cutting up a credit card because I wanted one just “in case of emergencies.” How about I can’t afford to get the car fixed, I just don’t have the money right now. Or I won’t go to the Dr. I just can’t afford it. The list goes on and on… I’ll do that when I have the money, then go out and buy extras from the gas station or catch that additional $5 meal on the go that turned into $11 after drink and a side. Well math is math and if you add up the things that sneak in extra you will be surprised where your new money for savings can come from if you pay attention.

Rule of Thumb: You should save enough money to cover your living expenses for at least 3 months. If your job is less secure, if the economy is weakening and job layoffs are increasing, or if you are self-employed, then you probably should save closer to 6 months or more.

*No Savings now? Stop doing what you are doing and get $1,000 in a bank, or in a safe place at home ASAP!!

But…..I’m not getting a raise and I can’t get another job? Maybe if I win the Lottery? Even better, you already have the money!!!!!! But HOW?

Splurge Price Times a Week/Month Savings

Vending Machine Soda 1.25 3/12 15.00

Venti Starbucks 4.95 1/4 19.80

Biolage vs. Suave Shampoo (24.99-1.79) 0/1 23.20

Vending Machine Snack .65 2/8 5.20

Convenience Store Chips .99 0/2 1.98

Pack of Gum .89 3/12 10.68

Fast Food Combo Meal 6.49 4/16 103.84

Your Savings 13/55 179.70

At this rate it would take you 5.56 months to save a $1,000 Emergency Fund! Make your own! Help a friend, start saving!

Alexis Boots Sr. Credit Specialist

Tips on Avoiding Debts From Identity Theft

Tips and advice like this may seem old-fashioned, but with 65,043 victims of identity fraud recorded by CIFAS Members in 2008, it just goes to prove that no-one should be complacent.

§ Always take particular care of your handbag or wallet. Don’t give thieves a chance. Be especially careful with your credit and debit cards. Try not to keep them together or have them all with you at the same time and never let them out of your sight. Also, avoid carrying documents such as passports unless necessary and never keep in the same bag as your wallet.

§ Shred all documents when you dispose of them. These can range from credit card or bank statements to letters from doctors, employers and indeed anything bearing your full name and address or signature. Receipts can also be valuable to a fraudster, so take care to shred these too.

§ Examine your bank and credit card statements carefully. Keep all your receipts until you have checked each one individually against the statements. This will help you to monitor your account.

§ Check your credit reference agency file regularly for unfamiliar items and take prompt action if you spot anything strange.

§ Don’t forget to keep your home secure, and keep your personal documents locked away. Increasingly it is these documents that are being searched for by burglars rather than TVs and computers. Theft or loss of documents such as your driving license or passport should be notified immediately

§ Don’t give your personal details to callers, charity collectors or “researchers” in the street. Check whether they are truly who they claim to be before giving them any information. Be just as careful when taking telephone calls. Fraudsters may try to dupe you into believing they are from banks or other companies. If you give them your account and security details they could run up huge debts in your name.

§ When buying online – keep your passwords secure at all times and regularly change your passwords. Make sure that you have up-to-date security software and only use sites that provide secure payments and be sure you know who you are dealing with.

§ Avoid online bank or shopping transactions when using public wi-fi zones or shared computers.

§ Redirect ALL mail when moving house or business addresses.

Author: Regan Ricci, Client Services Group

6 Easy Steps of Staying Out of Debt

By Natasha Hopkins, October 16, 2009

Step 1
Spend less. Today's easy credit tempts many into spending what they can't afford. The golden rule to staying out of debt is by not buy something unless you are sure you can afford it. Know what your income is and what your bills are. Make a budget and stick to it. Know how much money you have for what.

Step 2
Pay cash. Debit cards are handy but can make you spend more than you can afford. Know what you can spend. Pay cash if you can. If you don't have the money, then you probably don't need it.

Step 3
Ignore credit card offers. Use credit cards only in emergencies. If you are using them to get airline miles, only spend what you can pay off when you get your bill. The interest rate on a large balance will not help you to get out of debt, but will only dig you in deeper.

Step 4
Pay off credit cards. Always pay over the minimum, and pay monthly. Large balances and high interest rates are bad combinations. Use a zero balance credit card and try to pay off the debt in the six month time period before the offer ends.

Step 5
Buy on sale. Don't pay full price. Memberships in discount clubs like Sam's Club can pay off if you need to buy larger items. Buying in bulk or larger quantities can be cost effective for a larger family or things that are used often.

Step 6
Be realistic. We live in a consumer society that makes everything attractive. Ignore the siren calls. If you don't need it, don't buy it. If you can't avoid spending, don't go to a certain store. Invest in a hobby or something that will keep you busy and satisfy that desire to have something new.

Author: Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Report Fraud

By Lucinda Ramos, October 16, 2009

Recognizing fraudulent callers is important; reporting them to the appropriate law enforcement authorities is critical, too. When you report, you can help stop telephone scammers. Report telephone hucksters to the FTC and your state Attorney General so they can prosecute fraudulent telemarketers who try to steal your money. Jot down the name and number of the caller, and the date and time of the call. To report phone fraud, visit FTC.gov or call 1-877-FTC-HELP.

Author: Lucinda Ramos, Client Relations at CreditAllianceGroup (886) 543- 9073

Divorce and Dividing Debt

That vow of for better or worse also meant that you share in whatever debts you and your spouse accumulated in the marriage. Mortgages and credit cards are usually the biggest joint debts. You are both responsible for anything you have signed together like joint tax returns, joint credit card debts, joint mortgages or loans. If your spouse is spending money recklessly after you file for divorce, file a motion with the court explaining what is happening and ask for an early hearing.

Keep track of any money you pay on joint debts, especially when the debt was your spouse's responsibility.

If you live in a state where all the property acquired during the marriage is put in a pot, judges have enormous discretion as to how they divide marital debt. If your state considers only property acquired jointly, judges consider who incurred the debt and who is in a better position to pay. Other states determine which spouse is responsible for the debt.

Essential things to Remember:

1. If you do share joint credit cards then you should cancel them as soon as you know your marriage is ending to insure that the balance does not increase any further. Be sure to include on your list not only your major credit cards but your department and gasoline charge cards as well. You will also want to get a new credit card in your name only so that you may begin to build individual credit.

2. If your spouse is unable to pay a debt assigned to them in the divorce agreement, the credit card company or loan officer can legally require that you pay the debt. Late payments made by your spouse may show up on your credit report.

3. In most states, any debt that was incurred by your spouse BEFORE you married is their sole responsibility.

4. According to the Federal Trade Commission, a creditor, by law, cannot close a joint account because of a change in marital status, but can do so at the request of either spouse. A creditor, however, does not have to change joint accounts to individual accounts. The creditor can require you to reapply for credit on an individual basis and then, based on your new application, extend or deny you credit. In the case of a mortgage or a home equity loan, a lender is likely to require refinancing to remove a spouse from the obligation.

5. If you are given a portion, or all, of a marital debt to payback- consider contacting the lender to negotiate a lower interest rate. Many companies will offer a slightly lower rate if they think they will lose your business.

6. Attorney Gayle Rosenwald Smith suggests that if you do hold joint debt you may want to borrow money, in your own name, to pay it off. This way you are only responsible for individual debt.

7. Know that your credit card company, bank or mortgage company are not bound by your divorce agreement. Whomever's name is on the dotted line is responsible, no matter who filed for divorce.

8. If you and your spouse have filed joint tax returns that you think may not have been correct you will want to speak with your attorney about adding a clause to the agreement that states that whoever is responsible for the errors be responsible for paying the tax due and or penalties.

Heather Boyett

Motivación de la deuda

Estoy bastante segura de que todos han tenido esa sensación de preguntarse donde su dinero se fue después de cada cheque de pago. Incluso para hacer sus pagos mínimos de tarjeta de crédito cada mes, todavía parece tener mucho tiempo para pagar. Muchas de las veces parece que no hay manera con el aumento de los precios del gas, el precio de los comestibles suben, y otros gastos que son necesarios. Aquí es donde el estrés puede golpear en usted puede sentir como si no existe una solución para conseguir todas sus deudas pagadas. Piensa en algo que te motiva como la familia, rodéese con la gente positiva, alguien que puede motivarle. Porque sin motivación no hay acción y sin acción no hay logros. Un programa de gestión de la deuda es una buena manera de reducir el estrés causado por el acoso telefónico, o preocuparse de si el saldo es cada vez va a bajar. También le puede ahorrar tiempo, dinero y ayudar a conseguir una paz de la mente en tan sólo seis meses para que pueda volver a las cosas que realmente importan.

Author: Cristina Gomez, Client Services Group at CreditAllianceGroup (866) 543-9073

LITTLE SPLURGES

While Americans are finding it harder and harder to afford big purchases such as homes and cars, a new survey of household spending and savings indicates that it's not the big-ticket items that get many consumers in trouble.

Instead, it's the little things that Americans concede they splurge on that often prevent families from reaching their savings goals .Surprisingly, the biggest culprit isn't frequent trips to the mall, Many Americans say dining out at restaurants is the thing they "splurge on most."

What's more, America has drastically expanded the list of things they deem to be necessities of life. For instance, 68% of adults now believe that a microwave oven is an absolute necessity, up from just 32% a decade ago. Fifty-nine percent say they absolutely must have an air conditioner in their cars, up from 41% who thought so in 1996. Roughly half of all respondents say that a home computer and a cell phone are needed to function in day-to-day life.

Yet when surveyed about their own savings goals, the vast majority of Americans described themselves as thrifty. The Pew survey, based on telephone interviews conducted nationwide this fall, said 77% of adults describe themselves as "the kind of person who always looks for ways to save money." Meanwhile, 67% said they are the kind of people who are "always aware" of how much they're spending, and 88% said they closely watch how much they spend. When pressed on the issues, though, 63% of respondents conceded they "should be saving more.

"This seemed to confirm the findings of a survey released last week. That survey found that around 21% of Americans feel that their single most important financial goal this year is "just keeping up with the bills." Another 21% said their biggest task is to pay down debt. Meanwhile, other laudable goals, such as saving for retirement, putting kids through college and purchasing a home, ranked much farther down the list.

Author: Christina Baker Client Relations at CreditAllianceGroup (886) 543- 9073

National Debt Cap Will Need to Rise

Congress will be forced to raise the legal limit on the nation's credit card sometime later this year, Treasury officials reported Wednesday, focusing additional attention on the expanding national debt just as lawmakers expect to be putting the finishing touches on President Obama's trillion-dollar overhaul of the nation's health care system.

The amount the government may borrow from the public, including foreign creditors, is limited by law to $12.1 trillion, a cap that has been raised several times since the nation slipped into recession in December 2007. Treasury officials predicted this week that they expect to borrow an additional $892 billion through the end of the year, driving the overall debt past the cap sometime in the fourth quarter.

"Given the uncertainty surrounding potential borrowing needs, Treasury will continue to keep Congress and financial market participants apprised of developments as the debt outstanding approaches the statutory limit," Treasury officials said in a written statement.

The debt is the accumulated borrowing necessary to finance years of annual budget deficits. This year, the deficit is on track to exceed $1.8 trillion, a postwar record compared with the size of the overall economy. Polls show concern is growing over the nation's spending habits, and that concern is already influencing the health care debate on Capitol Hill, where Republicans -- and some Democrats -- are questioning whether a nation so deeply in debt can afford an expensive new program to expand health care to the uninsured.

The need to raise the debt limit could also put additional pressure on 0bama to rein in other parts of his agenda: The Congressional Budget Office has projected that the policies laid out in 0bama's first budget would require an additional $9 trillion in borrowing over the next decade.

Author: Regan Ricci, Client Services Group

Teaching your kids debt and savings

By Natasha Hopkins, October 12, 2009

Teaching children to be responsible about money is not an easy task We often have a hard time managing money ourselves so it can be a bit overwhelming trying to teach your kids how to be good with money. Here are a few tips from the on steps you can take to make sure your kids understand the value of a dollar and how to manage it.

Consider an allowance: As early as kindergarten or first grade, your child is going to have to start paying for things they want or need. Try to match the allowance closely to the expenses the child is expected to cover – that way, they learn that their spending is not unlimited. Decide whether she needs to earn an amount for extras – toys and candy, for instance – then stress why working for treats is important. When kids are younger, you should keep a frequent watch over how they’re handling their cash – checking in every day or so – and then spread out that oversight as they age.

Watch how you act with money: Children learn by example. Do you drive a bigger car than you can afford? Every time you go to the store, do you pull out a credit card to pay? Do you and your spouse or partner fight openly about money at home? Your child hears all of this. While parents can’t be perfect, think about the money behaviors you’re demonstrating in front of the kids, and try to make them positive.

Buy a piggy bank: Young children need this tried-and-true symbol of saving. They need to know there’s a place to put pocket change they don’t spend, and they are free to tap it only to accomplish a goal that the both of you discuss. This isn’t about buying stuff. It’s about setting goals and knowing where the money is. Make sure they count their money before spending it, and make sure they do the same thing at the store while they interact with the cashier. Once they learn that money is finite, they’ll start making their first spending decisions.Author:

Natasha Hopkins Client Relations at CreditAllianceGroup (886) 543- 9073

Follow this 12-step plan to rejuvenate your personal spreadsheet and position yourself for a prosperous 2009.

1. Set goals, and put them in writing. Everyone's circumstances are different, so spend some quality time thinking about your own priorities.

2. Track spending. Feeling like you've lost control of your finances is not always about lack of income. Sometimes, it has more to do with a disorganized approach to finances or even simple ignorance about where your money really goes.

3. Change your attitudes about money. It's easy to fall off the frugal wagon, but fundamental changes in your outlook are essential to avoid lapsing into old spending patterns. Learn how to say no to your spouse or children without feeling guilty.

4. Make paying down your credit card debt a high priority. Credit cards carry higher interest rates than any other type of loan, so it makes sense to pay off outstanding credit card debt first, before other types of loans.

5. Avoid taking on new debt. Aside from a house, car or college tuition, adopt the habit of saving until you can pay cash for any purchase. Deferred gratification until you can pay cash means your purchases will hold more meaning and value for you.

6. Turbo-charge your savings rate. It's a recession-defense measure and could prove to be a lifesaver in the event of an office downsizing. Specify what you'll save (in writing, again), by what date and how you'll free up money to do it.

7. Give credit its due. Review your credit report and score and, based on your personal fault lines, resolve to improve your credit by building a track record as a responsible borrower.

8. Invest in yourself. If your job doesn't make you happy, doesn't pay enough or looks shaky, consider a career move to a growth industry, like healthcare, or one where layoffs are unlikely, like the military.

9. Pare down major expenses. Look for ways to cut your biggest expenses, like your mortgage or auto or homeowners insurance.

10. Trim recurring expenses. If making cuts on big annual bills isn't enough, look next to cut back on frills, premium cable/satellite, your "8-at-a-time" Netflix subscription, eating out or your gym membership. Decide what you can, and can't live without, and remember that an either/or approach isn't necessary; often, all that's needed is downsizing, not elimination.

11. Wean yourself from consumer society. Reuse, recycle, repair, or do without. Become a do-it-yourselfer. Grow your vegetables. Barter with others for things you need.

12. Know what's important. People and relationships, not possessions, are the truly valuable things in life. Cherish them, and experience what it's like to feel truly wealthy.

Brittany Campbell/ Negotations Department

A few reasons to use a Debt Management Program.

There are many reasons to use a debt management program when you are trying to get your credit back on track and several can help reduce your amount of stress almost immediately.

When using a debt management program you are able to eliminate the harassing and often upsetting calls from your creditors. We use a feature called the DAAN module which deals with the persistent creditors.

You will no longer have to deal with late fees or other added charges that can pile up when handling your debt on your own. As many people know the extra fees can sometimes wipe away any progress you may have made in the previous months, with a debt management program you can avoid all of this.

Debt management programs provide an alternative to filing bankruptcy that will enable you to eliminate the harassing calls and still pay off your debt.

Lane Watson
(214) 317-4060

Moving forward through tough times...

Many of us don't think through our choices and how they might play out down the line. Whether its jumping into home ownership without fully understanding the mechanics of mortgages or choosing to become a stay-at-home mom when the family income is already stretched thin, financial stress can be minimized with some advance planning.

Address. The worst move you can make is to do nothing when you end up in a squeeze. Choosing to avoid bills or relying on hope and a prayer to bail you out of a steep mortgage is not going to cut it. The more committed you are to taking action now, the better off you'll be.

Anticipate. The goal is to make sure that whatever choices you make today you can handle tomorrow. You can’t forget about the future by living in the moment. Financial security often boils down to the simple task of anticipating the consequences of your actions. If you don't have health insurance, the bottom line is that you'd better keep a lot of cash in an emergency fund to pay for life's curveballs.

Adjust. If your finances have been limited and you are barely hanging on, it's time to step back and go in another direction. For example, choosing to be a stay-at-home parent is great but only if it makes financial sense for the family. If it doesn't, there is no need to jump back into the workforce working overtime hours; find a part-time position to help you get on better footing. Every problem is solvable if you stop holding on to the past and embrace the decisions that make sense going forward.

By S. Leiva, October 2nd 2009

STUDENTS, PUT THE CARDS DOWN!

The majority of the student population has at 2-3 credit cards averaging about $3,000. This may not seem like much to most, but to a student this is a huge amount. Most students have not been properly advised on how to handle their financials. Debt can sneak up on you before you know it, building up enormous amounts right under your nose; this is called “creeping indebtedness”. I have put together a few tips on how to keep your debt in order:

Two great alternatives to credit cards are debit cards and secured credit cards. Debit cards are good because they are tied to a banking account. This works because it tends to keep you from spending money that you do not have. This process teaches you to learn how to live and spend on a budget. Secured cards are safer than regular credit cards because it is require of you to first set up a savings account with a minimum balance. So in the event of default you will be able to use the funds saved to offset the balance owed on the card.

Cash is the best solution overall. Try to use cash as much as possible. Cash is easier to keep track of while you are spending. Using this method you can see your money disappearing triggering the reaction to stop. As opposed to plastic you can spend and spend totally unaware of your daily totals until the bill arrives with the gift of added debt. With cash and debit cards you can avoid the hassle of late fees (about $39 each) and interest. The average interest on credit cards right now is between 20% and 30%.

Be smart! By the time graduation comes you could possibly get hit with a number of bills: the credit card bill, rent, car note, and of course student loans. That alone is too much new graduate to handle and that’s not even to factor in food and gas. Just think how much easier life could be with one less bill.

Author: P. Grainger , Title at CreditAllianceGroup 866-454-5044

Dealing with Debt

Not being able to manage debt is a major cause of many stress related health issues as well as marital difficulties. It’s important to learn how to control your debt and if it's already a problem, what you can do to make it through the situation. Recognizing the warning signs of too much debt, negotiating with creditors and, if necessary, handling bankruptcy can sometimes be vital to dealing with your debt. One of the most important things is to know your legal rights, responsibilities and options. Consumer debt continues to increase and many consumers find themselves looking for any way out of what can often seem like an impossible situation.
It is unfortunate but one option that many choose is bankruptcy, although there are other ways of dealing with the situation. Another is hiring the services of a debt management company to help when the situation seems too daunting. Instead of purchasing expensive clothing go only on sale days where prices are marked down substantially. Cut up all the credit cards you have except one. Keep it on hand, at home, for emergencies. Then, buy only with cash. When you get your monthly bills and review them you may feel overwhelmed by the amount of money that you’re spending simply because of debt. Don’t get discouraged because there are always ways of reversing this situation and solutions to your problems. Good debt should be obtained through wise decision-making about your current situation but also about your future as well.

Lane Watson

A few reasons to use a Debt Management Program.

There are many reasons to use a debt management program when you are trying to get your credit back on track and several can help reduce your amount of stress almost immediately.

When using a debt management program you are able to eliminate the harassing and often upsetting calls from your creditors. We use a feature called the DAAN module which deals with the persistent creditors.

You will no longer have to deal with late fees or other added charges that can pile up when handling your debt on your own. As many people know the extra fees can sometimes wipe away any progress you may have made in the previous months, with a debt management program you can avoid all of this.

Debt management programs provide an alternative to filing bankruptcy that will enable you to eliminate the harassing calls and still pay off your debt.

Brittany Campbell

All You Need to Know about Debt Settlement Programs

Many consumers swimming along happily in a sea of credit suddenly find themselves drowning in a quagmire of debt. According to a 1992 Federal Reserve study, 43 percent of U.S. families spend more than they earn and, according to Cardweb.com, almost one out of every 100 American households will file for bankruptcy during their lifetime.

What should you do if you are one of these consumers? You could take advantage of one of the many services available to you, such as debt settlement programs. You can have your financial freedom back again.

What Are Debt Settlement Programs?

For years, debt settlement has been a popular method for thousands of consumers to regain financial wellness. Debt settlement means that, with the help of a settlement negotiator, you work out an agreement with creditors to settle your delinquent payments or unpaid balances.

If you are behind on payments on a high interest loan, for example, it could take you as long as 20 years to pay your debt. Debt settlement programs can help shrink your payment terms and amounts, and they can also provide you with the following benefits:

A Current Credit Report

When you sign up for, and begin, a debt settlement program, many creditors will �re-age� your account, or bring it to a current status.

Lowered Interest and Monthly Payments

Depending on your debt settlement program, your settlement negotiator can help reduce the interest payments and monthly payments on your outstanding loans.

A Reduction in Creditor Calls

Creditors call consumers regularly if they are behind on their payments or not making payments at all. Negotiators can work with creditors to eliminate this practice once you are enrolled in a program.

In addition to these benefits, debt settlement programs can also assign you a credit counselor. Besides playing an active role in your settlement, these counselors can also provide you with financial tools to teach you how to maintain a healthy spending practice.