Free Credit Counseling

Don’t Look For Debt Relief From Credit Card Rules Change Legislation

    By now every credit card holder has experienced the following scenario You have very good credit, pay your monthly credit card bill like clockwork but then receive a letter telling you that your interest rate is going from 7% to 21%. You call the credit card bank thinking this is surely a mistake, only to be told it is not an error, and due to changes in the general market they have raised your rate. Not to worry, it doesn’t mean you are a bad person, it’s just the way  things are.

  

    So, to remedy this the Federal Reserve has proposed new rule changes which would change the way banks currently do business. The rules proposal may take effect as early as the end of 2008. What is proposed?  For one thing, banks would no longer be able to hike up interest rates on existing debt, Also, card companies would have to split required monthly payments evenly between the high- and low-rate balances on a card. (Currently, card companies allocate payments to the lowest interest-rate balance first, which leaves a lot of cardholders unable to make a dent in balances at higher interest rates. That's a recipe for rapidly accruing interest and a feeling of helplessness about managing debt, say cardholders. Additionally, cardholders would get a longer grace period.

   

       So, reading this you say finally! Well, not so fast. As reasonable as the changes sound, the banks are not fond of them. In fact, their position is that, if the proposed rules go into effect, they will be forced to simply stop offering low interest cards. That’s right, now they say as a result of this misguided attempt to reign there rip-off practices in, everyone will now have to suffer. The banks have posted their response on the Federal Reserve Website.

  

      So, what is the bottom line? The more things change the more they stay the same. It is still time to get out of debt. If you can, debt management, if not debt settlement, but do not look for any help from anyone else. Empower yourself with debt freedom.

 

Written By:

Steven Ciantro

American Debt Enders

help@americandebtenders.com

Member National Association of Certified Credit Counselors

 

This article may be reprinted provided the entire signature line including this permission line is used.

How To CreateYour Own Debt Management Program

Yes, it is possible to create your own Debt Management Program. It will take some self motivation
on your part, and knowledge of a few guidelines. The purpose of this article is to provide you with those guidelines. This will only work if you have enough money every month to at least cover minimum payments.

First, evaluate your current unsecured debt status by pulling out all of your statements. Get a pen a paper and write down your balances low to high, and corresponding interest rate and minimum payments. Also, and very importantly, look at the statement to see if you have or are being charged
for "Credit Card Protection Insurance". This is an insurance policy many credit card companies slip in
for a monthly fee of anywhere from 5.00 to 15.00 per month. It is supposed to protect you in the event you can no longer work, not if you quit your job, by making the minimum payments for you for a period of time. These policies are full of swiss cheese holes, and not worth it. If you find you are paying for a policy like this call your credit card company immediately and cancel it.

Second, check the interest rates you are currently paying. Chances are you may not be able to negotiate a lower rate on your high interest cards, but, it is worth trying, especially if you have a good payment history.

Third, make a monthly budget. You need to be sure you can stick to the plan and the best way to do this is to layout your monthly income and expenses. Try to find unnecessary expenses so you can apply more money to your monthly payments.

Fourth, Realize that you are no longer going to use any of the credit cards you want to pay off--absolutely no cheating, or this will not work. Keep out one card which is going to be your only credit card.

Fifth, You are going to pay the same minimum amount of money every month until all the cards are paid off. Starting with the lowest balance, only because when you pay it off you will feel a sense of accomplishment and want to keep going. On the first, lowest balance card try to make the minimum plus, 50.00 per month and on all the other cards just the minimum. The extra 50.00 is equal to the fee you would be paying to a debt management company and you should have little trouble finding it, if you are motivated. When the first card is paid off, apply all the money you were paying on it to the next card plus the minimum payment on that card. Repeat this process until all the debt is cleared up.

A note of caution, do not close any of the cards as this will lower your credit score. This approach works best if your interest rates are not higher than say 18%. If they are , you may want to consider enrolling in a debt management program to get them lowered. If you are behind on your payments and are having trouble meeting just your monthly minimums, then, you may want to explore a debt settlement program.

Written By:

Steven Ciantro
American Debt Enders
Help@americandebtenders.com
Member National Association of Certified Credit Counselors

 

Debt Relief Internet Communities

       As those of you who read my newsletter and blog articles know I am always interested in bringing youhelp for debt relief and knowledge for self empowerment. In the interest of doing so I have come across an internet community with 117,000 members strong, all chatting and supporting each other in their quest to lead debt free lives. Whether you have questions about debt settlement, IRS issues, student loan debt or anything else related to debt and would like to know you are not alone, please feel free to visit:
http://www.debtconsolidationcare.com/credit-counseling.html, register and jump into a forum. And, of course, you can always email me directly with a question.

Written By:
Steven Ciantro
American Debt Enders
Help@americandebtenders.com
Member National Association of Certified Credit Counselors

This article may be reproduced in full provided the complete signature line is used including this permission line.

Have A Cell Phone Contract You Need To Get Out Of? Here's How.

        Short and sweet, here is some very practical advice.

        Cutting Costs often involves terminating unnecessary services such as cable T.V.,
lawn care, etc. If cell phone use is not part of your job, your cellular phone service would
also fall into the non-essential category. However, it's not always easy to hang up on a twoyear service contract that comes with heft penalties and fees for early termination.

        Consumers can now utilize a new service to avoid the $175. to $200. early termination penalty.
For a $19.95 fee, Celltradeusa.com finds people to take on your existing contract thereby satisfying the
cell companies bottom line. Reports indicate that it is fast and easy and can be accomplished completely
online.

        If you feel you still need a cell phone for emergencies you can always use pre-paid minutes,
purchased from your cell phone provider. There is no contract involved in pre-paid minutes.
If you found this article helpful, you can find more like it by visiting: http://freecreditcounselingblog.typepad.com/creditcounseling/ and subscribing FREE to the newsfeed
from this blog.

Written By:
Steven Ciantro
American Debt Enders
Member National Association of Certified Credit Counselors
Help@americandebtenders.com

This article may be reproduced in its entirety provided the entire signature line including this
permission line is included.

If Your Credit Counselor Can Only Offer You One Solution, Find Another Counselor

    Having just completed my recertification as a Nifce certified credit counselor and member of the National Association of Credit Counselors, I noticed that the banks actually created there own definition of credit counseling. As amazing as it seems, if you tell a banker from the credit card industry that you are going through credit counseling, they think that you mean you have enrolled in a debt management program, which they control. If you say you are being counseled about the difference between debt management and debt settlement then the banker would comment that this is something other than credit counseling.

  It should be no surprise to anyone in the industry that the banks and some legislative bodies have managed to narrow the definition of what the real spirit of credit counseling is. It is about offering a solution which really meets a persons needs. People with debt problems have more needs than just the immediacy of getting rid of the debt. They have a need to live. In order to keep going there are certain other needs that must be met. What happens if they need a car and, of course, because of bad credit or lack of a cosigner cannot get one. What about credit restoration? Should the counselor tell them they have to wait seven years before the negatives on the credit report will improve? What about a credit card? Even a basic, secured credit card. It is very difficult to function in todays world without one credit card. You cannot rent a car, etc.

   Frankly, non-profit credit counseling conveniently ignores these issues. Why? Because they do not have answers. They can only offer you budgeting education, and a debt management program, or even sometimes housing counseling, but nothing else. The legislators need to take a deep breath and start thinking of credit counseling in different terms. Smart companies have chosen to operate as for-profit credit counseling/referral companies. This allows the counselors to offer a wide array of debt solutions through strategic alliances with partner companies which offer programs more suitable or specific to a clients needs.

  A client opting for a debt settlement program should know that the nature of the program is that the creditors will not be receiving money until it is time to settle the debts in one lump sum. So, this clients credit score, although 99% of the time already quite low, is going to need some credit restoration sooner than seven years. Is it possible? Absolutely. Many of todays more astute referral companies when enrolling someone into debt settlement will also enroll them into a credit restoration program. How about also offering a secured credit card and bad credit car loan.

   The wave of the future in the credit counseling industry is for companies which can offer this array of life saving programs to the debt oppressed to truly allow them to achieve self empowerment.

    If you would like to read more self empowering articles on debt reduction and debt relief, please subscribe to the newsletter feed from this blog by visiting: http://freecreditcounselingblog.typepad.com/creditcounseling/, the subscription is free and we never share your information.

Written By:
Steven Ciantro
www.americandebtenders.com
Certified Credit Counselor
877-766-2465

This article may be reprinted in its entirety provided the full signature line including this permission line are included.

A Different View Of Todays Economic Crises

     OK, you say, so here we have another view of the economic problems growing in our country. I say, think again, I do not think you will hear the "talking heads" of TV land or our national leaders giving you this view. I would like you to know, as you read this article that in addition to being a credit counselor, I am also a pretty conservative capitalist who strongly supports a minimul government regulation free enterprise system. Since I have considerable experience in the areas of credit and debt counseling, mortgage brokering and credit restoration, and while not an attorney, even the court system as it pertains to debt and judgments and subpoenas.

       So lets start at the beginning. as far back as the 1700's, the concept of buy now and pay later existed in some form. In the 1920's, hotel chains issued them to there customers for convenience, when they were on the road. In 1946, John Biggens of the Flatbush National Bank invented the "Charge-It" card. This was the first bank issued card and was used as a retail credit card for store purchases. In 1951, the Diners card was created, and in 1958,The American Express  card was born. It wasn't until the 1970's with the creation and regulation of the magnetic strip that credit cards began to grow in popularity. If you can believe this, in the mid 70's, congress actually banned the mass mailing of active credit cards to people, unless they were requested.

     How things have changed. By the 1990's, government lawmakers made a 180 degree turn around and de-regulated the credit card industry. Helped along by two favorable Supreme court decisions which essentially eliminated the usury laws (Usury laws defined illegal interest rates), the seeds for potential disaster were sown. Also, during the 1990's our lawmakers decided home ownership should become easier for everyone to achieve. They did this by allowing he formation of the sub-prime investment market. Wall street got into the mortgage game and realized how much money was to be made by creating mortgages for people with bad credit who could not verify there income, or ability to pay. The problem was that to get a sub-prime loan you generally had to pay an onerous rate of interest. Of course, not initially. You could purchase the home for perhaps as low as 3% interest with no money down. But , after the first, second and third years, the interest would skyrocket increasing the monthly payment to an unaffordable level. These loans became secured investment instruments traded on wall street for a premium, because of there high rate of return, or high interest charged to the home buyer.

    Instead of rewarding the sub prime borrower who made on time payments month after month, as these escalation of interest clauses kicked in, the interest and monthly payments increased to levels which were unmanageable by many. Thereby forcing a new loan with all of its accompanying closing costs, broker fees and bank fees and taxes due for another closing. Everyone was benefiting, but the homeowner, who was deceived into thinking this was the way it should be.

  Couple this with the deregulation of credit cards allowing banks to charge as much as 35 and 40% interest, with onerous late fees and over-limit charges and we add another ingredient to the soup. Couple this with the advent of payday loan companies being allowed to charge 350% interest annually for a payday loan, then add to this the universal default clause allowing banks to raise your credit card interest just because you may have paid late on another banks credit card, and you have a very sour tasting soup, indeed. The really amazing thing is that now everyone is investigating everyone else to see what happened. The FBI is investigating the Mortgage industry, of course, no one seems to be doing anything about the banks charging onerous fees, as credit card fees continue unabated, and payday loan companies continue to flourish.

   If Wall street and the mortgage banks had been a bit more astute and less greedy, they would have rewarded sub prime borrowers with lower interest rates rather than forcing them to refinance. This should have been a no brainer. When credit cards reached there credit limit, instead of allowing an over-limit charge with an out of this world fee, the over-limit charge should have been denied. No over-limit charge and thus no over-limit fee. Universal default clauses should have been made illegal. What does paying late on my Visa card have to do with my mastercard. The banks argue that it shows increased risk. It produces increased risk, due to the higher interest rate!

   Then, in about 2004 the OCC, or Office of the Currency Comptroller ordered banks to raise the minimum payment on credit cards to at least 3% of the balance and encouraged 4%. They said this would allow higher interest credit cards to be paid off faster. The problem with this brain storm was that many people did not have the monthly cash flow to accommodate these higher minimum payments. why doesn't anyone think about this stuff, before they act.

    All this brings us to today. Coupled with all of the above, we now have a recession and, in my opinion, run away inflation about to take place. Meanwhile, congress finds it necessary to hold hearings on steroid use in baseball. If this weren't such a tragedy, it would be hilarious.

  Again, just a few minor course corrections applied ten years ago would have, I believe prevented this melt down. Amazingly, the banks have become indignant with the advent of debt settlement as an option for debtors who would like to avoid bankruptcy, but cannot afford the Debt Management programs which are controlled by the banks. What's the bottom line? Greed, has gotten out of control, and, our leaders are asleep at the switch. I just read an article stating that after a law suit brought against Ameriquest Mortgage Company, Ameriquest was fined for not accurately disclosing costs and fees associated with many of its loans. Isn't that nice. The people who were abused got a small meaningless check, and the lawyers got rich.

   This article is not about hindsight. Each of the examples I mentioned occurred because of greed. if reasonability had been applied in each of these areas, i totally believe, that as a nation we could have avoided, or at least minimized what is about to befall us. The bottom line here is you need to do what you must to get out of debt, as fast as you can. If you must seek out credit counseling, get into a program, whether it be debt management, or debt settlement, or just learning to better manage your money, but make it a priority to be beholden to no one. You may subscribe to our Free Credit Counseling Newsletter absolutely free by visiting:http://freecreditcounselingblog.typepad.com/creditcounseling/. Do so, and we will send you a free budgeting calculator software.

Written By:
Steven Ciantro
Credit Counselor
American Debt Enders
Help@americandebtenders.com
877-766-2465

This article may be reproduced in its entirety provided that the full signature line including this permission line are included.

Are You In A Personal Recession?

Is there a national economic recession comming? This has become a major topic of business commentators, both writers and television business analysts, otherwise known in my own personal terminology as "the talking heads". No matter who you speak to, or listen to, everyone has an opinion.

Since there are only two possible answers to this question, that means that only half of the opinions can be right. In fact, the odds that your guess has the same odds as the experts might be somewhat disheartening. Here are some facts. Americans taken as a whole, have virtually, no savings. We are in the midst of a major housing slowdown. Forget the talking heads. Drive around an ordinary middle class neighborhood and evaluate for yourself if the number of for sale signs have increased, and stay up much longer.

In Great Britan which is has seen these same problems about 18 months before us, credit card charge offs have increased by 50%. That's totally unsecured debt. Here in the US, credit card debt sets a new record high, every month! People have started using there credit cards to pay there mortgages, in higher ratios. The cost of energy, which effects everything,continues to rise significantly. Need I even mention the collapse of the sub-prime mortgage market. I could go on here, but, the focus of this article is about your personal economy. The idea here is to keep yourself solvent, no matter what course economic events take. So, that means, now is not a good time to be spending extravagantly. Now is a time to get your personal house in order. If you are carrying high unsecured debt levels, you need to now consider seriously paying them down. If you are now just making your minimum payments, you need to strongly consider enrolling in a debt consolidation or debt settlement program. Whatever you do, you need to stop making new credit card debt. Why? Besides the fact that you will empower yourself to learn a debt free lifestyle, it will also allow you to weather any economic storm which may come.

Do not think you can depend on anyone else to help you. You must learn to live a debt free life, now. You might want to start by budgeting, and figuring out where your money is going. You can use this free budget calculator to help you do this. Start thinking differently. Do you really need the big screen TV? 100 cable channels? If you take a sober view of your finances, you will not have to worry which way things go, as you will have reduced your income needs to a minimum. Written By: Stevem Ciantro American Debt Enders Help@americandebtenders.com This article may be reproduced in its entirety provided the entire signature line including this comment are included.

Written By: Steven Ciantro
American Debt Enders
Help@americandebtenders.com

This article may be reproduced in whole provided the writers signature line and this permission lineare included.

Pay Day Loans, When The Mafia Gave You One It Was Illegal!

So, the car broke down and you do not have the money to get it repaired. But,it is your only means of transportation. So, you think, I can get an advance on my paycheck, or a pay day loan to take care of the problem. Bad Idea. When I was growing up in Brooklyn, the only Pay Day loans available were from your friendly neighborhood mob guy. Not family guy, thats a TV show. The mob-guy otherwise known as a loan shark, would give you the cash and told you clearly what the interest or vig,or vigorish, as it was otherwise known, was going to be. If when pay up time came you did not have the vig, plus the principal, then you were expected to pay the vig, and the loan shark would extend the loan at another outrageously high interest rate. If over time, you were unable to pay either the interest Or the loan principal, then you got new loan terms which usually included bodily harm.

So, we need to now ask, how did all this get to be legal!We have all seen the ads. Very captivating, you need money, we want to help you, we also want you to borrow responsibly. Right! Who are they kidding, these loans start at 350% interest. Lets look further. A $500.00 payday loan at an initial 30% interest for 2 weeks will cost you $650.00. Thats $500.00 plus $150.00 in interest. So payday comes and you cannot pay the entire amount back. So, you explain to Vito that you have a problem. Vito says, no problem, just pay me the $150.00 and and you will pay me another $150.00, plus a $15.00 service charge, plus the $500.00 you owe me on the principal in 2 weeks. That's a total of $815.00, assuming you can repay the loan in two weeks. So the original $500.00 loan, now cost you 315.00 in interest and fees. Imagine if this continues a few more weeks! Loan Sharks used to actually go to jail for doing this.

Every once in a while you'll read an article that says the following:"Politicians Express Concern Over Pay Day Loans". They make a few statements about the fact that 1000% annual interest rates on these loans are getting people, especially, poor ones, into financial distress. By the way, military personal unfortunately, often fall victim to these loans, then the these same politicians take a sip of that magical kool-aid they like to imbibe, and nothing happens.

The bottom line is this. Imagine that there was actually a time when there was no such thing as a Pay Day Loan. People actually got along without them. Imagine, you have a need for quick cash. As legitimate as the need may be, the world will not come to an end, if you just don't even think about using a Pay Day loan. Unless you are about to die from hunger and need food desperately, to live. Just do not even consider that such a business even exists! You simply must find a better way. If you feel you need help in how to avoid these pitfalls, then seek free credit counseling. If you have already fallen prey, and are trapped in a bad cycle of interest only payments, seek debt relief through a credit counseling company. Generally, if the Pay-Day loan has gone into default and been sent for collection, then you can put it into a debt settlement program as one option. If it has not gone to collection, then sometimes you can put the account into a Debt Consolidation program, and stop the interest from accruing as you pay down the debt in installments.

After all is said and done, the bottom line is, no one can protect you from these predators better than you can. The name of the game is that it is not about how much you earn, but how you control it.

Written By: Steven Ciantro Credit Counselor American Debt Enders Help@americandebtenders.com

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Keywords: american debt enders, credit card debt management, debt consolidation program, debt settlement, free credit counseling, pay day loans

About the Author
Steven Ciantro

Wage Garnishments | Free Credit Counseling

This is an important area to have knowledge of for anyone who is in debt and having trouble keeping up. Unfortunately, many times being served a subpoena is the singular precipitating event for taking action to deal with a debt crises. Quite often, the debtor will use this event to actually seek help and jump into a debt settlement program or try to get into a debt consolidation program. Unfortunately,while it is good that action is finally being taken, often it is to late to stop the proceeding or garnishment. However, this does not mean that it is to late to stop action or take action on other debts.

So, here are a few things you need to know if you are presented with papers giving you notice that a wage garnishment order has been issued. Do not panic, it is upsetting but not the end of the world. While I am not an attorney, there are some important highlights I can pass on to you.

One is, if you are the victim of a default judgement, which means, for whatever reason, you did not show up in court on the appointed day to defend yourself, you have what is called a default judgement. In this case, you may actually stop the garnishment for a period of time by going to the office of the clerk of the court where the judgement was issued. Bring all the paperwork you have with you. Tell the clerk you were issued a default judgement and would like to have it overturned on that basis. It may be temporarily stayed, until a new court date is set. The creditor that sued you will have to file again. No garnishment can take place until you go back to court and lose. assuming you do lose. This will give you time to take action. You can contact the creditor and see what you can work out directly with them. If you are ultimately unsuccessful and you are garnished, you will receive a notice from the appropriate sheriffs office to forward a certain amount of money to them each time you get paid. Failure to do so will result in them contacting your employer to withhold that amount from each paycheck and forward it to them. You cannot be terminated from your job because of a wage garnishment.

Also, how much can be taken from your wages varies by state. Also, if you are a minimum wage worker, chances are good you cannot be garnished no matter what. Essentially, there is an exemption on the following(minimum wage x 40) per week which amounts to somewhere in the area of $180.00 to $200.00 per week.

Also, if you are on disability, or social security your income is exempt from all garnishments, including those from the IRS, yes, you heard me right. Not even the IRS can touch your disability money or social security money. However, and this is important-you must not mingle any of your social security or disability money with any other source of income...in other words it must be kept in a separate bank account, all by itself. Then and only then will it be untouchable.

Want to know how much money they can take? It varies from state to state. You can visit: http://www.fair-debt-collection.com/state-wage-garnishments.html#33 and get a specific breakdown by state on exactly what you might be in for.

The thing to do is to deal with your debt before it gets to this stage. Enter a debt consolidation or debt settlement program where you will be represented by counsel to help you. Doing so will help keep you in control. And remember just because you have a garnishment on one debt, does not mean you cannot work on the others in a suitable debt settlement program and cut off any further problems.

Written By Steven Ciantro Credit Counselor American Debt Enders help@americandebtenders.com

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Keywords: best debt settlement company, debt advice, debt negotiation versus debt consolidation, debt relief options, debt relief programs

About the Author
Steven Ciantro

help@americandebtenders.com