Money Savvy » Credit Card Debt

Organize Debt Consolidation Quickly and Easily

Author — Sat, 04 Jul 2009 19:52:23 +0000

(ARA) – Until recently, Ken Goins of Woodland Hills, Calif. was like most Americans — he carried a balance on several credit cards. The weight of the balance became heavier and heavier, and Goins just wanted to end his debt.

The average American has 13 credit obligations on record at a credit bureau, and 36 percent of Americans carry more than $10,000 of non-mortgage debt, according to myfico.com.

Credit card debt is often necessary for large or emergency purchases, but as interest rates climb, carrying the debt long term can become unmanageable and unwise. Goins hit that point a few months ago, when he was making little headway trying to pay off $65,000 in credit card debt at a painful 12 percent interest rate.

The downturn in the economy has been a wake-up call to many debt-heavy consumers like Goins. More than ever before Americans are examining their options for paying off debt faster, or lowering sky-high rates. Typically these options include:

* Continuing with minimum payments.

* Playing the costly balance-transfer game.

* Using outside debt consolidation services.

But now, there’s a better option. Consumers are turning to their social networks for affordable financial relief — and a light at the end of the tunnel. A loan from a relative or friend usually means a lower interest rate (which adds up to significant savings over time) and more flexible terms. Because these kinds of loans have been known to strain even the fondest relationship, it’s a good idea to bring in a third party, like Virgin Money, to help document, service and automate the process.

A social loan managed by a third party is similar to a traditional debt consolidation service. For example, consumers can combine multiple high interest-rate credit cards or other debt into one loan. The big difference is that the borrower and lender agree to their own rates and terms. Credit reporting is even available, enabling the consumer to improve their credit score while paying off their now-affordable social loan.

Goins’ friend wanted to help him out with his debt, and had read about how he could make the loan official with Virgin Money. Here’s what they investigated:

* Continuing with his $700 monthly payments, it would take Goins more than 22 years and $120,000 in interest — paid to the card companies — to get him out of debt.

* When Goins looked to his network, he connected with a good friend and a sibling both willing to help him out. For a few hundred dollars in fees, he was able to arrange a loan with each, formalizing the agreement and automating his repayment.

* All parties agreed to a 7 percent interest rate, higher than the two lenders were receiving on their fixed income investments, and significantly lower than Goins’ credit card rate of 12 percent.

* Goins now makes those same payments of $700 a month, but will be done in 11 years for $28,000 in interest — money paid to those he loves.

With a social loan, Goins’ repayment is not only much cheaper, but also hassle-free thanks to Virgin Money’s e-mail reminders, electronic funds transfers, online accounts, year-end reporting and free credit reporting. “We’re thrilled to help consumers get the best deal possible and empower them to be in charge of their debt. That’s exactly what we’re here for. What better way then to get a friend or family member to invest in you?,” says Asheesh Advani, chief executive officer of Virgin Money on the sharp rise in use of the company’s debt consolidation products in recent months.

Learn more about debt consolidation or refinancing at www.virginmoneyus.com.

Courtesy of ARAcontent

There Really Are No Bad Credit Debt Relief Repair Secrets

Author — Fri, 02 May 2008 09:42:41 +0000

When people find themselves at the bottom of the class in the credit score department they instantly start looking for ways to improve their position. What many may not realize is that they can have items that should not appear on their credit report removed on their own. In most cases negative information that is not true can be removed simply by notifying the credit reporting agency, along with proof of the misinformation and it will be removed. However, these bad credit debt relief repair secrets, which are not really secrets at all, are often kept from the average consumer.

Before buying in the prospect of buying bad credit debt relief repair secrets it should be understood that while the three major credit reporting agencies are private companies they are controlled by the federal government and their reporting tactics have to adhere to strict government regulations. There are also rules governing the release of bad credit debt relief repair secrets by the agencies, which most will follow to the letter of the law or risk losing their license to conduct business.

One thing that many of the bad credit debt relief repair secrets peddlers will not divulge is that any information on the report that is accurate, cannot legally be removed until the time on the information expires, usually in seven years. Anyone that claims otherwise is either misinformed or passing on bad information.

Keep Watch On Report For Inaccuracies

One of the best known bad credit debt relief repair secrets is to keep a close eye on your credit report, and not just one, but the report maintained by all three agencies. Simply because an item is missing from one report does not mean it is not on another one. If an item appears on your report that you question, you have the right to questions its validity and if it can be proven the information is false, it has to be removed.

People and companies that claim to be able to offer a clean credit report in 30 days are probably not being honest in their presentation. Some of the bad credit debt relief repair secrets they talk about include that fact that true information cannot be removed. What they may be offering is help in getting outdated or erroneous items on the report removed, something that can take time, but something that can be done with paying someone else to do it.

Staying Away From Bad Consolidation Credit Debt Relief Programs

Author — Thu, 01 May 2008 09:37:58 +0000

They are so many people right now who are suffering financially that it is making some people wonder if we, as a country, have hit some sort of all time record. But, maybe that is just because they are one of the people who are having troubles stay afloat and need help. With all of the people who are in need of financial and budgeting help, it is no wonder that so many bad consolidation credit debt relief programs are coming out of the woodwork. It is so easy to fall into their traps so one must be extremely careful not to fall into something that can only make things worse for them later down the road.

Consolidation loans are often a wonderful way to see the light again and to get things in order. But, if the wrong one is selected or it the consumer is taken advantage of, that relief will be extremely temporary as more trouble is soon to follow. By getting suckered into a bad consolidation credit debt relief loan or program, you are digging your own grave again. In the beginning, things may be looking better but as the ugly terms of the loan start to surface, you will be soon wishing you had never taken out a bad consolidation credit debt relief loan in the first place.

What They Do To You

A bad consolidation credit debt relief loan is often times something that is meant for the purpose of taking advantage of you. As with most all other consolidation loans, you are generally placing another lien on your home, which means if you default on your consolidation loan, they can come after your home. For most people, this is not a problem because the consolidation loan they got is a healthy one and one that they can maintain. But for others who end up with a bad consolidation credit debt relief loan, they may be facing foreclosure instead of bill collector calls for a past due credit card.

If someone is trying to get you into a bad consolidation credit debt relief loan, you will know based on the terms of the loan. It is extremely important that you read all of the fine print and if you are not able to understand all of the legal aspects of the agreement, then it is highly advisable that you take it to someone who can, such as a lawyer. Even though you may have to pay a small fee, that is much better then falling into the trap of a bad consolidation credit debt relief loan and paying the price by no longer having a home to call your own.

Finding Ways To Pay Off Credit Card Debt

Author — Tue, 29 Apr 2008 04:08:20 +0000

Running up credit card debt is easy is the attempt to pay off credit card debt that is difficult. The quest to pay off credit card debt is the same as trying to lose weight, it is so easy to gain all the excess and it can be gained in a very short period of time but losing the excess can take years of hard effort. Just like with gaining weight people do not necessarily mean to rack up large credit card debt it usually happens through years and years of unhealthy living that finally catches up with you and just like obesity serious credit card debt will eventually catch up to you. The difference is that credit card debt will catch up to you a lot faster and leave you feeling a lot worse when the full effects are known. There is no surgery you can get to pay off credit card debt like there is to lose weight so you need to pay off credit card debt yourself and there are things you can do to help the process along.

The first thing you can do, and it seems so obvious, is to stop using the credit cards. Many people get themselves into a vicious circle where they need the room on the credit card to buy gas and food but they cannot afford to pay anything but the minimum monthly payment. Then the credit card company seems like saviors when they raise your limit but all they are doing is keeping you trapped in the cycle. So the first step in the quest to pay off credit card debt is to stop using the cards. Only use cash and if you don’t have enough extra cash each month to pay your bills and do the things you need to do then you need to move on to the next step in all of this to help you pay off credit card debt faster.

It Will Take Hard Work

Unfortunately the way to pay off credit card debt is through hard work and sacrifice and that means a few things. First of all you need more money coming in and if that means taking on overtime at work, or even getting a second job, then that is what you have to do. This is not going to be easy and it will seem hard at times but if you do it right then there can be a light at the end of the tunnel and you will work very hard knowing there is a destination instead of that heavy feeling you get when two full time jobs become your necessary lifestyle every month. Make a plan and have a way you are going to use that extra money to satisfy your debt and you will have a light to move towards.

Your are going to need to cut back in your spending. If cable television is costing you $100 a month then get rid of it. If you put a good plan together then the lack of cable will be temporary. As was said before it will take sacrifice and if you are not willing to sacrifice then you will not succeed.

Getting Real Help With Non Profit Credit Card Debt Consolidation

Author — Sun, 27 Apr 2008 04:07:53 +0000

Many people spend years and years balancing a fragile credit card debt with their ability to pay it and eventually even the most inept of personal spender can see the house of cards getting ready to collapse. The first inclination is to run to the credit card debt management companies you see on television and ask them to help you put the house of cards back together so you can go on with your spending habits until the cards crash again and that is exactly what a regular credit card management company will do. They will help you get out of trouble temporarily and then watch you get right back into trouble again so they can swoop in and save you while adding to the money they already make from you on a monthly basis. Maybe you should turn off the television, pick up the phone book, and find the phone number of a non profit credit card debt consolidation organization to offer you some real help.

With a non profit credit card debt consolidation organization you will get honest answers and they will sit down with you and show you all of the numbers involved in non profit credit card debt consolidation and then they also have to show you what they will be charging you every month to do the service. Every debt consolidation service charges a fee it is just that the other services never tell you how much that fee is while a non profit credit card debt consolidation service will tell you and they will work with you to help you find a way to get your debt under control. You can also expect a non profit credit card debt consolidation organization to ask you a lot of questions so that they can better help you get your life under control. They may not be able to get you any better deals than the regular debt management companies but non profit credit card debt consolidation organizations will at least keep you involved.

Now The Bad News

If you are a qualified debt consolidation manager which organization would you work for? You would probably work for the one that pays the most, right? A non profit credit card debt consolidation organization can have a difficult time attracting good talent because they do not pay well and in the financial services industry, as you can imagine, money means everything. Sometimes you many not get the best manager for your case but just ask a lot of questions and if you are not comfortable with the manager then you may want to decide to take your problems elsewhere.

The people at non profit credit card debt consolidation services mean well and they do good work for the most part. If you really are going to call a debt consolidation service then try a non profit credit card debt consolidation service first.

Tips On Negotiating Credit Card Debt

Author — Fri, 25 Apr 2008 04:07:28 +0000

Many people that get themselves into credit card debt do not realize that they can be negotiating credit card debt for themselves without relying on a credit management company. When you are negotiating credit card debt you just have to remember that there are two sides to every story. Yes it is difficult for you to pay right now but the credit card company just wants their money so when you are negotiating credit card debt remember that you are trying to find a place to meet the credit card company halfway. One of the things that help you in negotiating credit card debt is to know what can be negotiated and what is not open for negotiation. If you go into it wanting to negotiate your principle down, which the money you spent that you actually owe them, then you can cut up that credit card and say goodbye to your credit rating. Principles owed are not open for talks when you are negotiating credit card debt however interest owed and interest rates are open. The credit card company may not like it and they may cancel your card but at least you are paying your principle and that counts for a lot.

If you look at your credit card bill you will see that your interest rate is listed on there in a spot that is easy to find. If your rate is over 10% then you have something you can use for negotiating credit card debt. Many store cards and low limit credit cards have rates that are over 20% and they usually go up every year. These are arbitrary numbers set by the credit card company and you can use them when you are negotiating credit card debt. As long as you always pay your principle you are fine. I had a friend that would call his credit card companies once a year and tell them that if they didn’t lower their interest rates he was paying the card off in full and canceling it. More often than not the rates got lowered. This also affects your monthly payment and can help you control your monthly debt.

Not Your Friend And Not Your Buddy

In the end the credit card company only cares about getting paid and if you expect more than that then you are being naïve. They don’t care about you no matter how nice they talk to you; all they care about is money. They also do not like you if you pay your balance off every month. I know someone who has used their card and paid off their balance every month for years and their credit limit has never been raised. I pay my minimums on my three cards and my limits get raised constantly. Threatening to pay off the entire balance is a huge threat you can use when negotiating credit card debt.

Remember that they are a business and you are the customer. You always have the option of taking your business elsewhere if you are unhappy. If you let them know you are willing to do that then they will talk to you.

Preventive Knowledge with Info on Credit Card Debt

Author — Wed, 23 Apr 2008 04:06:57 +0000

Anyone that is living or about to live on their own, be they high school graduates or middle aged parents, should understand the uses and perils of credit cards. They can be fantastic tools for charging items when you’re a little too short on cash, but using them too often and to charge very large purchases can result in massive debt that some people find it nearly impossible to escape out of. Because of the problems people face when using credit cards, everyone should read about info on credit card debt.

How to Get into Debt

Getting into debt is a lot easier than most people realize, so info on credit card debt can help them avoid the hassles and possible bankruptcy down the road. So how does somebody get into credit card debt without their realizing it at the time? Firstly, they most likely make a lot of small purchases which add up over time. While eating out at McDonald’s or seeing a movie at the theater doesn’t seem like much at the time, continual small purchases do add up. A $5 purchase of anything once a day is $150 a month. Therefore, try paying small purchases with cash or a debit card as opposed to a credit card.

Enough info on credit card debt though. What can you do if you do get into debt? Don’t ignore the bills! If you do, your credit rating will suffer, making loans and other lines of credit harder to acquire over time. When you get bills, pay them on time. This will help minimize the interest that you accumulate from credit companies. Interest doesn’t go down on its own, and when many people ignore it, it grows to unmanageable proportions. A $5,000 balance can grow to $15,000 and more if people ignore the bills, and their credit rating will be shot.

For more info on credit card debt, you can turn to credit counseling companies to give you an idea of how long it would take to pay off a particular balance with a particular interest rate. Many people unfortunately believe that paying off a balance with a minimum payment is the best way to go. In fact, they are simply increasing the total amount of money they will have to pay back over time. By paying more than the minimum payment, you can easily shave 50% of the interest payments off. This is just a basic amount of info on credit card debt. If you do get into debt, don’t let it ruin your life. There are ways to eliminate your debt so that you can get back to living the life you want.

An Effective Way To Wipe Out Credit Card Debt

Author — Mon, 21 Apr 2008 04:13:46 +0000

Any effective way to wipe out credit card debt is going to begin with the same type of advice. If you are not willing to stop using your credit cards in order to wipe out credit card debt then thanks for reading and good night. If you are serious about wanting to wipe out credit card debt, and you can stop using your cards, then you can continue. What you do with your cards once you wipe out credit card debt is up to you. If you want to start using them again and do this cleansing exercise every couple of years then that is your choice. Many people do that and as long as you are not getting yourself in over your head then you should be able to repeat this cycle of running up credit card debt only to wipe out credit card debt indefinitely. If you have that kind of self control then personal finances will be easy for you. But there is a practical and effective way to wipe out credit card debt and it begins with putting the cards away.

The next thing you need to do is bring all of your debt together under one loan or other means of consolidation. You can use consolidation loans or you can wipe out credit card debt by using offers from a new credit card to consolidate your debt under the new card. If you use the new card method then just be warned that you are probably setting yourself up for even more credit card debt. You may want to find other ways of consolidation and then use cash for everything else you will be needing for the foreseeable future. Cash is your friend when you are trying to wipe out credit card debt and the more you can use it the better off you will truly be in the end.

Make It Its Own World

Once you have consolidate your debt then next thing you want to do is dedicate a portion of your monthly budget to paying that consolidation off and that portion of your monthly budget should be more than the minimum consolidation payment. If you need to give up some things in the meantime, like that extra phone number or internet access for your cell phone, then do whatever you can to get extra money coming in and then apply that extra money to paying the consolidation off. It may mean a few less dinners out each month but you need to pay that consolidation off so apply all extra money to the consolidation.

Once you get all of that under control you just keep using cash while you are paying the consolidation off and you should be able to pay it off in a reasonable amount of time depending on how deep in debt you are.

Learning How To Stay Out Of Credit Card Debt

Author — Mon, 21 Apr 2008 04:06:18 +0000

A lot of people already will tell you that they understand that credit card debt is something that can destroy lives. And those same people will also tell you that they try to avoid credit card debt as much as possible but not as many people are so lucky and many end up in the debt trap. Learning how to stay out of credit card debt is the best way to make sure that you never have to face the challenges of being financially strapped or make sure that you don’t repeat the same mistakes you made before. It is important to first understand the effects that out of control debt can have on you, your family, your home, and even your job.

Knowing how to stay out of credit card debt is important because credit card debt is a debt that acts more like quick sand then any other debt that you will ever owe. Not knowing how to stay out of credit card debt often lands people in a spot where they have spent their available limit on their credit cards and they are often left in paying the very minimum payment every month. By doing this, you are basically throwing your cash away because your payments will mostly go to interest rates and fees. Once you are at the point of being stretched to the limit, you are stuck there and if you ever miss a payment you are then going to be hit with an incredible amount of fees that will make it even harder to catch up.

How To Make It Happen

Before you ever charge another thing again, you must understand exactly how to stay out of credit card debt. If at all possible, you need to make a list of things that are acceptable to charge such as car repairs, tires, medical expenses, and things of that sort. Understand that in order to continue to know how to stay out of credit card debt, you must never charge things that are not needed such as dinners out, gifts, extra clothing, jewelry, or other bills. Make sure that you only use your cards when you have to and if the need every does arise, as soon as you go home you will want to determine what your new monthly payment is going to be and if you are unable to pay the balance off the next statement cycle, determine how much extra you can pay to go towards that balance.

A good way in making sure you completely understand how to stay out of credit card debt is by repetition and by this I mean removing the temptation. If you are not traveling far away from home, such as being out of state or away on vacation, leave all of your credit cards at home. By removing the possibility of charging something, you are saving yourself from a lot of headaches. A lot of credit card debt is because of impulse purchasing and if you do not even have access to your credit card at that moment, more in likely you will walk away from the purchase. By teaching yourself that you must take time to think about purchases you will learn how to stay out of credit card debt.

Understanding How To Get Out Of Credit Card Debt

Author — Sat, 19 Apr 2008 04:05:47 +0000

Understanding how to get into debt is a lot easier than automatically knowing how to get out of credit card debt. Something that not a lot of people really consider is how quickly credit cards can turn your financial status upside down and it can happen in a heartbeat if one is not careful enough. It is important to do as much research as possible in order to properly and efficiently know how to get out of credit card debt. The first thing that anyone has to do is understand how he or she got into this place of financial trouble to begin with. By taking a look at exactly how it was that they accumulated so much debt is a way of making sure that you do not repeat the same mistakes and that your efforts on knowing how to get out of credit card debt are not wasted.

Determine if the credit card debt was because of unexpected expenses that you had to pay for such as car repairs, important home repairs such as furnaces or hot water tanks, medical expenses. If your credit card debt was not because of those types of spending, what was it exactly that got you into the position you are in now? Was it spending too much on gifts, dinners out, clothes, or vacations? Learning how to get out of credit card debt starts with recognizing where you went wrong so you can change that situation. If you do not change what made you get into this spot, then it is only going to happen again and after the long work that it will take to learn how to get out of credit card debt this is not something you want happening again.

What Steps To Take

By talking with a professional who knows how to get out of credit card debt, you may end up saving yourself a lot of time, worries, and frustrations as the situation may not be as bad as you might think. There are options such as debt negotiation, consolidation loans, repayment plans, and bankruptcy that can help you in understanding how to get out of credit card debt. Most of the agencies and organizations that are out there to help will offer you a free consultation in which they can briefly go over your financial status and help you understand what it is that they suggest doing and how it will benefit you. There are many options available to someone who is in need of help including government assistance if the situation calls for it.

So it is important to start making a list of everyone who owe and include everything from their contact information to the exact amount you owe them. And then the next step would be to start making phone calls to those who are experienced in how to get out of credit card debt. Do not limit yourself to one consultation as you must make sure that you contact several different agencies to see who gives the best advice for you and your personal needs and who can offer you help at the cheapest rate. Remember, it is all about saving money so you must be careful to select your help wisely.