New Credit Card Rules Give Consumers a Break – in 2010
Deceptive credit card practices that have kept consumers permanently in debt are now being reined in by Federal Regulators. That’s the good news. The bad news is that the new rules don’t go quite far enough, and they don’t take effect until 2010.
You know you should read every contract before accepting it, but credit card contracts are often 30 pages long and written in a form of “legal-eze” that even lawyers find hard to decipher. Thus, most consumers don’t even attempt it. If you’re like most people, you probably don’t even know where you put it.
In recent years, credit card companies have added a variety of clauses designed to maximize penalties and fees, while allowing them to increase interest rates to 25% - and in some cases even higher.
A common ploy to lure consumers into the debt trap has been to offer rock bottom introductory rates – some even at zero percent for the first few months. Accompanying those offers are a few checks – with a letter encouraging consumers to “take that vacation” or “purchase that new furniture” with the checks.
Once the introductory rate period ends, rates go back to “normal” – or higher.
To be fair, some companies offer those rates on balance transfers and convenience checks until the balance has been paid off. But they don’t stress the fact that if you use your credit card to make a purchase, the interest on that purchase will be at a high rate. And – your payments will be applied first to the balance transfer or check at the low rate. Thus your high-interest purchases are buried where you can’t begin chipping away at them until you’ve paid off the low rate balance.
Under the terms of “Universal default” credit card issuers are allowed to raise those introductory rates in the event you are late with a payment – and that’s fair except for one thing. The late payment doesn’t have to be on their account – it can be a late payment on any other account that is reported to the credit bureau.
The new rules won’t completely prohibit Universal default, but they will prohibit the card issuers from
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Bad Economy, No Job – How Can I Repay My Debts?
When you have collection agencies calling you and you are in debt up to your eyeballs, it’s time to take action and quick. First step you need to take is to get a job, sooner than later. You cannot afford to use the bad economy as an excuse any longer. The bad economy may be standing in the way of you getting the job that you desire, but it shouldn’t keep you from obtaining gainful employment that will help you start paying your bills. Your only priority when you have debt to repay should be to get a job that allows you to have enough income to start repaying those creditors.
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Credit Card Debt – ‘Til Death Do Us Part
There are a lot of things you can’t take with you when you die, and in the case of credit card debt, it can be a good thing. However, this can change depending on where you live and whose names the credit card is under. Of course, the simplest scenario is that the credit card was on your name alone, with no joint account holders. In this case, any debt owed on the card, after death, would belong to only you and no one would inherit it.
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Maintain the “You” in Your Credit Union
However, when it comes to credit, too much togetherness can be bad for your bottom line. Even though there’s no such thing as a “couples” or “joint” credit report, if you both are named on a loan or listed as joint account holders, any flub-up (late payments, defaults) on the account will mar both of your credit files, no matter who forgot to put the mortgage check in the mail.
CreditReportBlog.com recommends that all couples make looking at each other’s credit reports a part of the screening process once things start to move towards the marriage phase. As skeptical as it sounds, there is never a guarantee that any marriage is going to last forever. An uncomfortable conversation now can avoid an even more uncomfortable situation later, if things turn sour with your finances.
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FICO 08 May Change Your Credit Score
The credit scoring formula has been periodically updated over the past 20 years, with changes in technology. FICO 08 will make the scoring system more sensitive to multiple late payments and less sensitive to isolated incidents of late payment or those that occurred a few years ago,� states Craig Watts, Public Affairs Manager, for Fair Isaac Corporation, the creator of the credit scoring system.
CreditReportBlog.com - As credit reports are increasingly being used as the basis of making major decisions concerning many facets of a person’s life, it is more and more important that the FICO score be as precise as possible in giving a true picture of one’s financial well-being. As we all know, your FICO score can affect possible employment, all loan applications ( big or small ), rental applications, etc. Read more
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Easier, cheaper credit report freezes
SACRAMENTO - Gov. Arnold Schwarzenegger Monday signed legislation to put the deep freeze on fees charged for freezing credit reports.
http://weblog.signonsandiego.com
CreditReportBlog.com - Well, we can hardly call this piece of legislation a “deep freeze”. There a few good changes, but anything huge. It calls for the fees charged by credit reporting agencies to now be $10 instead of $12, gives seniors a rate of $5, and calls for agencies to comply to all freezing requests within 3 days. Another little tidbit, requests can now be made through regular mail, instead of only certified mail.
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The Major Credit Bureaus
The 3 major credit bureaus are Equifax, TransUnion, and Experian. These companies collect financial information from various creditors and sell this information in the form of credit reports to lenders or others who have a legitimate use for it. Each individual has a right to see what is contained in their credit report at the various credit bureaus. Individuals are entitled to receive one FREE copy of their credit report from each bureau, once every 12 months. The information contained in the credit reports may be as follows:
· Individual’s full name, address, place of employment, and spouse’s name, if married.
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Reasons to Check Your Credit Report
Most people don’t check their credit report until it is time to make a purchase that requires a degree of creditworthiness, i.e. buying a house or a car, opening up a credit card, etc.
Credit Report Blog.com would like to take this opportunity to reinforce to its readers the importance of consistently checking their credit reports for various reasons, as mentioned in this report. When an important decision is to be based on your credit report, it may cause unforeseen delays or rejections, if surprises pop up on your credit report which you were not expecting. The causes of these surprises could be the result of identity theft, reporting errors, mistaken names, etc.
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Credit Restoration Service Announces Contest for the Worlds Worst Credit Report
July 2, 2008 — Lee Harrison Credit Restoration is looking for the world’s worst credit report. They will clean the worst credit report each month for 6 months for free. To enter the contest, applicants must send a copy of their Experian, Equifax, transunion and CSC.
CreditReportBlog.com – Well, this sounds like a great deal if you are the lucky, chosen few. With the enormous number of Americans sinking in debt these days, there will the credit restoration company is likely to be flooded with applicants for this new “contest” to find the worst credit reports in America. If you think you’re situation is bad, there will probably be many others with stories 10 times worse.
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College Students-In Debt already?
While in college, students are constantly hounded by credit card companies enticing them to apply for their credit card. Students see applying for credit cards as a great way to start building credit. However, if you are not careful with the way you start charging things, you may end up in a whole heap of debt. With not enough income coming in, usually a part-time job, many students end up spending well above their means. If you are a student and are looking at some of the credit card offers out there, here are some things you may want to think about before signing up:
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How do I correct a mistake on my credit report?
Everyone should take advantage of their right to obtain a FREE credit report for themselves, every 12 months from each of the three credit bureaus. This is the only way you can monitor your own credit file, without paying high fees to a credit monitoring service. Although the FREE credit report will not include a credit score, it will let you view any negative information included in your file. If the negative information is true, complete and accurate, then you can take actions to start improving your credit situation. Read more
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Foreclosure stigma haunts would-be renters
As if losing a house on the court steps wasn’t enough, some former homeowners may fiand themselves turned away by apartment owners spooked by the foreclosure history on their credit reports.
CreditReportBlog.com sympathizes with individuals hit with such a dreadful experience as foreclosure on their home. Along with bankruptcy, foreclosure can be one of the most devastating experiences in one’s life. Being forced out of your home, can cause enormous stress, shock, and even depression to an otherwise content person. Read more
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Looking for a job? Clean up your credit report.
Julie Lawrence interviewed for a job in March. Lawrence believed the company was going to make her an offer after a background check. She was unaware that included a credit check.
CreditReportBlog.com would like to advise its readers of the importance of maintaining a clean credit report for so many reasons, other than the obvious. Not only are lenders looking at your credit reports, but these days other parties that you would not have thought of, are also peering into your credit records.
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Can you get a Business Loan with BAD CREDIT?
Getting a business loan with bad credit can be very difficult. Banks will not even entertain the idea of lending to a business with bad credit, so you are better off not wasting your time there. Fortunately for some business, there are institutions out there that will approve bad credit applications for a business loan. At the same time, they will charge substantially higher interest rates for making these loans to a high risk client and will require substantial collateral from your business or personal assets.
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Tech offers students interest-free loans for bicycle purchase
The Tech Outdoor Pursuits Center has initiated a new program that will allow students to receive a $500 interest-free loan for one year, so they can buy a bicycle.
http://media.www.dailytoreador.com
CreditReportBlog.com commends the Tech Outdoor Pursuits Center in its initiative to promote this program. This program has so many good purposes that we would highly recommend every educational institute in the country try to adopt a similar program.
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The Fair Debt Collection Practices Act
Although you may have defaulted on your loans and owe creditors their money, remember, you do have the right to be treated fairly by the collection agencies. Creditreportblog.com feels for its readers who are frustrated at being hounded by these collection agencies, leading to a lot of stress in their daily life. In order to keep these aggressive collection agencies in check, the Fair Debt Collection Practices Act was put into place. This act applies to those who work on behalf of creditors to collect outstanding debts from individuals, such as unpaid car loans, mortgages, credit cards, and medical bills. Under this Act, there are certain guidelines that the collection agency must adhere to.
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“Freezing your credit report?”Good idea?
Credit Report Blog (Creditreportblog.com) frequently gets this question about the idea of “freezing your credit report”. However, there are still many who have not heard of this new concept of limiting access to the credit report. The credit report is a key tool and essential part of the decision process of lenders on whether or not to extend credit to individuals. In the wrong hands, however, the credit report can also be the tool used by thieves to cause much financial damage to someone. As a result of the rise in identity thefts across the country, this option of freezing a credit report has come about.
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What to look for in a CREDIT COUNSELOR
At Credit Report Blog (Creditreportblog.com), many readers write in about having heard of credit counseling agencies and ask whether they really are helpful and even make sense to hire, when you are already up to your neck in debt. People think of the services of a credit counselor as another bill to pay. If you are one of many Americans living paycheck to paycheck, worried about calls from debt collectors and not being able to work out a suitable repayment plan, then a credit counselor could be the answer. However, you have to be very careful when choosing a counseling service. Many credit counseling organizations claim to be non-profit but actually end up charging high fees that are sometimes hidden or suggest solutions that cause the person to go deeper into debt.
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How is your CREDIT SCORE calculated?
Well, it’s just a mathematical formula. It’s based on information contained in your credit report which is compared with millions of other people. The resulting number is in indication of how likely you are to repay your debts. The higher your number is the better deals you will get with lenders, in terms of types of plans offered and interest rates. Credit scores are used extensively by lenders when determining what rate you get for a mortgage, car loan, credit card, or auto insurance. There are many different kinds of credit scoring models used by lenders to determine credit worthiness of potential clients.
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Bankruptcy and your credit report
We at CreditReportBlog.com get this question asked pretty often by our readers: Is it a good idea to file bankruptcy to get rid of our debts? Well the answer is not a simple one. With the economy in shambles these days, more and more Americans are looking at filing for bankruptcy as the only alternative left to get themselves out of a bottomless hole of debt. However, before you go ahead, you must be made aware of the terrible stain filing bankruptcy leaves on your credit report.
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