USAinDebt

If you have read the first two parts of the “Getting Out of the Debt Hole” series by now you should have figured what you owe, what are your monthly expenses and approximately how much your debt costs you per month. You You should also have reduced your spending and optimized your costs of living

Your next step in dealing with debt is to negotiate your rates with your creditors. Now that may sound impossible but you may actually be surprised that some lenders are willing to work with you.

So, open up your “accounts file” and start calling. Make sure to write down the names / numbers of representatives you speak with , you may need them for future reference. Be polite, explain that you are facing some financial difficulty and ask them to help you out by lowering your APR. You may encounter a stubborn rep who won’t be willing to work with you - then just call again, and if you don’t have any success the second time, ask to speak with a supervisor. They are usually authorised to make such changes to your account. If you are still unable to lower your interest at that point, you can bluff a bit and try to convince them that you are about to close your account or consolidate it. You can also ask directly to be transferred to the retention department, which usually handles cancellations - that should put the red light on and you are most likely to get what you want. I have worked in a company that had it’s retention department representatives trained to handle customers that wanted to cancel service - 95% of the calls were transferred back to me after they bribed the customer.

Calling your creditors will take you probably an hour of your time but it can save you a lot of money. Don’t be afraid to talk to them it won’t hurt you if you try!

Tags: debt | finance | money management | apr | creditor | lender | negotiate | rates | retention

As many as 1.6 million scout badges have been recalled after testing revealed high levels of lead in the paint. Sports Authority recalled about 12,000 aluminum water bottles due to violation of lead paint standard. 20,000 Razor E300 scooters are recalled because their handlebars can detach causing loss of control. Injuries were reported already. 150,000 Antioch Publishing bookmarks & journals are pulled because of high lead paint levels. Dollar General Merchandising Inc. is recalling 192,000 toxic keychains, again because of a high level of lead. Eveready Battery Co. recalls 79,000 toy flashlights due to violation of lead paint standard.

These are recalls, posted at U.S. Consumer Product Safety Commission’s website for the last week. It is unknown how many more unsafe products are out there…

Tags: china | recalls | high level of lead | scout badge

Credit cards are not just charging you interest, they also come with fees. Some of them you probably have heard of already, but lenders have a lot more tricks in the hat for you. If if you don’t watch out, your available credit can be easily eaten up by all kinds of “extra” charges. Actually 17 of them.

Annual Fee. The simplest and most common fee is the Annual Fee. It is usually charged on secured credit cards, cards with extra benefits (such as point or cashback programs) or low-credit-score cards. The Annual Fee is charged either monthly or annually, and it’s usually in the margin of $39-$59.

Program Fee. Some cards have a Program Fee. It is usually charged once, when the card is activated. It is common for credit cards for individuals with poor credit.

Participation Fee. Lenders have also came up with a Participation Fee, which is similar to the Annual Fee. It is charged either monthly or annually, and it’s usually in the margin of $29-$159. 

Application Fee. When you first open a card, you can also be charged an Application Fee. Usually in the margin of $19-$59.

Reload Fee.  Some lenders charge you a Reload Fee. It is common for prepaid plastics or cards for individuals with poor credit. Usually varies depending on the amount that you are paying towards the card, although some companies have a fixed rate and a reload limit per month.

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I happened to have some friends with their kids currently in high school, and I frequently notice how often those kids fail to recognise the importance of personal finance handling. They seem to be well educated on the latest PlayStation games and have the hundreds of spare hours to post on MySpace. But when it comes to money, all they know is that money come from their parents and that’s about it. And while some still argue that “money is not everything” money definitely are what’s moving the world. The next generation spends 4 years in school preparing for their college and making plans on their future. They learn a bit of just about anything, but why are finances not included? Many of them begin working prior to going to college and. they still don’t know the value of money at that point. To me, basic finance should be included  in the core curriculum just like basic computer skills are. As an immigrant from a foreign country, I learned finances the hard way. It costed me a lot of time and money which youngsters can save, if they are taught properly on how to spend wisely. Why learn the hard way?

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Jonathon A have emailed the following: Hi, I am John. I have gone through your blog. I have one query regarding debt…can you please help me. My query is…”Debt consolidation is how much helpful for a person with huge debt?”

Well Jonathon, debt consolidation can be very helpful, depending on the circumstances. As always, you have to be careful and do your research before you take any decisions. Read on.

Debt Consolidation companies can usually consolidate your Credit cards, Personal loans and Taxes into one single bill. There is a couple of things to watch out for. First of all, what are the new interest rates? If they new APR’s are lower you are OK to move on. The second thing to check for is what is the period that you are consolidating for. Use this calculator to find out how long it will take you to pay off your current credit card debts, and then compare it with the time-frame and the cost, which your debt consolidator offers. If they are lowering your APR’s but are stretching your payment schedule, you may end up paying more. Also, check if the debt consolidator is charging you any fees for their service. Sometimes they only ask for a volunteer contribution, but sometimes they are charging you a flat fee. You may want to shop around and compare the offers.

Individual’s credit score has turned into the individual’s life score in our society. Your credit score is constantly checked, your credit report is evaluated by numerous companies for numerous reasons. No wonder that everybody is trying to figure out what to do to raise their FICO’s. Here’s a couple of tips that can help you out:

•  Pay your bills on time, and pay as much as you can. Missing your payments or sending the funds late will impact your numbers negatively. Besides that, the more credit you have used, the higher your credit available to credit used ratio is. Higher ratio means lower score.
• Check your credit reports. You credit reports contain all the information, that lenders will judge you by. If there are errors on your report, you better get them fixed, unless you want somebody else to buy that nice shiny car you are looking at the dealership.
• Refinance. Check your credit cards and see if you can get a good deal on a balance transfer. Shop around ans refinance your mortgage. Both of those will leave with more cash to apply towards your loans.
• Be careful with the accounts. Don’t open new accounts rapidly, and keep the old accounts open.
• Control your spending. Try to use cash and keep the plastics for emergencies. Keep your balances low, call your bank every now and than, ask them to lower your APR’s or waive your fees. Set-up a budget, write everything down and stay on top of your finances.

- Get all three credit reports for free here (not a sponsored link or a hoax; it’s 100% free)

- Get all three credit reports unlimited views for $9.99 per month (Credit-Keeper by HSBC)

Tags: credit score | fico | loan | apr | annualcreditreport | hsbc | budget

We live in expensive times and being short on cash is what a lot of us have to deal with. Unfortunately, “life” and “unpredictable” always go together, and you never know what the day will bring. Your car breaks down, the hard-disk on your PC is fried or you get sick, and suddenly your bank account has 2-3 dollars left, and the next paycheck is still 7 days away. You need cash and you need it fast. And if you already have maxed out all your credit cards, you are most likely not getting anymore credit to cover your unexpected expenses.

This is where the Payday Loan comes in. The loan sharks know that you are stuck, that you don’t have any other credit options, but you are working, you are getting paychecks and they can expect a good return if they lend you money. They already have a preapproved offer for you: “get the money as early as tomorrow, pay back when you get your next paycheck!” Isn’t that a great? You can get the money needed tomorrow and just pay back with your next check! Yes, it may be good, but at what price?

Payday loans (PDL’s) are one of the most dangerous and expensive loans that you can take. Unless you repay your loan back asap, you will end up paying back huge amounts for a small principal. Besides loan fees, which are usually about 20-50% of what you are initially borrowing, PDL’s usually can carry hundreds % of APR. That’s right: 500%, 600% Annual Percentage Rate is very common to Pay Day Loans. PDL lenders are setting you up with what seems to be a fair deal, hoping that you will fail to pay the amounts due on time and roll over your loan. That is when they will eat you alive. And with these tremendous APR’s, your balance will multiply daily. People fall into the Payday Loan trap, take out more similar loans and their credit files and financial status is ruined.

Besides high costs, Online Payday Loans pose another threat - your identity falls into the hands of unknown companies and individuals. When you are applying for a PDL, you are asked to enter most of your personal information, such as name, address, social security number, bank account numbers. This information is enough for anybody to take control over your personal account. You don’t know who you are giving your information to on the Internet - anybody can set-up a fake Payday Loan website with just some basic skills.

Summary: Before applying for a Payday Loan, stop and think, reconsider your other options. Ask your family if they can borrow you some money, call your friends. See if you can sell something, like your TV or your computer. Ask your employer if you can get a payday advance. Payday Loans can be a big hassle and they should be your last resort.

Tags: debt | fast cash | payday | loan | pdl | apr | pay advance | paycheck

Everybody (hopefully) knows already that APR stands for Annual Percentage Rate. So far so good, but then the next question is: “What is an Annual Percentage Rate?”

Consumers often think that the Annual Percentage Rate is the cost of credit per year. It includes interest and other finance charges. APR is commonly used to compare loans from different lenders, but don’t be fooled - your APR does not regulate your monthly payments, and a lower APR does not necessarily mean a better deal. Your APR does not reflect you real interest on a credit card loan. Your bank is actually charging you by an Effective Interest Rate, which is a result from the compounding interest on a credit card. It is important to know how your credit card company calculates your finance charge. Most companies calculate using the daily periodic rate, and less companies go by the monthly periodic rate. If the daily periodic rate is used, your APR is divided by 365, and then multiplied by the average daily balance. If a monthly periodic rate is used, your interest is calculated by dividing your APR by 12, and then multiplied by the sum of the average daily balance for the month.

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Thursday, Experian announced that, starting November 1, it will allow consumers the option of ‘freezing’ their credit file. Experian is the final credit bureau to allow credit…

Read Experian now allows credit freezes, too on Advanced Personal Finance

Tags: personal finance | fico | credit report | experian | equifax | transunion