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5 Tips To Help You Deal With Credit Card Debt

5 Tips To Help You Deal With Credit Card Debt

Do you tend to be late in paying your credit card bills? Is your pile of notices from creditors getting higher and higher? Do you fear you might lose your properties because you can’t pay off your credit card debt?

Being in deep credit card debt is not a thing that can be easily brushed off or treated lightly. Anyone who’s been in this situation knows how terrible it feels. However, if you ever find yourself in deep credit card debt, there are things you can do to make your financial situation not worse than it already is.

Tip #1: Budget right away.

Don’t wait until you lose your house. As soon as you find yourself in a bad financial situation, make a budget right away. How much is your income? Does it cover your expenditures? Assess your situation and know which expenditures are vital and which are not. Do you really need to eat out three times a week? Do you truly need to have all the bells and whistles that come with your cellphone plan? Must you shop for clothes every week? Your budget needs to cover all your basic necessities: food, housing, clothes, basic utilities, and health-related costs.

Tip #2: Face your creditors.

Many deal with their creditors by avoiding them or running away from them. Dealing with creditors this way only leads to bigger and more serious problems. If you find yourself having a hard time paying off your debts on time, the best way to deal with it is to contact your creditors right away. Disclose to them your reasons for not being able to pay your debts and ask if they can come up with a revised payment arrangement. It’s important that you let your creditors know that, while you are in debt, you are very willing to pay it off. Face your creditors. Don’t let them reach a point where they pass your situation to a debt collection agency.

Tip #3: Deal with debt collectors.

The Fair Debt Collection Practices Act is a federal law clearly stating that debt collectors cannot bug you, give false assertions or do anything that is not fair when they are trying to collect money from you. Read and understand this federal know so you can properly address debt collectors.

Tip #4: Consider credit counseling to get tips on how to get out of credit card debt.

There are groups and institutions that offer credit counseling for those who need help with their financial problems. A good credit counseling organization can help you come up with an improved payment arrangement for your credit card debts. You can present this plan to your creditors for their approval.

Tip #5: File for bankruptcy.

Filing for personal bankruptcy is a last resort to fixing — and the legal way of addressing — your credit card debt. However, keep in mind that if you file for bankruptcy, it will remain in your financial information report for years. Thus, you may find it difficult to get additional credit, buy a house, or even get a job with a bankruptcy on your financial information report.

Bankruptcy Help – 5 Things You Can Do After Bankruptcy

Bankruptcy Help – 5 Things You Can Do After Bankruptcy

One of the issues that people considering bankruptcy often worry about is that they will never get credit after filing Chapter 7 or Chapter 13. That, or the fact that the bankruptcy will stay in their credit report for 10 years from the filing, which fact would serve as a warning to future creditors that you might turn out to be a bad risk. But neither is true, however, while bankruptcy will indeed stay in your credit report for ten years, it does not necessarily mean that you can no longer get new credit. If you want to learn more or need some advice on how you can get bankruptcy help, book a call now.

Furthermore, only a Chapter 7 bankruptcy will stay in your credit report within 10 years. If you filed under Chapter 13, the period is shorter – about five to seven years. Worst case scenario: You can get a new loan but with high-interest rates or fees. Now, that’s not so bad, is it? Especially after considering that even people with good credit can get bad loan deals. The fact remains that no matter how bad or good your credit line, it is not a guarantee that you are going to get approved for a loan or get low-interest rates. In other words, bankruptcy may damage your credit but only to an extent. It does not necessarily mean that you will never qualify for new credit. What damage there is, you can always rebuild. And that is what you should be focusing on, instead of wallowing in the pits of Credit Doom.

#1 CAN DO: Keep a Credit Card Out of the Bankruptcy

When filing for bankruptcy, the rule is that you have to make a schedule. A schedule is a list of all assets and liabilities that you are required under the law to disclose before a bankruptcy case could commence. If you owe money on a credit card at the time you file for bankruptcy, you have to include that in the schedule. Otherwise, you may be sued for perjury and penalized under federal law. What’s worse, if you fail to disclose unpaid credits like this, you may be denied a discharge of all your debts.

The rule, however, only applies to unpaid credits. So if you do not owe any money on your credit card, then you can go ahead and keep that one out of bankruptcy. You are not obliged to inform the credit card company of the bankruptcy case. Note, however, that your credit card company may still find out about it through other means and cancel your card as a precaution. If your credit card company gives you notice of cancellation of your credit card, don’t give up yet. Many credit card companies allow their credit cardholders who are filing for bankruptcy to keep their credit cards on the condition that they agree to reaffirm the balance on the card and enter into a new agreement. Try to re-negotiate the terms with your credit card company and see if you can settle for a situation that is beneficial for both you and the company. While the decision is up to the creditors, keep in mind that what they want is to avoid the loss incurred when the debt is discharged and to have your future business.

#2 Get New Credit After Bankruptcy

If there is one thing you can count on in today’s competitive lending environment, it is that credit is always available, even to the recently bankrupt. The catch? Credit may be more expensive than before and available with lower limits. But all that is second only to the fact that credit does exist and you can get it. One of the easiest credits available to the recently bankrupt is a secured credit card. As opposed to an unsecured credit card, in a secured card, you must make a deposit of a certain amount of money in exchange for a card that you can use just like a regular credit card. Your credit limit is equivalent to the cash deposit you made. Now, the good thing about a secured credit card is that it is usually available post-bankruptcy at lower rates than unsecured cards.

What’s more, the fact that these credit cards are secured is not often indicated in your credit report so creditors have no way of knowing whether your credit card is secured or not. All they will see is that you have been approved for a credit card, which ups your credit score a bit and puts you back in the game fairly quickly. Note, however, that credit experts are not quite in agreement concerning the impact of secured credit cards on your credit rating. So if you do decide to open a secured credit card post-bankruptcy, be sure to do it slow.? While your rush at rebuilding your credit is understandable, making mistakes that could significantly affect your credit score like this is not worth it.

Rebuilding your creditworthiness after bankruptcy is a matter of getting a toe-hold in the world of credit. The balance is often precarious and needs delicate treatment. Use credit cautiously and pay on time.

#3 Buy a House After Bankruptcy

Absolutely. In fact, there are many studies that show bankruptcy debtors can qualify for a home loan on the same terms as if they had not filed bankruptcy within 18 to 24 months after a bankruptcy discharge. You see, what the creditors are concerned about here is not your past financial troubles but your current financial status – e.g., your down payment, the stability of your income, and the relationship between the loan payments and your monthly income. That said, take note of the following things that you might want to do in preparation for your first house purchase post-bankruptcy:

• When purchasing a home after bankruptcy, the key is the discharge date, since there is usually a waiting period. If your loan was an FHA loan, you usually have a 2-year waiting period for that. For other conventional loans, the waiting period is four years. Now, during the waiting period, you need to do two things: re-establish at least 4 lines of credit (auto loans or credit cards, for example) and maintain an excellent payment history.

• Make sure that there aren’t any delinquencies on your credit report that should have been cleared off with the bankruptcy. If you find any, contact your creditors immediately. Include a copy of your “Schedule of Creditors” in your letter so that your creditors can indicate the debt was included in the bankruptcy and update your credit report.

• The more money you have in your savings or checking account, the better and stronger your file is going to look to a lender when you apply for a home loan. Remember that your ability to make a down payment bears great significance in your approval rating. If you have money in your savings account, your creditors will naturally conclude that you have the money to make a down payment.

#4 Get New Wheels After Bankruptcy

A common misconception people have after a bankruptcy is that getting new credit like a car loan is virtually impossible. Well, note that the word used is “virtually.” That is not the same as saying that you are certainly never going to qualify for a new car loan. Because the truth is you can and you should if you need to. If you can get a house after bankruptcy, then there is all the more reason for you to be able to get a car. In fact, you can even start going through some dealerships as soon as your discharge papers are in. Just remember that the interest rates are not going to be cheap. Here are some tips to help you deal with that one tiny tangle:

• Check with the Special Financing Department

Most car dealerships have this special financing department that handles would-be car purchasers who are going through some financial trouble. Since these buyers would not be able to qualify for a conventional auto loan, some dealerships are willing to offer you a different deal to help you get that car you want and at the same time overcome the hurdle of credit after bankruptcy.

• Credit Unions

If you are a member of the credit union at your workplace, contact them and see if you can get a car loan through them. Often, credit unions offer lower interest rates than banks, which in addition to charging you higher interest rates, may also require you to deposit your paycheck directly with them. If your workplace does not have a credit union, your neighborhood may have one. Some are available to people based on an organization or church affiliation, or even residence in a certain community.

• Charities

Not many people are aware of this but charities are actually a good place to look for inexpensive cars. You may have heard of charities that ask you to donate your working or non-working cars to them. In order to raise money, they repair these cars and sell them for a price that is significantly lower. Try those charities found in your neighborhood and see if they sell cars that are more along with your price range.

#5 Have a 700+ Credit Score Two Years After Discharge

You might find this statement suspect, which is understandable really when you consider the many stories of how one bankruptcy can thoroughly damage the credit rating you’ve been building up for years. Expert after expert has said that new credit is near impossible to get after filing for bankruptcy. However, in almost the same breath, the experts likewise say that it is not impossible to rebuild your creditworthiness after bankruptcy. And this is bolstered by the fact that you had a good reason for the bankruptcy, such as unemployment, medical, business failure, etc, and that you immediately took steps re-establishing credit after receiving the discharge.

So why then, despite complying with these two requirements, your credit score remains way below average? The answer lies in your credit report. Your credit report contains everything about your finances. All of the information contained in your credit report, when added up, result in your three-digit credit score. Hence, any errors in your credit report, such as a fraudulent credit line or a debt that remains even though it was supposed to be discharged after bankruptcy, can adversely affect your credit score.

Common sense tells you that if you correct these errors and mistakes, you can improve your credit score. Also, some creditors make various inquiries into your credit report. This act could lower your credit score. What’s more, after a discharge, they are allowed to make only one inquiry into your credit report. After that, you are entitled to ask for $1,000 every time they look into your credit report. Make certain that your creditors are not making any more inquiries into your credit report. Write them a letter explaining that the debt has already been discharged. Include a copy of the discharge order as well as a copy of the ‘Schedule of Creditors’ from your bankruptcy papers as proof that the debts have already been discharged.

Consolidate Credit To Stop Getting Turned Down

Consolidate Credit To Stop Getting Turned Down

If you have been applying for credit and always being turned down, that is because your credit report has negative information on it. Time to do something about that! Your credit file is the information kept by credit reporting agencies concerning your record of payments to creditors. There are three major credit reporting agencies that perform these services for companies who are interested in finding out how good or bad a risk you are. Whenever you apply for a loan, try to rent an apartment, and even apply for a job, you can be sure your credit report is being looked at. Time to consolidate credit and do something about your personal finances if you have a bad credit report and you get declined for any of these.

Your credit file is built up over the years by the credit reporting agencies that keep track of all of your bills and your bill-paying habits. If you have been in the habit of missing payments, being late, or just forgetting to pay, that will all be in your credit file as marks against your credit. These will result in lower credit scores, and lower credit scores mean you will not have a very good chance of getting a loan, or some other things you might be interested in, such as an apartment or a job. The opposite will also happen: if you are consistently a good payer, you can be sure you will be able to get a car loan, mortgage, credit card line, or just about anything else from a lender.

With so many people filing bankruptcy these days or using debt management programs, the lending companies lose money. So they want to avoid risks with people who may end up in bankruptcy. A bankruptcy ruling will stay on your credit record for ten or fifteen years. Debt management companies help you temporarily, but you are extending your debt and paying more fees, so it is harder to get out of debt.

You do have some protection under the law, but if you have bad credit, you will never really breathe easy until you can completely clean it up. In addition to a negative credit report and low credit number, we are also going to be facing judgments, foreclosures on a home, or repossession of goods, and even perhaps lawsuits. No one wants to risk being homeless and penniless. You know you have to find a way out.

What if you are in a situation where you cannot make a living, such as if you are on welfare or on disability? Look at any option you can to repair your credit. If your car is too expensive, find a cheaper one. If your home is too expensive, you may have to size it down to the one you can afford. Once these big expenses are eliminated, you can start to pay down debt and get your credit report back on track. This is the only way you will stop being turned down for credit.

How To Find A Legitimate Debt Settlement Company

How To Find A Legitimate Debt Settlement Company

It is important that before you consider filing for bankruptcy protection or go on a debt management plan that you consider contacting a legitimate debt settlement company first.

What is a debt settlement? Debt settlement is a way of negotiating and reducing the amount of debt you have with each creditor. A debt settlement company can negotiate with your creditors on your behalf and get them to agree to a lesser amount. In addition to negotiating the amount owed to each creditor, a debt settlement company will also send them the payment for you, take care of all the paperwork and agreements reached with each company, and also negotiate how the settlement of your debt will be reported to the credit bureaus.

You may wonder why companies would agree to lower the amount that you owe them. In most cases, companies realize that if you are not paying back the unsecured debt that you owe them unless they can come to some terms to help you pay it back they will likely end up getting nothing. So when you look at it from their perspective, something is definitely better than nothing, even if it is less than they were originally owed.

Using a debt settlement company can be an excellent way to recover your financial freedom and repair your credit rating. The best thing about using the debt settlement process is that after the debt has been paid, you owe nothing at all. The debt is settled and you are debt-free.

So now that you know what a legitimate debt settlement company is, and what it is that they do, the next question is how do you find a good, reputable debt settlement company?

In order to find a reliable debt settlement company, you will have to do a little research. You can start by looking in the usual places – online in search pages and in the phone book. When looking for them keep in mind the following criteria and see if you can get these answers: How long have they been in business? Are they registered with the Better Business Bureau? If so, how is their rating with them? Do they have references that you can check up on? It is extremely important that you entrust your financial future to a reputable company, and the more you know about them the better able you are to make an informed decision.

How To Tackle Your Super Bad Credit to Avoid Bankruptcy

How To Tackle Your Super Bad Credit to Avoid Bankruptcy

The more you understand about any subject, the more interesting it becomes. As you read this article you’ll find that the ways to avoid bankruptcy is certainly no exception.

Those of you who are not familiar with the latest on avoiding bankruptcy now have at least a basic understanding. But there’s more to come.

If you have bad credit and a lot of debt like most of the people in the country, it may seem that there is no hope for you. Don’t worry because there may be a light at the end of your tunnel. You might want to consider debt consolidation services to help you with your credit repair efforts. Many times this process eliminates stressful payments and helps get consumers out of debt at the same time.

Credit Repair can be an answer to a prayer for many people; particularly those who are hoping to buy their first home or a new car. Finding the right company to trust with this process may be a difficult challenge, but with the help of a professional debt counselor and a little bit of research, you should be able to find a company to represent you well. You can do this by going online and researching as many companies as you can. Get reviews and rate quotes if you can.

The next step that you have to take is to gather up all of your debt information. You can start by asking yourself some of these questions: How many credit cards do you have? How much are your minimum payments each month? Questions like these will be important information for you to share with the representative who will handle your transactions. After you find a trustworthy company and begin sharing your information, you will be quoted a monthly fee. The rest is up to the consolidation company.

You will be able to enjoy lower payments, however, (you will no longer make the payments to your creditors, but to the consolidation company) and less time in debt. Debt repair could be your answer to get out of debt without resorting to bankruptcy, which is just as beneficial. There are many debt consolidation companies in the world these days. This is mostly because so many people need to be out of debt. Most credit repair companies see this trend as an opportunity to conduct business in a thriving market. It is your responsibility as a consumer to find a company that will best represent you and your needs. Sometimes, with so many choices, this can be nearly impossible.

When choosing a company to help you repair your debt, you have to begin with research. Ask about company history and reviews. You can find these online very easily. You should also check the company’s status with the Better Business Bureau. Also, ask friends or relatives who have consolidated debt which companies they chose and why. Make sure you also ask them about the company’s policies.

Make sure you ask questions before signing on the dotted line. Getting out of debt will not be easy, but it shouldn’t ruin your credit or cost you a fortune, either. Basically, you can begin getting out of debt by being wise with your money, getting a copy of your credit report, and finding a credit repair company.

I hope that reading the above information was both enjoyable and educational for you. Your learning process to avoid bankruptcy should be ongoing–the more you understand about any subject, the more you will be able to share with others.

Want more free tips, tricks, and techniques to avoid bankruptcy? Click Here to grab more!

Is Bankruptcy Really The Answer?

Is Bankruptcy Really The Answer?

In today’s world, it is not difficult to obtain enough unsecured debt in a very short time to make bankruptcy look like an appealing option. But is this the best option for you? Before you decide to file for bankruptcy protection, you should really take a close look at a debt management program.

A debt management agency will generally assign a debt consultant to you to help you work out how much you owe, how much you can afford to pay, and then help you to manage your budget and also pay off your debts.

This can help you in a number of ways. First of all, it keeps the creditors off your back. They will call all of the people you owe money to on your behalf and talk to them about your particular situation. They will negotiate with each creditor to reduce the amount of the monthly payment that you owe them and they may even be able to help you get a reduced interest rate so that more of your payment actually goes towards paying off the debt, rather than paying more and more interest.

Secondly, your debt management counselor can help you buy going over all your household and living expenses and helping you to come up with a realistic budget. This way you can clearly see what you are wasting money on and what you should be paying for things like groceries and eating out at restaurants. Often times we waste money on things that we don’t really need, especially when we are up to our ears in debt.

The third way that your debt management company can help you out is by consolidating all your monthly payments into one. You send them the total amount that you are paying towards your debts and they disburse it for you and make sure that everyone gets it on time. This takes a lot of burden off you and you don’t have to worry about making sure everyone is paid the correct amount every month.

If this seems like a viable plan for you then you should definitely go with a debt management program over filing for bankruptcy. A debt management company is a lot less harmful to your credit rating and bankruptcy will stay on your record for up to 10 years. For this reason, you should opt for the debt management program and get out of debt – you’ll be very happy that you did.

Massachusetts Mortgage After Bankruptcy – 3 Of The Most Expensive Mistakes You Can Make

Massachusetts Mortgage After Bankruptcy – 3 Of The Most Expensive Mistakes You Can Make

Massachusetts has state laws that prevent predatory lending practices, but when refinancing after bankruptcy, it can still happen.

Everyone makes mistakes, but when it comes to refinancing after bankruptcy, mistakes can get expensive. To make sure you don’t cost yourself any unnecessary hard-earned money, it’s better to learn from some of the errors that other people have made. Here are some of the most common mistakes associated with refinancing a Massachusetts mortgage after bankruptcy:

Not Taking Steps to Repair Credit Before Refinancing

With a low credit score, you are guaranteed to pay more for your Massachusetts mortgage refinance after a bankruptcy. If you can afford to wait for a few months to take the time to repair your credit, you should. You will qualify for much better rates and terms. A lower rate could save you thousands of dollars over the life of your loan.

Choosing the Wrong Lender

Your post-bankruptcy refinance is only as good as the lender you choose to work with. If you get bad rates, bad terms, and bad service, you could pay for it for years to come. Always take time to find the right lender to work with. If you catch a few small ways that the lender has tried to cheat you. If you continue to work with a lender that has been dishonest, you may find after closing that the lender has cheated you more than you thought.

Not Negotiating for Cheaper Closing Costs

Closing costs for Massachusetts refinance loans average $3,143. If you want to pay less than that when closing on your Massachusetts mortgage refinance, you should try to negotiate with your lender to see if you can have certain fees waived. Lenders don’t usually advertise the fact that they will negotiate when it comes to closing costs, but almost all of them will if the borrower brings it up.