Predatory lending and out-of-control credit card debt isn't just an American problem apparently our Aussie friends are running into some serious challenges with their consumers. The credit card problem has brought attention to Australian legislators who have stepped in and are currently proposing some groundbreaking legislation in regards to credit cards.
If it's passed, the reforms require financial institutions to allocate payments to higher interest credit card debt first. As well it will protect against lenders from charging over-limit service fees unless of course consumers exclusively concur that their own account may go over the limit.
Also, the actual draft legislation would prohibit the so called 'tick a box' unrequested credit offers - such as credit limit extension that indicate cardholders have been "pre-approved" (giving the flase impression they are able to find the money for it).
Lenders also are required under the draft bill to make cardholders mindful of the implications of only making bare minimum repayments. Numerous cardholders are stunned to realize that it would likely take more than 24 years to repay an outstanding balance of $10, 000 making only the bare minimum repayments.
Even though the proposed new laws and regulations may help Australians avoid getting into credit card debt, for many it is currently too late. If you're looking for ways to try and climb out of your financial debt pit, then try following these tips.
Quit spending - seriously, it's that easy because if you don't have the money, simply don't buy it. Chop up the cards, get rid of them, bury them in your backyard - do whatever you've got to do to prevent using charge cards. This could also involve altering your own spending habits along with your perspective.
Cease paying the minimum. Make a budget and look for methods to cut the fat and apply that money into the credit card. In case you are having troubles finding money in your budget, look at ways to increase your revenue. Request a raise, get a part-time job or start moonlighting.
Prioritize repayment schedules. For those who have unpaid account balances with 2 or more cards, and then look at paying off the particular credit card with the greater monthly interest first. In the event that both cards have reached the identical monthly interest, then target paying down the card with the lower balance. By paying this off aggressively you can gain self confidence. After that card is repaid cut it up. Then target the other card. In addition to the minimum payment, contribute what you were paying on the first account watching the balance quickly fall.
Think about a balance transfer. A number of credit card banks offer honeymoon rates for fixed durations that are 0 % interest or low interest. This is often a good way to shed your credit card debt swiftly, but should be definitely avoided if you will be unable to pay off the entire balance throughout the introductory period.
Consider a traditional debt consolidation loan. For those who have several charge cards along with other financial loans, rolling them all directly into one bank loan generally is a practical solution to pay it back. But standard debt consolidation is not an option for borrowers already too far in arrears. Before you agree to debt consolidation compare loan provider policies carefully.
Build a crisis fund. When you repay your charge card debts, begin putting a little aside into a checking account. This will likely help you overcome the temptation of using your credit cards all over again should something surprising come up.
Get assistance. If you find your own spending habits are out of hand, obtain unbiased legal services or even visit a credit counselor. But beware of predatory brokers and credit providers.
Friday, April 29, 2011
Friday, April 8, 2011
Mortgage Refinance Scams
For a home owner going through fiscal difficulties, re-financing could cause difficulty. While the majority of creditors operate honestly, there are also predatory lenders on the market who don’t care one way or another regarding you and won’t hesitate to try and rip you off. It’s often a good idea to remain on guard, even if you believe you’ve discovered a trusted loan officer because they’ll have lots of opportunities to take advantage of anyone during the entire mortgage process. The best way to protect you is to first become experienced in possible questionable practices. Loan steering is one such tactic that homeowners in turmoil need to look out for.
Loan Steering
It’s easy to call this the four R’s—reject, refer, refinance, regret. That is when a bank or other mortgage lender informs a qualified borrower that they’re not qualified for a loan from their particular loan company. They may inform you of it’s as a result of your earnings, history of credit, or a plethora of other excuses. For some predatory loan companies, it is usually a routine process, or just the work of a single dishonest member of staff at a reputable mortgage lender. Either way, the “trusted” loan officer refers you to a “friend” with another company who might be able to “help. ”
Embarrassingly, you unwillingly talk with the brand new mortgage officer, but the terms of the loan aren’t so great. The interest rate is much higher than what most mainstream loan companies are offering, and the list of fees is infinite. Preying on your feelings, the financial institution has the advantage because you’re so disappointed about being rejected and fear even more of the identical from yet another financial institution. After you think about it for a day, you begin receiving message or calls from the loan provider telling you it’s a great deal for someone in your financial predicament and they’ll make it as easy as possible for you.
At this point, other scams can easily enter into play:
• Hostile and high pressure sales
• Encouraging a cash-out refinance to settle debts, burning a person of equity
• Moving closing costs into the mortgage loan, increasing monthly payments
• Advising to refinance once again, at a later time, to secure a much better deal.
Part of the fraud is that the two loan officers from the various lending institutions know each other and are partners inside their con. The first one made some funds from the second one for the recommendation.
As you will see, those people who are in dire need of money can certainly become the victim of mortgage refinancing frauds. Don’t become quickly fooled by offers of easy cash. Prevention is the greatest defense—take your time, use caution, research the organization, and remember—don’t sign anything at all prior to having the opportunity to examine and fully grasp all the documents.
Loan Steering
It’s easy to call this the four R’s—reject, refer, refinance, regret. That is when a bank or other mortgage lender informs a qualified borrower that they’re not qualified for a loan from their particular loan company. They may inform you of it’s as a result of your earnings, history of credit, or a plethora of other excuses. For some predatory loan companies, it is usually a routine process, or just the work of a single dishonest member of staff at a reputable mortgage lender. Either way, the “trusted” loan officer refers you to a “friend” with another company who might be able to “help. ”
Embarrassingly, you unwillingly talk with the brand new mortgage officer, but the terms of the loan aren’t so great. The interest rate is much higher than what most mainstream loan companies are offering, and the list of fees is infinite. Preying on your feelings, the financial institution has the advantage because you’re so disappointed about being rejected and fear even more of the identical from yet another financial institution. After you think about it for a day, you begin receiving message or calls from the loan provider telling you it’s a great deal for someone in your financial predicament and they’ll make it as easy as possible for you.
At this point, other scams can easily enter into play:
• Hostile and high pressure sales
• Encouraging a cash-out refinance to settle debts, burning a person of equity
• Moving closing costs into the mortgage loan, increasing monthly payments
• Advising to refinance once again, at a later time, to secure a much better deal.
Part of the fraud is that the two loan officers from the various lending institutions know each other and are partners inside their con. The first one made some funds from the second one for the recommendation.
As you will see, those people who are in dire need of money can certainly become the victim of mortgage refinancing frauds. Don’t become quickly fooled by offers of easy cash. Prevention is the greatest defense—take your time, use caution, research the organization, and remember—don’t sign anything at all prior to having the opportunity to examine and fully grasp all the documents.
Thursday, April 7, 2011
Choosing a Credit Counselor
Are you currently still burned out over your bills and increasing debt despite the fact that you’ve tried out everything you can to get control of your financial situation? You might have already set up a budget but can’t seem to adhere to it. Perhaps it is time to for you to look at seeking the instruction and proficiency of a qualified credit counseling agency. It’s definitely very important that you do your homework to locate a trustworthy organization. Below are some things to consider.
• How long have they been in business?
• Ask them to send you some free details in the mail; you shouldn’t have to provide them with any personal financial information or money to receive it.
• Do they belong to any professional groups including the Better Business Bureau or AADMO (American Association of Debt Management Organizations).
• Ask about their online privacy policy; these people shouldn’t sell your information.
• Determine what exactly services are included, like cash strategy, sessions, training courses, debt settlement plan.
• Inquire if your cash is definitely safe.
• Learn how they’re audited.
• Question the process; ensure the credit counselor spends time dealing with your finances and bills to correctly evaluate your circumstances.
• Ask if there is a charge to sign up.
• Inquire if there are regular monthly payments or perhaps other costs for handling the plan.
• Find out what the standard time is for consumers to complete this course.
Normally, included in the program, you may have to agree not to apply for, or use, any further credit while in the program.
Take into account that numerous agencies do charge month-to-month service fees, even non-profits. Check with your State to find out what exactly legal or not. Additionally, the counselor could possibly decrease your finance expenses and monthly obligations, and stop creditor harassment. Having just as much details in advance will allow you to make a knowledgeable decision and steer clear of surprises later. Success takes a commitment to making regular and timely payments to the agency.
While a debt payment plan can eliminate a lot of anxiety that comes with overdue bills and dealing with creditors, bear in mind you still have the debt to repay. The truth that you’ve made a decision to look into a debt management program, rather than bankruptcy, reinforces your sense of obligation. Also, knowing what to anticipate before you decide to commit to the program will provide you with peace of mind that you’ve discovered a respected business that will be on your side, not against you.
• How long have they been in business?
• Ask them to send you some free details in the mail; you shouldn’t have to provide them with any personal financial information or money to receive it.
• Do they belong to any professional groups including the Better Business Bureau or AADMO (American Association of Debt Management Organizations).
• Ask about their online privacy policy; these people shouldn’t sell your information.
• Determine what exactly services are included, like cash strategy, sessions, training courses, debt settlement plan.
• Inquire if your cash is definitely safe.
• Learn how they’re audited.
• Question the process; ensure the credit counselor spends time dealing with your finances and bills to correctly evaluate your circumstances.
• Ask if there is a charge to sign up.
• Inquire if there are regular monthly payments or perhaps other costs for handling the plan.
• Find out what the standard time is for consumers to complete this course.
Normally, included in the program, you may have to agree not to apply for, or use, any further credit while in the program.
Take into account that numerous agencies do charge month-to-month service fees, even non-profits. Check with your State to find out what exactly legal or not. Additionally, the counselor could possibly decrease your finance expenses and monthly obligations, and stop creditor harassment. Having just as much details in advance will allow you to make a knowledgeable decision and steer clear of surprises later. Success takes a commitment to making regular and timely payments to the agency.
While a debt payment plan can eliminate a lot of anxiety that comes with overdue bills and dealing with creditors, bear in mind you still have the debt to repay. The truth that you’ve made a decision to look into a debt management program, rather than bankruptcy, reinforces your sense of obligation. Also, knowing what to anticipate before you decide to commit to the program will provide you with peace of mind that you’ve discovered a respected business that will be on your side, not against you.
What is Credit Counseling?
Some of us have been in the predicament where we’ve borrowed lots of money and have gotten troubles paying it back. If the debt that’s hanging over our head is credit card debt than you should be delighted to hear that there are alternatives and also possibilities barring having to pay your credit card. This is where a qualified and experienced credit counselor in your corner will almost certainly help you in your journey to financial freedom.
If you have made a new year’s resolution to take command of your money situation and you are looking to be free and clear of your debt, you will probably certainly want to talk to a credit counselor. Be sure to practice a little due diligence and research a great credit counselor that you can work with and begin making success in direction of a debt free future.
A highly trained credit counselor is proficient in the art of negotiating with creditors and will understand how to deal with each individual creditor. A few creditors are harder to deal with than others, for example, Capital One, refuses to accommodate those enrolled in a debt settlement program though most credit cards will work with you if you’re enrolled with a credit counselor. By signing up for a debt management program you are proclaiming the move to be clear of debt and can be used as an instrument negotiate lower rates with your creditors; lower rates being the main objective of credit counseling.
Once you’re enrolled, have examined your expenses, budget and income and are in a DMP you are going to have to work out some sort of pay back plan with your creditors if you’re going to get those lower interest rates.
The integral bit of credit counseling is your DMP, or debt management plan, this is used as a tool in which you can approach your creditors and negotiate better terms; better terms with your credit cards means cutting your over-all debt.
The American consumer has about $2.4 trillion in debt, with a great deal of that
being credit cards. With the existing economy and the substantial unemployment level it’s no wonder that many people are seeking help with their debt. Credit counseling is not a magic pill, at the end of the day it’s each individual’s duty to take care of their debt.
If you have made a new year’s resolution to take command of your money situation and you are looking to be free and clear of your debt, you will probably certainly want to talk to a credit counselor. Be sure to practice a little due diligence and research a great credit counselor that you can work with and begin making success in direction of a debt free future.
A highly trained credit counselor is proficient in the art of negotiating with creditors and will understand how to deal with each individual creditor. A few creditors are harder to deal with than others, for example, Capital One, refuses to accommodate those enrolled in a debt settlement program though most credit cards will work with you if you’re enrolled with a credit counselor. By signing up for a debt management program you are proclaiming the move to be clear of debt and can be used as an instrument negotiate lower rates with your creditors; lower rates being the main objective of credit counseling.
Once you’re enrolled, have examined your expenses, budget and income and are in a DMP you are going to have to work out some sort of pay back plan with your creditors if you’re going to get those lower interest rates.
The integral bit of credit counseling is your DMP, or debt management plan, this is used as a tool in which you can approach your creditors and negotiate better terms; better terms with your credit cards means cutting your over-all debt.
The American consumer has about $2.4 trillion in debt, with a great deal of that
being credit cards. With the existing economy and the substantial unemployment level it’s no wonder that many people are seeking help with their debt. Credit counseling is not a magic pill, at the end of the day it’s each individual’s duty to take care of their debt.
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