Archive for March, 2009
Can someone explain this credit tip to me?
I read this on mint.com, after seeing it quoted on Consumerist.com.
What on earth is it saying? Take your available balance on a credit card and put it into a savings account or CD? Or take what you owe on a credit card and move it over? The wording makes no sense to me. here it is:
Transfer credit card funds into your bank account. “Consumers who have excellent credit, assuming the bank has a zero percent interest balance transfer offer, can ask for blank balance transfer checks,” says Oren Milgram, CEO of StudentMarket.com, an online shopping and credit resource for college students. There is often a $50 to $75 fee associated with the transfer, but if you don’t have any major upcoming expenditures, depositing the credit in a high-interest online savings account, short-term CD, or Money Market mutual fund can be a way to earn interest on your credit card balance until you need to use the card again. However, be sure to repay the initial funds by the end of the grace period (typically six to twelve months), or you’ll face massive interest fees.
Hazel
Isn’t CCCS a conflict of interest if it’s funded by the credit card industry?
We’re all familiar with Consumer Credit Counseling Services (CCCS) and most of us long time posters have referred people to this service.
Yet, I was recently horrified by a Yahoo poster who stated that she was having major financial problems and went to CCCS with $14K in credit card debt…. and they “advised” her to sell her house and give the money to her credit card companies…then to move into an apartment where the rent was twice that of her mortgage.
I’ve also been aware of CCCS advising people to never file for Chapter 7 even though they probably should. I’m rethinking my advise to refer people to CCCS….Maybe people should negotiate directly with their creditors instead….Any thoughts?
Debra
In California, can a debtor sell the debt and still report negatively while the new debtor does the same?
Posted by admin in Law & Ethics on March 11, 2009
, so that even though the account was sold , they are both reporting the debt as a negative mark on a consumers credit report at the same time, thanks ?
Marvin
What is the best method for consumer credit card debt relief?
We started a program with “Consumer Credit Counselors” This progarm has us pay the Consumer Credit Counselors, then they pay the credit cards every month. All they do is lower some of the interest rates. They don’t negotiate amount owed. The payments are too high for us, so we looked into other alternatives. We found one company that will do it differently for less. They have you pay into an escrow account, and they pay off each credit card individually. They say they negotiate lower balances and interest rates. The payment would be lower and the payoff time cut in half. Does anyone know of any reason we shouldn’t do this? Are there any other better ways? WHAT IS THE BEST WAY TO GET CONSUMER DEBT RELIEF with no loans?
Jason
How Consumer Credit Counseling Works
Your phone keeps ringing but you are afraid to answer it because you know the calls are not from your friends or your family. Instead, your phone line is tight up by the harassing calls from your creditors or debt collectors demanding their money. As long as you don’t pay what you owe to your creditors, the situation will be continued and your debt will keep snowballing to a bigger level which you will find harder to resolve it later. Fortunately, there are ways to resolve your debt issue, and one of these is consumer credit counseling.
How consumer credit counseling actually works to help the debtors to resolve their debt issue? Let see how it works before you decide whether this debt solution is able to resolve your debt problem, or you need to find other way for debt relief. The key function of consumer credit counseling is helping debtors to rebuild and reestablish their credit by creating a debt repayment plan that fit the financial affordability of the debtors. When you approach a consumer credit counseling service, basically, you will go through three-part in a credit counseling program:
1. Financial Assessment
You will be assigned with a counselor who will perform an assessment on your financial condition to understand how badly your debt problem is. Not all debt conditions will best benefit from consumer credit counseling. Based on the assessment result, the counselor will let you know whether you debt issue will be best fixed by consumer credit counseling.
2. Establish A Restructuring and Repayment Plan
If your financial condition is applicable for consumer credit counseling, the counselor will help you to establish a debt repayment plan that fit your financial affordability. During the process of working out a debt repayment plan for you, the counselor will negotiate with your creditors to minimum debt interest rate or waive part of the interest. Normally, the credit counselor won’t negotiate the overall amount of your debt; instead they work on the interest. Hence, if you are hoping your total debt amount can be reduced after negotiation, then you will need to work with a debt negotiation company instead of consumer credit counseling. A debt repayment is established once an agreed terms and conditions are met between you and your creditors. You need to follow the debt repayment plan and work your way out of debt while restructuring your credit.
3. Credit Education
Then, the credit counseling agency will give credit education that teaches you how to manage your money effectively so that you won’t fall back into debt again after you get rid of it. The credit education can be the most important step which you should not avoid it because by learning about credit and money management help you keep your newfound financial freedom for the rest of your life.
Summary
The consumer credit counseling basically involves three steps to identify your debt condition; then it will propose a solution that involves a debt repayment plan; and finally provides credit education to help you stay out of debt forever.
Tony